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In This Issue:
ETF Timing Matters
Bitcoin Breaks The Daily 50 MA
Altcoin Charts
Every Market Is Glad September Is Over
Bitcoin Spot ETFs Are Likely Toast For 2023
But Ethereum ETFs Are HERE
Coinbase To Offer Perpetual Futures Trading
Optimism About Bitcoin Is On The Rise
“Bitcom” | Gensler Gets Bullied & SEC Says ETF-U To Bitcoin
ETF Timing Matters
What's the sweet spot for the launch of a spot Bitcoin ETF? On the surface, it might seem like an off-the-wall question, but the timing could redefine the crypto sector. Different camps have different takes, so let's dig into them.
Green Light the ETF Now, No More Waiting
First off, the Bitcoin diehards are crystal clear: the world needs a Bitcoin ETF yesterday. The crypto ecosystem has stood the test of time and overcome every obstacle thrown in its path. Every day we're not marching forward with an ETF is a day wasted. And this isn't just for those looking to pad their portfolios. There are serious advantages to consider:
Market Calm: A Bitcoin ETF can be a stabilizing force, offering a regulated alternative to the free-for-all that exists on some crypto platforms.
Liquid Gold: ETFs are known for their liquidity. A Bitcoin variant could breathe new life into the market.
The Big Boys: An ETF would surely attract the eye of institutional players, giving the space even more credence.
Tax Magic: An ETF structure can offer tax efficiencies not seen with direct crypto holdings.
Global Standings: Nations like Canada are already in the ETF game. It's high time we caught up.
Educating the Masses: If you're crypto-curious but don't know where to start, an ETF can be your gateway.
Give the SEC Its Due Time
This viewpoint may not be the loudest in crypto forums, but it has its merits. If and when SEC Chair Gary Gensler waves his magic wand, you can bet it'll be a “well-considered” decision. Hasty moves could lead us into murky waters, not unlike the situations Coinbase or Binance found themselves in.
Due Diligence: Letting the SEC take its time ensures a thorough vetting process.
Market Maturation: Holding off may mean a less volatile market, which is good for everyone involved.
Curating the Space: We want an ETF, sure, but not at the expense of quality.
Sustainable Success: The best ETF is one that stands the test of time. Patience can help ensure that.
I'm not here to sing Gensler's praises, but a balanced view never hurt anyone.
Wait for the Bull Market Zenith
Some might see this as self-serving, but there's more to it. If an ETF gets rubber-stamped during a market high, be ready for a price explosion powered by FOMO. Here's why that's not necessarily a bad thing:
The Trust Factor: Approval in a bull market solidifies crypto's place as a worthy investment.
Everyday Joes and Janes: ETFs lower the entry barrier, making it easier for retail investors to get in the game.
Capital Wave: An influx of fresh money could keep the bull market cruising.
If an ETF is approved in a bear market, we may “miss” the upside move that could come with it in the bull.
The timing of a spot Bitcoin ETF isn't just some footnote. It's a pivotal moment that could dictate the future trajectory of the crypto space. Whether it's tomorrow or next year, the difference in impact will be substantial. It's the most defining move in the Bitcoin ecosystem, next only to Bitcoin's invention. So, when that day arrives - and it will - I'll be the first to toast to a new era in crypto. Cheers to the future!
Bitcoin Breaks The Daily 50 MA
Finally, some good news. Bitcoin managed to close above the 50 MA on the daily on the 6th attempt this month (with more failed attempts in August).
This is the first meaningful signal that things might be improving slightly in the short term, as the move was confirmed by a nice spike in volume.
The 200 MA looms ahead around $28,000, which would be a nice target for this move in an otherwise sideways market.
As discussed, the RSI breakout gave us a hint that this price breakout was coming. Now price is through resistance on the line chart, so we should see further upside.
Altcoin Charts
Altcoins are showing some potential today. Take a peak at the ETH/BTC chart I shared yesterday. This could be a decent signal that some altcoin relief is coming.
Every Market Is Glad September Is Over
Stocks rallied on the quarter's last trading day, fueled by dovish comments from the Fed and signs of easing European inflation. Europe's Stoxx 600 rose by 1%, buoyed by a slowdown in French inflation and stronger-than-expected British economic data. U.S. equities also advanced, marking a respite after a quarter that saw the steepest rise in 30-year borrowing costs since 2009. Positive sentiment was further boosted by speculation about a potential U.S.-China summit. Global bond yields retreated, easing concerns about immediate rate hikes. Overall, the market showed signs of optimism amid economic uncertainties.
Key events this week:
Eurozone CPI, Friday
US consumer spending, wholesale inventories, University of Michigan consumer sentiment, Friday
ECB President Christine Lagarde speaks, Friday
New York Fed President John Williams speaks, Friday
Some of the main moves in markets:
Stocks
The Stoxx Europe 600 rose 1.1% as of 10:19 a.m. London time
S&P 500 futures rose 0.4%
Nasdaq 100 futures rose 0.6%
Futures on the Dow Jones Industrial Average rose 0.3%
The MSCI Asia Pacific Index rose 0.6%
The MSCI Emerging Markets Index rose 1%
Currencies
The Bloomberg Dollar Spot Index fell 0.4%
The euro rose 0.4% to $1.0608
The Japanese yen rose 0.2% to 149.02 per dollar
The offshore yuan was little changed at 7.2933 per dollar
The British pound rose 0.3% to $1.2243
Cryptocurrencies
Bitcoin fell 0.2% to $27,026.33
Ether rose 1.1% to $1,674.1
Bonds
The yield on 10-year Treasuries declined four basis points to 4.53%
Germany’s 10-year yield declined eight basis points to 2.85%
Britain’s 10-year yield declined six basis points to 4.42%
Commodities
Brent crude fell 0.2% to $94.95 a barrel
Spot gold rose 0.4% to $1,871.60 an ounce
Bitcoin Spot ETFs Are Likely Toast For 2023
Could a curveball alter the course of history? Sure. However, if the SEC has its way, the approval of a Bitcoin ETF before year-end seems very doubtful. BlackRock's submission was undoubtedly the most robust among all the applicants, so its delay should seal the fate of the others. This suggests that the SEC may have yet another arbitrary or capricious reason to rebuttal the Grayscale case and delay or deny ETFs in general. This turn of events underscores the importance of conviction in the world of cryptocurrency investing. It has never been simple to be a crypto investor.
The most likely reason for this delay yesterday is a looming government shutdown. They probably wanted to get ahead of the decision, since their staff is likely to be out of work for a while.
But Ethereum Futures ETFs Are HERE
Valkyrie got approved!
And next week is likely to be ETH Future ETFapalooza, with many more to be given the green light.
As I write this segment, the SEC has not yet publicly approved the VanEck Ethereum ETF. Nevertheless, VanEck has not allowed this to hinder their efforts in announcing and promoting their forthcoming product. The Ethereum Futures ETF (EFUT) is set to be listed on CBOE, joining the ranks of the Bitcoin futures ETF (XBTF), and it will primarily invest in contracts traded on the Chicago Mercantile Exchange. As illustrated in the commercial featured above, VanEck is wasting no time in positioning itself for an early market advantage.
Details aside, one can't help but find it intriguing to witness the emergence of commercials promoting crypto-related products. While crypto commercials are not entirely novel, the revitalization of them is a refreshing sight, particularly for those who survived through the bear market. With the anticipation of spot ETFs receiving approval, one can only imagine the forthcoming marketing battle among rival ETFs, and we, the audience, get to sit back and enjoy the spectacle.
In addition to VanEck offering an Ethereum futures ETF, Valkyrie is the first asset manager to receive SEC approval and has decided to convert its Bitcoin futures into a blended Bitcoin and Futures ETF. Most investors know Valkyrie for its successful Bitcoin mining ETF, which is currently the top-performing crypto ETF in the U.S. I will be interested to see if investors have a similar appetite for a blended ETF, diversification is a good thing.
Coinbase To Offer Perpetual Futures Trading
Coinbase has recently achieved a significant milestone that might not have caught the attention of most of its users. The Bermuda Monetary Authority (BMA) has granted approval for the exchange to introduce a new category of products tailored for non-U.S. retail traders, expanding access beyond non-U.S. institutional clients. This development carries substantial implications due to the fact that the derivatives market accounts for a substantial 75% of crypto trading volume, as indicated in the linked article.
These new products will soon be accessible through Coinbase Advanced in the upcoming weeks. However, it's important to exercise caution and consider these products carefully. I strongly advise that retail investors approach such offerings with caution unless they possess the appropriate expertise in this area.
Optimism About Bitcoin Is On The Rise
Bitcoin Magazine reported on a study conducted by Block and Wakefield Research that surveyed 15 developing nations and 6,600 individuals on their perspective of Bitcoin. The findings revealed that despite Bitcoin’s price fluctuations over the past year, optimism about Bitcoin’s future has consistently remained higher than skepticism. One of the key findings in the survey centered around the close relationship between remittances, optimism, and engagement with Bitcoin. The survey discovered that “86.8% of adults who own Bitcoin are part of a household that regularly sends or receives remittances –– and individuals in this category hold a significantly more positive outlook on Bitcoin’s future compared to those not involved in remittances.” I included this section for a straightforward reason: it's important to remember that the appeal of Bitcoin extends far beyond its market value.
“Bitcom” | Gensler Gets Bullied & SEC Says ETF-U To Bitcoin
Let's breakdown Gensler's testimony and discuss the fate of Bitcoin ETFs, which now looks doomed. Join my special guests Matt Hougan, Bitwise, Steven McClurg, Valkyrie, and my Thursday markets guy Dan The Chart Guy!
The views and opinions expressed here are solely my own and should in no way be interpreted as financial advice. Every investment and trading move involves risk. You should conduct your own research when making a decision. I am not a financial advisor. Nothing contained in this e-mail constitutes or shall be construed as an offering of financial instruments or as investment advice or recommendations of an investment strategy or whether or not to "Buy," "Sell," or "Hold" an investment.