Markets Insights
Next FOMC meeting: Sept 20th 2023.
- Probability of a 0bps hike → 88.5%
- Probability of a 25bps hike → 11.5%
The News Room
Jacobi Asset Management Launches Europe's First Spot Bitcoin ETF on Euronext Amsterdam
London's Jacobi Asset Management has launched Europe's inaugural spot bitcoin ETF on Euronext Amsterdam, a development that came nearly two years after its initial approval. Dubbed the "Jacobi FT Wilshere Bitcoin ETF" and trading under the "BCOIN" ticker, this ETF is overseen by the Guernsey Financial Services Commission, with Fidelity Digital Assets offering custody and Flow Traders as the market maker. Despite obtaining approval in October 2021, Jacobi delayed the listing due to challenges in the digital asset market, including the Terra ecosystem's collapse and FTX's bankruptcy.
Unlike the prevalent ETNs in Europe, which are debt securities, Jacobi's ETF allows shareholders to own a share of its underlying assets. Interestingly, this move means a spot bitcoin ETF will trade in Europe before the U.S., where numerous SEC applications have been declined. However, with BlackRock's recent "surveillance-sharing" agreement submissions, there's renewed optimism for U.S. approval to combat market manipulation.
Prime Trust Declares Chapter 11 Bankruptcy Protection in Restructuring Effort
Prime Trust, a prominent fintech firm offering digital asset services, has declared Chapter 11 bankruptcy following a shortfall in customer funds. Earlier attempts to secure emergency fundraising in June proved unsuccessful, leading to Nevada's Department of Financial Institutions shutting down its operations. Despite these challenges, Prime Trust aims to navigate through Chapter 11 and explore strategic options, such as a potential company sale. Three linked entities, Prime Core Technologies, Prime IRA, and Prime Digital, are also declared as debtors. A special restructuring committee will coordinate efforts for a financial overhaul, aiming for a transparent recovery process that benefits all stakeholders. This downfall reflects the broader industry challenges, notably the disruption triggered by Terra's ecosystem collapse in 2022. Prime Trust had previously secured over $100 million in investments from Kraken Ventures, Mercato Partners, and Fin Capital, among others.
Singapore's Central Bank Introduces Regulatory Framework for Stablecoins
The Monetary Authority of Singapore (MAS) has introduced a regulatory framework for single-currency stablecoins linked to the Singaporean dollar or any G10 currency, such as the U.S. Dollar, Euro, and British Pound. Following a public consultation in October, the guidelines mandate that stablecoin issuers desiring regulation in Singapore adhere to specific requirements concerning value stability, capital, and redemption protocols.
Notably, stablecoins should maintain a base capital of at least 1 million Singapore dollars ($740,000) and honor redemption requests within a maximum of five business days. Circle, a prominent stablecoin issuer, already secured a digital payment token service license from MAS in June. Globally, other jurisdictions are also moving forward with stablecoin regulations, with a related bill currently progressing through the U.S. Congress.
Trading Desk Insights
China’s central bank unexpectedly cut rates on Tuesday, as policymakers continued to ramp up support for its struggling economy. Last night, China reported an increase of industrial production of 3.7%, missing estimates of 4.3%, with retail sales increasing by 2.5%, lower than forecasts of 4.2%. The second cut in three months brought one-year loans, or medium-term lending facility, down by 15 basis points from 2.65% to 2.50%.
In a recent statement, an analyst from Fitch Ratings indicated that the U.S. banking sector is nearing potential challenges, with the possibility of broad rating reductions encompassing major banks, such as JPMorgan Chase. Should there be a shift in the industry's rating from AA- to A+, Fitch would need to reassess the ratings of the 70+ U.S. banks under its purview.
On Tuesday, market sentiment took a hit as global economic concerns, combined with subdued performance from the banking sector, weighed on Wall Street. International sentiment also appeared cautious following unexpected data from China and an unanticipated rate reduction by its central bank.
Bitcoin continues to trade sideways within a price range of high volume. Prices will most likely continue to trade within 29,000 and 29,500. Another price range of high volume would be 30,100 - 30,600 which should act as resistance in the short term.
The 30-day annualized volatility for BTC has reached a new all-time low at 15.5%. For comparison, the average annualized 30-day volatility for BTC in 2022 was 61.4% and for 2023 it averaged 43.8%.
In other news, Europe is listing its first spot Bitcoin ETF in Amsterdam nearly two years after it was first approved. The Jacobi FT Wilshere Bitcoin ETF will trade under the ticker "BCOIN."
Economic calendar:
MONDAY
TUESDAY
- CAD CPI
- US retail sales
WEDNESDAY
- Crude oil inventories
- FOMC meeting minutes
THURSDAY
- US unemployment claims
- US Philly Fed Manufacturing Index
FRIDAY
Technical Charts
Altcoin Watch
The EDX Markets integration propelled Bitcoin Cash (BCH) to new heights.
Bitcoin cash’s open interest recently surged to over $400 million, indicating higher inflows and improved sentiment. Its plans for the scaling system 'CashTokens' have also added renewed interest.
A network upgrade and an influential exchange listing have likely served as two key catalysts for the sudden trading interest in BCH.
BCHUSDT has been trading within a falling wedge pattern since its yearly highs in late June. Prices have been pulling back since and rebounded right off the 50% Fibonacci level. The coin is having difficulty closing above the 20-day moving average but at least the RSI remains supported by a rising trend line.
A break above 240 would trigger bullish implications sending prices higher towards 255 and 282 in extension.
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