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Tornado Cash Banned in the US, Game dApps Thriving, and More!
Bitcoin barely moved over the past seven days while Ethereum saw an increase in price by 4.9%. Avalanche recorded a 21.31% increase week-over-week, following its listing on Robinhood on August 8 alongside Stellar. Other outliers from this past week are Chainlink and Polkadot, each recording an increase of 19.7% and 16.27% respectively, in addition to Binance Coin whose price increased by almost 14%; all on the back of developments which we will delve deeper into further in this newsletter.
Key Takeaways
• New bipartisan bill wants to hand jurisdiction over BTC and ETH to CFTC
• Wallet addresses holding 100 ETH or more increase ahead of Merge
• USDT, FRAX to honor redemptions on new POS ETH chain, won’t support POW fork
• Gaming dApps account for 60% of all blockchain activity in July
• Multiple ETHPOW forks are expected to launch post-merge
Macro, Regulations; Spot, and Derivatives Markets
Bank of England raised interest rates to 1.75% in the biggest increase since 1995, while estimating inflation to peak at 13.3% in October. July’s US inflation data is scheduled to be released on August 10 and the next Federal Reserve meeting is slated to take place on September 21.
In its earnings report, Microstrategy reported a $918M impairment charge on its Bitcoin holdings in Q2, compared to $414.2M for Q2 of 2021. On the back of that news, former CEO of Microstrategy Michael Saylor stepped down to assume the role of executive chairman to focus primarily on innovation and long-term corporate strategy, while continuing to provide oversight of the Microstrategy’s Bitcoin acquisition strategy as head of the Board’s Investments Committee.
A new bipartisan legislation wants to hand the regulatory authority over Bitcoin and Ethereum to the Commodities Futures Trading Commission (CFTC). There has been a long dispute in Congress over whose place it is to regulate cryptoassets, the Securities and Exchange Comission (SEC) or the CFTC. The Digital Commodities Consumer Protection Act of 2022 grants the CFTC ”exclusive jurisdiction” over cryptocurrency trades that meet commodities law. Aiming to bring more clarity into the space, the bill aims to introduce a new term “digital commodity,” leaving it up to the CFTC to define.
The SEC charged 11 people linked to Forsage for fraud, calling the decentralized smart contracts platform a textbook pyramid scheme. A few days later, documents were leaked to the public showing that the SEC had open cases on all US-based crypto exchanges, along with Binance. More law enforcement that took place last week:
• New York State Department of Financial Services marked its first crypto law enforcement action by fining Robinhood $30M for violating cybersecurity and AML laws, an event the company has been expecting since last year.
• Celsius is facing a lawsuit from over 300 of its custody clients claiming rightful ownership of $180M of firm’s assets locked in bankruptcy proceedings.
• Portuguese banks closed accounts of crypto exchanges, on the back of “suspicious transactions.”
Senator Elizabeth Warren of Massachusetts wants Office of the Comptroller of the Currency to rewrite guidelines permitting banks to hold reserve-backed stablecoins like USDC and USDT. Meanwhile, the European Central Bank called stablecoins and Bitcoin problematic while calling central bank digital currencies a “holy grail” for cross-border payments in a report published earlier this month.
On-chain Indicators
Figure 1: Lightning Network Capacity
Source: Glassnode
The Lightning Network, which allows for near-instant transaction finality, has almost 4.5K BTC in its capacity, which means over $100M are ready for peer-to-peer payments on the Bitcoin blockchain network. That is 500 more BTC since June.
Figure 2: Addresses with 100 ETH or more
Source: Glassnode
Ethereum is leaving 2018 levels in terms of wallets holding 100 ETH or more. Over the past week, wallets holding 100 ETH or more have increased by more than 200.
Media Coverage
Our Director of Research Eliezer Ndinga was featured on Blockworks to talk about price developments and market sentiment. You can read more here.
In other news, our very own research associate Carlos Gonzales was featured on Forbes to discuss Litecoin. You can read more about it here.
Last but not least, we’re thrilled to welcome Sherif El-Haddad as 21Shares’ first Head of Middle East Sales as we expand into new markets. You can read more here.
News
Tornado Cash Just Got Banned in the US
What happened?
The US Department of Treasury banned Tornado Cash, a decentralized protocol used to obfuscate the trail of transactions for privacy, for facilitating the laundering of the proceeds of cybercrimes, according to the statement. The US Treasury said that Tornado Cash has been used to launder more than $7B worth of cryptoassets since it launched in 2019. That figure amounts to the total value of cryptoassets that have been sent through Tornado Cash since launch.
Why does it matter?
The move comes after the US Treasury linked the $600M+ Ronin Bridge exploit to North Korean cybercriminal Lazarus Group, which sent approximately $80.3M worth of ETH through Tornado Cash, according to blockchain analytics firm Elliptic.
Back in July, Chainalysis revealed that 10% of all funds coming from illicit addresses are sent to crypto mixers, such as Tornado Cash and Blender.io which has been recently sanctioned earlier by the US on the back of the infamous Axie Infinity hack.
Tornado Cash announced in April that it’s using Chainalysis’ oracle contracts to block wallet addresses sanctioned by the US. ”Maintaining financial privacy is essential to preserving our freedom; however, it should not come at the cost of non-compliance,” said the Tornado Cash team.
Crypto trades around the clock and often responds quickly to market uncertainty. Bitcoin usually drops first during the market turbulence because it’s risky and easy to trade, just like tech stocks. Here’s how Trump’s tariffs are playing into that.
Stablecoins: The real powerhouse of crypto
Stablecoins are digital currencies tied to assets like the U.S. dollar, making them stable in price and easy to send worldwide instantly. They drive the crypto economy, moving billions, powering financial applications, and reshaping payments. From remittances to billion-dollar treasuries, explore how leading stablecoins like USDT and USDC are making it happen.
Why the memecoin mania isn’t a joke
A memecoin is a cryptocurrency inspired by internet memes or viral trends. Unlike traditional cryptocurrencies focused on utility (like Bitcoin or Ethereum), memecoins thrive on community engagement, humor, and speculative momentum. With low barriers to entry, they’re easy to create and trade, making them a go-to starting point for crypto newcomers.
Research Newsletter
Each week the 21Shares Research team will publish our data-driven insights into the crypto asset world through this newsletter. Please direct any comments, questions, and words of feedback to research@21shares.com
Disclaimer
The information provided does not constitute a prospectus or other offering material and does not contain or constitute an offer to sell or a solicitation of any offer to buy securities in any jurisdiction. Some of the information published herein may contain forward-looking statements. Readers are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties and that actual results may differ materially from those in the forward-looking statements as a result of various factors. The information contained herein may not be considered as economic, legal, tax or other advice and users are cautioned to base investment decisions or other decisions solely on the content hereof.
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Mar.25 crypto update, Research commentary on market turmoil, CIO Notes and ETP performance attribution
A – Research commentaries from last week developments
- Markets reacted to Trump tariffs – Bitcoin stands
Global markets fell sharply after President Trump’s new 25% tariffs on Chinese imports. Stocks led the decline – the Nasdaq 100 is now down -14% since the election, and the S&P 500 -12.3%. Crypto reacted too, but not uniformly:
• Altcoins such as SOL and ETH were hit hardest (down over 30% since November)
• Bitcoin and the Nasdaq Crypto Index (NCI) showed resilience, gaining +14.3% and +9.3%, respectively since Election
This kind of selloff tends to erase diversification — everything moves together. But it’s essential to take a longer view:
• Since Trump’s election, only three assets have consistently outperformed: Bitcoin, NCI, and gold.
• Last week, only gold outpaced BTC, confirming the role of digital assets as a strategic long-term allocation — even in volatile regimes.
- Regulatory tailwinds are building
The next phase of crypto decoupling could come from policy. In the US, the signals are turning positive:
• The STABLE Act advanced in Congress, with Trump urging swift approval
• A tokenized fund paid $4.17M in dividends last month, proving blockchain’s real-world income potential
• The SEC has launched a review of past crypto guidance — a move toward clearer rules and broader institutional comfort
Bottom line: In a week where most assets fell, crypto stood out. That’s not a coincidence — it’s a signal.
B – CIO Monthly Notes – Crypto’s Political Tailwinds Are Blowing Hard
• Following a week in Washington, our CIO outlines how crypto is gaining bipartisan traction in DC.
• Key takeaway: regulatory clarity is coming faster than expected, and institutions are taking note.
C – March 2025 ETP performance overview
As of 31/03/25 – Source: Hashdex and Bloomberg. Performances in USD.
Hashdex Nasdaq Crypto Index ETP (HASH / HDX1) : March: -4.5% | YTD: -19%
Key drivers in March: Bitcoin and Ethereum
March Performance Attribution:
Hashdex Crypto Momentum Factor ETP (HAMO / HDXM): March: -8.5% | YTD: -22%
Key drivers in March: Litecoin, Ethereum and Solana
March Performance Attribution:
Hashdex Multi-Crypto Index ETPs
Hashdex Nasdaq Crypto Index ETP (HASH)
• Broad exposure to BTC, ETH, and major altcoins (SOL, XRP, ADA, etc)
• Quarterly rebalancing – evolutive, market cap-based allocation with no caps (weights and number of constituents)
• Largest crypto index ETP in Europe (+$300m AUM)
• ISIN: CH1184151731 | Tickers: HASH (SIX, Euronext) / HDX1 (Xetra)
• Tradable in USD, EUR, CHF, GBP
• Factsheet / Product page / Index Methodology
Hashdex Crypto Momentum Factor ETP (HAMO/HDXM )
• Momentum-based strategy with monthly rebalancing
• Designed to capture trends across large-cap crypto assets
• ISIN: CH1218734544 | Tickers: HAMO (SIX, Euronext) / HDXM (Xetra)
• Tradable in USD, EUR, CHF, GBP
• Factsheet / Product page / Index Methodology
Trump’s Liberation Day: The impact of tariffs on the crypto market
WEBN ETF en billig globalfond från Amundi
Mar.25 crypto update, Research commentary on market turmoil, CIO Notes and ETP performance attribution
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