The Daily: SEC drops another probe, ZAP reaches $100 million valuation, ETFs five-day inflow streak and more

It's Friday! In today's Daily, the SEC drops another probe, this time into Hiro's Stacks blockchain. Plus, some firms may escape the agency's controversial crypto accounting bulletin, ZAP reaches a $100 million valuation and more.

Let's get started.

• In a Form 1-U filing that companies use to report material changes, Hiro said it was informed on July 9 that the SEC had concluded its investigation into Stacks and staff do not intend to recommend enforcement action against the developer.
• The project was founded by Ryan Shea and Muneeb Ali in 2013 while they were students at Princeton University.
• Formerly known as Blockstack, Hiro previously conducted a $50 million token offering under the SEC's Regulation A+ framework in 2019.
• Regulation A+ gives an exemption from registration for small issues up to $50 million a year.
• This latest decision comes after the agency dropped an investigation into BUSD following its Paxos probe, also not recommending enforcement action, The Block reported on Thursday.

Some firms allowed to skirt controversial crypto accounting bulletin

• Since the release of Staff Accounting Bulletin No. 121 (SAB 121) in March 2022, firms have been consulting with the SEC on how to develop new crypto policies and procedures, according to the source, adding that SAB 121 in itself has not changed.
• SAB 121 requires firms that custody crypto to record customer holdings as liabilities, drawing controversy for potentially preventing banks from safeguarding digital assets.
• Despite President Biden's veto amid legislative efforts to overturn SAB 121, discussions and modifications to accommodate well-regulated entities offering crypto custody services are ongoing.

Token distribution protocol ZAP reaches $100 million valuation

• The funding includes $900,000 from a seed round in December, $2.1 million from a private round in June and $12.1 million from an ongoing "vault sale" with the potential to raise up to $50 million.
• ZAP's protocol, built on the Ethereum Layer 2 network Blast, aims to validate user contributions for fair token rewards and expand to more blockchains like Base.
• ZAP recently launched its "Blast Gigadrops" campaign with a $1 million prize pool, rewarding users for their social and on-chain interactions. It is also developing a "no-code" token launcher for venture-capital-backed projects.

Spot Bitcoin ETFs log five-day net inflow streak

• BlackRock's IBIT, the largest spot Bitcoin ETF by assets under management, led the inflows, adding $72.1 million.
• Fidelity's FBTC saw net inflows of $32.7 million on Thursday, with Bitwise's BITB and Ark Invest's ARKB registering $7.5 million and $4.3 million in net inflows, respectively.
• Grayscale's higher-fee GBTC was the only ETF to witness net outflows, with $37.7 million exiting the converted fund.
• The spot Bitcoin ETFs have generated $880.6 million in net inflows over the past five trading days and more than $15.5 billion since launching in January.

Germany's bitcoin holdings are quickly depleting

• Since June 18, a German government authority has been gradually offloading 50,000 bitcoins it seized from the online film piracy site Movie2K in January.
• In total, the German government sent out 5,748.25 bitcoins ($330 million) on Friday and received 500 bitcoins ($28.6 million) back.

Looking ahead to next week