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digital asset
May 10, 2024
9 min read

DigitalX Weekly Crypto Update: Market Trends and Analysis

19-26 April 2024

This week's latest trends and insights in the digital asset market from our asset management team.

Market Commentary

Bitcoin rallied following last Friday’s FOMC meeting, while the Federal Reserve continued with the higher for longer narrative, as risk markets were reprieved from their decision to taper QT at a faster than expected rate. The rally failed to sustain throughout the week, with the US Securities and Exchange Commission putting further pressure on American crypto companies, with the regulator serving Robinhood’s crypto arm with a Wells Notice. On the ETF front, Grayscale’s Bitcoin ETF experienced its first net inflow day backed up by a subsequent day of positive flows since the Fund’s listing in January, stemming Bitcoin supply from the sales.

One significant milestone was Bitcoin surpassing one billion transactions processed, underscoring its growing adoption and utility as a network. Additionally, institutional confidence in Bitcoin received a boost with Jack Dorsey’s Block announcing plans to increase its Bitcoin holdings, potentially paving the way for other institutions to follow suit. 

Runes, the new fungible token standard on Bitcoin, debuted amid high anticipation during the Bitcoin halving event in April. However, initial excitement has dwindled as trading volume and activity declined in the weeks following the launch. Despite this, a dedicated group continues to trade Runes, with comparisons drawn to previous Bitcoin innovations like Ordinals and BRC-20 tokens, suggesting potential for future growth and adoption. While the current landscape may be challenging, the evolving technology and opportunities for improvement signal a potentially promising future for Runes within the Bitcoin ecosystem.

CEO Comment

The Gap between Bitcoin and the S&P 500 has gradually tapered, now sitting at 15% – down from last week’s 17%. Digital asset markets seem to be closely following traditional markets at present and ETF flows regaining positive momentum with Grayscale’s GBTC turning the corner and reporting its first net inflows. This may prove to be a landmark event when we look back as supply from the halving dwindles. 

As for the shift list, which we define as the major events and announcements facilitating the broader market’s transition to Web3 financial rails or the internet of value, the top shifts for this week include:

  1. There are up to 1.86 billion financial transactions per day so it’s not lost on us that Bitcoin is still a nascent financial rail – nonetheless 1 billion is a significant milestone – Bitcoin surpasses one billion transactions processed, eight hundred weeks after launch, click here to read the full article.
  2. The data in this report shows that the scaling up of real world asset tokenisation is gaining momentum – with Blackrock leading the way – the unspoken revolution here is that treasuries can now be bought and sold at record times. This narrative will gain momentum – BlackRock, Ondo, Superstate: The biggest movers in the RWA sector in Q1, click here to read the full report.

Our Top “alts shifts” for this week, featuring shifts in our altcoin universe that drive our thematic approach, saw the second gap, or the broader digital asset market, remain flat at circa 42%. I want to reiterate that this is a big opportunity, as mentioned we see this as a selective opportunity to identify and grow our alternatives portfolio via our “alThematics” work. The gaps themselves are proving to be a risk on, risk off proxy and hugely high Beta – volatility is a certainty and an opportunity – the building is happening no matter what.

  1. This project will be a game changer. Why? Message me. Synthetix founder Kain Warwick targets mid-May launch for Infinex, click here to read the full article.

What are our favourite thematics for 2024? We continue to like any infrastructure plays of the shift from Web2 to Web3 financial rails and any plays in the real-world asset tokenisation infrastructure, data validation and decentralised storage, as well as scale-up technologies such as ZKrollups. We are closely following all the ”de’s” – DeFi, DePin, DeSoc – (want to know what that means? – message us).

Lisa Wade, CEO DigitalX

 

CRYPTO TOP 20 7 DAY PRICE CHANGE

*All figures throughout are in USD unless otherwise specified

 

Market Updates

The Shift List

Macro and Regulatory Environment

About DigitalX

DigitalX Ltd (ASX:DCC) is a leading ASX-Listed Bitcoin and digital asset funds management business. The Company has a 9 year track record mining Bitcoin, blockchain and smart contract development. DigitalX Asset Management is the investment manager of digital asset investment products that provide qualified investors with highly secure and streamlined access to digital asset exposure. To learn more contact the team at [email protected] or visit our website https://digitalx.fund/.

Disclaimer:

DigitalX Asset Management Pty Ltd is a corporate authorised representative (CAR) of Boutique Capital Pty Ltd (AFSL 508011), and True Oak Investments Ltd (AFSL 238184). To the extent to which this document contains advice it is general advice only and has been prepared by the CAR for individuals identified as wholesale investors for the purposes of providing a financial product or financial service. The information herein is presented in summary form and is therefore subject to qualification and further explanation. The information in this document is not intended to be relied upon as advice to investors or potential investors and has been prepared without taking into account personal investment objectives, financial circumstances or particular needs. Recipients of this document are advised to consult their own professional advisers about legal, tax, financial or other matters relevant to the suitability of this information. Past performance is not indicative of future performance.

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