Trakx Weekly Update: April 29

Weekly Update
• Apr 29, 2024
Trakx Weekly Update: April 29

Key Crypto Market Figures

Trakx Weekly Update: April 29

CTIs Weekly Performance

The post-Bitcoin halving hangover continued with the price of crypto assets tracking lower last week as evidenced by the Trakx Top 10 Crypto CTI declining by just under 3%. The best performing CTI was the Meme CTI, which gained 2%, while at the bottom of the return stack was the Interoperability CTI, down 7%.

Weighing on sentiment and prices were some rather unfortunate US macro data. While economic growth decelerated by more than expected in Q1 (1.6% vs. 2.5%), inflation on the Fed’s preferred core PCE deflator measure surprised on the upside in March, with the 3-month annualized rate increasing to 4.4%. The “stagflationary” tone to the data highlights the dilemma facing the Fed ahead of Wednesday’s FOMC policy meeting. The overwhelming consensus is for no immediate change to US monetary policy, but investors will be closely watching Chair Powell’s comments at the press conference to gauge the appetite of US central bankers to lower interest rates later in the year. In addition, to the Fed decision, investors also have to contend with Friday’s non-farm payroll report. Over the past several months the US employment picture has been much firmer than expected and, as such, suggests the hurdle to Fed easing remains quite considerable.

Perhaps just as important as the Fed announcement, the US Treasury is due to release its quarterly refunding announcement. Typically such announcements are a complete yawn-fest. However, after the surge in US government debt over recent years, in no small part due to the jump in debt-servicing costs as a result of Fed rate hikes, investors are keen to see what happens to the duration of issuance and the target for the TGA (the Treasury’s general account at the Fed). By changing the TGA balance the Treasury can, in effect, withdraw (increase the TGA) or inject (lower the TGA) money into the US banking system independent of the Fed’s actions. With the Fed seemingly sidelined because of macro data, it will be interesting to see how Treasury Secretary Yellen decides to play it given the Biden administration faces the electorate in little over six months time.

Finally, and more crypto-specific, Consensys – a backer of the Ethereum blockchain - filed a lawsuit against the SEC alleging that it has no authority to regulate global, peer-to-peer computer networks. The lawsuit is a pre-emptive attempt to block the SEC from classifying ETH as a security, a move that would radically alter the regulatory burdens on crypto firms using such tokens and potentially putting many incumbents at risk of being fined for violating securities law for such a simple act as transferring ETH over the network. While the outcome of the lawsuit, not to mention the SEC’s ruling on whether to green-light a spot ETH ETF, are both still up in the air what is clear is that the US is increasing falling behind the crypto curve – see Hong Kong news below.

Trakx Weekly Update: April 29

Sources: Trakx, Coingecko, Alphavantage

Market Trends

  • Bitcoin, Ether Nurse Losses as U.S. Stagflation Fears Grip Market: CoinDesk.
  • Consensys sues SEC, seeks court declaration that Ethereum is not a security: CryptoSlate.
  • Hong Kong to debut Bitcoin and Ethereum ETFs on April 30: Yahoo Finance.
  • BlackRock, Grayscale have to wait for SEC’s spot ETH ETF decisions: Cointelegraph.
  • Here’s How EU Nations Are Preparing to Enforce MiCA: CoinDesk.

Trakx News

It has been a busy period of product development here at Trakx, with the introduction of new two Crypto Tradable Indices:

  • The Bitcoin Momentum CTI, which is designed to replicate the performance of a dynamic Bitcoin allocation based on price momentum indicators.
  • In partnership with OpenTrade we also launched USDc Earn CTI so that our clients can maximize the value of their stablecoin deposits by earning yield backed by real-world financial assets.

Please reach out to the team if you are interested in investing in these or any of our other innovative Crypto Tradable Indices.

Trakx CTIs Performance

Trakx Weekly Update: April 29

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.

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