Last week, cryptoassets rebounded from oversold levels amid
bearish sentiment and lopsided positioning
Our in-house "Cryptoasset Sentiment Indicator" has rebounded sharply from its lows and signals a positive sentiment
A factor that contributed to this reversal in prices was the fact that crypto markets increasingly traded on US presential election odds as pro-crypto candidate Trump seems to have fared better than
Biden during the latest public
Chart of the Week
Increasing odss for a Trump win have supported the recovery in Bitcoin & Cryptoassets recently
Source: Bloomberg, ETC Group
Performance
Last week, cryptoassets rebounded from oversold levels amid bearish sentiment and lopsided
positioning. Many indicators had indicated that downside risks are relatively limited and that the
short-term risk/reward had shifted to the upside as described here.
One of the factors that contributed to this reversal in prices was the fact that crypto markets
increasingly traded on US presidential election odds, as pro-crypto candidate Trump seems to have fared
better than Biden during the latest public debate (Chart-of-the-Week).
Trump has made many positive statements towards cryptoassets over the past few weeks,
including an endorsement for domestic Bitcoin mining in the US.
Major players in the industry have recently joined forces behind Trump’s
campaign with major donations from both the Winklevoss twins who operate the crypto exchange Gemini as well
as Kraken’s founder Jesse Powell.
Apart from these political developments in the US, the industry is watching a
potential spot Ethereum ETF trading launch in the US that was anticipated to take place as early as this
week.
Bloomberg analysts had previously expected US spot Ethereum ETFs to debut
in early July already but recent actions by the SEC suggest that a trading launch
could come later
than this week, possibly next week or by the end of summer.
Despite the expectation that net flows into Ethereum ETFs won’t be as big as the initial
Bitcoin ETF flows, we still expect these flows to have a comparatively large price impact on Ethereum as
outlined here.
Besides, several issuers have filed for a Solana ETF in the US which pays into the topic that
regulatory sentiment towards cryptoassets continues to shift towards a pro-crypto stance. It also signals
that Solana is cementing its ranking as the 3rd most
important cryptoasset next to Ethereum and Bitcoin.
Cross Asset Performance (Week-to-Date)
Source: Bloomberg, Coinmarketcap; performances in USD exept Bund Future
Top 10 Cryptoasset Performance (Week-to-Date)
Source: Coinmarketcap
In general, among the top 10 crypto assets, Avalanche, Solana, and TRON were the
relative outperformers.
Overall, altcoin outperformance vis-à-vis Bitcoin has significantly increased
compared to the prior week, with 95% of our tracked altcoins managing to outperform Bitcoin on a weekly
basis. This is potentially signalling a significant come-back in risk appetite as well.
Sentiment
Our in-house “Cryptoasset Sentiment Index” has
rebounded sharply from its lows and signals a positive sentiment again.
At the moment, 7 out of 15 indicators are above their short-term trend.
Last week, there were significant reversals to the upside in BTC long futures
liquidation dominance and the altseason index.
The Crypto Fear & Greed Index has also rebounded from “Fear” levels
at the beginning of last week and now signals "Neutral" sentiment as of this morning.
Performance dispersion among cryptoassets continued to increase sharply. This means
that altcoins are increasingly becoming uncorrelated with the performance of Bitcoin.
Altcoin outperformance vis-à-vis Bitcoin has significantly increased compared
to the week prior, with around 95% of our tracked altcoins outperforming Bitcoin on a weekly basis, which is
consistent with the fact that Ethereum also outperformed Bitcoin last week.
In general, increasing (decreasing) altcoin outperformance tends to be a sign of
increasing (decreasing) risk appetite within cryptoasset markets and the latest altcoin underperformance
could signal declining appetite for risk at the moment.
Sentiment in traditional financial markets rebounded from its multi-year lows along
with a rebound in market-based global growth expectations, judging by our own measure of Cross Asset Risk
Appetite (CARA).
Fund Flows
Despite the weak price action, fund flows into global crypto ETPs continued to be
positive last week. Global crypto ETPs saw around +38.2 mn USD in net inflows across all types of
cryptoassets.
Global Bitcoin ETPs saw net inflows of +50.9 mn USD
last week, despite -37.1 mn USD in net outflows from US spot Bitcoin ETFs. However, most vehicles saw a
resumption in inflows towards the end of the week. An interesting observation is the fact that the 2x
Bitcoin Strategy ETF (BITX) saw the 2nd highest net
inflow among all Bitcoin ETPs worldwide with +70.1 mn USD which signals a significant return in risk
appetite.
Meanwhile, outflows from Hong Kong Bitcoin ETFs accelerated with -204.3 mn
USD.
The Grayscale Bitcoin Trust (GBTC) continued to see net outflows, with around -159.0
mn USD in net outflows last week.
Meanwhile, net outflows from global Ethereum ETPs decelerated
last week compared to the week prior but stayed negative with net outflows
totalling -40.1 mn USD. Interestingly, Hong Kong Ethereum ETFs neither recorded in- nor outflows last week
(+/- 0 mn USD).
In contrast, altcoin ETPs ex Ethereum continued to attract
capital of around +10.7 mn USD last week.
The same is true for Thematic & basket crypto
ETPs which also continued to see positive net inflows of +16.6 mn USD, based on our
calculations. The ETC
Group MSCI Digital Assets Select 20 ETP (DA20) saw neither in- nor
outflows last week.
Meanwhile, global crypto hedge funds have started to increase their market exposure again. The
20-days rolling beta of global crypto hedge funds’ performance increased from a low of 0.47 on the
24/06 to around 0.57 per yesterday’s close.
On-Chain Data
Bitcoin on-chain data also implied some type of capitulation last week which made a
short-term stabilization more likely.
For instance, the Bitcoin short-term holder spent output profit ratio (STH-SOPR)
declined to 0.96 on Monday last week meaning that spent coins that were previously held less than 155 days
were spent at an average -4% loss.
In fact, realized losses by short-term holders spiked to 345 mn USD – the highest since
1st of May - when bitcoin also touched ~58k USD.
In other words, short-term holders literally capitulated and exited the market with
significant losses. In this context, it is important to note that most of these losses were realized by
larger investors, especially those that control more than 100 BTC. Approximately 75% of realized losses came
from this larger investor cohort.
In addition, we have seen increasing profit-taking by longer term investors as well,
which appears to be related to the recent bitcoin liquidations by both US and German entities.
Based on information provided by Arkham Intelligence, as of this writing, the German
government still holds 46k BTC and has only traded out -4k BTC since it began issuing coins on June 19,
2024.
However, the German government seems to be very aware of the impact it has on prices
and is currently distributing coins in an orderly manner through a number of exchanges and market makers,
including Coinbase, Kraken, Bitstamp, and Flow Traders. As a result, we shouldn't anticipate significant
drawdowns from this specific distribution.
The Mt Gox trustee has not been distributing bitcoins over the last few weeks,
despite certain false market speculations. According to data provided by Arkham, the trustee now holds about
142k BTC spread over several wallets.
But more recently, the US government began to distribute coins, which also had an
impact on market pricing. The US government sold approximately 3940 Bitcoin in June, bringing its total
holdings to 214k Bitcoin. With authority over 1.01% of the overall supply of Bitcoin, the US government
remains the largest government holder in the world. It is followed by the Chinese government, which has 190k
Bitcoin (~0.90% of the total supply).
Over the next few weeks, the market may continue to see selling pressure from US and
German government agencies which could exert some downward pressure on prices.
We have also seen negative net outflows from global crypto ETPs in general and US
spot Bitcoin ETFs in particular as described above which also contributed to selling pressure on exchanges.
All in all, these forces have led to around -751 mn USD in net selling volumes on
Bitcoin spot exchanges over the past 7 days.
This was exacerbated by the fact that whales (entities that control more than 1,000
BTC) sent the most bitcoins to exchanges year-to-date. Approximately 22.7k BTC net were transferred to
exchanges by whales last week.
The good news is that negative selling volumes on exchanges have gradually subsided since the
low on the 24th of June which implies some level of
“seller’s exhaustion”.
A short-term risk remains the continued distribution by BTC miners amid ongoing
“miner capitulation”. However, we are already observing that BTC miners have decreased their
selling volumes more recently compared to the level of selling in mid-June. Over the past 30 days, BTC
miners have sold around 105% of mined supply which is around 13.7k BTC.
Futures, Options & Perpetuals
Last week, BTC futures open interest declined amid increased long liquidations. The
decline in BTC futures open interest was particularly pronounced on CME where open interest declined by
around -23k BTC. In contrast, BTC perpetual futures traders managed to increase their exposure by around
+10k BTC.
Perpetual funding rates turned negative at the beginning of last week which tends to
be a sign of a local bottom as it incentivizes longs vis-à-vis shorts. When the funding rate is
negative, short positions periodically pay long positions. The 3-months annualized BTC futures basis rate
also rebounded from its lows to around 11.6% p.a.
BTC options signalled a significant increase in risk aversion last week. For
instance, the 25-delta 1-month option skew increased to the highest since mid-May as traded put-call volume
ratios increased to the highest since end of May amid the latest market rout.
BTC option implied volatilities also increased during the sell-off early last week
but continued their downward trend thereafter. Implied volatilities of 1-month ATM Bitcoin options are
currently at around 43.3% p.a.
Meanwhile, Bitcoin options’ open interest decreased significantly amid the
quarterly expiration of options.
Bottom Line
Last week, cryptoassets rebounded from oversold levels amid
bearish sentiment and lopsided positioning
Our in-house "Cryptoasset Sentiment Indicator" has rebounded sharply from its lows and signals a positive sentiment
A factor that contributed to this reversal in prices was the fact that crypto markets increasingly traded on US presential election odds as pro-crypto candidate Trump seems to have fared better than
Biden during the latest public
Appendix
Bitcoin Price vs Cryptoasset Sentiment Index
Source: Bloomberg, Coinmarketcap, Glassnode, NilssonHedge, alternative.me, ETC Group
Cryptoasset Sentiment Index
Source: Bloomberg, Coinmarketcap, Glassnode, NilssonHedge, alternative.me, ETC Group; *multiplied by (-1)
Cryptoasset Sentiment Index
Source: Bloomberg, Coinmarketcap, Glassnode, NilssonHedge, alternative.me, ETC Group
TradFi Sentiment Indicators
Source: Bloomberg, NilssonHedge, ETC Group
Crypto Sentiment Indicators
Source: Coinmarketcap, alternative.me, ETC Group
Crypto Options' Sentiment Indicators
Source: Glassnode, ETC Group
Crypto Futures & Perpetuals' Sentiment Indicators
Source: Glassnode, ETC Group; *Cumulative daily absolute change in BTC OI multiplied by sign of BTC price change
Crypto On-Chain Indicators
Source: Glassnode, ETC Group
Bitcoin vs Crypto Fear & Greed Index
Source: alternative.me, Coinmarketcap, ETC Group
Bitcoin vs Global Crypto ETP Fund Flows
Source: Bloomberg, ETC Group; Only ETPs & Grayscale Trusts
Global Crypto ETP Fund Flows
Source: Bloomberg, ETC Group; Only ETPs & Grayscale Trusts
US Spot Bitcoin ETF Fund Flows
Source: Bloomberg, ETC Group; data subject to change
US Spot Bitcoin ETFs: Flows since launch
Source: Bloomberg, Fund flows since traiding launch on 11/01/24; data subject to change
US Spot Bitcoin ETFs: 5-days flow
Source: Bloomber; data subject to change
US Bitcoin ETFs: Net Fund Flows since 11th Jan mn USD
Source: Bloomberg, ETC Group; data as of 28-06-2024
Bitcoin vs Crypto Hedge Fund Beta
Source: Coinmarketcap, Bloomberg, NilssonHedge, ETC Group
Altseason Index
Source: Coinmarketcap, ETC Group
Bitcoin vs Crypto Dispersion Index
Source: Coinmarketcap, ETC Group; Dispersion = (1 - Average Altcoin Correlation with Bitcoin)
BTC Net Exchange Volume by Size
Source: Glassnode, ETC Group
Important information:
This article does not constitute investment advice, nor does it constitute an offer or solicitation to buy financial products. This article is for general informational purposes only, and there is no explicit or implicit assurance or guarantee regarding the fairness, accuracy, completeness, or correctness of this article or the opinions contained therein. It is advised not to rely on the fairness, accuracy, completeness, or correctness of this article or the opinions contained therein. Please note that this article is neither investment advice nor an offer or solicitation to acquire financial products or cryptocurrencies.
Before investing in crypto ETPs, potentional investors should consider the following:
Potential investors should seek independent advice and consider relevant information contained in the base prospectus and the final terms for the ETPs, especially the risk factors mentioned therein. The invested capital is at risk, and losses up to the amount invested are possible. The product is subject to inherent counterparty risk with respect to the issuer of the ETPs and may incur losses up to a total loss if the issuer fails to fulfill its contractual obligations. The legal structure of ETPs is equivalent to that of a debt security. ETPs are treated like other securities.
About Bitwise
Bitwise is one of the world’s leading crypto specialist asset managers. Thousands of financial advisors, family offices, and institutional investors across the globe have partnered with us to understand and access the opportunities in crypto. Since 2017, Bitwise has established a track record of excellence managing a broad suite of index and active solutions across ETPs, separately managed accounts, private funds, and hedge fund strategies—spanning both the U.S. and Europe.
In Europe, for the past four years Bitwise (previously ETC Group) has developed an extensive and innovative suite of crypto ETPs, including Europe’s largest and most liquid bitcoin ETP.
This family of crypto ETPs is domiciled in Germany and approved by BaFin. We exclusively partner with reputable entities from the traditional financial industry, ensuring that 100% of the assets are securely stored offline (cold storage) through regulated custodians.
Our European products comprise a collection of carefully designed financial instruments that seamlessly integrate into any professional portfolio, providing comprehensive exposure to crypto as an asset class. Access is straightforward via major European stock exchanges, with primary listings on Xetra, the most liquid exchange for ETF trading in Europe.
Retail investors benefit from easy access through numerous DIY/online brokers, coupled with our robust and secure physical ETP structure, which includes a redemption feature.
Confirm your location and investor type to help us deliver the site experience most relevant to you:
Cookie Settings
We use cookies on our site to optimize our services.Learn more
We use cookies on our site to optimize our services.Learn more
Required cookies
These cookies are necessary to ensure the smooth functioning of this website (e.g. session cookies, cookie to store the selected cookie preferences, etc.). These required cookies can thereforce not be deactivated.
Optional cookies
Functional cookies are used to ensure the smooth functioning of all tools on the wesites. The entire and proper function of the webite is available to the user only with the use of functional cookies. The use of analysis cookies serves the ongoing quality improvement of this website and its content. By using them, wa aim to maximise user satisfaction.
Avis Important
Des produits tels que BTCE - Bitwise Physical Bitcoin ("BTCE") sont des Exchange Traded Commodities ("ETC"), instruments financiers considérés comme des titres de créances complexes par l'Autorité des Marchés Financiers présentant des risques difficilement compréhensibles par le grand public. A ce titre, leur distribution en France répond à des règles spécifiques. Il relève de la responsabilité des intermédiaires et investisseurs professionnels souhaitant offrir des ETCs à leurs clients de s'assurer que leur distribution auxdits clients est réalisée dans le respect de la réglementation française.
Terms of website use
Important Notice
Please read these terms carefully before using this website. By clicking on “Accept” and by accessing the website on an ongoing basis, you are deemed to have read, understood and accepted these Terms of Website Use.
The distribution of the information and material on this Website may be restricted by law in certain countries. None of the information is directed at, or is intended for distribution to, or use by, any person or entity in any jurisdiction (by virtue of nationality, place of residence, domicile or registered office) where publication, distribution or use of such information would be contrary to local law or regulation. By clicking on “Accept” and by accessing the website on an ongoing basis you attest that you are a professional investor or are otherwise allowed to access this website pursuant to all applicable laws.
You must not use or attempt to use any automated program (including, without limitation, any spider or other web crawler) to access our system or in relation to this Website.
We may change these Terms of Website Use from time to time. Any changes we may make will be posted on this website. By continuing to use and access this website following such changes, you agree to be bound by any changes we make. Please review this page frequently to see any updates or changes to these Terms.
If you are in the UK, US or Canada
Information available on this website is not, and under no circumstances is to be construed as, an advertisement or any other step in furtherance of a public offering in the United States, to, or for the account or benefit of, any U.S. Person or in Canada, or any state, province or territory thereof, where neither the Issuer nor its products are authorised or registered for distribution or sale and where no prospectus of the Issuer has been filed with any securities regulator. Neither this website nor information it contains should be accessed by a US person or legal entity or taken, transmitted or distributed (directly or indirectly) into the United States.
This document does not constitute an invitation or inducement to engage in investment activity. In the UK, this document is provided for information purposes and directed only at investment professionals (as defined under the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 as amended from time to time). It is not intended for use by, or directed at, retail customers or any person who does not have professional experience in matters relating to investment in cryptocurrencies and crypto-backed ETPs. Neither the Issuer nor its products are authorised or regulated by the UK Financial Conduct Authority.
No advice
Nothing on this website should be considered to be investment, legal, tax or any other advice nor is it to be relied on in making an investment decision. All investors should obtain independent investment advice and inform themselves as to applicable legal requirements, exchange control regulations and taxes in their jurisdiction.
The information on this website is provided for information purposes only. The fact that Bitwise has provided it does not constitute investment advice or a recommendation to buy or sell any particular product or to engage in any other related transaction. The products involve a high degree of risk and are not necessarily suitable for everyone. The products presented in this section of the website are intended for sale only to sophisticated investors who are able to understand and bear the risks involved. They may not be suitable for you.
In preparing the information in this section of the Website, Bitwise has not taken into account your individual investment objectives, financial situation or investment needs. Nothing in the website constitutes or is intended to constitute financial, legal, accounting or tax advice. Neither Bitwise or any affiliate will provide or purport to provide you with investment advice as a result of your use of this website. Accessing this website does not create any contract whereby Bitwise agrees or undertakes to provide you with any information or investment advice. The information on this website is provided solely on the basis that you will make your own investment decisions.
Limitation of Liability
Neither Bitwise nor any of its affiliates, directors, officers or employees shall be responsible or will be liable for any loss or damage including consequential or indirect damage or loss of profit, arising in any way from the use of, or inability to use, this website or any reliance placed on the information it contains. The website is provided on an "as is" basis. Whilst we take all reasonable care to ensure the information published on this website is up to date and as accurate as possible, Bitwise does not guarantee or warrant that this website, or any services or content on it, will always be accurate, available or provided uninterrupted. We may suspend, withdraw, discontinue or change all or any part of this website without notice. We do not guarantee that this website will be secure or free from bugs or viruses. You agree that your use of this website is at your own risk.
Certain documents made available on this Website may have been prepared and issued by persons other than Bitwise. Bitwise is not responsible in any way for the content of any such documents. The website may also contain hyperlinks to external websites that are not under the control of Bitwise. Bitwise does not approve or endorse the contents of such websites and does not control or take any responsibility for the content of any such websites.
Risk Warnings
Cryptocurrencies and products linked to cryptocurrencies are highly volatile.
You can lose some or all of your investment.
Risks of investing are numerous and include market, price, currency, liquidity, operational, legal and regulatory risks.
Exchange traded products do not offer a fixed income or match precisely the performance of the underlying cryptocurrency.
Investment in cryptocurrencies and products linked to cryptocurrencies are only suitable for experienced investors and you should seek independent advice and check with your broker prior to investing.
All investors should read the relevant base prospectus and final terms contained on this website before investing and, in particular, the section entitled ‘Risk Factors' for further details of risks associated with an investment.
General
The website is owned and operated by ETC Management Ltd, a company registered in England and Wales under number 12165332 with its registered office at Gridiron, One Pancras Square, London, England, N1C 4AG. You can contact us by email at europe@bitwiseinvestments.com.
References to “Bitwise”, “we”, “us” and “our” in these Terms of Website Use refer to ETC Management Ltd and our affiliates.
All content and the design of this Website are owned by Bitwise or our licensors and protected by copyright and other applicable laws. Any copying of the website or of its content requires the prior written consent of Bitwise.
Bitwise respects the privacy of users. Please see our Privacy Policy for information setting out how we handle personal information collected through the Website.
Important Notice:
The distribution of the information and material on this website may be restricted by law in certain countries. None of the information is directed at, or is intended for distribution to, or use by, any person or entity in any jurisdiction (by virtue of nationality, place of residence, domicile or registered office) where publication, distribution or use of such information would be contrary to local law or regulation.
The products displayed on this website are not available for subscription or purchase by retail investors in your selected jurisdiction. Please contact your broker or financial adviser for further information.
Important information:
The distribution of the information and material on this Website may be restricted by law in certain countries. None of the information is directed at, or is intended for distribution to, or use by, any person or entity in any jurisdiction (by virtue of nationality, place of residence, domicile or registered office) where publication, distribution or use of such information would be contrary to local law or regulation.
If you are a UK professional investor and want more information on the products, please visit www.hanetf.com. For professional investors only. Capital at risk.
You are about to access the Bitwise Asset Management website. Based on your location, clicking 'Continue' below will redirect you to the US-specific website.
You are about to access the Bitwise Asset Management website. Based on your location, clicking 'Continue' below will redirect you to the US-specific website.