Market Snapshot
Bitcoin (BTC) continues to stagnate, posting a small decline of 3.1% last week amid fresh outflows from exchange-traded investment products. The slippage helped pull down the total crypto market capitalization to as low as $2.13tn. Crypto's inertia contrasts with gains for stocks and gold in the past few weeks, though certain tokens are bucking the trend, leaving investors evaluating how to cherry-pick successful protocols. Some are also turning to tokenized versions of conventional assets as an alternative source of returns.
Macro Summary
On the macro front, the week will be influenced by inflation data releases, minutes from the Fed's last major committee meeting, a rate decision in China, the latest round of corporate earnings and ongoing developments in the Middle East.
Fed Chair Kevin Warsh has taken a tight-lipped approach to communication, but the publication of minutes from the last Federal Open Market Committee (FOMC) meeting may reveal more about its members' views on the ongoing inflationary period in the US. The Fed had decided to keep rates unchanged at 3.75% at that meeting.
Consumer price data updates from the euro area, Japan, the UK and Canada pack out the week. China's central bank is also due to announce an interest rate decision.
The corporate earnings season continues to shape investors' views of the health of the two largest economies with large US retailers such as Home Depot, Target, Walmart, as well as China's Alibaba reporting their Q2 results.
The geopolitical landscape will also continue to be shaped by events in the Middle East. Transit through the Strait of Hormuz slowed over the weekend, according to ship-tracking data from Kpler.
Recap
- The US Office of the Comptroller of the Currency (OCC) granted preliminary approval for a national trust bank tied to President Donald Trump's family, clearing the way for World Liberty Financial to directly issue and manage reserves for its roughly $4bn USD1 stablecoin. The move prompted concerns over the nature of the regulatory oversight given that the head of the OCC is a political appointee.
- The White House was reported to be preparing to host executives from crypto and prediction markets companies this week ahead of a meeting between the CFTC and industry representatives.
- The corporate earnings season continues to raise questions over appetite for building crypto portfolios. The new CEO of Twenty One Capital, which was created to accumulate Bitcoin, didn’t include buying the original cryptocurrency in a set of five top priorities mentioned in a shareholder letter. While treasuries that stockpile the major coins have endured accounting-led losses, Cypherpunk Technologies had a cheerier result from its favourite asset, Zcash (ZEC), after the privacy-focused token’s rally fueled a Q2 profit. Canton Strategic Holdings, a publicly traded digital asset treasury company built around the Canton Network, reported its first revenue from its token-hoarding strategy.
- Bullish, the exchange operator that’s acquiring transfer agent Equiniti, followed peers in reporting a Q2 loss and left its stock trading well below the price featured in the deal first announced in May. Trading platform operator eToro announced its third deal of the year after agreeing to buy US broker TradeZero for as much as $231mn.
- The Bank of Russia proposed to admit Bitcoin (BTC), Ether (ETH) and Tether's USDT stablecoin for public trading. These are the first three assets named since a crypto law signed by President Vladimir Putin on 4 Aug legalized retail trading.
- Hong Kong finally debuted its first regulated Hong Kong dollar stablecoin.
- US inflation rose in line with economist expectations in July, according to a Consumer Price Index (CPI) update last week but will keep the Fed under pressure as it holds above target. Investors are increasingly focused on what analysts have described as an unusually unclear communication style from the Fed's new chair.
Top Gainers
- H (Humanity) +79%
- ETHFI (ether.fi) +31%
- LINK (Chainlink) +14%
Top Losers
- UNI (Uniswap) -19%
- APT (Aptos) -12%
- PEPE (Pepe) -12%
Market Metrics
- Total Market Cap: $2.16tn (-2.3% vs last week)
- BTC Dominance: 58.4% (vs 58.9% last week)
- Fear and Greed Index: 36/100 (vs 39 last week)
- Alt Season Index: 47/100 (vs 37 last week)
ETF Flows
- BTC (Bitcoin): -$385.2mn (vs +$865.3mn previous week)
- ETH (Ether): -$3mn (vs +$234.7mn previous week)
Futures (CME)
- BTC (Bitcoin): $62,910 (-3.5%) (as at Friday close)
- ETH (Ether): $1,881 (-2.1%) (as at Friday close)
This week, we’ll be monitoring (all times UTC):
Monday 17 August
Economic data
23:50 (Sunday) Japan GDP: The fourth-largest economy publishes preliminary second-quarter GDP figures. GDP expanded at an annualized rate of 1.8% in the first quarter of this year, driven by public investment and exports. Economists polled by Reuters expect the Japanese economy to have expanded by 2% in Q2.
12:30 Canada inflation: Statistics Canada will provide CPI (Consumer Price Index) figures for July. Economists expect the annual rate to be 2.9%, up from 2.8% in June. The Bank of Canada held its target for the overnight rate at 2.25% in July, as economic growth is expected to pick up while inflation recedes from the recent spike.
Crypto event (conference)
The Wyoming Blockchain Symposium, organized by SALT, begins in Jackson Hole, running through 20 August in advance of the Fed's annual conference in the same resort. The institutional-focused event brings together digital-asset executives, investors and policymakers for discussions spanning market structure, regulation, stablecoins and the integration of crypto into traditional finance.
Notable US government figures expected to attend include SEC Chairman Paul Atkins, the head of the Office of the Comptroller of the Currency (OCC), senators Cynthia Lummis, Tim Scott and Ruben Gallego and Patrick Witt, Executive Director of the President's Council of Advisors for Digital Assets. as well as executives from Kraken, Galaxy, Bitgo, Securitize, Anchorage Digital, Customers Bank, Ripple and the CEO of the largest HYPE-focused treasury company.
Crypto event (token unlock)
- Aster (ASTER) Token Unlock: 164.7mn ASTER (~5.9% of circulating supply), worth roughly $99.13mn. The cliff-style release comprises 120.0mn ASTER from the treasury and 44.7mn from the airdrop allocation. At close to 6% of circulating supply, the unlock is sizeable, although the treasury-heavy composition should limit the amount immediately available for sale.
Tuesday 18 August
Economic data
06:00 UK ILO unemployment rate: the UK publishes employment statistics for June. Economists expect the unemployment rate to be 4.8%, down from 4.9% in May. For context, when the Bank of England kept the rates unchanged at 3.75% in July's meeting, Swati Dhingra, a member of the Monetary Policy Committee, noted that "the labour market continues to loosen with vacancies below pre-pandemic levels."
Wednesday 19 August
Economic data
06:00 UK CPI: The Office for National Statistics (ONS) is set to release July inflation data, following June's reading of 2.6%. Economists polled by Reuters expect inflation to be 2.9% in July. According to the Bank of England, "the conflict in the Middle East, and its impact on energy prices and the UK economy, [has] remained the dominant source of uncertainty for the inflation outlook."
09:00 Euro area HICP final: The euro area reports final inflation estimates for July, measuring price stability in line with the European Central Bank (ECB)’s mandate. Deviations from the ECB’s inflation target of 2% guide monetary policy decisions, including interest rate changes and liquidity measures. The flash reading of inflation in July was 2.9%, up from 2.8% in June. For context, the ECB decided to keep the main refinancing rate unchanged at 2.40% in the last meeting while noting that "uncertainty remains high and the full inflationary impact of the energy shock has yet to play out."
Central banks
18:00 Fed FOMC Minutes: the committee issues minutes from the 28-29 July policy meeting where US Fed policymakers decided to keep rates on hold in a target range of 3.50%-3.75%.
Thursday 20 August
Central banks
01:00 China loan prime rate: Beijing will report the new monthly LPR – the country’s benchmark lending rate – for July. China has left key lending rates unchanged for over a year.
23:30 Japan CPI: Japan publishes its key inflation indicator for July. Economists polled by Reuters expect core inflation, which excludes food, to be 1.8% in July, up from June's reading of 1.6%.
Crypto event (token unlock)
LayerZero (ZRO) Token Unlock: 25.7mn ZRO (~7.3% of circulating supply), worth roughly $20.12mn. The cliff-style release is concentrated among strategic partners and core contributors, alongside 1.7mn repurchased tokens. The investor and contributor-heavy composition makes the release a more direct source of potential short-term selling pressure.
- Kaito (KAITO) Token Unlock: 25.7mn KAITO (~10.6% of circulating supply), worth roughly $10.43mn. The release spans ecosystem growth, core contributors, creator incentives, early backers and the foundation. Despite its smaller dollar value, the unlock is large relative to KAITO’s circulating float and therefore represents meaningful potential supply pressure.
Friday 21 August
Crypto event (token unlock)
- GateChain (GT) Token Unlock: 4.2mn GT (~3.9% of circulating supply), worth roughly $27.82mn. The cliff-style release is split between research & development, the Community Development Foundation, and marketing & foundation expansion. With no investor or contributor allocation in the release, immediate sell-side pressure should be more limited than the headline unlock size alone suggests.
