Cryptocurrency Market Trends as Traders Anticipate Spot Ether ETFs | Video

Good morning everyone. Welcome to another episode of Markets Daily. It’s Wednesday, July 17th and it’s been an eventful week so far in the cryptocurrency space, we found out on Monday that the Ethereum S spot ETF will most likely launch next Tuesday. Later that day, former President Donald Trump announced his pick for Vice President of Ohio, Senator J.D. Vance, who has tried to push for clearer legislation on cryptocurrencies in the past. He also owns Bitcoin. So I think crypto leaders are pretty happy with that pick. He is expected to address the Republican Party later today at the Republican National Convention. So we’ll see if he voices his views on digital assets. Speaking of digital assets, Bitcoin is up about 2.2% over the past 24 hours. Partly in reaction to Trump’s pick for Vice President, Ethereum is up 1.8% trading at $3,471 as of 10:00 AM Eastern time. Bit wise Chief Investment Officer Matt Hogan wrote in a note this morning that the launch of the Ether ETF S next week will push the price above $5000. So something to watch out for. But let’s invite our guests and make sense of all this. As always, I’m joined now by Michael Anderson, co-founder of Framework Ventures. Good morning, Michael. It’s great to be here. Thanks for having me. Thanks for coming this morning, Michael. Let’s stick with the ETF talk for a second. The spot. Bitcoin ETF S crossed $16 billion in inflows yesterday after receiving, I believe, 300 million on Monday. How do you think the inflows and volume will change or, or not change at all? Once the spot Ether ETF S is out, do you expect any changes? Well, I think there will be changes just in the fact that there will be a relative market cap discrepancy between Bitcoin and Ethereum. Some of the experts, including Matt Hogan, who you mentioned earlier, have talked about what the percentage A um of the SE ETF will be compared to the Bitcoin S ETF. They both have an excess of G BT C and C respectively. Uh, I think the excess is different. It’s, it’s a little bit less uh in percentage terms than you saw with G BT C. Um And the other factor, also uh, that I think will start to play out and we’ll start to see with the E ETF S is that there’s over 40% of all the eo staked or used in DFI in a bridge in a collateralized protocol of assets uh DI uh. And I think overall, it’s going to take over as, as a major narrative because it’s going to take less value in these ETS, less spot buying to start to drive some of the price appreciation that you would expect. And as we’ve seen with most of these price moves, um, price follows narrative and narrative follows price. Um, so I would expect there to be a lot more activity around the ETF and, and I think we, we kind of pick up the narrative as soon as it launches. So with those ETFs most likely launching less than a week from now, I’m sure Stratify will definitely start, you know, paying more attention to the Ethereum ecosystem. If they’re looking to invest in it through one or more funds, what are some potential pain points in the ecosystem that traders should be watching over the next couple of months? Well, maybe to touch on the first point, which is, I think it’s an important time where in most of the institutional conversations that we’re having, we’re, we’re talking to people who are saying, hey, I want some exposure to cryptocurrencies um Bitcoin. I can understand that being digital gold. Um, the narrative with Ethereum is really OK. It’s the App Store for financial services and you know, being able to understand that growth mindset, that growth, uh asset class, uh they can mentally model uh how an App Store would behave or how it would behave if it were any other category. And so I think most investors want to have both um in, in terms of, in terms of, you know, what we’re looking for um with the ecosystem uh is we’re starting to see more assets grow on the, on the platform, we’re starting to see more layer two launches. Um you know, gas fees have been the lowest they’ve ever been uh because of some of the upgrades that have been done recently. But those are some of the metrics that we track in terms of cost of business um and number of applications that are relying on it. Now, let’s step back for a second. How do you expect the cluttered environment in the second half of the year to impact cryptocurrencies, especially now that, you know, we’re very likely going to see a rate cut in September from the Fed. Yeah, rate cuts, you know, people are pricing in 90% plus in September, uh potentially two by the end of the year. I think we’re about to enter, you know, a classic rate cut season. Eh And, and what that ultimately means is, uh I think last week was the highest number. Eh we hit an all-time high in terms of liquidity in money market accounts. And what I kind of liken that to is basically money sitting on the sidelines waiting for interest rates to change so that money can go and find a better rate of return. Eh And what I would expect is that when we start to see some of these rate cuts, uh a couple of things will happen. The first is, you know, the valuation models for these different assets are going to change, you know, when you’re able to change, what’s the discount rate, what’s that interest rate? And it goes down, the valuation goes up? Uh So for growth assets, are we going to see price appreciation? But then we’re also going to start to see money move off the sidelines into some of the higher risk, higher return asset classes like cryptocurrencies. And so I would expect that that won’t necessarily happen with that first rate cut, but it will start to happen as we see more and more rate cuts over the next 12 months. Now, do you have a price target for Bitcoin and Ethereum for let’s say 2025? No, no price target? Um, I think there’s so many variables, it’s impossible for us to predict. Um, but we continue to see inflows, we continue to see activity. Um, I would say that’s definitely something that we’re excited about for the next 12 months. Now, when you say the Fed has cut several rates, if you know, they actually started cutting rates in September, what will the Fed have to see to cut rates further over the next let’s say 12 months. Well, I, I think the same activity that would lead to a cut in September will lead to further cuts over the next 12 months. And, and looking at the dot charts, the expectations are that we’re probably going to see another 1.5 to 2% rate cuts over the next couple of years leading to interest rates of 3 to 3.5% by the end of 2026. And what that really means is that we’re probably going to see rate cuts of 8 to 1025 basis points over that time period. And you know, the classic signals are going to be, are going to be the main determinant of whether, you know, we go higher or whether, we go even further. But it’s going to be inflation and we expect inflation to continue to, to continue to decline. We expect, you know, the labor market to look like it’s recovering at least from the latest employment and unemployment numbers that we’ve seen. Um, those are the two mandates from the Fed and, and those are the metrics that I’m sure, you know, everyone is tracking very closely. Now, we don’t talk a lot about gaming here on this podcast, but I know that the framework initiatives are investing heavily in crypto gaming among other branches. Obviously. So for all of our players out there. What does the crypto gaming landscape look like right now? And what are some other areas that you’re looking to invest in over the next year or so? Yeah. I, I think the crypto landscape, if I could attribute it to kind of a market narrative right now, is that it’s just getting started. Um, what we’ve seen in the last six months is we’ve seen our first multi-million dollar monthly active game in the form of pixels. Um, in the last 30 days, they’ve had over 1.5 million active players in that gaming ecosystem. Um, we’re also seeing platforms like immutable, reaching 2 million individual signups on their passport, their wallet product. Um, there are over 275 games coming out on immutable in the next 18 months. And I’m sure for every single gamer out there, you’re going to be able to find a game in those 275 that you find interesting or, or something that you, you really like. Um, so I imagine this trend really becomes a pretty big narrative just based on the numbers. Um, you can imagine some of these games are going to be wildly successful, tens of millions of actives per month, some of them are not going to be as successful, but that’s kind of the, the nature of the beast. Um, but I guess if we were talking about games this time next year. Um, it’s probably one of the top categories, just like DI has been for the last few years. Um, and some of the market narratives that we’re, we’re continuing to see. We’ve announced a couple of investments in the AI ​​space. Um, really, really talented founders are coming into the space right now. Um, whether they’re from Google, um, or Tesla or any of the other notable AI ecosystems from traditional tech companies. Um, they’re starting to get into the crypto space because they recognize that blockchains are going to be the monetization layer for, for AI. Um, it’s not necessarily going to be the compute layer, but it’s going to be the monetization layer and, and I think we can, um, work collaboratively with the rest of the AI ​​ecosystem to build that out. Um, yeah, although those are the main things, you know, that we’ve been looking at over the last couple of months and, um, I’m always thrilled to be surprised whenever we meet a new founder working on something completely different. Great, Michael. Well, I think we need to stop there, but um, thank you so much for joining us this morning and sharing your insights. Yeah. Thank you for having me.

Fuente