Cryptos Rise As Multiple Catalysts Emerge

Cryptocurrencies surged close to 2 percent in the past 24 hours amidst a slew of catalysts that emerged to buoy crypto sphere. Euphoria surrounding SEC approval for an Ether Futures linked ETF product, Dollar weakness, indications of a decline in inflation in Europe, easing sovereign bond yields as well as an ideological support for decentralized cryptocurrencies amidst a potential U.S. govt shutdown contributed to bullish sentiment for the digital assets sector.

Asset manager Valkyrie, which launched the Bitcoin Strategy ETF (BTF) in October 2021 said it received SEC approval for adding Ether Futures to the Fund, allowing investors to assume exposure on both Bitcoin and Ethereum through a single investment vehicle.
The fund’s new strategy would be formally effective on Oct. 3. While the BTF ticker has been retained, the name of the Fund would be updated to Valkyrie Bitcoin and Ether Strategy ETF.

The SEC has however not greenlighted the applications for an ETF product linked to the spot prices of Bitcoin. Decisions delayed by SEC include those related to applications filed by asset management giant BlackRock as well as Invesco, 21Shares and Ark Investment Management.

The Ether-based ETF approval has come as a welcome relief for crypto markets which have been awaiting a meaningful catalyst. Bitcoin and other top cryptocurrencies had been languishing within a tight range even when Dollar, bond yields, gold and equity markets experienced wild swings.

The Dollar’s weakness and a close to half a percent plunge in the Dollar Index (DXY) – a measure of the Dollar’s relative strength – also supported the general risk appetite for cryptocurrencies. The DXY is currently at 105.75 versus 106.22 at the previous close and the recent peak of 106.84 touched on Wednesday.

The easing in sovereign bond yields across tenors and regions also supported the bullish sentiment towards cryptocurrencies. Yields on 30-year bonds in the U.S. declined 0.54 percent overnight. The decline in yields was 0.72 percent for ten-year bonds and 0.77 percent for 5-year bonds. The reduction in bond yields bodes well for cryptocurrencies as it reduces the opportunity cost of holding cryptocurrencies, which are essentially non-interest-bearing.

Ethereum gained close to 3 percent in the past 24 hours whereas Bitcoin added a little less than 2 percent. Only around 10 percent of the top 100 cryptocurrencies are trading in negative territory on an overnight basis. Overall crypto market capitalization jumped to $1.08 trillion, from $1.06 trillion a day earlier.

Bitcoin traded between $27,259.50 and $26,424.95 in the past 24 hours. BTC is currently trading at $26,979.88, having gained 1.8 percent on an overnight basis, 1.3 percent in the past week and 62 percent in 2023.

Ethereum touched a high of $1,687.28 in the past 24 hours. The highest-ranking alternate coin has been buoyed by the SEC approval for an ETF product and is currently trading at $1,669.39, having gained 2.7 percent overnight, 4.6 percent in the past week and 62 percent on a year-to-date basis.

Among the top 10 cryptocurrencies, Solana (SOL) and TRON (TRX) surged more than 4 percent overnight, followed by Cardano (ADA) and XRP (XRP) that added almost 2 percent. BNB (BNB), Dogecoin (DOGE), Toncoin (TON) and Polkadot (DOT) gained a little over 1 percent in the past 24 hours.

Only Toncoin (TON) is trading with losses on a weekly basis. BNB (BNB), Dogecoin (DOGE), Toncoin (TON) and Polkadot (DOT) continue to be loss-making in 2023.

Among the top 100 cryptocurrencies, 95th ranked Pepe (PEPE) gained 12.1 percent, followed by 81st ranked Sui (SUI) that rallied 11.9 percent. 82nd ranked Compound (COMP) gained 9.7 percent, followed by 90th ranked Gala (GALA) that added 8.2 percent overnight.

33rd ranked Maker (MKR), 84th ranked Terra Classic (LUNC) and 87th ranked GateToken (GT) are the only cryptocurrencies among the top 100 to trade with overnight losses of more than a percent. MKR plunged 4.2 percent followed by LUNC and GT that has dropped close to 2 percent.

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