Crypto Market Update

The big news this weekend was the speech given by former President Trump at the Bitcoin conference, where he outlined his plans for integrating Bitcoin as a strategic reserve asset. This announcement triggered significant volatility as traders placed highly leveraged bets in both directions. As the volatility settled, prices rallied from Sunday into Monday morning, with BTC briefly rising above $70,000 on most exchanges for the first time since early June. ETH outperformed slightly, currently trading north of $3,300 after making a charge at $3,400, and SOL briefly moved above $190, now trading just below that mark. Prices have since retraced much of their Sunday rally. A notable outperformer this morning is BCH, which Mt. Gox creditors received BCH along with their BTC. The rally in BCH could be viewed as confirmation that the market has moved beyond Mt. Gox distribution concerns. This week is packed with macro data and earnings reports, with no catalyst bigger than the FOMC meeting on Wednesday, where we expect some dialogue about September rate cuts. Before that, we have the quarterly refunding estimates from the Treasury today, which will provide insights into the amount of debt the Treasury plans to issue through the rest of the year. Rates are lower, and equities are somewhat mixed to start the week.

Trump and Lummis to Push for Strategic Reserve

On Saturday, Presidential Candidate Trump announced plans at the BTC Conference to establish a strategic Bitcoin reserve, initially funded by retaining the BTC already held by the DOJ (approximately 1% of the total supply). He also reiterated the GOP platform that emphasizes supporting domestic mining companies, preventing a CBDC, and preserving the right to self-custody and private transactions. New points discussed included supportive comments on stablecoins and the desire to end Chokepoint 2.0. Shortly thereafter, Senator Lummis took to the stage to discuss a bill she will introduce to Congress, proposing that the US government purchase 1 million BTC over five years to mitigate the effects of dollar debasement. We have explored various potential outcomes for this conference over the past few weeks, and this is undoubtedly the most bullish.

Cantor Launches Bitcoin-Backed Lending

Cantor Fitzgerald plans to launch a Bitcoin financing business, providing leverage to investors who hold BTC, with an initial allocation of $2 billion, expanding in $2 billion increments as needed. Announced by Chairman and CEO Howard Lutnick at a Bitcoin conference in Nashville, the business will partner with select Bitcoin custodians, though specifics were not disclosed. Lutnick emphasized Bitcoin’s global trade potential, likening it to gold, and highlighted Cantor’s substantial Bitcoin holdings. This initiative deepens Cantor’s involvement in the digital assets space, where it already acts as a custodian for Tether and has financed several crypto companies, including miners Bitdeer, TeraWulf, Riot Platforms, and Cipher Mining.

Technical Strategy

Litecoin has begun to show gradual technical progress off the lows, and today’s push to exceed the recent consolidation from mid-July has carried LTC to the highest levels since early July.  Given that the early breakout of its three-month downtrend is now being followed up by a push above $74.21, this is considered a bullish technical development and likely can start to help LTC begin a larger rally.  Initial resistance should materialize near $84.90, then $91.50.  Support lies at $74.62, and cannot be broken without postponing the rally.  However, today’s push higher is quite constructive and should allow for additional upside progress in the near-term.

Daily Important Metrics Crypto Size Bullish signal is tied to the crypto market growing Market cap 2.48T +$67B (2.76%) BTC Dominance 55.54 % (0.16%) Stablecoins Increase in circulating stablecoins is a Bullish signal In Circulation +$114B (0.00%) In Exchanges +$19B (0.02%) BTC Metrics A decrease in Bitcoin on exchanges is bullish, indicates investors are moving coins to cold storage # BTC Exchanges +$3.0M (0.08%) Funding Rates Positive funding rates indicate traders are Bullish Aggregate +0.9650 (-0.0470) Binance +0.9421 (-0.0563) Bitfinex +0.0005 (-2.8225) Bitmex +0.8701 (0.0081) ByBit +1.0000 (0.0000) Deribit +1.3506 (0.4392) Huobi +1.0000 (1.0000) Kraken +0.7321 (0.2359) Mean +0.9650 (-0.0470) OKex +1.2295 (-0.0612) Sentiment BMI : 60 (100.00%) Futures A positive spread between Futures Prices and Spot Prices is Bullish CME Price $70,735 (2.85%) Spot Basis +$803 (1.15%) Volume 286,430 (-63.40%) Open Interest 307,975 (0.62%) Options all exchanges Higher open interest change in a bull market is bullish for the sector Volume 11,330 (-60.51%) Open Interest 234,823 (-2.41%) Vol. Put/Call Ratio 0.4464 (-17.38%) OOI Put/Call Ratio 0.4283 (0.94%) All metrics as of 2024-07-29 13:16:33 All Funding rates are in bps Crypto Prices Symbol Market Cap Last Price Daily Change Year to Date Relative to BTC YTD BTC $1.37T $69,247 1.84% 63.96% ETH $402B $3,346 2.14% 47.05% -10.31% SOL $89B $191 2.39% 87.74% 14.50% DOGE $304,173 $0.0003 8.32% -99.66% -99.79% All prices as of 2024-07-29 10:00:09 Exchange Traded Products (ETPs) Symbol Prem. to Nav Last Price Daily Change Year to Date Relative to BTC YTD BITW -31.67% $37 2.13% 58.67% -3.23% ETHE 1.56% $28 1.05% 44.36% -11.95% News Quick Bits The Block Ava Labs engineering head Patrick O’Grady leaving team to start own company While O'Grady declined to share specific details of his next venture, the veteran developer will continue on-chain development in some capacity. The Block $24 million Compound Finance proposal passed by whale over DAO objections Other DAO protocols have alleged similar attempts to hijack DAO governance by the whale, known as Humpy, who was behind the proposal. Decrypt.co Cynthia Lummis' Home State of Wyoming to Launch Bitcoin Research Institute The institute will focus on producing "high-quality” studies on Bitcoin, aiming to close knowledge gaps stemming from misguided research. Market Data The Block The spot Ethereum ETFs’ first week by the numbers U.S. spot Ethereum ETFs had a contrasting start, with $1.2 billion of inflows overwhelmed by $1.5 billion in outflows from Grayscale’s ETHE. Regulation Decrypt.co Qatar Revisits Crypto Stance After Ban, Promises Regulations by End of 2024 "The Digital Asset Framework represents a pivotal milestone in our journey towards fostering innovation and growth," said an official. The Block Hong Kong lawmaker advocates for including bitcoin in financial reserves following Trump’s speech Johnny Ng, a Hong Kong lawmaker, said he will talk with 'different stakeholders' the possibility of including bitcoin in financial reserves. Product Updates and Partnerships The Block Mempool explorer launches service to expedite unconfirmed bitcoin transactions via five mining pools Mempool launched an off-chain accelerator, helping users expedite unconfirmed transactions by paying an extra miner fee and service charge. Hacks, Exploits, and Scams CoinDesk WazirX Surveys Users on Recovery Options After $230M Hack, Leaves Customers and Industry Players Fuming Indian cryptocurrency exchange WazirX is facing industry and customer heat for its "Withdrawal Management Programme: Opinion Poll" in the aftermath of the $230 million hack, 45% of its user funds, it suffered earlier this month.