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🚀 Coinhako Commentary/Colour - 19 Sep 24 The Fed finally commenced its 50bps rate cut, marking the first such move since the onset of the COVID-19 pandemic. This decision, which aligns with market expectations in response to moderating inflation and a weakening labour market. The Fed aims to balance the risks between employment (or growth) and inflationary pressures as they seek to still bring inflation closer to its 2% target without significantly raising unemployment with tight monetary policy. The "dot plot" suggests more rate cuts to come by the end of the year, though Fed Chair Powell did not commit to indicating further series of 50bps rate cuts. Bank of England (BOE) will have their rate decision tonight while the Bank Of Japan (BOJ) will have theirs' tomorrow. The rate cuts signalled the Fed's intention to support growth in the mid-term and boost market sentiment as the market has perceived that the economy is still moderately strong. The Fed Put is still well and alive but at what price? Risk assets rallied upon Asian open. Deribit Implied Volatility Index (DVOL) for BTC and ETH decreased to 52.23% and 61.22%, respectively. The 30-day 25-delta skew (C-P) for BTC and ETH increased to 0.26 and -0.91, respectively. Bitcoin's 7-day and 30-day IV witnessed a sudden sharp decline before surging to 52.96% and 50.63% as hedges unwind after the FOMC rate announcement and press conference and expect more volatility post-rate cuts. BTC’s 7-day and 30-day call-put skews transitioned to positive levels of 0.72 and 0.26, respectively, signalling potential reversal in price declines into a sustainable rebound into October. 👉 Follow Coinhako Institutional Twitter for more commentary! https://x.com/Coinhako_insti

🚀 Coinhako Commentary/Colour - 16 Sep 24 🏦 ECB cut rates further last week and the Fed continues to be behind the cycle. Last Friday, equities and crypto closed higher, recovering from an early-September selloff, as investors are now pricing in 50% of a 50bps rate cut this week (18th Sep FOMC). There is some evidence that shorts on the S&P500 have been covering over this period. Chinese economic data and global commodities prices continue to disappoint, potentially sparking concerns of a global deflationary slowdown. US tax collections will be flowing into the Treasury General Account this week as funding liquidity will be drained from the financial markets. The US corporate blackout period have started from 13th Sep as market liquidity (top-of-the-book depth) have suffered and declined. Any market moves over this period could be on 'shaky ground'. As this month will be the last fiscal month for the US government, the SEC have been rather active in cleaning up some crypto cases recently eg eToro fined for offering crypto-securities. There would be an open meeting between the US House and the SEC over their oversight across crypto and DeFi on the 18th Sep. Since it is the new fiscal year 2025 is starting on 1st October 2024, there are some tussle between the Democrats and Republicans on implementing future new fiscal packages and this will dictate economic growth of the US economy in the coming quarters. The debate between Trump and Harris were rather disappointing last week as crypto was not mentioned and Harris had the "home-ground" on ABC News. Harris odds of winning the election have jumped after the debate and faded after another botched assassination attempt on Trump this morning. This week will be an important one as the Fed is about to commence its first rate cut, be it 25bps or 50bps and whether the Fed will stop its Quantitative Tightening policy. 🐻 ETFs continued to have outflows last week but there are some inflows on Friday. Onchain data still indicating negative crypto sentiment as whale interest in crypto waned. However, the reclaim of 60k over the weekend was fueled by mid-term accumulation from large holders, along with decreasing inventories of BTC on exchanges. Bitcoin's 7-day IV exhibited a noticeable upward trend, indicating a sharp increase in short-term market uncertainty to levels of 56%. The 30-day IV also shows a slight increase but not as pronounced as the 7-day maturity. Traders are expecting short-term volatility this week with the FOMC event. BTC’s 7-day and 30-day call-put skews show signs of persistent bearish sentiment, remaining negative at -3.37 and -1.76, respectively. The sharper decline in 7-day call-put skews indicates that the market is pricing in potential downside risks more aggressively in the short term than in the medium term while maintaining a bearish view of the overall market. The 30-day 25-delta skew (C-P) for ETH remained negative at -2.13, citing bearish sentiment. Altcoins in general underperforming BTC as ETHBTC have hit new lows. SOL have underperformed as a FTX-related entity just unstaked a tranche of SOL from the validators last week. ⚡️ Events this week: 17th Sep - Retail Sales US 18th Sep - FOMC Rate Decision 18th Sep - US House Hearing with SEC Oversight 19th Sep - Unemployment Claims US Entire Week - Token2049 Singapore 🗓 Have a great week ahead! Check us out for Token2049! 👉 Follow Coinhako Institutional Twitter for more commentary! https://x.com/Coinhako_insti

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🚀 Coinhako Commentary/Colour - 9 Sep 24 (2) 🏦 The tax filing and payment season will began this week as the bearish overhang on risk assets continue. We might still see a counter-rally this week to the upside before continuing its bearish trend towards and after mid-September. Looking beyond this month, we might see a rebound in October and a choppy Nov/Dec. The reason being that US Treasury Yellen estimates to continue higher net T-Bill issuance in October after pausing in Sept and the BTFP loans from the Federal Reserve that were originated last year Nov-Dec will began to expire 1 year after. Until we see sizeable uptick in public debt issuance, return of the lending programs from global central banks (esp US and China) and uptick in fiscal stimulus and deficit spending from US and China, liquidity will remain sluggish and that will not be positive for crypto. The case for aggressive rate cuts, return of QE, ramping up higher net T-Bill issuance and increased deficit spending requires lower asset prices. Commodities such as base metals (copper) and long-dated US government bonds are pricing in a growth slowdown whereas corporate bonds, high-yield credit, large caps and small caps US equities are pricing in a goldilocks soft landing. It could be expected that the US monetary authorities will ramp up mentions of other easing programs leading up to Q1'25 eg QE and other Fed lending programs. ⚡️ Events this week: 9/9 - 9.9 Retail Sales For Asian ECommerce 10/9 - iPhone 16 launch (Apple & AI integration) 10/9 - Trump vs Harris debate on ABC 10/9 - 1st hearing on DeFi by the US House (SEC testify) 10/9 - US Tax Filing and Payments began to stream in 11/9 - US CPI 12/9 - ECB Interest Rate Decision 12/9 - US Jobless Claims, US PPI 12/9 - SEC vs Binance, crypto as 3rd party securities 🇨🇳 The 9/9 sales and iPhone 16 launch will signal strength of the US and Asian consumer, especially in China. Political debate between Presidential Candidates at 9pm Eastern Time tomorrow. Kamala Harris has updated her web platform for her campaign 2024 and still there is no mention of any crypto-focused policies. Leading up to this debate, mentions about crypto have appeared less and less on mainstream media. Trump's odds of winning this election have inched up closer to Harris's on Predictit while it is not expected for any candidate to have a landslide victory. Election predictions by statisticians: Nate Silver have updated his odds in favour of Trump while Allan Lichtman continues to champion Harris. A few hearings this week and this month with the US House, SEC and various industry players on DeFi, SEC oversight on crypto and the motion that Binance have listed securities (reference to crypto-tokens). US CPI might not be that important as the market have shift its focus on each job data to price in the pace of easing. 🗓 Have a great week ahead! 👉 Follow Coinhako Institutional Twitter for more commentary!

🚀 Coinhako Commentary/Colour - 9 Sep 24 🔧 US non-farm payrolls reported for Aug came in lower than expected on Friday at 142k (est 162k) jobs added. Wage growth of 0.4% m-o-m, supporting consumer spending. Market's initial reaction was that the dollar sold off and risk assets rallied but it reversed within 1h of trading as market began to price out 50bps rate cut in Sep FOMC. Pre-NFP release, the market was pricing in 55-60% odds of a 50bps rate cut for Sep FOMC. By the close and Monday's open, market is pricing in a 25% odds of a 50bps rate cut for Sep FOMC. There is a belief that such pricing is overdone as parts of the market believe that a 25bps rate cut is appropriate. If the Fed continues their gradual rate-cutting cycle with 25bps each meeting, the US dollar and bond yields could face a short-term rebound into October. Comments from Williams and Waller seems supportive for a 25bps rate cut and will look to further deterioration in ecodata for consideration. With the reversal in 50bps rate cut pricing, risk assets and major equity indices tumbled as dollar rebounded. However, the new index-cap rules will be kicking in this month as passive funds will have to rebalance out of the heavily-weighted mega-cap tech sector. Sectors in the S&P500 like consumer staples, utilities and real estate were holding stronger towards the close. 💰 Bitcoin spot ETFs had a net outflow of $706 million last week, and none of the 12 Bitcoin spot ETFs had a net inflow last week. Grayscale ETF GBTC had a weekly net outflow of $160 million, and Fidelity ETF FBTC had a weekly net outflow of $404 million. Last week, the Ethereum spot ETF had a net outflow of US$91.04M. Grayscale ETF ETHE had a net outflow of US$111M. Jim Bianco launched a thread/article citing that the ETFs are not an adoption vehicle for tradfi/boomers and instead, it's a small tourist tool from self-directed online brokerage accounts. Blackrock confirms that 80% of IBIT inflows are from these accounts. CryptoQuant analysis suggests that most spot BTC ETF inflows were from onchain holders moving back to tradfi accounts, so very little "new" money has entered the crypto space. Average trade sizes is now under $12K, the lowest average trade size since March as average trade sizes for SPY & QQQ at $100-150K. About 9% of the ETF holders are from the investment advisors, 12% are with the hedge funds (mostly basis trades) and that makes 85% of the holdings are not held by tradfi institutions. Spot BTC ETF holders are sitting on a record $2.2B unrealised loss or 16% underwater. However, the case can be made that the investment advisors are updating their mandates to market these ETFs. It is still a sign that crypto-majors like BTC and ETH are still tied to macro correlations as a liquidity release valve for the excessive liquidity from public debt issuance and private credit creation.

🏦 The tax filing and payment season will began this week as the bearish overhang on risk assets continue. We might still see a counter-rally this week to the upside before continuing its bearish trend towards and after mid-September. Looking beyond this month, we might see a rebound in October and a choppy Nov/Dec. The reason being that US Treasury Yellen estimates to continue higher net T-Bill issuance in October after pausing in Sept and the BTFP loans from the Federal Reserve that were originated last year Nov-Dec will began to expire 1 year after. Until we see sizeable uptick in public debt issuance, return of the lending programs from global central banks (esp US and China) and uptick in fiscal stimulus and deficit spending from US and China, liquidity will remain sluggish and that will not be positive for crypto. The case for aggressive rate cuts, return of QE, ramping up higher net T-Bill issuance and increased deficit spending requires lower asset prices. Commodities such as base metals (copper) and long-dated US government bonds are pricing in a growth slowdown whereas corporate bonds, high-yield credit, large caps and small caps US equities are pricing in a goldilocks soft landing. It could be expected that the US monetary authorities will ramp up mentions of other easing programs leading up to Q1'25 eg QE and other Fed lending programs. ⚡️ Events this week: 9/9 - 9.9 Retail Sales For Asian ECommerce 10/9 - iPhone 16 launch (Apple & AI integration) 10/9 - Trump vs Harris debate on ABC 10/9 - 1st hearing on DeFi by the US House (SEC testify) 10/9 - US Tax Filing and Payments began to stream in 11/9 - US CPI 12/9 - ECB Interest Rate Decision 12/9 - US Jobless Claims, US PPI 12/9 - SEC vs Binance, crypto as 3rd party securities 🇨🇳 The 9/9 sales and iPhone 16 launch will signal strength of the US and Asian consumer, especially in China. Political debate between Presidential Candidates at 9pm Eastern Time tomorrow. Kamala Harris has updated her web platform for her campaign 2024 and still there is no mention of any crypto-focused policies. Leading up to this debate, mentions about crypto have appeared less and less on mainstream media. Trump's odds of winning this election have inched up closer to Harris's on Predictit while it is not expected for any candidate to have a landslide victory. Election predictions by statisticians: Nate Silver have updated his odds in favour of Trump while Allan Lichtman continues to champion Harris. A few hearings this week and this month with the US House, SEC and various industry players on DeFi, SEC oversight on crypto and the motion that Binance have listed securities (reference to crypto-tokens). US CPI might not be that important as the market have shift its focus on each job data to price in the pace of easing. 🗓 Have a great week ahead! 👉 Follow Coinhako Institutional Twitter for more commentary! https://x.com/Coinhako_insti

🚀 Coinhako Commentary/Colour - 6 Sep 24 (1) 🔧 Bank of Canada cut its benchmark rate on Wednesday evening from 4.50% to 4.25%. This might be a signal that the Fed is still lagging behind its peers. US JOLTS job openings printed their lowest level since January 2021, while layoffs rose to its highest since March 2023. The market reacted by pricing in a 50% chance of a 50bps rate cut in Sep and a total of 4.5 cuts for 2024. US ISM Services Index for August came in at 51.5 vs 51.4 previous, signalling an expansion in the services sector, accounting for over 90% of the US economy. Employment activity in the services sector indicated growth in August for the 2nd consecutive month and for the 3rd time in 2024. US ADP employment showed a 99k increase in job openings vs 145k in forecasts, signalling a potential slowdown in growth. Tonight, the NFP jobs data and unemployment rate will be out for the month of August. Historically, August data usually paints a weaker job market than normal, which might reprice bigger rate cuts in 2024 and higher odds of 50bps rate cut in Sep'24 FOMC. This may cause the dollar to continue to slide as USDSGD breaches 1.30 handle to the downside. However, there are some signs that the weaker job market may be temporary with seasonal distortions to the labour market. If tonight's NFP jobs data surprise to the upside, rate cuts expectations will be repriced as market expects a 25bps rate cut in Sep'24 FOMC and a gradual rate cutting cycle in Q4'24 and in H1'25. Currently, market is pricing in 50/50 for rate cuts of 25bps and 50bps for Sep'24 FOMC. 💰 Last night, Bitcoin spot ETFs saw a $211M net outflow on Sept 5, marking 7 consecutive days of outflows. Grayscale ETF GBTC had an outflow of $23.2175 million. Fidelity FBTC had an outflow of up to $149 million. Bitwise BITB had an outflow of $30 million. While, Ethereum spot ETFs had a smaller net outflow of $152.7K. Grayscale ETF ETHE had a net outflow of $7.3895 million on a single day, and Grayscale mini ETF ETH had a net inflow of $7.2368 million on a single day. Overall, 2024 flows into the BTC ETFs are impressive but are the ETF holders offside right now? Since the ETFs' introduction, the average 5% market depth for ETH pairs on U.S.-based centralized exchanges has declined by 20% to roughly $14 million. On offshore centralized venues, it's dropped by 19% to around $10 million. It's actually now easier to move the spot price by 5% in either direction, a sign of reduced liquidity and increased sensitivity to large orders. Coinbase appstore ranking decreased and is currently sitting outside of the top 500 rankings. This shows that retail sentiment for crypto is close to its all-time lows once again. Deribit Implied Volatility Index (DVOL) for BTC and ETH remained relatively flat at 56.85% and 67.33% respectively. The 30-day 25-delta skew (C-P) for BTC and ETH dropped again to -2.50 and -3.61, respectively. BTC's short-term structure have flipped into backwardation with higher implied volatility in the short term for contracts up to 21 days (3-weeks). ETH term structure largely remained in contango. BTC skew has continued to decline, with both the 7-day and 30-day C-P skew approaching monthly lows. This reflects an increasingly bearish sentiment in the market. While puts and downside hedges are expensive now as observed on the BTC skew (50-55k strikes), there is a case for calls to be cheap (especially on the longer dates).

🚀 Coinhako Commentary/Colour - 6 Sep 24 (2) 😭 While there might be a short-term rally tonight as we head into next week's Q3 tax filing season (10-18th September) in the US, the market remains bearish and expects USD cash liquidity to be drained from the market. Historically, Q3 tax season may see 500bn of USD cash liquidity flow into the US Treasury General Account over the next 2 weeks. However, it is expected to only increase the TGA by a net of 100-150bn to July's Q3 QRA estimates of 850bn (from 700bn+ currently). Additionally, 18th Sept will be a huge event for the markets regarding 1) Sept FOMC on Jpow's rate decision, 2) Beginning of Quad witching & VIX expiration, 3) Trump's prison sentencing. Over the course of September, the Fed will roll off 25bn of US Treasuries (mid-Sep, end-Sep) and 35bn of Mortgage-backed securities from its balance sheet as part of its Quantitative Tightening program while it can be expected that they may stop this entirely in 2025 with the rate cuts. US Treasury have scheduled around 30bn+ of US Treasury securities buyback, using proceeds from the tax collections in Sep to smooth out the market volatility expected from QT and Q3 tax season. The US Treasury have began to issue less T-Bills starting next week into mid-Sept and this may cause further deterioration in funding/refinancing liquidity. As Q3 draws to an end, corporations and financial institutions begin their quarterly window dressing and asset rebalancing. Around the 23rd-24th September towards month-end, cash balances and liquid assets on balance sheets will began rise as a result of this phenomenon. This may cause further cash liquidity drain from the financial markets around the size of 250-300bn. Furthermore, even though China have been signalling that they want to promote growth and stability in their economy, they continued to drain net 1.19trillion yuan from the open market this week ahead of its domestic tax filing and payment deadline on 18th September. 🏝 TGIF! Have a great weekend! 👉 Follow Coinhako Institutional Twitter for more commentary! https://x.com/Coinhako_insti