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digital asset
July 05, 2024
8 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

After the price of Bitcoin increased to roughly US$64,000 at the midpoint of the week, it has continued to struggle holding above the US$60,000 mark. The current instability in the price of Bitcoin can be largely attributed to the looming mass selling pressures from distributions executed by the defunct crypto exchange Mt. Gox. As stated by QCP Capital, “the overhang of 140,000 BTC will continue to weigh on markets, especially since the exact release schedule is unknown right now”. This may have been a significant contributor to the US$13 million in net outflows from the US-based spot Bitcoin ETFs on Tuesday, ending the recent five-day inflow streak.

Despite the weak digital asset market performance, Bitcoin miners continue to raise funds and expand their presence in global markets. Iris Energy, an Australian-based Bitcoin mining firm, has recently raised about US$413 million through stock offerings to fund expansion. In addition, German Bitcoin miner and cloud computing firm Northern Data AG – Europe’s largest Bitcoin miner by market cap – is seeking an IPO in the United States valued at up to US$16 billion. This response from miners comes in an attempt to expand revenue and mining capacity in order to offset April’s Bitcoin halving, which reduced mining rewards by 50%.

In a recent report released by Standard Chartered, they have forecasted the tokenisation market to reach US$30.1 trillion within 10 years, with trade finance estimated to make up one-sixth of that figure. Evident by many recent partnerships, such as Rakkar combining their digital asset custody expertise with DigiFT’s tokenised RWA exchange – including US T-Bills, bank bonds and money market funds – to advance regulated real-world assets in digital finance. Further, Raze Finance looks to utilise Texture Capital’s SEC-registered Alternative Trading System (ATS) to facilitate the trading of tokenised securities within the United States.  

CEO Comment

The Gap between Bitcoin and the S&P 500 is at 20%, dropping from last week’s 22%. This is surprising given the negative market action – we expect this figure to fluctuate over the coming month as the latest supply surprise is absorbed by the market. 

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. This comment from Vitalik Buterin on faster ETH speeds is great to see. Anything that speeds up transaction times is a blessing – mind you we already transact in minutes what can take up to days in the “real world” with the goal of it one day being seconds.
  2. Tax can be boring, but yet so important for our nascent industry, so this move by the US Treasury will be an enabler.

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, drop to circa 44%. 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 shift to close the gap can happen very quickly and will correlate to the next up move in BTC – the building is happening no matter what.

  1. It can’t be understated how important on-chain NAV’s are for transforming fund administration. This is something DigitalX has been pioneering in the background, so good to see the big end of town joining the shift – Fidelity, Sygnum partner with Chainlink to bring NAV data on-chain. 

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

Tinkering with Tokenisation

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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