February 9, 2024

Markets Insights

Economic Calendar

Next FOMC meeting: Mar 20th 2024

Probability of a 25bps ease → 18%

Probability of a 0bps hike → 82%

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ETF Dashboard

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The News Room

Bitcoin Miner Hut 8 Appoints Asher Genoot as New CEO

Bitcoin mining company Hut 8 has named its President and board member, Asher Genoot, as the new CEO, succeeding Jaime Leverton who left the position with immediate effect. Genoot, who played a significant role as COO and then President at US Bitcoin Corp (USBTC) before its merger with Hut 8 in November, stepped into the President role at Hut 8 in December. This leadership change aligns with Hut 8's board decision to steer the Nasdaq-listed firm towards a new strategic direction following the merger, emphasizing the company's critical juncture towards market leadership under Genoot's guidance. Leverton expressed gratitude for her tenure, highlighting the team's accomplishments. Genoot acknowledged Leverton's contributions and is committed to enhancing operations, fostering growth, and maximizing shareholder value. This transition comes as Hut 8 continues to evolve its operations, evidenced by a recent agreement with Marathon Digital, involving a $13.5 million termination fee for Hut 8 to relinquish operational control of two Bitcoin mining sites to Marathon Digital.

Ripple Ordered to Share Financial Statements in SEC Lawsuit Over XRP Sales

A New York judge has directed Ripple Labs to submit specific financial documents and details related to its institutional XRP sales following an SEC request linked to a critical lawsuit judgment. The lawsuit accused Ripple of selling unregistered securities, but Judge Analisa Torres previously ruled that only the institutional sales violated U.S. law, a decision seen as a partial victory for Ripple. The SEC's document request aims to assist Judge Torres in deciding on potential injunctions or penalties against Ripple for violations identified before the 2020 lawsuit filing. Despite Ripple's opposition to this request as untimely and unjustified, Magistrate Judge Sarah Netburn mandated Ripple to provide financial statements for 2022-2023 and relevant contracts, fully granting the SEC's request.

Thai SEC Accuses Former Zipmex CEO of Fraud and Asset Misappropriation

Thailand's Securities and Exchange Commission (SEC) has charged Akarlap Yimwilai, the former CEO of Zipmex Thailand, with corruption and deception, following the unauthorized transfer of customer assets from the crypto exchange's Z Wallet to overseas wallets. This action contradicted the information previously provided by Zipmex Thailand and led the SEC to accuse the company of fraud. Yimwilai, who served as CEO from August 2018 to November 2023, led the Thai unit of the Singapore-based Zipmex, which was authorized by the Ministry of Finance and SEC in 2020. Following these allegations, the SEC has already suspended Zipmex Thailand's trading and brokerage services, with the exchange's website and app being disabled. The SEC's findings of inconsistent reporting by Zipmex Thailand prompted a complaint against Yimwilai with the Office of the Provincial Crime Suppression Division for potential legal action, underscoring the seriousness of the allegations.

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Trading Desk Insights

On behalf of the SDM team, we would like to wish you and all your families and friends a very Happy Lunar New Year!

Bitcoin's trading dynamics and sentiment have experienced a lull in the past fortnight, driven by concerns about substantial outflows from the Grayscale Bitcoin ETF. The recent slowdown in GBTC outflows has reignited positive sentiment, coupled with the momentum generated by the S&P 500 briefly breaching the historic 5,000 level on Thursday. Despite encountering a short-term resistance zone, BTC has seen a commendable 10% surge this week, reaching the anticipated $47,000. The market now faces the question of whether it will sustain this rally or exhibit a fade.

Turning our attention to ETF flows, the market witnessed a substantial influx of $405 million, marking the third-largest day of inflows since the approval of these ETFs. Notably, these Bitcoin ETFs (Ex-GBTC) collectively hold more BTC than MicroStrategy, the largest publicly traded holder of the cryptocurrency. As of Wednesday, these ETFs boasted a combined holding of 192,255 bitcoin, surpassing MicroStrategy's holdings by over 2,000. Also, it's interesting to note that US-based ETFs currently contribute only 10-15% to the total BTC spot trading volume on global centralized exchanges.

Pre-market trading on Friday saw positive movements in crypto stocks like COIN and MSTR, along with mining firms CLSK, RIOT, and MARA.

In the broader market, equity futures experienced an upswing on Friday. The government's announcement of a lower-than-initially-reported inflation reading for December and the S&P 500 approaching a decisive break of the 5,000 level contributed to the positive momentum. Treasury yields traded lower following the revised inflation figures for December to 0.2% instead of 0.3%, and anticipation is building for January's CPI figures set to be released next week.

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Disclaimer

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This research is for informational use only. This is not investment advice. Other than disclosures relating to Secure Digital Markets this research is based on current public information that we consider reliable, but we do not represent it is accurate or complete, and it should not be relied on as such. The information, opinions, estimates, and forecasts contained herein are as of the date hereof and are subject to change without prior notification. We seek to update our research as appropriate.

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.

The information on which the analysis is based has been obtained from sources believed to be reliable such as, for example, the company’s financial statements filed with a regulator, company website, company white paper, pitchbook and any other sources. While Secure Digital Markets has obtained data, statistics, and information from sources it believes to be reliable, it does not perform an audit or seek independent verification of any of the data, statistics, and information it receives.

Unless otherwise provided in a separate agreement, Secure Digital Markets does not represent that the report contents meet all of the presentation and/or disclosure standards applicable in the jurisdiction the recipient is located. Secure Digital Markets and their officers, directors and employees shall not be responsible or liable for any trading decisions, damages or other losses resulting from, or related to, the information, data, analyses, or opinions within the report.

Crypto and/or digital currencies involve substantial risk, are speculative in nature and may not perform as expected. Many digital currency platforms are not subject to regulatory supervision, unlike regulated exchanges. Some platforms may commingle customer assets in shared accounts and provide inadequate custody, which may affect whether or how investors can withdraw their currency and/or subject them to money laundering. Digital currencies may be vulnerable to hacks and cyber fraud as well as significant volatility and price swings.

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