Welcome to “Uptober”
Key Takeaways
- A FUD-free week combined with shifting regulatory sentiment catalyzes a 33% weekly increase for $BTC and a 28% increase for $ETH. Bitcoin’s market cap returns to $1 trillion and trades above the 200-day moving average.
- Data points to a spot-driven market for Bitcoin as just over $100 million in short positions were liquidated on Wednesday’s move and leverage remains relatively subdued despite the bullish price action.
- $BTC transfer volume data demonstrating a higher percentage of transactions above $10 million in aggregate value suggests increased participation from institutional players.
- Bitcoin dominance appears to be gaining steam as the leading cryptoasset diverges from the altcoin market. This potentially indicates the start of wider rotation out of altcoins and into Bitcoin.
- On-chain supply dynamics may finally be bearing fruit as the current illiquid supply levels may have led to outsized impact from today’s spot demand.
- Bottom Line: Bitcoin and Ethereum’s performance in the face of a seemingly murky macro landscape is a positive sign for investors. We continue to view the remainder of Q4 as bullish for $BTC and $ETH and will continue to approach any near-term pullbacks as opportunities to add to our positions.
What a difference a w...
Reports you may have missed
BTC AS A POSSIBLE STRATEGIC RESERVE Last week, we discussed the rising political tailwinds affecting crypto. Despite events earlier in the year that might have suggested a changed stance from the Democratic Party, the political divide over the issue has grown stronger. The GOP has become the party that is undoubtedly more favorable to the industry. The attempted assassination of former President Trump, juxtaposed against a Democratic Party seemingly in...
Gox Wallet Movements Still Present a Risk, But Macro & Politics Keeps Us Allocated Here (Core Strategy Rebalance)
DISCUSSING THE SUPPLY CONCERNS On balance, macro conditions have moved in our favor thus far in early Q3. We have received soft jobs numbers and softer ISM reports, and cooler inflation figures, which have sent rates and the DXY lower. Unfortunately, the mere reveal of imminent sales from the German BKA and the solidification of the Mt. Gox disbursement timeline were not enough to put a bottom in for bitcoin....
LESSONS FROM OPEC We have witnessed a significant market panic partially related to formerly locked BTC hitting the order books. The major sources of supply include:Mt. Gox – 141,686 BTCUS Government – 8,100 BTCGerman Government – 50,000 BTC At current prices, this would equate to over $12 billion in supply. This threat, combined with an inhospitable macro backdrop (rising DXY, higher rate expectations, hawkish Fed), has brought BTC down to...
LDO Risk/Reward Looks Good Here, Immediate-term Macro Picture Still Uncertain (Core Strategy Rebalance)
FLOWS AND SENTIMENT STILL SUBDUED Last week, we received a better-than-expected CPI print, but the DXY continued to move higher due to global weakness and a hawkish Fed. We discussed the risks appearing in the metrics we use to gauge sentiment and flows. The overall lack of follow-through in the crypto market was evident. Volumes, net ETP flows, the Coinbase discount, stablecoin market cap trend, and search interest for key...