Markets Insights
Next FOMC meeting: Sept 20th 2023.
- Probability of a 0bps hike → 90.5%
- Probability of a 25bps hike → 9.5%
The News Room
Grayscale Wins Legal Battle for Bitcoin ETF Review, Sparks Optimism for Approval
Grayscale achieved a significant legal victory against the US Securities and Exchange Commission (SEC) as the DC Circuit of Appeals approved a review of the SEC's decision to deny its spot Bitcoin ETF conversion bid. This decision reignited optimism for a potential Bitcoin ETF approval, leading Grayscale's Bitcoin Trust (GBTC) to surge by almost 17% in secondary trading. The positive sentiment extended to the broader Bitcoin market, with BTC appreciating approximately 7% by the close of New York trading. This landmark ruling could pave the way for other major asset managers, such as BlackRock and Fidelity, to pursue similar Bitcoin ETF initiatives.
X Obtains Currency Transmitter License in Rhode Island, Paving the Way for Cryptocurrency Integration
X, previously known as Twitter, has acquired a currency transmitter license in Rhode Island, advancing its ambition of incorporating cryptocurrencies into its platform and evolving into a multifunctional app, similar to China's WeChat. Rhode Island mandates that entities handling digital currency on behalf of users must be licensed.
Having registered with the Treasury Department's Financial Crimes Enforcement Network (FinCEN) last year, the platform is securing licenses across various states. This initiative reflects the growing trend of social media platforms integrating digital payments. X’s latest Rhode Island license marks a significant step towards its comprehensive digital platform goals.
SEBA Bank's Hong Kong Branch Receives Preliminary Approval for Regulated Crypto Investment Services
SEBA Bank's branch in Hong Kong has secured preliminary approval from the Securities and Futures Commission (SFC), positioning it to offer regulated cryptocurrency investment services in Hong Kong. Once the license is fully granted, SEBA will join a select group of entities in Hong Kong licensed for crypto services. Amy Yu, CEO of Asia Pacific at SEBA Hong Kong, expects the full license to be achieved by Q4 2023, dependent on meeting SFC's specific requirements. SEBA is also eyeing expansions into other crypto hubs, such as Singapore.
This development comes after Hong Kong introduced a crypto licensing system earlier this year and encouraged banks to accept crypto exchanges as clients, indicating its evolving role as a major crypto market player. Presently, HashKey and OSL Exchange are the only entities on the SFC's licensed crypto platform list.
Trading Desk Insights
Stock futures remained steady on Wednesday morning, following a consecutive positive session, underlining the recent surge as market participants work to offset August's downturns. Tuesday's advancements were driven by data suggesting a potential economic deceleration, a scenario where "bad news is good news". The Consumer Sentiment Index fell short of projections, and July's open job listings witnessed a dip. Furthermore, this morning's ADP non-farm payroll data and preliminary GDP results both failed to meet expectations, pointing to an economic slowdown.
Bitcoin started to pull back yesterday afternoon after its rise from $26k to $28.1k (+8.25%). Interesting how prices started to trade lower after reaching the 61.8% Fibonacci level which has acted as resistance. Volatility levels have also come down a bit after the recent pop yesterday.
Following the positive news between Grayscale and the SEC, the Grayscale Bitcoin Trust (GBTC) discount to NAV jumped to -18%, its highest level since December 2021.
Most altcoins have started to pull back, especially Bitcoin Cash (BCH) trading -4% this morning after having squeezed 20% higher yesterday to $229. This coin has been a high Beta play compared to Bitcoin. When BTC squeezed by +27% in June, BCH traded +200% higher. As much as it goes up more than BTC, it also goes down by a lot more as well as prices dropped 50% from the yearly highs of $330 to $166 on August 17th.
Economic calendar:
MONDAY
TUESDAY
- US S&P Home Price Index
- US JOLTS Job Openings
WEDNESDAY
- US ADP Non-Farm Employment
- US prelim GDP
- China manufacturing + services PMI
THURSDAY
- EU flash CPI
- US Core PCE
- US unemployment claims
FRIDAY
- CAD GDP
- US nonfarm payrolls
- US unemployment rate
- US ISM manufacturing PMI
Technical Charts
Disclaimer
This research is for informational use only. This is not investment advice. Other than disclosures relating to Secure Digital Markets this research is based on current public information that we consider reliable, but we do not represent it is accurate or complete, and it should not be relied on as such. The information, opinions, estimates, and forecasts contained herein are as of the date hereof and are subject to change without prior notification. We seek to update our research as appropriate.
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