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Lead Attorneys Resign Following SEC's Controversial Case Against DEBT Box

According to Bloomberg, Michael Welsh and Joseph Watkins, two lead attorneys, resigned this month following an SEC official's warning of termination if they remained in their positions. This information comes from individuals who are familiar with the situation. Welsh and Watkins were the primary lawyers in a case against Digital Licensing Inc., a cryptocurrency platform also known as DEBT Box. The SEC's lawsuit against DEBT Box was tainted by false statements, misrepresentations, and a lack of evidence. Neither Welsh nor Watkins, who were stationed at the regulator's Salt Lake City office, responded to requests for comment. The SEC, as well as a representative of the union representing agency staff, also declined to comment. In July, the SEC accused DEBT Box and its executives of defrauding investors of at least $49 million. The regulator requested that the company's assets be frozen and the firm be put into receivership. However, this asset freeze was reversed after it was discovered that the SEC may have made 'materially false and misleading representations.' The judge criticized arguments from Welsh, the SEC's lead trial attorney on the matter, and evidence provided by Watkins and his team. Welsh had informed the judge that DEBT Box, based in Draper, Utah, was closing bank accounts and transferring assets overseas. The court found this to be untrue. An SEC investigator later stated that a miscommunication led to the error, and Welsh apologized to the court. In December, the SEC enforcement chief declined to comment. A lawyer for DEBT Box also declined to comment. Last week, attorneys for DEBT Box and other parties filed motions requesting that the SEC pay more than $1.5 million in fees and other costs incurred in the case. Earlier this month, the SEC moved to dismiss the case against DEBT Box without prejudice. The judge has yet to rule on that motion.
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Grayscale Aims To Retain Spot Bitcoin ETF Market Leadership With New Mini Trust

According to CryptoPotato, Grayscale, the world's largest asset manager, is striving to maintain its dominance in the spot Bitcoin ETF market. This comes after a significant capital withdrawal from its primary GBTC product. To compete with its ten competitors, Grayscale has proposed a smaller Bitcoin ETF with highly competitive fees. Grayscale's new ETF, the Bitcoin Mini Trust, has set fees at a mere 0.15%, according to its recent filing with the US Securities and Exchange Commission. On April 21, Bloomberg ETF analyst Eric Balchunas responded to the news, stating that Grayscale's mini-BTC would have a fee of 15bps, potentially making it the most affordable BTC ETF on the market. However, he clarified that this is still hypothetical and does not guarantee a fund fee of 15bps. The existing Grayscale Bitcoin Trust charges a 1.5% fee, which is one of the reasons it has lost a significant portion of its assets under management compared to lower-fee competitor funds. The Franklin Bitcoin ETF (EZBC) is currently the closest competitor to the new fund, with fees at 0.19%. When the Bitcoin Mini Trust (BTC) is launched, the company will transfer 10% of the GBTC assets to the new fund, according to the filing. This could amount to approximately 30,500 BTC, worth around $2 billion. However, if GBTC continues to experience steady outflows until the mini-BTC fund is launched, this figure is likely to be lower. Shares of the new fund will be automatically issued and distributed to GBTC shareholders. Since converting to a spot ETF in mid-January, GBTC has lost over 50% of its BTC holdings. The fund currently holds 304,970 BTC following a $45.8 million outflow on Friday. Last week, Grayscale lost $458 million, although the outflows began to slow towards the end of the week. On April 19, Nate Geraci, President of ETF Store, stated that the consensus among industry analysts was that spot ETH ETFs would likely be disapproved by the SEC in late May due to lack of engagement.
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Bitcoin Layer-2 Solution Stacks Launches Nakamoto Upgrade

According to Blockworks, Bitcoin layer-2 solution Stacks has begun the rollout of its Nakamoto upgrade. This development, which follows the recent halving, is aimed at improving transaction throughput and ensuring Bitcoin finality for layer-2 transactions. The upgrade is expected to speed up block processing and finalize all settlements on the layer-1, allowing Bitcoin to maintain its security while becoming programmable, akin to Ethereum and Solana Virtual Machines. Muneeb Ali, co-founder of Stacks, believes that the Nakamoto upgrade and the overall expansion of Bitcoin layer-2 infrastructure could reignite interest in the Bitcoin blockchain. Ali stated that users are now distinguishing between BTC as an asset and Bitcoin as a platform. He noted that BTC has established itself as a hedge or store of value, resulting in nearly $1 trillion in idle capital. Ali credits advancements like the Nakamoto upgrade for this resurgence. The Stacks team anticipates that the Nakamoto upgrade rollout will continue over the next month, reducing block times from the current 10-30 minutes to approximately five seconds. Ali suggests that these enhancements will allow Bitcoin layer-2s to support the growing number of DeFi applications being developed. He also believes that the market is realizing that Bitcoin can serve as the base layer for the industry, with layer-2s facilitating an economic flywheel around BTC through apps and smart contracts. In addition to the improved Bitcoin layer-2 infrastructure, Ali highlights that other types of innovations are also attracting significant interest in the Bitcoin blockchain. These include ordinals and BRC-20s, which experienced a surge in interest following Bitcoin’s all-time high last month. Ali encourages further research and development around layer-2s, Ordinals, Runes, and other innovations, predicting a layer-2 summer where the Bitcoin developer ecosystem and competition intensify post-halving.
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Bitcoin Layer 2 Solution Tokens Outperform BTC Post-Halving

According to CryptoPotato, Bitcoin layer 2 solution tokens have shown superior performance compared to Bitcoin (BTC) following the recent halving of the mining reward on the blockchain. These tokens have seen a surge of 5% to 20% since the event, outpacing the top cryptocurrency by market capitalization. The market cap for Bitcoin layer 2 solutions stands at $4.3 billion, marking a 5.6% increase in the past 24 hours, with a trading volume of $184 million. Stacks (STX), a Bitcoin layer 2 solution, has been among the top-performing cryptocurrencies in the past 24 hours, according to CoinGecko data. The STX token has surged almost 20% to $2.87 since the halving event. In contrast, Bitcoin has not seen significant growth, with the token up slightly over 4.5% to $66,046 since the halving event, 1.7% over the last 24 hours, and down 0.8% over the last 7 days. Bitcoin’s price experienced significant volatility last week, dropping from over $66,800 to below $60,000, but has since recovered. Other layer 2 tokens, such as Elastos’ ELA token and SatoshiVM’s SAVM, have also seen gains of 11% and 5%, respectively, since the halving. Other altcoins have observed slight daily gains, except for TON, which has experienced a significant double-digit decline despite Tether’s announcement of expanding to the TON blockchain. Bitcoin layer 2 solutions address blockchain scalability and transaction speed limitations by operating on the Bitcoin blockchain and processing transactions off the main chain. On April 20, when the halving occurred and the Runes protocol launched, Bitcoin transaction fees reached an average of $128.45, according to ycharts data. This figure is over six times higher than the average fee rate the day prior and approximately double the previous record set three years ago. The fee surge can be attributed to the launch of the Runes protocol, which enables users to “etch” and mint tokens on the Bitcoin blockchain. The introduction of Runes prompted speculators to rush into minting tokens and trading meme coins, leading to increased transaction activity and, subsequently, higher transaction costs. However, the fees have since come down, and the transaction fees dropped to $34.8 on April 21. According to data from Ord.io, the total number of Runes inscriptions on the Bitcoin blockchain has already reached 3,700.
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Historic Bitcoin Sign Set for Auction

According to Bloomberg, a historic sign that became a symbol for Bitcoin supporters is set to be auctioned. The sign, which was displayed behind then-Federal Reserve Chair Janet Yellen during a Congressional testimony in 2017, was created by Christian Langalis, a 22-year-old Bitcoin owner and intern at the Libertarian think tank Cato Institute. After the sign was caught on television, Langalis was escorted out of the hearing but received about seven Bitcoin in unsolicited donations. At the time, Bitcoin was gaining public attention, trading at around $2,300, up from less than $1,000 six months earlier. The cryptocurrency surged more than 13,000% in 2017, only to crash 74% the following year. This boom-and-bust cycle has become a common pattern for the digital asset. With Wall Street giants like BlackRock and Fidelity now supporting the token, Langalis is looking to capitalize on the current momentum that saw Bitcoin reach a record high of almost $74,000 in March. In 2019, Langalis sold 21 replica editions of the sign for an average realized price of 0.8 Bitcoin. These replicas, numbered and time-stamped, were created by Langalis himself. Recently, Langalis was offered five Bitcoin for the original sign, currently worth around $330,000, but decided to auction it instead. The auction materials describe the item as an 'Ink Drawing on Legal Pad' weighing half a pound, which also contains Langalis's notes from the hearing. The page with the sign drawing was removed from the notepad shortly after the hearing and has since been reattached with clear archival wire. The winner of the auction will be announced at a Bitcoin-themed eatery called the Pubkey in New York, where Langalis uses as a co-working space. The sign was previously displayed at the bar.
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Bitcoin Miner Hut 8's Diversified Revenue Streams Could Provide Long-Term Advantage

According to Blockworks, Bitcoin miner Hut 8's diversified revenue streams could potentially give it a long-term advantage over its competitors, as per analysts at Benchmark. The research firm began covering the stock three days after the Bitcoin halving, when per-block rewards decreased from 6.25 BTC to 3.125 BTC. Senior equity research analyst at Benchmark, Mark Palmer, assigned Hut 8 a buy rating and a price target of $12, approximately 50% higher than its current trading level. Hut 8's 2025 enterprise value-to-revenue multiple is 2.6, compared to the average 3.1 multiple of its competitors, based on Benchmark data. This research considered the multiples of Marathon Digital, Riot Blockchain, CleanSpark, Bitfarms, Cipher Mining, Iris Energy, Hive Digital Technologies, and TeraWulf. The figures are based on consensus 2025 revenue estimates, and the enterprise values include the companies’ net debt balances. Palmer stated that Hut 8 is expected to close the valuation gap with listed peers that are further along in boosting their self-mining capacity as it executes on the build-out of its platform. Investors are currently focused on self-mining due to expectations that the price of bitcoin will rally aggressively following the latest halving. Hut 8’s self-mining deployed hash rate is 5.4 exahash per second (EH/s), lagging behind some of the space’s largest players. However, Palmer believes that the diversity of Hut 8’s platform will benefit it over the long-term, as its revenue streams outside of self-mining position it to weather severe downturns in bitcoin’s price better than most of its listed peers. This comes after Hut 8 and US Bitcoin Corp. underwent a “merger of equals” that closed in November. The combined company has business lines focused on managed services, hosting, high-performance computing, and AI. Hut 8 CEO Asher Genoot has stated that he is examining every business line to identify and eliminate inefficiencies and reduce costs. The company recently energized a third of its 63 MW Salt Creek site in Culberson County, TX, relocating miners from its Kearney, NE and Granbury, TX sites. Genoot believes that this move will provide control over their miner fleet and operating costs. Despite the need for more efficiency upgrades in Hut 8’s mining fleet, Palmer noted that its holdings of 9,102 BTC give it a solid liquidity cushion and the ability to capture upside during bitcoin price rallies. He concluded that the company’s diversified model and relative strength in bitcoin’s price should support its operating performance until new equipment is purchased and deployed.
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Investors Withdraw $500M ETH From Centralized Exchanges, Indicating Bullish Sentiment

According to CryptoPotato, data from IntoTheBlock shows that investors withdrew about half a billion ETH from centralized exchanges last week, marking the highest withdrawal since February. This large-scale withdrawal of ETH from centralized exchanges is seen as a sign of investor confidence in the asset's long-term price trajectory. Typically, market participants remove their cryptocurrencies from centralized trading platforms to store them in private wallets or cold storage, anticipating higher prices. Such significant withdrawals are often viewed as an indicator of bullish sentiment and a holding attitude among investors. Historically, ETH has seen substantial gains in the weeks following major withdrawals from exchanges. The expectation for higher ETH prices could be linked to the approval of spot Ethereum exchange-traded funds (ETFs) in Hong Kong and the recent Bitcoin halving event, which has traditionally sparked bull rallies across the market. With large amounts of ETH leaving exchanges, supply on these trading platforms could decrease, and high demand from large entities like spot ETF issuers could drive the digital asset’s price upwards, according to economic principles. While investors are reducing their ETH holdings on centralized exchanges, the Ethereum Futures market indicates a potential resurgence of long or short positions. A CryptoQuant Quicktake by pseudonymous analyst Shayan suggests that the Ethereum market may be on the brink of a fresh and impulsive move in either direction. Shayan explains that futures market sentiment significantly influences price movements as the intensity of long and short positions, and the potential for large liquidations, can trigger volatility. This sentiment can be gauged by the state of open interest, which shows the number of open perpetual futures contracts across various cryptocurrency exchanges. Notably, open interest in Ethereum decreased during ether’s recent drop to $2,900 amid heightened tensions in the Middle East, indicating a slowdown in futures market activity. As a result, the market seems ready for a resurgence of either long or short positions, potentially triggering a fresh and decisive market movement in either direction, according to Shayan.
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