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Michigan State Pension Fund Reveals Over $10M in Ethereum ETF Investments
The State of Michigan Retirement System has become the first U.S. pension fund to invest in a spot Ethereum ETF, disclosing $10 million in Grayscale's Ethereum Trust in its recent 13F filing. This marks a notable entry into crypto investments for pension funds, as Michigan also holds spot Bitcoin ETFs worth around $7 million. Other states, like Wisconsin and Florida, have also ventured into crypto-related investments, reflecting a growing interest among public funds.
Singapore to Expand Tokenized Asset Market to 'Deepen Liquidity
The Monetary Authority of Singapore (MAS) has introduced two new frameworks to advance tokenization in financial markets, targeting fixed-income assets and funds. Part of Project Guardian, MAS’s initiative for financial efficiency through tokenization, the frameworks include the “Guardian Fixed Income Framework” for debt market tokenization and the “Guardian Funds Framework” with best practices for tokenized funds. MAS aims to enhance transparency, trading efficiency, and asset settlement times. To expand liquidity, MAS has also launched the “Guardian Wholesale Network,” a coalition of major financial institutions including Citi and HSBC, to scale tokenization trials. Deputy Managing Director Leong Sing Chiong emphasized strong interest in tokenized assets, with MAS coordinating networked commercialization.
Taiwan's FSC to Tighten Oversight on Crypto Listings with New January Rules, Official Says
Taiwan’s Financial Supervisory Commission (FSC) will implement new compliance rules for crypto service providers in January 2025, focusing on anti-money laundering (AML) registration, crypto asset listing, and operational transparency. FSC securities division director Hsi-Ho Huang announced at Taipei’s FinTechOn conference that the rules will mandate crypto platforms to establish listing and delisting procedures, enhance asset custody protocols, and require annual CPA-audited reports for client assets. Non-compliant entities may face criminal penalties, including imprisonment. Additionally, FSC chair Jin-Lung Peng confirmed the development of a crypto-specific law proposal aimed for submission by mid-2025, while the local industry has set up an association to create self-regulatory standards.
Trading Desk Insights
Bitcoin and other cryptocurrencies experienced a downturn over the weekend as market participants prepared for the upcoming U.S. presidential election. Bitcoin, nearing record highs just last week, receded to $67,500 on Sunday, coinciding with fluctuating odds for Donald Trump's re-election bid. The crypto market's movements appear closely linked to these election odds, with traders taking a cautious approach until the political landscape becomes more transparent. Meanwhile, Kamala Harris's perceived likelihood of winning has seen an uptick on platforms like Polymarket, likely reflecting a strategic positioning by traders.
As we move into the week, Bitcoin has retreated to its 20-day moving average, eyeing the 50-day average around $65,000, which aligns with a supportive trend line from August. Open interest in the futures market has held steady, suggesting a wait-and-see attitude among traders, while spot trading volume has diminished since last Friday. A resurgence in volume will be crucial for signaling a robust recovery.
Market volatility has surged across both cryptocurrency and traditional sectors. The Deribit Bitcoin volatility index has reached heights not seen since late July, as traders anticipate increased fluctuations post-election. Similarly, the MOVE index, which tracks the implied volatility of U.S. Treasury notes, escalated to its peak since October 2023 last Friday.
Additionally, the financial markets are on alert for the Federal Reserve's upcoming interest rate decision. Market consensus currently shows a 96% expectation of a rate reduction at this week's Fed meeting. The key consideration for traders will be whether the Fed opts for a cut of 25 basis points or 50 in December, heavily influenced by forthcoming economic indicators. Investors will be keenly awaiting remarks from Fed Chair Jerome Powell for further guidance on the central bank's prospective monetary policies.
Crypto 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.
Any forecasts contained herein are for illustrative purposes only and are not to be relied upon as advice or interpreted as a recommendation. The price of crypto assets may rise or fall because of changes in the broad market or changes in a company's financial condition, sometimes rapidly or unpredictably. Past performance is not a guide to future performance, future returns are not guaranteed, and a loss of original capital may occur. Fluctuations in exchange rates could have adverse effects on the value or price of, or income derived from, certain investments. We and our affiliates, officers, directors, and employees, excluding equity and credit analysts, will from time to time have long or short positions in, act as principal in, and buy or sell, the securities or derivatives, if any, referred to in this research.
The information on which the analysis is based has been obtained from sources believed to be reliable such as, for example, the company’s financial statements filed with a regulator, company website, company white paper, pitchbook and any other sources. While Secure Digital Markets has obtained data, statistics, and information from sources it believes to be reliable, it does not perform an audit or seek independent verification of any of the data, statistics, and information it receives.
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Crypto and/or digital currencies involve substantial risk, are speculative in nature and may not perform as expected. Many digital currency platforms are not subject to regulatory supervision, unlike regulated exchanges. Some platforms may commingle customer assets in shared accounts and provide inadequate custody, which may affect whether or how investors can withdraw their currency and/or subject them to money laundering. Digital currencies may be vulnerable to hacks and cyber fraud as well as significant volatility and price swings.
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