Trakx Weekly Update: February 5
Key Crypto Market Figures
CTIs Weekly Performance
Trakx’s Top 10 CTI gained 1.6% over the past seven days, with six of the constituent tokens closing up on the week. One factor that contributed to limiting the gains was a 4.5% sell-off in XRP after the Chairman and co-founder of Ripple, Chris Larsen, revealed that several of his personal accounts had been hacked, with estimates putting the sum involved at $112million. Even though Larsen stated that no Ripple-managed accounts were compromised in the hack, the news negatively impacted sentiment towards the blockchain’s native token.
Interestingly, the gains in crypto came despite an interest rate double-whammy. On Wednesday the Fed signalled it was in no hurry to lower interest rates (a stance Chair Powell reiterated in his 60 minutes interview over the weekend). This was swiftly followed by Friday’s bumper non-farm payroll report, which showed the US economy adding a much better-than-expected 350,000 jobs in January. As a result, investors hopes of a March rate cut were significantly dashed. That said, with the US regional banks looking wobbly ahead of the ending of the BTFP in less than two months, (a topic covered in our January update – see below), investors have simply pushed the beginning of the rate cutting cycle to May.
Tying for top of the pile of the Trakx suite of CTIs was the Interoperability CTI and the RWA CTI – both of which gained 8%. Helping to drive the gain in the former was a 28% surge in the value of Chainlink’s native token (LINK), whereas the RWA CTI was boosted by an even greater 38% increase in the value of Pendle. The move up in both tokens is consistent with ongoing speculation that tokenized RWA assets will become a major market driver in crypto this year. Chainlink because it provides cross-chain capabilities required to be able to tokenize RWA at scale whereas Pendle is a permissionless yield trading protocol that splits yield bearing tokens into a principle and yield token (analogous to stripping in TradFi) allowing its users to create a DeFi yield market.
In contrast, the worst performer was the Diversifier CTI. It declined 6% last week on the back of near 20% drop in the value of Raydium – an automated AMM and liquidity provider for the Serum DEX whose value has surged 300% over the past year.
Sources: Trakx, Coingecko, Alphavantage
- Ripple's XRP falls amid reports it was likely hacked - CoinDesk: Reuters.
- America’s economy is on fire — and Bitcoin will win big time: DLNews.
- BlackRock and Fidelity Bitcoin ETFs reach top 10 in January flows: Cointelegraph.
- Chainlink's LINK Token Taps 22-Month High of $18, Ending Three-Month Breather: CoinDesk.
- El Salvador to expand Bitcoin initiatives following Bukele’s landslide re-election: CryptoSlate.
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.