The latest moves in crypto markets, in context Was this newsletter forwarded to you? Sign up here. |
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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: Bitcoin was rising Friday after a U.S. Labor Department report showed that jobs growth slowed dramatically last month – seen as a boost for prices of risky assets, since it relieves pressure on the Federal Reserve to raise interest rates aggressively.
- Market Moves: A look at how derivatives are dominating ether markets ahead of the Merge.
- Chart of the Day: U.S. inflation-adjusted bond yield is at its highest since mid July.
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Bitcoin (BTC) was back trading just above $20,000 Friday, after dipping to levels of $19,500 during the week as stock markets in Europe opened positively after a negative week. The largest cryptocurrency got an extra boost from a U.S. government report showing that the world's largest economy added 315,000 jobs in August – a slowdown from the 526,000 reported for the prior month but still exceeding economists' estimates for a gain of 300,000. The data might prompt traders to dial back their expectations for interest-rate increases by the Federal Reserve - theoretically a positive for prices of risky assets like cryptocurrencies. Ether (ETH), the second-largest cryptocurrency by market capitalization, was up 2% on the day and made gains of 6% over the last seven days. The network’s Merge is now less than two weeks away. In the altcoin market, Lido DAO, a liquid staking solution for Ethereum, was up 8%. The solution has almost $7 billion in total value locked (TVL) alongside a market capitalization of $1.2 billion. Polygon’s MATIC was up 7%. In the news, Reuters reported Thursday that in late 2020, U.S. federal prosecutors asked crypto exchange Binance to submit internal documents related to its money-laundering checks and communication involving CEO Changpeng "CZ" Zhao. Futures exchange FTX.US Derivatives said Thursday that former CFTC Commissioner Jill Sommers has joined its board in a move to help bolster the firm’s regulatory efforts. The hire comes as FTX has previously pitched the CFTC to directly clear customers' crypto swaps. The International Monetary Fund has called for a global platform for cross-border payments, and reiterated calls to regulate a crypto sector that officials say is unstable, inefficient and riddled with fraud. Cryptocurrency exchange Crypto.com has backed out of a five-year sponsorship deal worth $495 million with the UEFA Champions League, European soccer's elite league, according to a report in SportBusiness. |
●Bitcoin (BTC): $20,036 +0.0% ●Ether (ETH): $1,587 +1.1% ●S&P 500 daily close: 3,966.85 +0.3% ●Gold: $1,717 per troy ounce +1.2% ●Ten-year Treasury yield daily close: 3.26% +0.1 Bitcoin, ether and gold prices are taken at approximately 4pm New York time. Bitcoin is the CoinDesk Bitcoin Price Index (XBX); Ether is the CoinDesk Ether Price Index (ETX); Gold is the COMEX spot price. Information about CoinDesk Indices can be found at coindesk.com/indices. |
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Ether Derivatives Markets Continue to Heat Up Ahead of the Merge |
As the much anticipated Merge gets closer and closer, data from Kaiko shows that ether derivative markets are heating up. New money is returning to the perpetual futures markets more ferociously than ever, specifically for ETH, with open interest recently breaking all-time highs and an increase in volumes in ETH perpetual futures as investors on either side of the debate look to position themselves ahead of the Merge. The share of perpetual futures volume between bitcoin and ether had ETH commanding 45% of volume at start of August, going up to 57% at the end of month as this month's Merge approaches, according to Kaiko. |
BTC & ETH daily perpetual futures volume (Kaiko) |
Spot vs. perpetual futures volume An increasing amount of ETH perpetual futures trades are being made compared to spot markets, and beginning to have an outsized influence on sentiment surrounding ether, according to a report from Kaiko. According to the report, volumes typically correlate to price movements, and if futures markets are seeing a greater increase in volumes than spot markets, the correlation might signal that the futures market is leading price discovery. "Back when markets were at all time highs last November, perps only did 4x the volumes of spot markets," said the report. "Now at 7x the volumes and with open interest at all-time highs, it seems investors and institutions are turning to perpetual futures to place their bets on ETH, which as we’ve seen over the last month have been predominantly biased to the short side." Based on the ETH perpetual future daily volume over the last year, there is an increase from $19 billion to over $33 billion. Daily spot volumes rose from $3.7 billion to $4.8 billion in just over a year. |
Eth perpetual future and spot volume (Kaiko) |
U.S. Inflation-Adjusted Bond Yield at Highest Since Mid-July |
- The inflation-adjusted 10-year U.S. bond yield has jumped to 0.67%, the highest since July 11, according to data sourced from charting platform TradingView.
- Like gold, bitcoin tends to move in the opposite direction of the real yield.
- Bitcoin's 90-day inverse correlation with the real yield reached a record -0.95 in July and remained elevated at press time.
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Join us for Converge22, Circle’s first annual crypto ecosystem conference, taking place September 27th-30th in San Francisco! Featuring wide-ranging demos and developer workshops, plus high-powered guest speakers including Ethereum's Vitalik Buterin, Aave’s Stani Kulechov, Mary-Catherine Lader of Uniswap Labs, Anatoly Yakovenko of Solana, and dozens more. Register with code Coindesk to receive $100 off your ticket! Register today > |
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The following are the biggest movers in the CoinDesk 20 digital assets over the past 24 hours: |
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Biggest Gainers Biggest Losers |
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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 20 is a ranking of the largest digital assets by volume on trusted exchanges. |
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- Thailand Toughens Rules for Crypto Ads
The new rules, which took effect this week, require crypto operators to display clear risk warnings on ads and prohibit the inclusion of false or exaggerated information about companies. - Decentralized Crypto Exchange dYdX Scraps Promotion Amid 'Liveness Check' Backlash
The exchange implemented the liveness check to prevent users from farming the promo across multiple accounts, but it also raised questions around decentralization. - Coinbase Mispricing Allows Users in Georgia to Cash Out for 100 Times Rate
The bug saw Georgia's national currency, the lari (GEL), priced at $290 rather than $2.90. - Derivative Volumes of Ether Surpass Bitcoin Ahead of Merge, Here's Why
Traders are increasingly deploying two strategies that utilize futures ahead of the Ethereum Merge, leading to a surge in ether futures volumes. - Bitcoin, Ether Consolidate as Traders Eye U.S. Jobs Report to Gauge Next Fed Rate Hike
Instead of weighing the broader path for interest rates or the terminal rate, markets are trading the odds on the Fed's Sept. 21 decision: 50 bps or 75 bps, one trading firm said.
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Check out the CoinDesk TV show “First Mover,” hosted by Christine Lee, Emily Parker and Lawrence Lewitinn at 9:00 a.m. U.S. Eastern time. - Sasha Hodder, managing partner, Hodder Law Firm
- Bob Iaccino, co-founder and chief market strategist, Path Trading Partners
- Kyle McDonald, independent researcher and artist
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Which institutes are most impacting the blockchain world? Tell us your thoughts in a five-minute survey. We're welcoming responses until Sept. 7. Take the survey here. |
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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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