Plus, the correlation of bitcoin and the dollar has turned negative.
The latest moves in crypto markets, in context By Lyllah Ledesma, CoinDesk reporter Was this newsletter forwarded to you? Sign up here. |
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Welcome to Thursday. Here's what you need to know about crypto today: |
- November was a rough month for cryptos as bitcoin lost 18%.
- TradFi giant TP ICAP is breaking into the world of digital assets.
- Telegram is launching a crypto wallet.
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Bitcoin plunged by 18% in November, its biggest monthly loss in five months. Meanwhile, ether lost 21% during the month. The hardest-hit digital assets were a group of tokens commonly associated with Sam Bankman-Fried, the disgraced ex-CEO of fallen crypto exchange FTX. FTT, the utility token of FTX, tumbled 90% to $1 from $26. Serum (SRM), the native token of a decentralized exchange on the Bankman-Fried-championed Solana blockchain, sank 70%. |
This chart of the price of the FTT token shows just how swift and ruthless the sell-off was in November. |
Traditional-finance giant TP ICAP has registered as a digital-asset provider with the U.K.'s Financial Conduct Authority. The world's largest interdealer-broker is attempting to break into the crypto world via its Fusion Digital Assets marketplace. TP ICAP is working with Fidelity Digital Assets to offer the platform, which will match orders and execute spot crypto trades. Telegram is pushing forward with a buildout of crypto infrastructure. The messaging app, which is already a go-to for many crypto traders, is planning to build crypto wallets. The app has sold $50 million in usernames in less than a month through its blockchain-based auction platform, Fragment, CEO Pavel Durov said Wednesday. |
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Market Insight: Bitcoin Unties From Dollar |
The correlation of bitcoin and ether to the U.S. Dollar Index (DXY) has once again turned negative. BTC's correlation coefficient to the DXY has fallen to -0.36, after moving as high as 0.84 on Nov. 19. Correlation coefficients measure the relationship between two assets and range between 1 and -1. The former implies a direct pricing relationship between the assets, while the latter indicates an inverse relationship. BTC had held a persistently inverse relationship to the DXY since July, before crossing into positive territory on Nov 9. In August, the correlation between the two assets fell to -0.94. |
- The chart shows U.S. financial conditions have eased notably since the release of the October inflation report on Nov. 10.
- The more the Federal Reserve pivots away from aggressive liquidity tightening, the greater the loosening of financial conditions and the bigger the risk of the central bank missing its inflation target.
- Therefore, the Fed may push back against easing financial conditions, more so as investors on Wednesday focused on Chairman Jerome Powell acknowledging the slowing in the rate hikes while ignoring his core message of stubbornly higher core inflation.
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Disclaimer: The information presented in this message is intended as a news item that provides a brief summary of various events and developments that affect, or that might in the future affect, the value of one or more of the cryptocurrencies described above. The information contained in this message, and any information liked through the items contained herein, is not intended to provide sufficient information to form the basis for an investment decision. The information presented herein is accurate only as of its date, and it was not prepared by a research analyst or other investment professional. You should seek additional information regarding the merits and risks of investing in any cryptocurrency before deciding to purchase or sell any such instruments. |
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