Trakx Weekly Update: August 19

Key Crypto Market Figures

CTIs Weekly Performance

Compared with the gyrations experienced over the past several weeks, the prior seven days were a relative oasis of calm in crypto markets as evidenced by the benchmark Trakx Top10 CTI gaining 2% over the period. At the top of the performance stack last week was the Recovery CTI, which as per its design jumped 21% last week, whereas last place was taken by the Meme CTI, which slipped almost 4%.

While the overall impression was one of calm, there were still some price fireworks. Most notably, Bitcoin experienced a sizeable mid-week wobble, with its price slumping below the $60,000 level, after blockchain analytics firm Arkham Intelligence revealed that the US government had transferred 10,000 BTC – worth approximately $600M – confiscated as part of its Silk Road investigation to a crypto wallet associated Coinbase Prime. Fear that additional supply could be hitting the market was the trigger for the price slide. However, while previous government transfers of seized crypto were in anticipation of sales, early last month Coinbase announced that it had been selected as a partner of the US Marshals Service to “safeguard and trade”its large cap digital assets. Hence, it is perfectly possible that the transfer is simply to put them into safe custody and hence such fears about increased circulating supply are misplaced.

Certainly, last week we learned that it is not just institutions that have been warming up to cryptocurrencies (Black Rock has overtaken Grayscale as the largest spot crypto ETFs when measured by asset under management). As mentioned previously, Republican nominee Donald Trump recently backed the idea of a US Bitcoin reserve – a proposal formally announced by crypto-friendly US Senator Lummis – but other countries appear to be following suit. According to recent reports, NBIM – Norway’s Sovereign Wealth fund – and the SNB – the Swiss central bank – both significantly increased their holdings of MicroStrategy equity, the holding company of Bitcoin uber-bull Michael Saylor. As two very large institutional investors one would naturally expect them to hold shares of many large companies simply as part of the index replication process (as has been suggested by some tradfi analysts). However, NBIM’s stake has more than trebled over the past 12 months, which suggests that the increased stake is not simply a passive investment but a more active play seeking to increase their exposure to digital assets (albeit to a still very modest level compared with traditional asset classes).

Sources: Trakx, Coingecko, Alphavantage

Market Trends

• U.S. Moves $600M of Silk Road Bitcoin to Coinbase Prime, but Not Necessarily to Sell: Yahoo
• Norway’s Sovereign Wealth Fund Ramps Up Indirect Exposure to Bitcoin: Decrypt
• Bitcoin, Ether Held in BlackRock ETFs Cross Those of Grayscale’s for the First Time: CoinDesk
• 75% of all Bitcoin has been hodled for over 6 months: CoinTelegraph
• IMF proposes energy taxes for crypto miners, data centres to curb carbon emissions: DLNews

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.

TRAKX SAS,  10 rue de Penthièvre, Paris, 75008, FRANCE – French société par actions simplifiée Paris Trade and Companies Register number 850 626 078Crypto Asset Service Provider (CASP) Registered with the Autorité des Marchés Financiers (AMF) under number E2021-020
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.