Trakx Weekly Update: January 20

Key Crypto Market Figures

CTIs Weekly Performance

The crypto yoyo continued last week as illustrated by the 6% rally in our benchmark Top10 Crypto CTI, which pushed up the year-to-date return to 10%. The star performer though over the preceding seven day period was the Meme CTI, up 11%, followed by the RWA (Real World Asset) CTI, which gained just under 7%. By contrast, last in the performance table was the AI CTI, a sector that has previously proved popular with crypto players, after it fell 7% last week.

Trump Inauguration

The move up in digital asset prices reflected increased optimism as to what the imminent arrival of the first crypto-friendly US president would mean for the asset class. All the indications are encouraging including the recent appointment of Tom Emmer, the pro-crypto representative of Minnesota, as vice Chair of the House Subcommittee on Digital Assets, Fin Tech and AI. In addition, media reports last week suggested that Trump would hit the ground running issuing executive orders to reverse the SAB 121 accounting policy which acts as a deterrent to financial companies owning digital assets via a custodian because they must be reported as a liability on their balance sheet. Also likely is some form of swift redress to the crypto debanking programme, commonly referred to in crypto circles as Choke point 2.0, which Trump has previously promised to end.

Less seriously, but just as impactful, Donald and Melania Trump and both dropped official meme coins over the weekend. Despite being unimaginatively named as $TRUMP and $MELANIA, both witnessed very strong price gains. However, not everyone in the crypto sphere was amused by the US president-elect adopting degen behaviour just prior to taking office.

Good US Inflation

It was not just US politics that provided a boost to the sector, US macro also played a role after the PPI and CPI data releases were somewhat cooler than anticipated. The positive inflation news provided a much-needed boost to risk assets, which had been under pressure resulting from the bearish move up in Treasury yields as tradfi investors pushed out the timing of the next Fed rate cut.

Tether Finds A Home

A few weeks back we pointed out that the market cap of USDT was declining as EU-based crypto exchanges delisted the world’s largest fiat-backed USD stablecoin after the introduction of MiCA, legislation that the token does not comply with because the company never obtained the necessary licence. However, last week Tether announced that it recently obtained a digital asset service provider licence in El Salvador – one of the most pro crypto nation states on the planet whose President often tweets out the P&L of his government’s crypto purchases. Having secured the licence, CEO Paolo Ardoino announced that the company had also decided to locate its first ever physical headquarters within the central American country, which he described as a “beacon of innovation in the digital assets space”.

Sources: Trakx, Coingecko, Alphavantage

Market Trends

• Bitcoin Spikes to 2025 High Price Near $105K Ahead of Trump Inauguration: Decrypt
• Rep. Tom Emmer appointed as vice chair of Digital Assets Subcommittee: The Block
• Donald Trump’s surprise memecoin soars to $24bn on day one: DLNews
• Tether Group to Establish Headquarters in El Salvador in Emerging Markets Push: CoinDesk
• XRP hits 7-year high as optimism outweighs SEC appeal concerns: CoinTelegraph
• What is DeFAI? The AI-enabled DeFi narrative looking to take 2025 by storm: CryptoSlate

Trakx News

• We announced the launch of our groundbreaking Cardano Ecosystem Crypto Tradable Index, the first institutional-grade Cardano Native Index trackers to give retail and institutional investors access to Cardano’s rich ecosystem projects.
• The next Trakx CGP Seminar will be held in Lyon on January 21. To register please click here

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.

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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.