Daily News | Musk Questioned NFT, Tether's Reserve Assets Hit A Historic High, Many Market Makers May Provide Liquidity for BlackRock Bitcoin Spot ETFs

Crypto Daily Digest: Musk questioned NFT, Tether’s Reserve Assets Set a Historical High

According to CoinDesk, sources have revealed that if regulatory authorities approve BlackRock’s Bitcoin spot ETF, some of the world’s largest market making companies may provide liquidity for it. According to internal documents seen by insiders at BlackRock, trading giants Jane Street, Virtu Financial, Jump Trading, and Hudson River Trading have discussed their market making roles with BlackRock.

Tether released its reserve report for the third quarter. The proportion of its cash and cash equivalents (C&Ceq) reserves hit a record high, reaching 85.7%. The vast majority of them are US treasury bond bonds, worth $72.6 billion, including direct and indirect risk exposures. In addition, the report also emphasized a significant decrease of $330 million in the amount of guaranteed loans issued by Tether.

Investments in energy, Bitcoin mining, and P2P technology are not included in reserves, and the excess reserves remain stable at $3.2 billion. The volatility of Bitcoin and gold has a relatively small impact on excess reserves.

As of September 30, 2023, Tether’s consolidated total assets were at least $86,384,653,832, and its total comprehensive liabilities were $83,176,997,409, of which $83,153,363,663 was related to the issued digital tokens. The comprehensive assets exceed its comprehensive liabilities.

On October 31st, according to Bloomberg terminal information, Bernstein analysts predicted that Bitcoin would reach $150,000 by mid-2025. Analysts added that Bitcoin is expected to rebound in the approval of spot ETFs and initial ETF listings, and will experience a halving in April 2024, with a significant turning point after the halving.

On November 1st, Musk stated in the latest podcast hosted by Joe Rogan that “NFT is not even on the blockchain, it is just a URL pointing to JPEG,” which was accused of Musk questioning the security and meaninglessness of current NFTs.

In the past 90 days, approximately 60,000 Bitcoins worth slightly over $2 billion have been withdrawn from trading platforms. The number of Bitcoins on centralized exchanges is slightly over 2 million. The latest report by Falconx states that market volatility is exacerbated by the continued lack of liquidity.

According to the data of RWA monitoring platform RWA.xyz, as of press release, the market size of token US treasury bond bonds has soared from about $100 million at the beginning of the year to $700 million, an increase of nearly six times. Charlie You, co-founder of RWA.xyz, stated that the growth of new entrants and existing platforms in the field has driven this expansion.

Data shows that existing protocols, including Ondo Finance, Maple, and Backed, have seen significant growth in the past few months. Meanwhile, new agreements just launched in September, such as Tradeteq and TrueFi’s Adatp3r, attracted deposits of $4.5 million and $8.5 million, respectively.

In addition, recently, the value of the US treasury bond bond token on the Ethereum chain has exceeded that of Stellar Network, while the latecomers Polygon and Solana have also attracted more than $40 million of assets, which indicates “the prospect of a diversified blockchain of tokenized assets.”

Today’s Main Token Trends

BTC

The short-term high continues to hover around the $36,000 mark. In the short term, it appears to be at a phase peak, so be cautious of the possibility of a high-level pin action. For medium-term strategy, continue to strictly observe the $30,800 mark. If it retraces slightly but doesn’t break below $30,800, it may continue to show a bullish structure, making it a relatively good entry point.

ETH

In the short term, ETH is once again approaching the $1,805 mark. With a converging market structure, it is showing signs of an upward trend. You can consider buying in upon a breakout and continue to target $1,951 after it reaches $1,857. If it falls below $1,754, it may find support at $1,726.

BCH

The high point hit a resistance level at $269.08, and a short-term downturn may continue. Short-term downside targets are $239 and $232.32. Last week, it briefly retraced to the $232.32 support. If it holds steady at this support, a reversal may occur; otherwise, it will continue to have a bearish outlook and may reach a key support at $210.

Macro: Under the expectation of not raising interest rates, the Federal Reserve maintains hawkish rhetoric and focuses on the early morning interest rate resolution

On October 31st, a series of US economic data strengthened the market expectation that the Federal Reserve would maintain higher interest rates for a longer period of time. At the same time, inflation data in the eurozone continued to cool and GDP in the third quarter shrank from the initial quarter on quarter. The US dollar regained its upward momentum, closing 0.54% higher at 106.72, achieving a three month consecutive rise from August to October.

The market is betting that the interest rate resolution announced by the Federal Reserve on Thursday morning may not raise interest rates, but may maintain hawkish rhetoric, with the two-year US Treasury yield, which is more sensitive to monetary policy, rising to 5.08%; The 10-year US Treasury bond yield showed a V-shaped trend throughout the day, with the US stock market falling to 4.80% before trading, but later turning higher to close at 4.93%, still below the 5% mark. Investors are paying attention to the size and duration of the US Treasury bond auction to be announced on Wednesday evening.

The Federal Reserve may keep its benchmark interest rate unchanged at a 22-year high this week, while retaining the possibility of raising interest rates again if necessary to combat inflation.

If the economy does not cool down as expected by the Federal Reserve, and inflation slows down since June and rebounds again, officials may raise interest rates again in December or next year. The Federal Reserve may also consider whether the recent rapid rise in US bond yields can effectively replace another rate hike.

If interest rate hikes are suspended, it will be the second consecutive time the Federal Reserve has maintained interest rates unchanged, highlighting its wait-and-see stance in the fight against inflation. Since March 2022, the Federal Reserve has raised interest rates at its fastest pace in forty years. The last rate hike was in July, with the target range for the federal funds rate reaching 5.25% -5.5%.

Powell’s press conference became the focus of attention. He may say that the Federal Reserve hopes for a sustained slowdown in inflation and a cooling of economic activity and employment after rapid growth from July to September.

Another issue is how Federal Reserve officials can determine whether they are moving in the right direction. If correct, the next meeting will be able to keep interest rates unchanged, otherwise it may lead to them raising interest rates again.