Digital Assets Weekly: Feb 28th, 2020
- Crypto markets had a tough week as global risky assets sold off on coronavirus fears but crypto investors shouldn't panic.
Winners & Losers:
- Winner: Argon's Tim Draper investment may hold promise for future crypto legal governance.
- Loser: Ripple's illegal security lawsuit claims may mean potential upside isn't justified by regulatory risks.
- Why the announcement "Startup Tokenizes $2.2B in Commercial Real Estate Through Polymath" makes me cringe.
- Copper.co raises an $8M Series A round to build out its London based crypto custodian platform.
- Check out our recent report on the Bitcoin SV (BSV) Genesis protocol upgrade if you missed it.
Bitcoin sold off nearly 10% on the week and brought most other crypto assets in to the red along with it. Among the 10 largest crypto assets, the biggest losers were BSV (-25%), XTZ (-20%) and LTC (-18%), while the best relative performers were BTC (-10%), ETH (-12), and EOS (-13%).
The risk off sentiment seen broadly across global markets is the most proximate cause for the move, as fears of the coronavirus spreading and causing an economic slowdown crushed the S&P 500 by 13% on t...
Reports you haven't read
ETH GAINING RELATIVE MOMENTUM Given the success of Solana and Bitcoin's persistent dominance in this bull market, many have been quick to write off ETH. There is no doubt that ETH faces its own set of challenges, including a complex modular stack and potential cannibalization by Layer 2 solutions, which, while crucial to ETH's scaling roadmap, can sometimes fragment liquidity and users. Despite these issues, ETH continues to advance along...
BREAKING AWAY While we maintain that macro conditions are still the most critical factor in assessing the medium/long-term trajectory of BTC prices, daily returns of the leading cryptoasset continue to exhibit a lack of defined correlation with any major macro asset. To us, the biggest reason for this sustained lack of correlation is the advent of the spot BTC ETF. A prime example of how ETFs are influencing BTC's performance...
WEATHERING THE STORM Heading into Q1, the key risks identified were: (1) A potential QRA supply shock, as long-term interest rates could surge due to a possible shift in bond issuance towards longer-duration securities, (2) the repricing of interest rate cuts, as the Federal Reserve downplayed expectations regarding the timing and frequency of such cuts, and (3) concerns regarding the dynamics between the expiration of the Reverse Repurchase Agreement (RRP)...
QRA IN LINE WITH MARKET EXPECTATIONS _THE RESULTS_ The Treasury’s quarterly refunding announcement (QRA) was the first of two major macro events to transpire on Wednesday. Leading up to this, on Monday, there was an indication that the net borrowing for the current quarter would be $760 billion, which is $55 billion lower than the initial $815 billion estimate, and the total funding needs for Q2 would be just over...