Digital Assets Weekly: March 20th, 2020
Summary
Market Analysis:
- Crypto markets rallied off last week’s lows.
Portfolio Strategy:
- The risk / return profile looks attractive at these levels.
Winners & Losers
- Winner: The Steem community who is taking a stand against Tron founder Justin Sun.
- Loser: MakerDAO token holders who are getting diluted due to poor performing loans.
Weekly Rant:
- BitMex going down for maintenance makes me cringe, but it may have been for the better.
Financing Activity:
- Bakkt, Argent, Phemex, and GrainChain are among projects that raised funding this week.
Recent Research:
- Robert Sluymer: Crypto Technical Analysis: BTC collapses but holds 200-week sma, ETH vs BTC holds .22
- David Grider: Crypto Market Update
- Ken Xuan: Crypto Quant: Benchmark Crypto Indices Weekly Performance Review
Market Analysis
Bitcoin’s price has sold off significantly over the past few weeks and has now started to bounce off the bottom we saw last Thursday. The chart below from Rob Sluymer, Fundstrat’s Chief Technical Strategist gives you a sense of where we’ve been.
Bitcoin has rallied off the prior week’s lows and finished this week (3/12/20 to 3/19/20) up 25%, partially recovering earlier month losses, ...
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Crypto markets are up slightly on the day, BTC -0.47% has risen 0.54%, and ETH -0.60% has risen 0.15%. Interestingly, the ETH Dominance metric, a metric that measures Etheruem's market cap compared to the rest of the crypto market, has reached its highest levels since the Merge last year and at the peak of the 2021 bull market, indicating that Ethereum is extremely relatively strong to the rest of the market. Altcoins...
Today, we're witnessing a return of familiar correlations as Bitcoin, gold, and equities all stage a mini rally. Today's major macro news was the leap in jobless claims to 261k, a level not reached since October 2021 and notably above consensus. Advocates of continued rate hikes frequently point to the consistent strength of the labor market. However, this new data could signal the onset of a softening jobs market beginning...
INVESTMENT THESIS Given the rise in U.S. treasury yields (5.00% - 5.25% at the time of writing) and the suction of liquidity that ensued from risk assets, perhaps the most useful metric to gauge product-market fit at this stage of the bear market is Total Value Locked (TVL). Essentially, the consideration that is front and center in the minds of savvy investors is, ‘Would this investment or strategy yield better...
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