Crypto Market Update

The last key macro risk for crypto markets this week was Friday’s Bank of Japan (BOJ) meeting, with concerns around potential rate hikes or hawkish commentary. However, the BOJ held rates steady, reaffirming its stance not to raise rates in unstable market conditions. In response, crypto markets surged overnight, with BTC -1.69% briefly crossing $64K, ETH 1.98% rising above $2,570, and SOL -2.06% climbing past $152. Since the U.S. market opened, crypto assets have retraced a portion of these gains as broader risk assets have trended lower following yesterday’s sharp rally. Major outperformers over the past 24 hours include TAO -0.71% , SUI -1.21% , APT 0.68% , and CORE. Notably, BTC ETFs saw nearly $160 million in net inflows, ETH ETFs received $5 million, while stablecoins experienced minor outflows. Overall, the 30-day trend in capital inflows across these categories appears to be ticking higher after declining for about a month.

MSTR Upsizes Note, Buys More BTC

MicroStrategy has added 7,420 BTC to its holdings, spending $458.2 million at an average price of $61,750 per bitcoin, bringing its total BTC holdings to 252,220, worth approximately $15.8 billion. This purchase follows the company’s completion of a $1.01 billion upsized convertible note offering, with proceeds aimed at redeeming $500 million in secured notes and buying more bitcoin. MicroStrategy’s total BTC investment now stands at $9.9 billion, with an average purchase price of $39,266 per bitcoin. In terms of dry powder, MSTR -1.69%  still has approximately $900 million left in their $2B ATM equity offering agreement, after announcing their purchase of $1.1 billion of BTC financed via equity sales just last week.

Firedancer Inching Closer to Mainnet

Jump Crypto’s initial version of its Solana validator client, Firedancer, has gone live on testnet, marking a significant step towards its full deployment. At the same time, a hybrid client called “Frankendancer,” which merges existing validator tech with new developments from Jump, is already enhancing the Solana network’s mainnet. During Solana’s Breakpoint conference, Jump’s Chief Science Officer Kevin Bowers highlighted the advancements, noting that Firedancer is expected to improve Solana’s performance and resilience by introducing a second independent validator. Though the full release date remains unspecified, its testnet presence indicates it’s moving closer to completion.

Technical Strategy

Minor weakening in Bitcoin’s market capitalization “dominance” chart in recent days but still insufficient to call for a rolling over in Bitcoin’s outperformance just yet.  The BTC -1.69% dominance chart shows a sharp pullback following this breakout of the two-month consolidation, and price is nearing the first true test of support by revisiting the pivot area of the recent breakout.  To have conviction that Altcoins might be starting to gain traction, this Dominance chart would require a break of this trendline support along with a violation of the current uptrend from July.  At present, this can’t be called a “sure thing” but it’s best to await evidence of more deterioration before betting that Bitcoin will begin some relative underperformance.  At present, this chart should be nearing a good risk/reward to favor Bitcoin on this two-day period of lagging.

Daily Important Metrics Crypto Size Bullish signal is tied to the crypto market growing Market cap 2.19T +$21B(0.97%) BTC Dominance 56.77 % (-1.00%) Stablecoins Increase in circulating stablecoins is a Bullish signal In Circulation +$119B (0.15%) In Exchanges +$22B (0.25%) BTC Metrics A decrease in Bitcoin on exchanges is bullish, indicates investors are moving coins to cold storage # BTC Exchanges +$3.0M (-0.16%) Funding Rates Positive funding rates indicate traders are Bullish Aggregate +0.7661(0.1545) Binance +0.9015(-0.0216) Bitfinex +2.3073(2.3073) Bitmex +0.8292(0.4046) ByBit +0.4808(-0.4870) Deribit +0.4404(0.2612) Huobi -0.3084(-0.3084) Kraken +1.1939(0.3206) Mean +0.7661(0.1545) OKex +1.6156(0.5174) Sentiment BMI : 49 (100.00%) Futures A positive spread between Futures Prices and Spot Prices is Bullish CME Price $63,080(-0.20%) Spot Basis +$274(0.44%) Volume 726,948(-8.55%) Open Interest 304,662(2.18%) Options all exchanges Higher open interest change in a bull market is bullish for the sector Volume 41,790(49.61%) Open Interest 302,574 (2.65%) Vol. Put/Call Ratio 0.5705 (-42.32%) OOI Put/Call Ratio 0.5066 (1.13%) All metrics as of 2024-09-20 17:07:39 All Funding rates are in bps Crypto Prices Symbol Market Cap Last Price Daily Change Year to Date Relative to BTC YTD BTC $1.24T $62,806 -1.45% 48.71% ETH $307B $2,549 2.93% 12.02% -24.67% SOL $69B $148 3.00% 45.34% -2.27% HNT $1.1B $6.96 -3.43% -81.55% -87.60% DOGE $200,835 $0.0002 8.43% -99.77% -99.85% All prices as of 2024-09-20 17:07:20 Exchange Traded Products (ETPs) Symbol Prem. to Nav Last Price Daily Change Year to Date Relative to BTC YTD BITW -37.66% $29 -1.11% 22.40% -17.69% ETHE -0.17% $22 3.51% 10.93% -25.40% News Quick Bits The Block Jump Crypto’s Frankendancer client launches on Solana mainnet; Firedancer on testnet Firedancer, a blockchain validator client for Solana, is expected to enhance the network's efficiency and scalability. The Block MicroStrategy acquires another 7,420 bitcoin for $458 million, taking holdings to 252,220 BTC The latest acquisitions come amid MicroStrategy’s completion of a $1.01 billion upsized offering of convertible notes. The Block Non-dollar stablecoins will rise over next few years, Visa’s Head of Crypto says Sheffield also said it is “exciting” to see more entries into the stablecoin market that offers more options outside USDT and USDC. CoinDesk SocGen's Crypto Unit Takes EURO Stablecoin to Solana After Flopping on Ethereum Stablecoins are becoming systemically important to the global financial economy, Bernstein wrote in a recent report. Dose of DeFI CoinDesk DeFi Lender Sky Ratifies Plan to Offboard Wrapped Bitcoin, Due to Sun Concerns The matter has been closely followed in crypto markets, since the Sky platform has $200 million of loans collateralized by the token, and since WBTC is one of the biggest cryptocurrencies, with nearly $10 billion outstanding. Regulation CoinDesk Consensys Suit Against U.S. SEC Dismissed by Texas Court The U.S. Securities and Exchange Commission had – for a time – added Consensys to a list of crypto investigation targets, prompting the technology incubator company to sue it for overreach in federal court. Because the regulator then shut down that Ethereum probe earlier this year, a Texas judge has decided the lack of immediate danger means the lawsuit is unwarranted. Fundraising and M&A BTC Manager Crypto exchange Jupiter acquires blockchain explorer SolanaFM Decentralized trading platform Jupiter is acquiring blockchain explorer SolanaFM to expand its capabilities, leveraging the exchange’s infrastructure. Solana-based decentralized crypto exchange aggregator Jupiter has acquired Etherscan-backed blockchain explorer SolanaFM. In an X announcement on Sept. 20, the blockchain explorer said…