Biden's Sudden Major Regulatory Move Shakes the Market! Bitcoin Halving Spurs Bullish Surge, US-China ETF News Bolsters Buying

On Monday (April 22), Bitcoin rebounded to the $65,000 level. Despite the controversy and panic within the cryptocurrency community sparked by President Biden's weekend signing of a two-year extension to Section 702 of the Foreign Intelligence Surveillance Act, the fourth Bitcoin halving event took place, along with favorable developments from US-China ETFs, supporting Bitcoin buying.

Two-Year Extension of the US Foreign Intelligence Surveillance Act's Section 702

Last Friday, the US Senate approved the controversial extension of Section 702 of the Foreign Intelligence Surveillance Act by a vote of 60 to 34, which President Biden signed into law on Saturday. Enacted in 2008, Section 702 allows electronic surveillance of non-US persons outside the United States for national security purposes. While it targets foreigners, it often collects communications between the targets and US citizens, and domestic law enforcement agencies such as the FBI can access some information without a warrant, a practice often criticized for infringing on privacy rights.

US national security officials believe extending Section 702 is crucial for combating terrorism. Senate Majority Leader Chuck Schumer stated that allowing the act to expire would be dangerous, emphasizing that it is a vital part of US national security aimed at stopping terrorism, drug trafficking, and violent extremism.

However, after its approval, Ethereum co-founder Vitalik Buterin expressed dissatisfaction, criticizing that it infringes on privacy and affects the entire cryptocurrency community.

"This is terrible. Cryptocurrencies are not just about trading tokens; they are part of a broader spirit of preserving freedom and privacy, and empowering the underdog. Unfortunately, these values continue to be attacked globally," he said.

Buterin believes that physical privacy is rapidly diminishing, and better internet privacy is one of the few tools people control to regain some balance. Privacy rights are normal, and he supports privacy. He also warned that actions justified on security grounds often come at the cost of compromising the safety of opponents or the generally weaker, to enhance the security of the powerful.

His comments indicate growing unease in the cryptocurrency industry, with privacy and decentralization considered core values. Buterin thinks broader surveillance could lead to unnecessary government attention to cryptocurrency users and developers, thus undermining trust and security in the cryptocurrency world.

Bitcoin's Fourth Halving and Bullish Signals from US-China ETFs

The fourth Bitcoin halving occurred at 8:09 AM Beijing time on April 20, at block height 840,000, reducing the Bitcoin block reward from 6.25 to 3.125 coins. Block 839999 was the last to receive a 6.25 Bitcoin reward, as displayed by blockchain explorers like Blockchain and Mempool.

Hong Kong is seen as a cryptocurrency testing ground by China. Although the Hong Kong Securities and Futures Commission has not yet announced the issuers approved for Bitcoin spot ETFs, Victory Securities has disclosed its fees for Bitcoin and Ethereum ETFs. According to reports, Victory Securities has revealed its proposed fees for Bitcoin spot ETFs to investors, and the region recently approved cryptocurrency spot ETF products.

If approved by the Securities Commission, Victory Securities' clients will face proposed fees for buying Ethereum and Bitcoin spot ETF shares in the primary market, amounting to 0.5-1% of the total transaction amount, with a minimum fee of $850.

For investors interested in trading existing ETF shares on the secondary market, online trading fees are 0.15%, while phone trading fees are 0.25%.

These fees are comparable to those set by US asset management companies offering spot Bitcoin ETFs. Although different fees will be waived by US companies at different times this year, Franklin Templeton has set its fee at 0.19%, with other ETFs charging between 0.20-0.90%.

The Grayscale Bitcoin Trust (GBTC) charges a significantly higher fee of 1.5%.

On April 15, Cointelegraph reported that Hong Kong had become the latest market to approve Bitcoin and Ethereum spot ETFs. At least three offshore Chinese asset management companies, including Harvest Fund Management, Bosera Asset Management, and ChinaAMC's Hong Kong subsidiary, plan to launch Bitcoin and Ethereum spot ETFs soon.

While the approval has been praised by the cryptocurrency community, including local exchanges in Hong Kong, others are skeptical about the success of ETFs in the region.

Bloomberg ETF analyst Eric Balchunas tweeted on April 17 that mainland Chinese investors might not be eligible to buy Bitcoin and Ethereum spot ETFs listed in Hong Kong due to restrictions on purchasing virtual assets.

Meanwhile, in the US, the Wall Street Bitcoin spot ETF reversed a trend of outflows, with a net inflow of $59.7 million last Friday.

Source: Farside Investors