Funding Strains and Credit Risks May Weigh on Crypto Short Term, but Core Thesis Holds

Discussed in today’s video:

• Funding stress emerging: The widening SOFR–RRP spread and weakness in regional banks point to tighter reserves and potential near-term volatility from funding stress.
• Credit concerns rising: High-yield and private credit names continue to roll over, reflecting growing investor caution around potential defaults in both public and private markets.
• Credit and funding risks are acute, not structural: These pressures are likely temporary, as the “volatility controllers,” namely the Fed and Treasury, have the tools and incentive to intervene if credit or liquidity conditions deteriorate further. While it makes sense to manage risk around this data in the short term, our Q4 outlook on crypto remains constructive.

Tickers in this video: BTC 0.86%