December 6, 2023

Markets Insights

Economic Calendar

Next FOMC meeting: Dec 13th 2023

  • Probability of a 0bps hike → 98%
  • Probability of a 25bps hike → 2%

The News Room

Abrdn and Archax Launch Innovative Money-Market Fund Token on Hedera Hashgraph

U.K. investment firm Abrdn and regulated exchange Archax have collaborated to create a novel token representing ownership in a money-market fund (MMF), combining features of a yield-bearing stablecoin and collateral for trades. Launched in October, this institutional-grade MMF token, using the Hedera Hashgraph ledger, is drawing significant interest, with a $400 million pipeline of potential customers including payment firms and investors seeking yield in a rising interest-rate environment. The token, available for a minimum of $5,000, is currently limited to professional investors. Archax plans to introduce trading pairs of this MMF token with Bitcoin (BTC) next year, offering an alternative to traditional BTC trading against the U.S. dollar. Furthermore, the firms are exploring the use of this MMF token as collateral in regulated decentralized finance (DeFi) scenarios. This development reflects a broader industry trend towards tokenization, with Abrdn considering this token as a starting point for a range of financial products to be tokenized.

Riot Plots Aggressive Hash Rate Growth via Latest MicroBT Deal

Crypto miner Riot Platforms has made a major expansion by purchasing over 66,000 machines from MicroBT for $290.5 million, marking the largest hash rate purchase in the company's history and adding about 18 EH/s to its mining capacity. This follows a previous deal for 33,280 machines and is part of a long-term purchase agreement. With this acquisition, Riot, primarily operating in Texas, aims to surpass 100 EH/s in mining capacity.

The company also secured an option to buy up to 265,000 more miners, potentially adding 75 EH/s more. Bought at $16 per terahash, this move positions Riot strategically against future market price rises for miners. The crypto mining sector anticipates financial challenges due to the upcoming Bitcoin halving, and Riot's expansion mirrors the proactive steps taken by other industry players such as Hut 8, US Bitcoin Corp, Marathon Digital, and Bitfarms.

Crypto Mining Firm Phoenix Rises 50% on First Day of Trading After $370 Million IPO

Phoenix Group, a crypto mining and blockchain technology firm, saw its shares increase by about 50% on the Abu Dhabi Securities Exchange following a $370 million IPO. The company's shares initially rose from 1.50 to 2.20 dirhams ($0.41 - $0.60), later settling at 2.02 dirhams. This IPO, the first for a crypto-related company in the Middle East, was significantly oversubscribed, attracting about $12 billion in orders.

Phoenix, valued at around $2.5 billion post-IPO, has strategic initiatives including a joint venture with the Abu Dhabi government and a focus on environmental sustainability. The broader crypto market, including mining stocks and cryptocurrencies like Bitcoin, Ether, and Solana, has also seen substantial growth, with Bitcoin and other cryptocurrencies showing notable year-to-date increases.

Trading Desk Insights

Equity futures experienced mixed price action on Wednesday despite favorable economic indicators pointing to a decline in inflation.

A decrease in labor costs provided a positive outlook for inflation trends, while a notable increase in productivity hinted at the potential avoidance of an economic recession. The latest private payroll data from ADP also indicated that the job market, a long-standing concern for the Federal Reserve, was showing signs of improvement.

Bitcoin exhibited remarkable volatility over the past 24 hours, primarily due to a short squeeze, propelling prices to a peak of $44,500 in the trading session. Notably, there was a substantial increase in liquidations, reaching $70 million on Monday and surging to $90 million on Tuesday. Open interest has been steadily on the rise, underscoring growing interest in initiating new derivative contracts.

Our trading desk has observed robust demand for positions in both BTC and ETH, encompassing directional trades as well as hedging strategies. Interestingly, ETHBTC has continued its anticipated downward trajectory, despite options on Deribit suggesting a strengthening bias toward ETH call options.

DOGE has captured significant attention, currently trading at $0.10, marking an impressive 50% gain over the course of a month. Notably, open interest in DOGE has surged by 58% within a single week, reaching a level of $625 million, the highest since November 2, 2022.

Technical Charts


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Any forecasts contained herein are for illustrative purposes only and are not to be relied upon as advice or interpreted as a recommendation. The price of crypto assets may rise or fall because of changes in the broad market or changes in a company's financial condition, sometimes rapidly or unpredictably. Past performance is not a guide to future performance, future returns are not guaranteed, and a loss of original capital may occur. Fluctuations in exchange rates could have adverse effects on the value or price of, or income derived from, certain investments. We and our affiliates, officers, directors, and employees, excluding equity and credit analysts, will from time to time have long or short positions in, act as principal in, and buy or sell, the securities or derivatives, if any, referred to in this research.

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