Weekly Market Update: All Time Highs

Another week, another couple of All Time Highs for BTC this week. Volatility is creeping up too, and the early week price drop quickly flushed a lot of leverage out of the system. But then the money and the price returned. BTC is not alone, ETH had a milestone week too, breaking $4k for the first time since 2021. 

Despite all this, the retail Bitcoin holders have gone full diamond hands, with the number of Bitcoins unmoved in over a year holding flat.

BTC supply on exchanges is creeping up, but that is from market makers. As far as the market can tell, the only people selling are the miners who have been struggling the last few years, the retail wallets are hanging tough. 

In wider crypto news, the spot ETH EFT decision got delayed until at least May. Staying with Ethereum, the Dencun upgrade goes live tomorrow. Shapeshift settled with the SEC, but the opinion by the commissioner is a must read. Revolut has partnered with Metamask and Wormhold put out some details about its upcoming airdrop. There is a rumoured buyer for the FTX estate’s Solana too. 

In wider economic news, the February CPI data in the US came in slightly higher than estimated. After an initial sharp pullback, most markets kind of shrugged it off as a ‘no new news here’ kind of data point. And there are signs that the banking stress is still present. Global shipping rates continue to climb due to the Red Sea conflict.

In Europe, the ECB held rates steady but opened the door to rate cuts in June. Germany’s manufacturing sector continues to struggle and Sweden joined NATO. 

In Asia, China posted some good trade numbers and posted a positive CPI number for the first time in months. Japan had a good Q4 on the GDP front, while inflation crept up in the Philippines and Malaysia. 

Locally, Australian GDP was softer than expected. Households are struggling and their housing market is down. Finally in NZ heavy truck traffic is up indicating GDP is picking up, while a now familiar refrain, retail spending continues to be weak as household spending dries up. House price growth appears to be stalling too. 

The crypto market sentiment remains in extreme greed  this week, however we have moderated as the rate of price increases has slowed.

Highlights this week:

• We had another positive week for most assets in the top 30 by market cap, however the gains felt by most assets were more moderate.  There were some notable exceptions as euphoria rumbled through the alt coin market.
• Our buy – sell ratio has stabilised as more new buyers come into the the market. 
• With BTC hitting all time highs and ETH breaking $4k, it’s no surprise to see a little more selling from our longer term customer base.  
• Our new Swaps service continues to be heavily used with ETH remaining as the most swapped out asset. BTC and NZDD are the two most common end coins. 
• At the time of writing BTC and ETH were up 11% and 10% respectively. 
• BNB had a great run up 34%, whilst SOL and XRP posted respectable 13% gains. 
• Ox (ZRX) had a great week, up 156% to be our best performing assets. 
• TRON (TRX) was our biggest loser this week, down 5%.

View all top gainers: Visit the top gainers page to find out more.

Highlights from the crypto space

Bitcoin broke US$70,000 (NZ$114k) for the first time ever, and at the time of writing had posted an All Time High of US$72,710. ETH also topped US $4k (NZ$6,400) for the first time since December 2021. 

NYDIG is reporting that the number of people who have held Bitcoin for over 1 year has remained flat. Despite Bitcoin hitting all time highs…💎 hands. 

The SEC pushed back its decision on Blackrock’s Spot ETH ETF (try saying that fast) application. Looks like we are lining up for a May 23rd decision day.

In related news, Coinbase met with the SEC on the spot ETH ETFs. 

The early week BTC price correction appears to have been caused by excess leverage (borrowing) in the system.

Simply put, too many people were paying too much in fees on the futures market. In spite of this, open interest on perpetuals exchanges remains at an all time high. 

Another sign of growing retail volume and interest, Coinbase had another load based outage, and the Coinbase wallet app made the app store top 50. Binance also reportedly had a small glitch. 

The UK is looking to get into the ETF party with the FCA granting approval for Exchange Traded Notes (ETN) for sophisticated investors. 

Microstrategy is looking to raise another $600m to buy BTC. Interesting model, they borrow money via a long dated (ie. 2030) convertible note, and buy BTC at today’s prices, with dollars that are getting weaker by the year. Well played sir.

Other notable highlights from around the crypto space:

• Panterra Capital is reportedly raising $250m to buy the FTX estate’s Solana.
• The SEC and Shapeshift have settled on a case against it for running an unregistered securities exchange. In doing so, SEC commissioner Hester Peirce wrote an astounding dissenting opinion. 
• The fall-out of the Binance US – SEC lawsuit meant revenue fell 75% and they have cut some 200 staff. 
• Revolut has partnered with Metamask to allow UK and European users to be a fiat to crypto onramp to allow Metamask balances to be topped up. 
• Cross chain protocol Wormhole has put out details about their up-coming airdrop. Rumours are that this could be the largest this year. 
• SocialFi apps like Farcaster and Friend.tech are falling out of favour with a lack of active users. 
• The BRICS country alliance is looking to bypass the USD payments system by building their own using digital currencies and blockchains. 

And that wraps up our highlights from around the crypto space. Stay tuned below for other macroeconomic updates from around the world.

What is going on in the world of Finance … 

Bulk shipping rates for cargo are increasing and are now up 70% this year in response to the Red Sea issues. 

🌎 Macro news TLDR: US CPI hotter than expected. 

U.S. economic news

Retail sales continue to hold up in the US indicating a strong-ish consumer, however January factory orders were down 1.6%, showing a continued trend of manufacturing contraction.

Federal Reserve Chairman Powell said that the Fed was on track and a soft landing was likely, however he shied away from any rate cut timetable. February unemployment data edged up, with Non Farm payrolls increasing to 275,000. The unemployment rate is 3.9%.

CPI data for February came in slightly hotter than the consensus forecasts; CPI was up 0.4% for the month and 3.2% annualised. Analysts expected 3.1%. Core CPI improved from January to be 3.8%, again slightly above the 3.7% expected. 

Petrol and Electricity, plus insurance look to be the core drivers. The conclusion is that inflation is stickier than expected and will take more time to tackle. The timing of the expected rate cuts continue to slide out according to CME.

There are signs that the US banking issues are not over, this time the New York Community Bank managed a last minute rescue after a trading halt. US lawmakers have agreed to another stop gap to avert a 30% government shutdown. 22 March is the new date. 

Meanwhile in Europe….

The ECB has held its policy rate at 4.5% but has started making noises about discussing rate cuts in June. German factory orders for January fell sharply and are down 6% on a year ago. 

Sweden has officially joined NATO. 

And in Asia Pacific…

China overseas trade beat forecasts, suggesting we may be seeing improvements in the global economy. China’s CPI for February was 0.7%, the first positive number in 7 months. PPI (wholesale inflation) fell 2.7% year on year. 

Japan returned to GDP growth with a good Q4 number and an annualised growth of 0.4%. South Korea’s inflation edged up slightly in February to 3.1%, Philippines was the same. 

Australia posted a very healthy current account surplus of $11.8 bn, Q4 GDP data was subdued however, coming in at 0.2%, and ending at 1.5% annualised.

The Australian housing market is looking softer with new lending down 3.9%. The Council of Financial regulators in Australia noted an increase in hardship amongst households as they fall behind on repayments.

And in New Zealand, Global Dairy Trade prices fell 2.3%. The ANZ truckometer for February, showed that heavy truck traffic, a barometer of GDP, was up 2.8% year on year. 

Finally, retail spending dropped 1.8% in February, with Westpac economics saying this is indicative of an environment where household spending is under pressure. The BNZ is reporting that house prices are stalling too. 

That’s a wrap for this week. 

Stay tuned for the next update.

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