Trakx Weekly Update: December 18
Key Crypto Market Figures
CTIs Weekly Performance
After a blazing couple of months, it is probably not surprising that crypto prices experienced a bout of profit-taking as 2023 draws to a close as evidenced by the 6% decline in the value of the Trakx Top 10 Crypto CTI last week. Nevertheless, the year-to-date return of the index remains an impressive 91% - not a bad performance for an asset class the naysayers wrote off during last year’s crypto winter. The best performer last week was the Centralized Exchange (CEX) CTI, which rose 4%, followed by the Diversifier CTI that finished up 2% as did the DEX CTI. The worst performer was the Interoperability CTI, which slipped 8% over the same period.
One factor that contributed to the recent weakness in crypto prices was the news that Ledger, a well-known crypto hardware wallet manufacturer, experienced a security breach in its ConnectKit library that enabled unauthorized transfers from users wallets. Given this is a key integration component used by many dApps, such as Sushiswap and Balancer, the teams behind these projects warned users not to interact with them until further notice. In response to the hack, Tether announced that it had frozen the exploiters wallet.
Turning to the positive side of things, the gain in the CEX was primarily driven by a 50% surge in the price of WOO, the native token of the WOO Network liquidity platform, after BitMex listed a WOO perpetual contract providing users up to 10X leverage. Alongside the listing Woo Network released their annual 2024 outlook detailing their expansion plans to benefit from the rising trend of crypto adoption.
Certainly, last week’s decision by the FASB, a US regulator, allowing companies to use fair-value accounting for crypto assets held on their balance sheet from next year is a very encouraging step from the perspective of institutional adoption. Under the current rules companies are required to treat crypto on their balance sheet as an intangible asset whose value is marked at the original purchase price. In the event that crypto prices fall, companies are required to recognize these unrealized losses recorded as an impairment charge, but in the event of rising crypto prices, gains can only be recognized in the event that crypto holdings were sold. As such, the rule change brings brings greater clarity and transparency to the asset class, a significant step forward that highlights the increasing relevance of crypto in the corporate world.
Finally, as this will be the last weekly update of the year, Trakx would like to wish all of our clients the very best for the holiday season and we look forward to continuing the crypto journey with all of you in 2024 – a year that holds much promise.
Sources: Trakx, Coingecko, Alphavantage
- Under-the-Radar Altcoin Surges by 58% This Week Amid New Perpetual Contract Listing: The Daily Hodl.
- What We Know About the Massive Ledger Hack: CoinDesk.
- Bitcoin fees hit 20-month high as miner revenues match $69K BTC price: Cointelegraph.
- Federal Reserve Holds Policy Steady, but Indicates More Dovish 2024: CoinDesk.
- FASB publishes new crypto rules that will let firms use fair-value accounting: The Block.
- Ryan Shea published the Trakx 2024 crypto outlook, outlining the big picture trends that will impact crypto over the year ahead.
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.