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- 🥜 Time Has Come
🥜 Time Has Come
PLUS: ETF inflows popping off
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What we’ve cooked up for you today…
🏦 Have the Ethereum ETFs failed?
⏰ The time has come…
🔥 Big inflows are back on the menu
💰 And more…
MARKET WATCH ⚖️
Prices as at 4:20am ET
Only the top 20 coins measured by market cap feature in this section
HAVE THE ETHEREUM ETFs FAILED? 🏦
BREAKING: Ether ETFs have bled money, but that's not the whole story
At first glance, it may appear that the Ethereum ETFs have been a failure…
After all, since launch they’ve seen net outflows of $478.2 million.
And with BlackRock’s Bitcoin ETF continually putting up numbers like this…
26th August IBIT inflows
It’s hard not to look at the ETH ETFs and think:
What’s going on with them?
Well according to Nate Geraci, president of the ETF Store, we must look beyond Grayscale’s Ethereum Trust.
And if you do, it paints a very different picture…
If you remove ETHE from the equation, the Ethereum ETFs have experienced net inflows of $2.06 billion.
“The fact that over $2 billion has been purposefully allocated to the other spot ether ETFs is a good sign as it shows that investors want ether exposure… While not the dazzling debut we saw from spot bitcoin ETFs, I think spot ether ETFs have clearly had a successful first month and I expect this to continue.”
Geraci believes that the Grayscale outflows muddy the waters, making it difficult to gauge just how much demand there really is.
“We simply don’t know all of the underlying motivations of ETHE sellers, which is why I think it’s important to look beyond that product.”
Geraci also pointed out something interesting…
So far BlackRock’s Ethereum ETF has seen just over $1 billion in inflows.
Inflows of this magnitude make it the seventh most successful ETF launch of 2024.
Which is kinda insane when you think about it. (it’s only been trading for just over 1 month)
But, back to the question.
Have the Ethereum ETFs been a failure? 🤔
No. No they haven’t…
After 1 month of trading, the newly launched ETFs have attracted over $2 billion in inflows.
By ETF standards, that is ridiculous and anything but a failure.
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THE TIME HAS COME… ⏰
Markets hate uncertainty.
But that uncertainty is coming to an end.
That’s the message out from Matt Hougan.
Matt Hougan is the Chief Investment Officer at Bitwise, the 5th largest Bitcoin ETF issuer.
This week, he broke down why he believes the time has come for the next phase of the bull-run.
If you look at Bitcoin from a long-term perspective, the set-up is ridiculously bullish:
Record breaking ETF flows
Rapid institutional adoption
Aftermath of Bitcoin Halving
Yet, in the short-term, Bitcoin’s price has been going nowhere.
Why?
Uncertainty.
There’s 3 main sources of uncertainty hanging over the market:
The U.S Election - who will win?
FED Rate Cuts - when will they cut rates?
Mt. Gox & Government Bitcoin Sales - will holders cash out?
“Staring down these big near-term questions, it’s easy to imagine investors thinking: I’ll just wait until the dust clears to jump in.”
However, one of these sources of uncertainty, just got resolved.
Last week, Federal Reserve Chair Jerome Powell confirmed that interest rate cuts are coming.
There is now 100% certainty of a rate cut in September and a 2% reduction over the next 12 months.
“My guess—and it’s just that, a hunch honed over years of being in the market—is that Powell’s statement fired the starting gun for a new bull market in Bitcoin.”
When rates get cut, assets further out on the risk curve tend to disproportionately outperform.
This means Bitcoin & crypto.
The next major source of uncertainty - who will win the U.S election? - will be resolved in 69 days.
Finally, the uncertainty surrounding Mt. Gox is being resolved right now.
Over the next ~2 months, all major points of uncertainty in the market will have been resolved.
The next phase of the bull market has now commenced.
The time has come. ⏰
There we go…
Big inflows are back!
Last week, Digital asset funds saw net inflows of $533 million.
That’s the largest inflow we’ve seen in the last 5 weeks.
Bitcoin really stepped it up this week, experiencing inflows of $543 million. (last week was “only” $42 million)
Interestingly, the majority of these inflows came on Friday following the Feds comments on monetary easing. (we broke this down in yesterday’s newsletter)
Ethereum saw net outflows of $35.7 million for the week, largely due to the continued outflows from Grayscale’s ETHE.
From a regional perspective, the United States dominated with $498 million in inflows.
Hong Kong and Switzerland also saw notable inflows of $15.9m and $13.9m respectively.
Whereas Germany and Sweden experienced outflows of $8.9m and $1.2m respectively.
As we mentioned earlier, the majority of Bitcoin’s inflows came on the Friday.
On Friday, Fed chairman Jerome Powell suggested that the first interest rate cut would occur in September.
Immediately off the back of this news, Bitcoin’s price shot up and so too did inflows in Bitcoin ETFs.
Just goes to show sensitive Bitcoin is to interest rate expectations.
Just wait until the rate cuts actually start happening… 👀
CRACKING CRYPTO 🥜
Vitalik Buterin praises Polymarket as platform smashes growth records. Web3 prediction platform Polymarket is experiencing unprecedented growth, fueled largely by the upcoming 2024 US presidential election.
‘My Living Nightmare’: Detained Binance Exec’s Wife Begs for His Immediate Release. Tigran Gambaryan’s family says he can no longer walk and has battled multiple bouts of malaria pneumonia.
Bitcoin poised for breakout as US money market funds reach $6.2T. US money market funds hit a new all-time high of $6.2 trillion on interest rate cut expectations, which could propel Bitcoin price to new record highs.
Bitcoin likely to stay in tight trading range amid market uncertainty: QCP Capital. Although bitcoin optimism has increased since the Fed's dovish tones at Jackson Hole, derivatives data indicates lingering market hesitation.
WHAT WE’RE READING 📚
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The Neuron (link) - AI trends and tools to keep you ahead
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What is the maximum number of Bitcoin that can ever be created? |
MEME CORNER 😂
Because what would the crypto world be without its share of memes?
Trivia Answer: C) 21 million 🥳
Bitcoin has a supply limit of 21 million.
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