city silhouette

Weekly Newsletter September 22nd

Summarising weekly developments: Macro, TradFi, Crypto and Regulation...

Crypto terminology. The ultimate 2024 guide
one trading logo
Published in: One Trading · 5 min read
Summarising weekly developments: 1T, Macro, TradFi, Crypto and much more...

ONE TRADING NEWS

Happy Friday, One Traders, we hope you’ve had a great week! 

We certainly have and we’re delighted to have received such great feedback from so many of you about our new product, Instant Trade. Off the back of complementary feedback we’ve decided to do a price analysis of Instant Trade vs other exchanges. 

It turns out you were right and there is a lot of value for traders to be gained by using the product, so be sure to keep an eye out for our upcoming posts and blogs that will feature a deep dive into pricing and the benefits of trading with Instant Trade. 

If you haven’t already, you can also read more about Instant Trade on our blog here and be sure to check out our price comparison analysis.

Right, enough about all the value we’re bringing to the table 😁 let’s take a look at what else is going on in the world this week.

GENERAL MACRO NEWS

Beat from the Street (Tech/Business/Finance/Economy)

The United Kingdom reported employment changes for the three months ending in June, with a decline of 207,000 jobs. This outcome fell short of expectations and was the largest decline since the Great Financial Crisis, excluding the impact of COVID. The UK unemployment rate edged higher to 4.3%, indicating a clear upward trend, while GDP contracted by 0.5% in July, the most substantial decline this year. However, amidst these challenges, the UK witnessed remarkable wage growth, setting record highs. Additionally, monthly GDP estimates reached their lowest point this year, and house prices continued to decline at their fastest pace since the Great Financial Crisis.


Looking ahead, the Bank of England is expected to raise interest rates by 25 basis points in the upcoming week, potentially pushing interest rates in the country to 5.5%. (Simplicity Group Alpha). 


The pace of EV adoption is surging (Fin Watch):


  • The cost of batteries fell by nearly 10 per cent in August, taking them past a key milestone that is seen by energy analysts as a “tipping point” to supercharge the transition to electric vehicles (The Independent).
  • That said, there are also growing concerns about how lithium used in EV’s is causing social and economic harm and also involving children working in hazardous conditions in order to mine the necessary elements for the batteries (The Guardian).
  • Ford Motor Company Chief Executive Jim Farley said Thursday the United Auto Workers union proposal to hike wages by 40%, cut workweeks and add new pension benefits could bankrupt the company (Reuters).
  • Apple will sell a 'Made in India' iPhone at launch for the first time (Bloomberg). 
  • China says it identified security problems with iPhones (NY Times).
  • Apple to update iPhone 12 in France after fears of radiation (The Independent).
  • Germany says it will examine radiation concerns about Apple's iPhone 12 if France's investigation proceeds (Reuters). 
  • Fox News reports the White House said the Biden administration has spent over $100 billion on the war in Ukraine (Fox News).
  • Google is set to lay off hundreds of employees in its global recruiting team (Reuters). 
  • The European Central Bank increased the interest rate to 4.50%. (Expectation: 4.25%) - (ECB).

On Wednesday last week the United States released the eagerly awaited Consumer Price Index (CPI) data for August. The numbers surprised many as both the core and headline month-over-month changes accelerated. Year-over-year, the headline inflation rate rose to 3.7%, surpassing expectations of 3.6%, and the core inflation rate reached 4.3%, in line with expectations.

This increase in headline CPI was primarily driven by surging energy prices, marking the most substantial monthly increase since 2022. While these numbers may raise some eyebrows, it's worth noting that the three-month annualised core CPI stands at +2.4%, which is within an acceptable range for the Federal Reserve.

U.S. Producer Price Index (PPI) data also exceeded expectations, showing the fastest month-over-month increase since June 2022. The headline PPI rose by 0.7%, beating the expected 0.4%, while the core PPI increased by 0.2%, in line with expectations. Year-over-year figures were also elevated, with headline PPI at 1.6% and core PPI at 2.2%. Similar to CPI, energy price hikes played a pivotal role in these hotter-than-anticipated readings.

Despite already being at historic lows not seen since the 1990s, U.S. mortgage applications fell by 0.8% week-over-week, marking the lowest level since December 1996. Once again, energy price increases contributed significantly to these outcomes, though financial markets remained relatively stable in response (Simplicity Group Alpha). 

  • The Federal Reserve is losing $758 million per day paying interest to commercial banks on reverse repos and interest on reserves. The losses just reached $100 Billion (Fin Watch).
  • The U.S. Now Has:
  1. Record $17.1 trillion in household debt
  2. Record $12.0 trillion in mortgages
  3. Record $1.6 trillion in auto loans
  4. Record $1.6 trillion in student loans
  5. Record $1.0 trillion in credit card debt
  6. The average house payment is about to hit $3,000/month for the first time in history.
  7. All as oil prices are up ~40% in 3 months, mortgage rates hit 7.5% and credit card rates are at a record 25%.
  8. Borrowing more debt is not the solution to high inflation (Fin Watch).

U.S. fuel oil prices are now up 68% over the past three years. Wages are up 14% over the same period (The Spectator Index via X).

U.S. National Debt is now up a massive $1.5 trillion since the debt ceiling “crisis.” Over the last 3 months alone, the US has added $500 billion PER MONTH to the national debt, on average. (Fin Watch).

TradFi Pulse:

Top 10 banks investing in crypto-assets by market capitalization:

1. JPMorgan Chase: $418 billion

2. Bank of America: $225 billion

3. Wells Fargo: $150 billion

4. Morgan Stanley: $140 billion

5. Commonwealth Bank: $108 billion

6. Goldman Sachs: $107 billion

7. UBS: $82 billion

8. Citigroup: $78 billion

9. BNY Mellon: $34 billion

10. Credit Suisse: $3.5 billion

(Fin Watch)

American workers are now striking at some of the highest levels on record. Last month alone, large stoppages from strikes resulted in 4.1 million missed days of work. This is, by far, the largest volume of work stoppages since August 2000. As the UAW strike kicks off, we are on track for an all time record of workdays lost to strikes in 2023. People are feeling the pain of inflation and want higher wages. (The Kobeissi Letter

Banking giant Citi will transform customers’ deposits into digital tokens that can be sent instantly anywhere in the world (Bloomberg)

Bitcoin is once again showing a strong correlation with technology stocks, particularly the Nasdaq 100 Index, in a development that could pique the interest of both equity investors and crypto-assets enthusiasts. This revival of synergy comes after a period of divergence between these asset classes in June. According to Bloomberg, the 30-day correlation coefficient for Bitcoin and the Nasdaq 100 has rebounded to nearly 0.4, a stark contrast to the negative 0.1 observed in June and July.

In related news, Bloomberg’s crypto analyst, Jamie Coutts, reported that Bitcoin’s clean energy usage in mining operations has exceeded the crucial 50% threshold. Coutts bases his findings on the latest insights from the Cambridge Center for Alternative Finance, which recently revised its estimates of Bitcoin mining power consumption downward, taking into account sustainable energy sources like off-grid electricity and reduced reliance on fossil fuels. This development aligns with Elon Musk‘s statement in June 2021, when he indicated that Tesla would resume accepting BTC payments once the crypto-assets’s mining operations became more environmentally friendly. Tesla’s previous $1.5 billion investment in BTC. (Bitcoin Magazine

MARKET NEWS (CRYPTO SPECIFIC)

Digital asset investment products saw outflows totalling $54m last week, with outflows for 8 out of the last 9 weeks that aggregate to $455m. Bitcoin comprised 85% of the outflows, seeing $45m last week (Coinshares

Central & Southern Asia and Oceania (CSAO) is the third-largest crypto market, barely trailing North America and Central, Northern & Western Europe (CNWE), and accounting for just under 20% of global activity (Chainalysis)

💰 Active Polygon $USDC addresses are soaring, with 1.6 million being created in the first half of 2023 - that’s 76K per day. $USDC transfer size surged by 281%, with wallet-to-wallet transactions making up ~40% of all $USDC transactions. (Crypto Trading Reports

  • Crypto VC Blockchain Capital scores $580 million for two new funds (The Block)
  • Banking powerhouse HSBC working with crypto custody firm Fireblocks: sources (Coindesk
  • Japan to ease regulations, allowing start-ups to raise funds via crypto-assets (Nikkei).
  • Istanbul might not be a global Bitcoin hub yet, but the signs are everywhere. Follow the The Bitcoin Explorers’ journey as they delve deeper into the heart of Turkey's transformation amidst 60% annual inflation (BTC Times).
  • New York regulator to require higher standards for coin listings and delistings (WSJ)| archive | DFS NY.
  • Judge denies Bankman-Fried's request for pretrial jail release (Reuters).
  • Big Story: Mark Cuban loses nearly $900k in crypto thanks to MetaMask phishing scam. Here’s what he did (Promptbox).
  • Crypto exchange Huobi rebrands to HTX for tenth anniversary (The Block).
  • Deutsche Bank partners with Taurus to offer digital asset custody and tokenization services (The Block).
  • Japan’s largest investment bank Nomura launches Bitcoin Adoption Fund for institutional investors (Nomura Holdings).
  • Bybit expects to exit the UK market as new regulations loom (Ben Zhou via X).
  • Fidelity Investments has filed for a spot Ethereum ETF (Crypto Trading Reports).
  • FTX bankruptcy estate sues Sam Bankman-Fried's parents, Joseph and Barbara, to claw back 'misappropriated funds' — link (Coindesk).
  • BlackRock rumoured to shift crypto focus from Bitcoin to XRP (Investing.com).
  • Genesis has ceased all crypto trading services (CoinDesk).
  • Binance US Auditor Finds It Is 'Very Difficult' to Ensure Company Is Fully Collateralized at Certain Moments: SEC Reveals in Unsealed Files (Benzinga).
  • Binance.US legal executive, chief risk officer leave the exchange: (WSJ).
  • Binance US Chief Risk Officer, Sidney Majalya, as well as Head of Legal, Krishna Juvvadi, resign following increased pressure from regulators. They follow Binance US CEO Brian Shroder who left the company on Monday (Bitcoin Telegram Group). 
  • The following tokens with the largest unlock amount will be unlocked next week:
  1. Avalanche ($90.23M)
  2. XPLA ($16.03M)
  3. Astar ($7.3M)
  4. SPACE ID ($4.06M)
  5. Bonfida ($4.05M)
  6. Ribbon Finance ($3.74M)
  7. Radiant Capital ($3.23M)
  8. (Crypto Trading Reports)

  • Binance Resignations Past 3 Months:
  1. Chief Strategy Officer Resigns
  2. VP of Compliance Resigns
  3. Head of Product Resigns
  4. General Counsel Resigns
  5. Head of APAC Resigns

  • Binance U.S.:
  1. CEO Resigns
  2. Head of Legal Resigns
  3. Chief Risk Officer Resigns

Prices (at the time of writing)

  • BTC: $27,308 ⬆️ (+4.1%) from $26,188 last week 
  • ETH: $1,652 ⬆️ (+3.03%) from $1,602 last week

Dominance:

  • BTC: 47.52% ⬆️ (+.052%) from 47.28 % last week  
  • ETH: 17.71% ⬇️ (-0.15%) from 17.86% last week  
  • Stables:  9.7% ⬇️ (-0.39%) from 10.09% last week 

Market Cap:

  • Total: 1.12T  ⬆️  from 1.08T last week (3.70%)

Fear and Greed Index

(Alternative)

After a few weeks without change we’re now seeing more fear in the market. It is always interesting to understand what factors play into this as, on the one hand, we are seeing a surge in Bitcoin pricing, yet on the other, a lot of the broader macro indicators are ringing the alarm bell, which is likely to be part of the cause of the increased fear. 

TRADING HIGHLIGHTS

Top 3 Gainers (out of the top 100 by market cap only) - as always, this is not financial advice, and past performance is not a reliable indicator of future results

BITCOIN UPDATES

Bitcoin has had a busy week! Seeing as there is a lot of bullish sentiment, we thought we’d share what the bulls are sharing:

$800 billion asset manager Deutsche Bank has partnered with Swiss firm Taurus to offer Bitcoin custody for institutional clients (BTC Times).

Japan’s largest investment bank Nomura launches Bitcoin Adoption Fund for institutional investors (Nomura Holdings).

The number of pageviews on Bitcoin’s Wikipedia reached 7,830 on Sept 8th, the highest number of daily views in 2023. This could be attributed to the increased likelihood of a spot bitcoin ETF happening soon, leading people to search up Bitcoin and see what it's about (The Block).

Approximately $50B worth of Bitcoin are now held by ETFs, countries, public and private companies (Vaneck).

Here’s a list of all the asset managers that have applied for a spot Bitcoin ETF:

  • BlackRock ($10T AUM)
  • Fidelity ($4.5T)
  • Invesco Galaxy ($1.5T)
  • Franklin Templeton ($1.5T)
  • WisdomTree ($87B)
  • VanEck ($61B
  • GlobalX ($40B)
  • ARK Invest ($14B)
  • Valkyrie ($1B)
  • Bitwise ($1B)

In total, these managers have $17.7T of the Assets Under Management (AUM) (Crypto Trading Reports).

Money sent via Bitcoin this year has surpassed PayPal and is nearing Visa 📈 (Bitcoin Telegram Group). 

While we all know Bitcoin is notoriously volatile, if you want to end this bullish week with some bullish predictions, below are some Bitcoin price predictions for 2024.

  • Cathie Wood: $1 million 💎
  • Mike Novogratz: $500K 🌟
  • Tim Draper: $250k ✨
  • Standard Chartered: $120K 📊
  • Pantera Capital: $148,000 📉
  • Tom LEE: $180,000 🔍
  • Robert Kiyosaki: $100k 📙
  • Adam Back: $100k 🖋
  • Arthur Hayes: $70,000 ⏲
  • JP Morgan: $45,000 📌

Fun fact: If we average the predictions above, Bitcoin's price would be around $265,500. Imagine if each Bitcoin could buy a house in the U.S. 🏠🔮(Crypto Trading Reports).

As ever, please do not take any of the information we share as financial advice. It is always worth doing your own research and due diligence before making any financial decisions.

MEME OF THE WEEK...

Thank you for reading. If you’ve enjoyed this newsletter and have found it informative please let us know via our social channels and feel free to share it with friends or repost on socials. In any case, have a great weekend 😃 and for more updates, follow us across our channels here.

All the best,

The One Trading team