Don’t Fight Changes in Global Liquidity Conditions (Core Strategy Rebalance)
Regulatory Threats More Bark than Bite (To Asset Prices)
Last week we discussed that more regulatory actions would be coming – and they certainly were.
- On Monday morning, Paxos was ordered to shut down its services surrounding Binance’s BUSD stablecoin on the grounds that it might be deemed a security. There were worries that there would be additional regulatory action against other centralized stablecoin issuers, but as the week progressed, it certainly appeared that this was a Binance-specific issue.
- Later in the week, SEC chair Gensler proposed expanding federal custody requirements to include crypto assets, which would require crypto exchanges to gain regulatory approval and secure certain federal or state registrations. The changes would apply to all client assets, and the amendment includes a requirement for a written agreement between custodians and advisors, as well as enhanced record-keeping rules and surprise examination requirements. The amended regulation would also require that client assets be properly segregated and held in accounts designed to protect them in the event of a qualified custodian bankruptcy or insolvency.
Reports you may have missed
INFLOWS RESUME On Monday, market sentiments were rattled by a surprisingly strong manufacturing PMI figure, marking the first expansionary reading in 18 months. This led to a rise in rates, with risk assets across the board experiencing selloffs amid renewed inflation concerns and fears that the Federal Reserve might need to implement further measures to cool the economy. However, in our crypto comments video on Tuesday, we outlined a couple...
Adding RON and IMX As a Different Flavor of ETH-beta and Gaming Exposure (Core Strategy Rebalance)
MARKET SHRUGS AT HOT CPI The latest Consumer Price Index (CPI) data indicated a hotter inflationary environment than forecasted for February. Despite the surprise in the numbers, market participants appeared largely unmoved, suggesting that the potential impact had already been factored into their calculations prior to the release. This resilience reflects a broader sentiment that a rates-driven selloff, in response to the CPI figures, is not a significant near-term risk....
RESEND: Bitcoin ETF Equilibrium Price Dynamics: ETF likely to drive significant rise in daily demand
BY POPULAR DEMAND, WE ARE RE-SENDING THIS BITCOIN PRICE IMPACT OF SPOT ETF REPORT FROM JULY 24, 2023 The Bitcoin spot ETF was finally approved. And we are seeing the surge in price of Bitcoin because of attractive supply and demand dynamics.We received multiple requests to resend this report from July 24, 2023 which looked at supply and demand dynamics if a spot ETF was approved.In short, we believe a...
FLOWS BEGET MORE FLOWS We have recently discussed the potential return of crypto being correlated with equities due to the new category of market participants entering the fold. However, price action this week suggests that inflows into the BTC ETFs may be throwing water onto that theory. It seems apparent that, at least in the near-term, that the ETF flows narrative is gaining steam, and it is likely that the...
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