Trakx Weekly Update: October 16

Key Crypto Market Figures

CTIs Weekly Performance

For much of the past week, crypto markets were under pressure in the face of rising geopolitical tension in the Middle East and the slew of negative headlines from SBF’s ongoing criminal trial. As a result, the Trakx Top 10 Crypto CTI slipped 4% over the past seven days. The best performer was the Inflation Hedge, up 0.7%, while the weakest performer was the ESG CTI, down 5.5%.

As mentioned previously, the Inflation Hedge CTI typically outperforms during down markets due to its defensive nature. However, its performance last week was boosted by a 3% rise in the PAX Gold token, which gained in tandem with the rise in the price of the yellow metal – due to increased demand for safe-haven assets – and on the back of a slightly hotter than expected September US CPI report.

One factor that helped lift sentiment towards crypto assets over the last couple of days was the decision by the SEC not to appeal an earlier court ruling that concluded it was incorrect to reject the spot Bitcoin ETF application by Grayscale (the deadline for appeal was midnight Friday). Of course, this does not automatically imply that the SEC will allow the application, but it does mean that the SEC will have to find reasons other than those included in the original rejection to block the application. In response to the news, the NAV discount on Grayscale’s Bitcoin Trust narrowed to less than 16% - its tightest in more than two years - indicative of investors increasing the odds that the conversion will take place. Certainly, the news that ARK Invest has amended its spot Bitcoin ETF filing to include additional details on how the fund’s underlying assets will be valued and custodied – alterations that bring it into line with BlackRock’s amended application – suggests that larger tradfi institutions are inching closer to getting a spot Bitcoin ETF product accepted by the SEC.

Finally, on a lighter note, just in time to take advantage of the new bull market in crypto, Ferrari announced that it had started to accept cryptocurrency payments for its sports cars in the US and that the scheme would likely be extended to Europe. The obvious next question, surely, is - wen Lambo?

Sources: Trakx, Coingecko, Alphavantage

Market Trends

• Grayscale GBTC discount falls to 16% as markets bet on Bitcoin ETF approval: Cointelegraph.
• Cathie Wood's ARK Amends Spot Bitcoin ETF Filing to Include Surveillance Sharing, Similar to BlackRock: Coindesk.
• Bitcoin Dips With Rest of Market as U.S. Inflation Holds at 3.7%: Decrypt.
• Caroline Ellison’s testimony in SBF case was strong, but was it credible?: DLnews.
• Mastercard creates tech to tokenize CBDCs on multiple blockchains: CryptoSlate.
• Stablecoin Tether appoints chief technology officer Ardoino as CEO: Reuters.

Trakx News

• Ryan Shea published: “Solana: Light At The End Of The Tunnel?”, a deep dive on a cryptocurrency that has been negatively impacted by its strong association with Sam Bankman-Fried.

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.