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Japan's Top Three Banks to Pilot Cross-Border Stablecoin Transfer Platform
Japan’s three largest banks—MUFG, SMBC, and Mizuho—are set to trial "Project Pax," a cross-border stablecoin transfer platform aimed at streamlining international settlements for businesses. The initiative, run by blockchain firms Progmat, Datachain, and TOKI, will use stablecoins issued via Progmat’s platform and leverage SWIFT's API for secure, compliant transfers. The project seeks to minimize costs and improve the speed of cross-border payments, with plans for commercialization by 2025. Stablecoins on the platform will be available in major currencies like JPY, USD, and EUR.
US Spot Bitcoin ETFs Record $211 Million in Outflows, Extending Negative Flow Streak
U.S. spot Bitcoin ETFs recorded $211.15 million in net outflows on Thursday, marking their seventh consecutive day of negative flows. Fidelity's FBTC led the outflows with $149.49 million, followed by Bitwise’s BITB at $30 million. No funds saw net inflows, and total daily trading volume dropped to $1.35 billion. Meanwhile, spot Ether ETFs saw minor net outflows of $152,720, with Grayscale’s ETHE reporting $7.39 million in outflows and its mini trust gaining $7.24 million. Ether ETF trading volumes also declined, reflecting broader market anticipation of U.S. economic data.
Skyscanner Partners with Travala to Enable Hotel Bookings in Over 100 Cryptocurrencies
Skyscanner has integrated with blockchain-based platform Travala, allowing users to book over 2.2 million hotels across 230 countries using more than 100 cryptocurrencies, including Bitcoin, Ether, and Travala's AVA token. Travala is now featured alongside major travel agencies like Expedia and Booking.com on Skyscanner, which has 110 million monthly users. This partnership aims to boost crypto adoption in travel, providing travelers with alternative payment options. Travala users can also earn rewards through the AVA Smart Program, offering discounts and cashback in Bitcoin and other digital assets.
Trading Desk Insights
Technical Analysis:
This morning opened in the red across both equities and crypto markets. As expected, Bitcoin continues its downward trajectory, with a retest of the low $50,000 range appearing likely. The strong correlation with the equity market remains, prompting many funds and traders to likely consider risking stance given current price action and the short-term economic outlook.
U.S. spot Bitcoin ETFs saw their largest outflows since May 1st, with net outflows totalling $287.78 million on Tuesday. BlackRock’s IBIT, the largest Bitcoin ETF by assets, reported no major inflows, while Grayscale’s GBTC, the second-largest, experienced $50.39 million in withdrawals. Fidelity’s FBTC recorded the most significant outflows at $162.26 million. Other notable funds, including Ark and 21Shares’ ARKB, saw $33.6 million withdrawn, while Bitwise’s BITB had $24.96 million in outflows. Additionally, ETFs managed by VanEck, Valkyrie, Invesco, and Franklin Templeton reported smaller withdrawals.
Crypto Developments:
Examining various structures in Bitcoin’s derivatives market also provides insight into current market conditions. Bitcoin forward curves are showing annualized basis rates at their lowest levels of the year, with premiums of calendar futures to spot narrowing to 6%-9% (depending on expiration). This contraction in premium reflects reduced appetite for leveraged long positions (demand for cash leverage), indicating more cautious positioning by traders.
Implied volatility has responded to the recent price decline, despite typically being positively correlated with upside moves. Currently, we observe heightened volatility in the front end of the volatility surface, with 30-day ATM implied volatility at 56%. Evidently, volatility skew also responded to price action as indicated by short-dated skews dipping further negative. Volatility skew measures the how much higher call implied volatilities are relative to put implied volatilities. Thus, a negative skew for short and mid term option chains means put volatilities are higher and that there is heightened demand for short and mid term puts relative to calls.
Equity Markets:
U.S. job growth in August came in slightly below expectations, but many say not low enough to push the Federal Reserve toward a significant rate cut later this month. According to Friday’s Nonfarm Payrolls report, the U.S. added 142,000 jobs in August, below the forecasted 160,000, though still higher than July’s revised 89,000. The unemployment rate dipped to 4.2%, matching expectations and down from 4.3% in July. It was following the release that BTC saw a short-lived rebound to $56,500. U.S. equity markets are getting hit hard this morning, with SPY already down over 1.5% since open, Nasdaq down over 2.3%.
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.
Unless otherwise provided in a separate agreement, Secure Digital Markets does not represent that the report contents meet all of the presentation and/or disclosure standards applicable in the jurisdiction the recipient is located. Secure Digital Markets and their officers, directors and employees shall not be responsible or liable for any trading decisions, damages or other losses resulting from, or related to, the information, data, analyses, or opinions within the report.
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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