- Sept 18: U.S. FOMC Interest Rate Decision
It's going to be all about the FOMC interest rate decision this week. The big question will be whether it will be a 25 or 50 bps cut and how markets will interpret the reasoning and outcome of the decision. As of this morning, the CME Fedwatch tool has the target probabilities at 59% for a 50 bps cut and 41% for 25 bps. We cover more on the decision below in our random musing for the week.
- Sept 18-19: Token 2049 Singapore
The industry's largest Asian conference will be taking place in Singapore throughout the week, with over 20,000+ attendees representing 7000+ companies. Every day will likely be packed with announcements from several projects, so we'll be watching to see what makes headlines throughout the week.??? ?
Anticipation for FOMC Rate Decision
The market is waiting for the FOMC's decision, which is expected to reduce interest rates for the first time since 2020.
- Evolving Expectations for Rate Cuts:
Last week's economic data, including the Consumer Price Index (CPI) and Producer Price Index (PPI), both reported higher than expected figures. The core CPI indicated sustained inflationary pressures, and the core PPI also exceeded forecasts, reflecting persistent inflation across broader sectors. These data points have led to adjusted expectations for the Federal Reserve's upcoming decision, with market consensus leaning more towards a conservative 25 basis points rate cut.
However, sentiments shifted over the weekend towards a closer split between a 25 bps and 50 bps rate cut following a report by renowned Fed Watcher Nick Timiraos that argued a 50 bps cut was warranted. Probabilities last week were at 70% for a 25 bps cut, but evened to 50-50 over the weekend and have now shifted in favor of a 50 bps cut slightly this morning.? ?
A tweet from Charlie Bilello that highlights historical market responses to significant Fed rate cuts made the rounds last week, noting that deeper cuts often signal underlying economic troubles. This perspective adds a layer of caution to the optimism surrounding potential rate cuts, suggesting that a larger cut might indicate more serious economic slowdowns than previously recognized. ?
As the Federal Reserve gears up for a potential rate cut, the market stands on the brink of a crucial decision that could shape economic expectations through the end of the year. Amidst mixed economic signals, the upcoming FOMC meeting promises to be a pivotal moment.
- Coinbase?rolls out wrapped bitcoin alternative cbBTC on Ethereum and Base Commentary: Crypto exchange Coinbase has launched its own take on wrapped bitcoin, rolling out the cbBTC token on the Ethereum and Base networks from Thursday, after initially teasing the asset in August. The ERC-20 token is backed 1:1 by bitcoin held at Coinbase to use in decentralized finance applications within the Ethereum and Base ecosystems, including providing bitcoin liquidity to DeFi protocols or using it as collateral to borrow other assets. Dapps supporting cbBTC at launch include DEXs Aerodrome and Curve, lending protocols Aave, Compound, and Morpho, and cross-chain swaps platform DeBridge.
- New bill proposes?joint SEC-CFTC committee?to shape US crypto regulations Commentary: House Financial Services Committee member John Rose introduced his bill on Thursday, called the Bridging Regulation and Innovation for Digital Global and Electronic Digital Assets, or the "BRIDGE" Digital Assets Act. "The Joint Advisory Committee on Digital Assets will provide a framework for the government and private sector partners to cooperate on a path toward success for the regulatory landscape of digital assets and private sector participants.”
- Grayscale?launches new XRP closed-end fund, token jumps 8% Commentary: Grayscale said Thursday it's planning to launch an XRP “closed-end" fund that will allow investors to gain exposure to the popular token. The firm once managed an XRP fund it then shut down in 2021 after the U.S. Securities and Exchange Commission sued Ripple and argued that the digital asset XRP is a security under U.S. law. Ripple, which utilizes XRP, the native asset of the XRP Ledger, is the company most closely associated with the token.
- US House Republicans?probe SEC’s Gensler on political hiring claims Commentary: United States House Republicans have probed Securities and Exchange Commission Chair Gary Gensler, saying his agency could be hiring based on political affiliation, violating federal law. They claimed email correspondence made public in an SEC rulemaking comment may show that Gensler’s decision to hire the agency’s director of trading and markets, Dr Haoxiang Zhu, was “influenced by his political affiliation.”
- Paradigm-backed startup?Succinct and OP Labs?aim to solve ZK rollups Commentary: Paradigm-backed startup Succinct Labs announced Wednesday that it has been working with Labs, the main contributor to the Optimism protocol, to "solve" ZK rollups. Succinct Labs, which raised $55 million in a seed and Series A funding round led by Paradigm in March, said its new approach is significantly faster than "standard optimistic rollups," which have a "7-day fraud proof window," and costs "tenths of a cent per transaction" on average.
- UK government?looks to formally define crypto assets as new form of property Commentary: The UK government has introduced a bill to Parliament seeking to formally define crypto assets, including non-fungible tokens and real-world assets, as property. Alexander particularly notes the bill was drafted to maintain Britain’s “pole position in the emerging global crypto race” and attract more businesses and investments. According to the press release, digital assets bring in ￡34 billion a year to the UK economy.
- Crypto ETFs?from State Street and Galaxy Digital begin trading Commentary: Through a partnership, State Street Global Advisors, one of the world's largest investment managers, and Galaxy Digital have launched three exchange-traded funds designed to offer investment exposure to a mix of both companies associated with blockchain technology and cryptocurrencies through futures and other ETFs. The three funds that began trading Tuesday possess the ticker symbols DECO, HECO, and TEKX. While both DECO and HECO involve "cryptocurrency exposures through ETFs and futures," the latter also seeks to manage "volatility by incorporating covered call options and protective put options," according to the statement.
- Paypal, Venmo?integrate Ethereum Name Service for crypto payments Commentary: Paypal and Venmo have integrated the Ethereum Name Service (ENS) into their payments platforms. ENS is a decentralized naming system built on the Ethereum blockchain that gives readable names to crypto addresses. Now users of Paypal and Venmo can enter the recipient’s ENS name directly in the search field when sending crypto, and the payment platforms will automatically identify the wallet addresses linked to the ENS. The feature will first be made available to U.S. users.
- Nansen?acquisition enables staking services to over 20 blockchains Nansen, a blockchain analytics firm, has announced its acquisition of StakeWithUs, a Singapore-based staking service provider, to broaden its range of services. StakewithUs, supported by SGInnovate, offers secure staking services across multiple blockchain networks and will facilitate this directly on-chain on Nansen’s platform. Alex Svanevik, CEO of Nansen, explained that the new unified platform will allow users to “stake their tokens seamlessly with our validators across 20+ blockchains.”
- TON?hits record transaction highs post-Durov arrest while token price plummets 30% Commentary: Following the arrest of Telegram founder Pavel Durov by French authorities on August 24, 2024, activity within the network has surged exponentially, with a sharp rise in network transactions and active addresses. The 7-day moving average (7DMA) of daily transactions on the TON network has reached a new all-time high. The network saw an all-time high of 8.68 million transactions on Aug. 31, surpassing the previous record of 8.56 million from Jan. 17.
- Kamala Harris?releases policy platform details - No mention of crypto Commentary: Democratic presidential nominee Kamala Harris has released new policy plans for the 2024 United States presidential election. While the platform includes plans to prioritize innovation in the US economy, she did not explicitly mention digital assets or blockchain technology. The Democratic ticket highlighted several policies that differentiated itself from Republican nominee Donald Trump’s campaign. The official Republican platform—under the leadership of Trump’s daughter-in-law - included language on “champion innovation” using crypto, while the Harris campaign focused on policies to benefit the middle class.
- FBI?reports Americans lost $5.6B to cryptocurrency fraud in 2023 Commentary: The United States Federal Bureau of Investigation (FBI) Internet Crime Complaint Center has released its cryptocurrency fraud report for 2023. Americans lost $5.6 billion due to cryptocurrency fraud that year, up 45% from 2022, it said. Crypto-related complaints represented 10% of the total received, but almost 50% of the total lost that year. The report found that of the 69,000 crypto-related complaints the FBI received in 2023, people over 60 were most often victimized, accounting for almost $1.6 billion of the losses. Almost 71% of the crypto fraud was related to investment schemes, and about 10% involved call center fraud and government impersonation scams.
- Judge?issues temporary stay in CFTC-Kalshi election contract dispute Commentary: Prediction market Kalshi's move to offer contracts tied to the U.S. 2024 election will be held at a standstill, at least until after a hearing on Thursday, a judge decided on Monday. This marks the latest in the saga between Kalshi and the U.S. Commodity and Futures Trading Commission. The CFTC said last year that Kalshi could not offer contracts related to "congressional control contracts." Kalshi then sued the agency in November 2023.
- CFTC?files emergency motion seeking to stop Kalshi from listing election prediction contracts Commentary: Late last night, the U.S. Commodities and Futures Trading Commission filed an emergency motion to block prediction market Kalshi from listing election contracts for two weeks while the agency works on its appeal. The unusual request comes as Kalshi attempts to capitalize on the rise in popularity of political prediction marketplaces, especially Polymarket, the decentralized prediction market popular among crypto traders but which legally bars those in the U.S. from participating.
- Friend. tech?token drops 26% after team shirks control of smart contracts Commentary: The token for crypto social media platform friend.tech has plummeted after its team transferred the admin and ownership of its smart contracts to Ethereum’s null address — permanently relinquishing any control over them. Ethereum’s null address is a burn address aimed at intentionally destroying tokens, and anything sent to it becomes irrevocably lost. There is no way to recover or reuse tokens sent to the address. Serpin Taxt, a builder behind blockchain reputation protocol Ethos, posted to X that friend.tech’s move was the “end of an era” and “not at all how I saw it playing out.”
- Stacks’?smart contracts reach record high ahead of Nakamoto upgrade Commentary: Stacks reached a new all-time high in smart contract deployment just days before the much-anticipated Nakamoto upgrade is fully activated. Stacks, the Bitcoin network’s smart contract layer, reached a new all-time high of over 1,400 monthly smart contracts deployed. The new record high comes ahead of the full activation of the Nakamoto upgrade, which started rolling out at Bitcoin block 840,360 on Aug. 28. The upgrade is expected to revolutionize Bitcoin-based decentralized finance (DeFi), also known as BTCFi, a new technological paradigm that aims to bring DeFi capabilities to the world’s first blockchain network.
- Japan’s three major banks?to test cross-border stablecoin transfer platform Commentary: Japan’s three megabanks — MUFG, SMBC and Mizuho — are set to trial a cross-border stablecoin transfer platform to offer faster international settlement for enterprises. The pilot test, dubbed “Project Pax,” will leverage the stablecoins issued via Progmat, a blockchain startup backed by these three banks, SBI Holdings and Japan Exchange Group. The project plans to use SWIFT’s existing API framework for banks to instruct Progmat to settle on blockchain networks. That can help address anti-money laundering and other compliance challenges. “This enables financial institutions to avoid operational redundancy with fiat currency transfers and minimize investment costs,” the project said.
- September 17?- U.S. Retail Sales
- September 18?- U.S. FOMC Interest Rate Decision
- September 27?- BTC CME September (BTCU24) Options Expiry
- October 10?- U.S. Consumer Price Index for September
- November 7?- U.S. FOMC Interest Rate Decision
