Trakx Weekly Update: February 17

Key Crypto Market Figures

CTIs Weekly Performance

Even though our benchmark Top10 Crypto CTI gained 3% last week crypto markets essentially flatlined with crypto players caught between divergent cross-currents. The best performer amongst our suite of crypto indices was the Recovery CTI, which gained 17%. In contrast, it was the Centralized Exchange (CEX) CTI in last place in the performance tables, after slipping 0.5% over the preceding seven days.

Coming In Hot

Last week’s US inflation data – both at the producer and consumer levels – came in hotter than expected, not only on the headline measure but also on the core measure that strips out the more volatile food and energy and food prices. What these latest reports indicate is that core CPI inflation has stabilised around the 3% mark since the summer, which is notably higher than the Fed’s 2% target. Coincident with the inflation releases, in testimony before congress Fed Chair Powell reiterated that US central bankers need to see a resumption of the downtrend in inflation before the they would consider further interest rate cuts, monetary stimulus that typically provides a boost to cryptocurrencies. Further complicating the US monetary outlook, is the thorny issue of what impact the Trump tariffs and the tit-for-tat response from other nations will have on the future trajectory of US inflation (almost certainly up, but by how much?).

ETF Watch

On a more positive note, after last year’s SEC greenlighting of Bitcoin and Ethereum ETFs, crypto investors have been eagerly waiting to see which, if any, additional cryptocurrencies get the go ahead next. Ethereum-killer Solana was the top of most people’s list (including ours ) but last week saw Grayscale Investments submit an application to launch a Cardano ETF on the New York Stock Exchange. The news provided the ninth largest cryptocurrency by market cap with an immediate 12% boost, a gain that benefited not only our Top10 Crypto CTI, which has Cardano as a constituent, but also our recently launched Cardano Ecosystem ETF CTI.

Cardano was not the only cryptocurrency caught up in the SEC ETF listing price bump last week. Ripple’s XRP also rallied, gaining more than 14%, in reaction to the SEC acknowledging applications for an XRP ETF from Grayscale and the NYSE. Assuming the SEC appeal against last year’s US court ruling that found XRP sales to retail investors did not constitute securities transactions is either dismissed or settled (quiet possible given the change of leadership at the SEC following Gensler’s resignation last month), the path towards listing should be relatively clear.

The Political-Crypto Nexus

Trump may be successful at bringing warring nation-states to the negotiating table but if media reports are correct he is having distinctly less luck at bringing a diverse group of crypto experts together to form his crypto council under the chairmanship of the newly appointed crypto and AI Czar David Sacks. Instead, Trump is said to be is considering a series of crypto summits focused on specific issues peopled by crypto leaders on a rotational basis. This change of tack may be somewhat disappointing for the bulls as a crypto council would have been a good platform by which to promote supportive policy, but it should hardly come as a surprise to anyone familiar with the digital asset space, which is well-known for having a very diverse (not to mention opinionated!) set of characters.

Finally, Argentine President Milei faces a threat of impeachment after the LIBRA meme coin he promoted via his official X account saw its market cap slump from $4.5bn to $200mn. Following the 90% price crash that prompted accusations of it being a retail-focused rug-pull by a small group of insiders, Milei hastily deleted his earlier tweet before going on to claim that he was “not aware of the details of the [private] project”.

Sources: Trakx, Coingecko, Alphavantage

Market Trends

• Bitcoin price sells off after hot CPI print, but $100K remains in sight: CoinTelegraph
• Grayscale Seeks Cardano ETF Approval After Filing for Solana, XRP and Dogecoin Funds: Decrypt
• XRP ripped after SEC acknowledgment. These other three factors are driving its price: DLNews
• Trump May Swap Crypto Council For Summits – Insider Blames Ripple: Bitcoinist
• Javier Milei Backtracks on $4.4B Memecoin After ‘Insiders’ Pocket $87M: CoinDesk

Trakx News

• Trakx and Calci Patrimoine are hosting an exclusive training for CGPs & CIFs, in Paris on March 5, on the rapidly evolving crypto-asset market and how to successfully integrate crypto into wealth management. For more details, please contact us at [email protected]
• Reminder: Lionel will be attending the EtH Denver https://www.ethdenver.com/ at the end of the month. If you are planning to be there please drop by and say hello.

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 850 626 078. Crypto 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.