BTC

ETH

S&P 500 Futures

$68,517.75

$2,443.75

$5,748.50

(-2.53%)

 (-3.43%)

(+0.09%)

Note: All percentages shown above are referenced to the previous business work day's 09:00 (GMT+8)

GM 🌳

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October 2024 Market Recap

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Our Daily View

What We Are Covering Today

  • October’s labor market report showed steady growth and unemployment rate; Poll indicates a tight race between Trump and Harris in swing states (More in Macro & TradFi)
  • UBS launches tokenized money market fund; World Liberty to limit token sales in US to $30M (More in DeFi & CeFi)
  • TON blockchain's stablecoin volume grows; BTC sees a shift to leveraged trading and ETFs (More in On-Chain)
  • BTC’s IV surges amid geopolitical tensions; demand for near-term protective options intensifies (More in Crypto Derivatives)
  • BTC and ETH prices recover slightly after bouncing off from their support levels (More in Crypto Technical Analysis)

Macro & TradFi

In October, U.S. job growth nearly came to a halt, primarily impacted by strikes in the aerospace sector and disruptions caused by hurricanes, leading to a modest increase of just 12,000 nonfarm payrolls—the smallest gain since December 2020. The unemployment rate remained steady at 4.1%, attributed to a decrease in labor force participation. Revised data showed significant downward adjustments for August and September, totaling 112,000 fewer jobs than previously reported. Economists anticipate that the Federal Reserve will respond to this cooling labor market with another interest rate cut at their upcoming meeting, especially since the broader economic picture lacks clarity ahead of the presidential election. The strikes at Boeing and Textron accounted for a substantial loss of jobs in manufacturing, while other sectors like healthcare and government saw modest gains. Average hourly earnings increased by 0.4%, indicating ongoing wage growth, which supports consumer spending. Overall, analysts view the data as providing justification for the Fed's expected rate cut as they navigate a gradually cooling labor market.

Elsewhere, as the U.S. presidential election approaches, a New York Times/Siena College poll indicates a tight race between Democratic candidate Kamala Harris and Republican Donald Trump across seven swing states. Harris holds slight leads in Nevada, North Carolina, and Wisconsin, while Trump is slightly ahead in Arizona. The candidates are virtually tied in Michigan, Georgia, and Pennsylvania, with all matchups falling within the poll's 3.5% margin of error. Approximately 40% of respondents reported having already voted, with Harris leading this group by 8 percentage points. Conversely, Trump has the edge among voters who are very likely to vote but have not yet cast their ballots. Notably, in Pennsylvania, where Trump is gaining ground, he has narrowed the gap after trailing Harris by four points in previous polls. Both candidates are actively campaigning in these critical states over the weekend, with Trump focusing on Pennsylvania, North Carolina, and Georgia, while Harris is set to appear in Michigan.

On November 1, 2024, U.S. stocks closed higher as strong earnings from big tech companies and a soft jobs report boosted investor sentiment. The S&P 500 rose 0.4%, the Dow Jones Industrial Average gained 0.7%, and the Nasdaq Composite added 0.8%, although the Nasdaq ended a seven-week winning streak. The October jobs report showed fewer job gains than expected, with the unemployment rate steady at 4.1%, influencing Federal Reserve rate expectations ahead of next Thursday's decision. Outside of tech, Boeing rose 3% after a union deal, while ExxonMobil slid 1.5%. Besides the US election, investors are looking out for the Fed's interest rate decision which will also take place on Friday, 8 November, at 03:00 SGT.

DeFi & CeFi

  • UBS launches tokenized money market fund on ETH network
  • World Liberty to limit token sales in US to $30M
  • DOJ indicts Gotbit CEO for allegedly orchestrating massive wash trading scheme
  • Viral squirrel ‘Peanut’ triggers Solana memecoin frenzy
  • Ethereum researchers drops EigenLayer advisor roles
  • Three Arrows founder’s wife sells $38 million Singapore mansion

The Union Bank of Switzerland (UBS) has launched a tokenized money market fund on the Ethereum blockchain, named the “UBS USD Money Market Investment Fund Token” (uMINT), in response to rising investor interest in tokenized financial assets. The uMINT allows token holders to utilize UBS's institutional-grade cash management solutions, which focus on high-quality money market instruments within a conservative, risk-managed framework. This launch follows a successful pilot of the tokenized fund conducted last year through UBS’s in-house tokenization service, UBS Tokenize, which utilized Ethereum smart contracts for transactions such as redemptions and subscriptions. UBS's initiative aligns with a broader trend, as numerous financial institutions increasingly adopt blockchain technology for tokenized funds. For instance, Franklin Templeton recently launched its tokenized money fund on Coinbase's Base network, and other firms like Libeara and FundBridge Capital have also introduced tokenized funds on public blockchains, indicating the growing acceptance and implementation of tokenized financial products in the industry.

Meanwhile, World Liberty Financial, a decentralized finance (DeFi) project promoted by former President Donald Trump and his sons, has announced plans to sell up to $30M of its tokens within the United States. The company, based in Delaware but operates from Puerto Rico, has a total token offering valued at approximately $288.5M, with approximately 90% of the sales to occur offshore. To navigate the regulatory landscape, World Liberty is utilizing Regulation D to conduct its token sales in the U.S., which allows companies to raise funds from accredited investors, including institutions and high-net-worth individuals. As of October 15, World Liberty has raised $2.7M from 348 investors under this regulation. In addition to the token sales, World Liberty is exploring non-U.S. sales under Regulation S, which imposes fewer requirements than Regulation D but is limited to foreign investors. This move follows the recent launch of Trump's fourth collection of non-fungible tokens (NFTs) featuring the former president.

On-Chain

According to CryptoQuant analyst burakkesmeci, the TON blockchain has seen remarkable growth in stablecoin usage, particularly with USDT, which increased by 670% over the past six months to exceed $1 billion in circulation on the network. The surge highlights TON's appeal due to its low transaction fees—dropping from $0.061 in June to $0.035 by October—and high transaction speed, making it a competitive option for stablecoin transactions. As demand for efficient, cost-effective blockchain solutions grows, burakkesmeci posits that  TON is well-positioned to capture a larger share of the stablecoin market, offering a scalable alternative for high-volume transactions globally.

In an analysis by Onchain analyst Checkmate, Bitcoin speculators are increasingly entering leveraged futures positions as the U.S. election approaches, signaling heightened risk appetite in the market. Simultaneously, around 180,000 BTC previously held by long-term holders have moved into exchange-traded fund buyers' hands, suggesting a strategic reallocation toward more stable, institutional-driven investment vehicles. There is an observed growth in both speculative trading activity and regulated, structured Bitcoin exposure via ETFs, highlighting evolving investor strategies as market uncertainties loom.

Derivatives

  • Funding rate for BTC and ETH remained positive.
  • Deribit Implied Volatility Index (DVOL) for BTC and ETH rose to 62.71% and 67.40% respectively.
  • The 30-day 25-delta skew (C-P) for BTC rose to 2.84 while ETH remained flat in the negatives at -1.41.
  • The futures market witnessed $363.31M in liquidations in the last 24 hours, with longs representing 72.73%.

Net Annualized APR

Perp (USDT pair)

Long on

Short On

15.91%

XRP

OKX

Binance

11.02%

XRP

OKX

Bybit

9.90%

BNB

OKX

Bybit

Notes:

1) Pairs observed include BTC, ETH, SOL, BNB, XRP, LTC, and DOGE vs. USDT perps. 

2) CEXs observed include Binance, Bybit, OKX & dYdX.

3) Lookback period is 24 hours.

The 7-day at-the-money IV for Bitcoin has spiked to 77.00, significantly outpacing the 30-day IV, which, although also increasing, reached only 61.82. The divergence could be explained by escalating geopolitical tensions, as Iran’s threat to deploy more powerful warheads against Israel injects global risk and market instability.

BTC's term structure exhibits steep backwardation, as traders increasingly buy short-dated options to hedge against volatility from both the U.S. elections and Middle Eastern geopolitical tensions. This concentrated demand for options expiring in the next few days has driven IV to a high of 82.31 for 3-day contracts. As time to expiry shortens, the premiums on these options naturally decline, attracting more investors seeking rapid, near-term protection.

Bitcoin's 7-day call-put skew remains in negative territory at -0.42, indicating a tilt toward short-term bearish sentiment as traders predominantly purchase out-of-the-money puts to hedge against near-term downside risks. This skew reflects a demand for protective options, likely driven by immediate volatility concerns. In contrast, the 30-day skew is positive at 2.84, signaling that medium-term sentiment leans bullish, with option investors anticipating a potential price increase for BTC over the coming month.

Lastly, @Paradigm top structures highlighted mostly bullish purchases for BTC but long vega and bearish trades for ETH. Key BTC trades included the acquisition of 1225x 29-Nov-24 $85K Calls and 1000x 28-Mar-25 $85K Calls. In ETH, significant trades comprised a 5000x 29-Nov-24 $2.6K Straddle and a 3000x 8-Nov-24 / 29-Nov-24 $2.5K Put Calendar.

Crypto Technical Analysis

Bitcoin is currently trading near the $69K level after bouncing off a support area around $68.2K, which has been tested multiple times in recent months. A break below this support could indicate further bearish action, with the next support level at $66.1K, representing a potential 3.9% decline from the current price. The primary resistance level to watch is $72K; if Bitcoin pushes up and tests this area again, a breakout could lead to new highs.

Ethereum is currently trading around $2.45K, showing a slight recovery from its most recent local support near $2.44K. The immediate lower support level is at around $2.26K, a critical level for traders to defend to avoid further downside. The primary resistance level remains around $2.7K, which has proven to be a major hurdle, as it has been tested multiple times but failed to break above. The RSI is weak at 36.27, suggesting that selling pressure has been dominant but could indicate an opportunity for a potential bounce. Traders should watch for confirmation of a bounce from the support zone or further decline if this level fails.

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TRHX Research (Formerly Treehouse Research) 🌳