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Good morning, and welcome to First Mover. I'm Lyllah Ledesma, here to take you through the latest in crypto markets, news and insights. In today's newsletter: |
- Price Point: Both bitcoin and ether have traded in a tight range over the past week amid swirling macroeconomic conditions.
- Market Moves: A product designed by DeFi options platform Opyn has returned 14% this year on the basis of ether's low volatility.
- In the News: Axie's AXS token may come under selling pressure in the coming days because insiders will be able to "unlock" their positions.
- Chart of the Day: Risky assets like cryptocurrencies may face more volatility as the Bank of Japan could lose control of the six-year-old yield curve control program to keep the 10-year rate at 0.25%.
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Bitcoin (BTC) and ether (ETH) have traded in a tight range this week and are finishing the week pretty much back where they started. As macroeconomic turbulence continues across the globe, the crypto market appears to have suffered little impact. Both cryptocurrencies are down around 1% over the last seven days. Laurent Kssis, a crypto trading adviser at CEC Capital, still considers a target below $19,000 for bitcoin realistic. And “targeting levels at $1,200 for ETH is the trend,” Kssis said. European markets started Friday off lower as political chaos in the United Kingdom continued. On Thursday, Liz Truss resigned as prime minister after just 45 days in office. A leadership contest will now take place over the next week. Pound volatility nears bitcoin level |
Source: Bloomberg Data showed that the pound sterling and bitcoin volatility levels have become almost identical. The 30-day volatility for both shows that the pound is on the verge of becoming more volatile than the cryptocurrency. Stock futures are down in the U.S. as investors came out of a tumultuous day of wide-ranging corporate earnings. |
(AxieInfinity.com) Axie Infinity, which experienced a meteoric rise in popularity last year as one of the first blockchain-focused computer games, could face significant selling pressure as $215 million worth of the project’s AXS tokens are unlocked in the coming days. Some 10 million of Axie’s AXS tokens owned by insiders and early investors will be unlocked soon, creating selling pressure. AXS price has dropped following prior unlocking. |
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DeFi Options Platform Opyn's 'Crab Strategy' Generates 14% Return in Comatose Ether Market |
A decentralized-finance (DeFi) product that launched earlier this year to help investors profit from a sideways trending market is generating desired results. The "Crab" strategy, designed by leading DeFi options platform Opyn, is built to make money during bouts of low ether price volatility. It has earned 14% returns in U.S. dollar terms and 42% in ether terms since its v2 went live in late July. Ether has dropped 20% since the end of July, although the cryptocurrency has primarily traded between $1,100 to $1,300 in the past four weeks. The strategy is yet another example of the DeFi industry helping investors bypass complexities involved with traditional option strategies like "short straddle" that are often set up by sophisticated market participants during a market lull. In case of a short straddle, a trader sells bullish and bearish options contracts called call and put on a centralized exchange. If the market stays range bound, the short straddle makes money. Setting up such multi-leg strategies is easier said than done, as traders must select appropriate levels to buy/sell options and the expiration date and actively manage the position as several factors influence options prices. Read the full story here. |
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Biggest Gainers Biggest Losers |
Sector classifications are provided via the Digital Asset Classification Standard (DACS), developed by CoinDesk Indices to provide a reliable, comprehensive, and standardized classification system for digital assets. The CoinDesk Market Index is a broad-market index of digital assets, weighted by market capitalization. A full description of the methodology is here. |
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Move Over Fed. Bank of Japan May Be Close to a Breaking Point |
The yen swap market reveals investor fears that Bank of Japan may bow down to market pressures, allowing the 10-year government bond yield to rise beyond the long-established ceiling of 0.25%. (Source: Bloomberg) |
- The Bank of Japan may face a $200 billion loss on its bond holdings if it loses control of the six-year-old yield curve control program to keep the 10-year rate at 0.25%.
- That, coupled with the resulting sharp rally in the yen, may inject volatility into risk assets, including cryptocurrencies.
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Check out the CoinDesk TV show “First Mover,” hosted by Christine Lee, Emily Parker and Lawrence Lewitinn at 9 a.m. U.S. Eastern time. |
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- Mikkel Morch, executive director, Ark36
- Jason Shah, product manager, Alchemy
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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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