The latest moves in crypto markets, in context By Jamie Crawley, CoinDesk reporter Was this newsletter forwarded to you? Sign up here. |
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Happy Thursday! Here's what you need to know today in crypto: |
- Bitcoin spot ETFs could increase BTC demand to the tune of $30 billion
- El Salvador's junk-rated bonds have risen 62% in the last six months as bitcoin rallied
- Kuwait's financial regulator bans crypto payments, investment and mining
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CoinDesk Market Index (CMI): 1,325 +1.5%
Bitcoin (BTC): $30,388 +1.3%
Ether (ETC): $1,927 +1.0%
S&P 500 futures: 4,592.75 −0.1%
FTSE 100: 7,645.52 +0.8%
Treasury Yield 10 Years: 3.74% −0.0
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Bitcoin spot ETFs could increase BTC demand to the tune of $30 billion, according to a report by NYDIG. The crypto trading firm estimates that there are $27.6 billion in spot-like products, compared with $210 billion invested in funds for gold, to which bitcoin is often compared. "Bitcoin is about 3.6x more volatile than gold, meaning that on a volatility equivalent basis, investors would require 3.6x less bitcoin than gold on a dollar basis to get as much risk exposure. Still, that would result in nearly $30B of incremental demand for a bitcoin ETF," NYDIG writes. The possibility of a spot bitcoin ETF in the U.S. looks far more likely since BlackRock submitted an application to list one with a "surveillance-sharing" agreement, which the SEC sees as necessary to prevent market manipulation. |
Global bitcoin fund asset under management (NYDIG) |
El Salvador's junk-rated bonds due 2027 have seen a substantial upward trend in the last six months amid bitcoin's rally, defying some analysts' expectations. The Central American country, which made BTC legal tender in 2021, had its debt rating downgraded by Fitch last September with a prediction of a debt default in January. In fact, the junk-rated bonds are up 62% since the start of 2023 and are trading at 72 cents on the dollar. Bitcoin rose 79% in the same period. El Salvador's bonds have, however, even outperformed the Invesco Emerging Markets Sovereign Debt ETF (PCY), one of the largest holders of the country's debt, according to Factset. Kuwait's financial regulator has banned crypto payments, investment and mining as a means to combat money laundering. The prohibitions are aimed at coming into compliance with the Financial Action Task Force's (FATF) global recommendations for crypto assets, according to the regulator. "Securities regulated by the Central Bank of Kuwait and other securities and financial instruments regulated by the Capital Markets Authority are excluded from this prohibition," the regulator said in a circular. FATF compliance does require guardrails against money laundering, but the international watchdog says it has not asked any countries to ban crypto, it told CoinDesk in May. |
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Market Insight: XRP Could Set BTC Precedent |
XRP's bullish movements above a key resistance level may signal a sustained rally and set a precedent for bitcoin, Katie Stockton, founder of analysts Fairfield Strategies, said in a note to clients. A surge of nearly 60% last week saw XRP rise above a technical indicator called the "Ichimoku cloud," which is seen as a bullish breakout signal. The Ichimoku cloud comprises five lines based on an asset's moving averages: Leading Span A, Leading Span B, Conversion Line or Tenkan-Sen (T), Base Line or Kijun-Sen (K) and a lagging closing price line. The spread between the Leading Span A and the leading Span B represents the cloud. XRP has moved firmly above its cloud following a year-long consolidation, or basing pattern, suggesting more gains to come. Bitcoin, however, remains strictly range traded either side of the $30K mark. A similar bullish trend to XRP would be on the cards should it rise above its next resistance level of $31,900. |
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- The chart shows XRP's social dominance, which measures the percentage of social media discussions related to a cryptocurrency compared to all top 100 coins, has shot up to highest since January 2021.
- Increased crowd chatter is often observed at interim market tops.
- Source: Santiment
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Disclaimer: The information presented in this message is intended as a news item that provides a brief summary of various events and developments that affect, or that might in the future affect, the value of one or more of the cryptocurrencies described above. The information contained in this message, and any information liked through the items contained herein, is not intended to provide sufficient information to form the basis for an investment decision. The information presented herein is accurate only as of its date, and it was not prepared by a research analyst or other investment professional. You should seek additional information regarding the merits and risks of investing in any cryptocurrency before deciding to purchase or sell any such instruments. |
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It is now more important than ever to set industry standards and align on practical short-term and long-term objectives through pointed conversations with the best legal minds and Washington D.C.'s most important decision makers. Join us at State of Crypto: Policy and Regulation on October 24 in Washington D.C. for an unprecedented opportunity to evaluate, dissect and ultimately shape crypto regulatory frameworks that support a vibrant, secure and healthy future for the digital economy. Save 10% with code FM10. Learn more and register. |
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