Trakx Weekly Update: Flat Prices, Bullish Undercurrent

Key Crypto Market Figures

CTIs Weekly Performance

Digital asset prices continued to track sideways last week as evidenced by the -0.4% dip in our flagship large cap Top10 Crypto CTI. The standout performer over the past seven days was the Lending CTI, which gained just over 6%. Meanwhile in last place in the performance ranking was the AI CTI. It declined 8% over the week as investors questioned whether the popular long-term narrative that such tokens will unlock numerous future use-cases for crypto can translate into near-term trading profits.

Trading Insults

As we noted in last week’s comment, Musk’s exit from DOGE is a long-term positive for crypto because of what it implies about the unsustainable trajectory of US fiscal trends. Short-term, however, his departure has been somewhat negative because just days after Trump gave Musk a symbolic key to the White House in the Oval Office, the two alpha males took to social media to engage in a rather unseemly public spat. In response to Musk’s critique of his “big, beautiful tax bill” Trump threatened to terminate Musk’s numerous government contracts. This triggered Musk into tweeting to his 220M followers that SpaceX would immediately begin decommissioning its Dragon spacecraft (a threat subsequently retracted) before dropping what he described as the “really big bomb” that Trump was named in the Epstein files and that this was the real reason why they have not yet been released.

While none of this directly relates the crypto industry, such a high profile, and seemingly acrimonious, falling out between two major crypto fans unnerved investors in the asset class amid worries that it might translate into a less crypto supportive stance in the US.

Initial Offerings

Notwithstanding the disappointing near-term price action, there remains plenty of evidence of an underlying bullish tone to crypto. The meme coin launchpad Pump.fun was last week reported to be preparing to launch a $1billion initial coin offering (ICO), meaning the platform would be worth approximately $4 billion, roughly equivalent to the market cap raised by the 11 million tokens they have issued on the Solana blockchain since its January 2024 launch.

Separately, at the less degen end of the crypto spectrum, stablecoin issuer Circle bumped up its share IPO price to $31, enabling it to raise just over $1bn from the sale of 34 million shares, implying a fully-diluted valuation of $8 billion. The raise came after the initial offering was reportedly oversubscribed by 25 times – a clear indication of just how popular crypto is becoming with tradfi institutions (as was the first day 160% rally in Circle’s stock price).

“Pet Rock” Collateral

Speaking of tradfi institutions, JP Morgan made headlines last week by announcing that it will now allow its trading and wealth management clients to use certain crypto-linked assets—such as BlackRock’s IBIT spot Bitcoin ETF—as collateral for loans. In a further nod to the legitimacy of digital assets, the bank also revealed it would factor select crypto holdings into clients’ net worth calculations. What makes this move particularly noteworthy is its source: JP Morgan is helmed by Jamie Dimon, one of Wall Street’s most vocal crypto sceptics. Just last year, in an interview at Davos, Dimon famously dismissed Bitcoin as a “pet rock,” arguing that “it does nothing.” Perhaps his change in stance echoes the sentiment attributed to the famous British economist John Maynard Keynes: “When the facts change, I change my mind. What do you do, sir?”.

Sources: Trakx, Coingecko, Alphavantage

Market Trends

• Bitcoin, Ether Bulls Hit With $800M Liquidation as Trump-Musk Tussle Rattles BTC, ETH: CoinDesk
• Pump.fun considering token launch with $4B fully diluted value, $1B sale: CryptoNews
• Stablecoin issuer Circle raises $1.05 billion in upsized US IPO: Reuters
• JPMorgan to Allow BlackRock Bitcoin ETF Shares as Loan Collateral: Decrypt
• Fartcoin Bucks Market Trend, Jumps 12% on Coinbase Listing Plan: CoinDesk

Trakx CTIs Performance

Sources: Coingecko and AlphaVantage

*Return of bitcoin is calculated since 01/05/2020, while CTIs performances were calculated since their respective launch date.
**Includes simulated performance.
***The risk signal is determined according to the historical volatility level, the higher the riskier.

Trakx is a global fintech company creating new standards for digital asset investments. Through our trading platform, we offer thematic Crypto Tradable Indices (CTIs) and customised solutions, providing sophisticated investors with a high degree of compliance, custody and liquidity.

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Disclaimers: No Investment Advice. Index returns and statistics are for illustration only. Index returns do not reflect any transaction costs or expenses. Past performance does not guarantee future results. The information provided in this newsletter does not constitute investment advice, financial advice, trading advice, or any other sort of advice and you should not treat any of the newsletter content as such. Trakx.io does not recommend that any cryptocurrency should be bought, sold, or held by you. Readers shall conduct their own due diligence and consult their financial advisors before making any investment decisions.