Markets
The NYSE sees an opportunity for traditional structures in the cryptocurrency sector
Lynn Martin, president of NYSE Group and president of ICE Fixed Income & Data Services, said the exchange will continue to look for opportunities to bring traditional structures paired with crypto assets to the forefront as it aims to launch bitcoin index options settled in cash.
Martin spoke at the Consensus 2024 conference in Austin, Texas on a panel on the convergence of cryptocurrencies and traditional finance on May 29.
That day the New York Stock Exchange, part of the Intercontinental Exchange, announced it was launching cash-settled index options that track the CoinDesk Bitcoin Price Index, which it says is the longest-running spot bitcoin index. Last year, ICE Futures Singapore partnered with CoinDesk Indices to upgrade its bitcoin futures contracts.
Lynn Martin, New York Stock Exchange
Martin said the NYSE is working to gain regulatory approval to launch options contracts on Coindesk’s Bitcoin index. He said: “We are incredibly excited.”
Andy Baehr, head of product at CoinDesk Indices, said in a statement: “XBX has provided reliable bitcoin pricing to millions of investors, market participants and bitcoin enthusiasts since 2014. Partnering with the NYSE to launch options on the The XBX Index opens a new chapter in digital assets, putting important and familiar risk management tools into the hands of US and global investors.”
Tom Farley, CEO of regulated digital asset exchange Bullish, which is also the parent of CoinDesk Indices, also spoke on Martin’s panel, and Farley spoke at Consensus 2024.
Farley said the idea for the contract came when David LaValle, global head of ETFs at digital currency asset manager Grayscale Investments, told him the industry needed a cash-settled bitcoin option, which would be new and differentiated.
“In the world of stock options, cash-settled options have a long history of being a very attractive product for clients,” Farley added. “Cash-settled S&P options may be the best-known options product.”
If the options contracts are approved and traded, Farley said it could result in greater overall liquidity for bitcoin, especially in combination with new types of bitcoin ETFs that he expects to see in the near future.
Martin added that options will provide an additional risk management tool, which is attractive to both new entrants and more established institutional names that are becoming involved in bitcoin ETFs.
“This is another evolution in how institutional and retail investors can manage risk in their portfolio, which I think is a good thing,” he said.
Accelerated settlement
On May 28, 2024, the U.S. securities market went from stabilizing two days after a transaction, T+2, to one day after the transaction, T+1. In contrast, on-chain digital assets can be liquidated instantly.
Martin explained that it took the industry a year to go from T+2 to T+1, while it took several years to go from T+3 to T+2.
The technology behind cryptocurrencies, particularly blockchain, is great technology,” he added. “It’s something the industry will continue to look at to see how it can be used to make deals more efficient and transparent.”
He’s optimistic that the industry will eventually move toward more real-time solutions as it upgrades archaic technology, much of which was built in the 1980s. However, the traditional financial ecosystem needs to digest T+1 before moving on to the next innovation.
“I continue to be optimistic about using blockchain technology to make processes more efficient,” Martin said.
Farley, a former NYSE president, agrees that digital assets have the advantage of atomic settlement, but points out that other parts of the ecosystem still lag far behind the speed of connectivity of traditional market centers. For example, trades on cryptocurrency exchanges can take seconds, or at best milliseconds, while stock trading is measured in microseconds.
Martin pointed out that the NYSE’s average response time to execute a trade is 30 microseconds. As a result, the exchange processed three-quarters of a trillion incoming order messages every day.
Furthermore, although instant settlement means there are no failed trades, the process requires much more capital as transactions must be pre-funded. Additionally, crypto venues experience more disruptions than traditional exchanges.
Tom Farley, bullish
“A lot of cryptocurrency venues, including us, are almost moving away from real-time settlement and offering things like deferred settlement because that allows for a lot more liquidity and more active trading,” Farley said.
He went on to say that the current stock market is largely efficient, so blockchain offers greater benefits in other asset classes such as fixed income.
Martin said: “In fixed income, for example in the US municipal bond markets, there is no liquidity. This is probably a better market to start using the technology that underpins the cryptocurrency industry, as it has an inefficient market structure.”
Bitcoin and other digital assets are available for trading 24 hours a day, seven days a week. The NYSE commissioned a survey of 24/7 trading, and Martin said the exchange is still consulting with members.
“The most important thing is that we are looking at various aspects of the ecosystem and in particular the clearing area, to see how it would handle the 24-hour aspect, whether that’s five or seven days a week,” he said. added. “There are a variety of conversations going on.”
Martin was also asked if the NYSE will launch a spot cryptocurrency exchange, and she said this could be an opportunity if there were clear regulatory guidelines.
NEW: 🇺🇸Blackrock’s #Bitcoin The ETF became the fastest ETF to reach $20 billion.
Bitcoin shook Wall Street 🤯 pic.twitter.com/HehCIiLd6V
— Bitcoin Magazine (@BitcoinMagazine) May 30, 2024
Crypto ETFs
Martin pointed out that it took six years for the U.S. Securities and Exchange Commission to approve bitcoin ETFs. The SEC recently approved ether ETFs, which Martin said was partly due to the approximately $58 billion invested in bitcoin ETFs since they launched in January 2024, which he described as a huge success.
“The flows are a strong signal that the market is looking for cryptocurrencies in traditional structures,” he added. “We will continue to try to find opportunities to bring traditional structures paired with crypto assets to the forefront.”
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Bitcoin AND Etherealalong with the rest of the top 10 cryptocurrencies by market cap, appear to be in hibernation on Thursday morning.
At the time of writing, the Bitcoin Price is still below $65,000 and 2.2% lower than it was this time yesterday, according to CoinGecko data. Things are worse for the Ethereum Pricewhich is 3.7% lower than 24 hours ago at $3,185.22. The drop in ETH’s price is identical to that of Lido Staked Ethereum (stETH), a liquid staking token for Ethereum.
In recent days, falling prices have led to the liquidation of derivative contracts worth $225 million, according to Coin glassAnd about half of that, about $100 million, was liquidated in the last 12 hours.
When a trader is liquidated, it means that their position in the market has been forcibly closed by an exchange or brokerage due to a margin call or insufficient collateral. Margin is especially important when it comes to leveraged positions, which allow traders to control a multiple of their deposit, such as opening a $10,000 position with only $1,000 in their account.
Now that Bitcoin has been in the red for three days in a row, there is a chance that the world’s oldest and largest cryptocurrency could sink even further, BRN analyst Valentin Fournier said in a note shared with Decrypt.
“Bitcoin has closed in the red for three days in a row, with one-way trading showing limited resistance from bulls. Ethereum had a slightly positive Monday with strong resistance from bears who have won the last two days,” he wrote. “This momentum could take BTC to the $62,500 resistance or even the $58,000 territories.”
Looking ahead, Fournier said BRN’s strategy will be to “reduce exposure to Bitcoin and Ethereum and find a better entry point after the dip.”
This is despite Federal Reserve Chairman Jerome Powell’s comments yesterday on interest rates being widely regarded as accommodating and indicative of FOMC rate cuts in September.
Singapore-based cryptocurrency trading firm QCP Capital said the rally in stocks, which sent the S&P 500 up 1.6% from Wednesday’s close, was not felt in cryptocurrency markets.
“Cryptocurrencies have seen a broad sell-off overnight and into this morning,” the firm wrote in a trading note. “The market remains poised as traders pay close attention to daily ETH ETF outflows and further supply pressure from Mt Gox and the US government.”
Meanwhile, the other top-ranking coins are showing mixed performance.
Solana (SOL) is down 7.2% since yesterday to $169.13. Things are even worse for its most popular meme coins. In the past 24 hours, the most popular meme coins Dogwifhat (WIF) are down 12% and BONK (BONK) is down 9%, according to CoinGecko data.
Their dog-themed competitor, Ethereum OG Dogecoin (DOGE), the only meme coin in Coingecko’s top 10, is down nearly 4% since yesterday and is currently trading at $0.1205.
XRP (XRP) dropped to $0.608, which is 7% lower than it was at this time yesterday.
Binance’s BNB Coin (BNB) has kept pace with BTC and is currently trading at $571, down 2.4% from yesterday. Toncoin (TON), the native token of The Open Network, is down just 0.4% over the past day.
This leaves the stablecoins USDC (USDC) and Tether (USDT), both of which are stable as they maintain their 1:1 ratio with the US dollar.
The Securities and Exchange Commission (SEC) will hold another closed-door meeting with Ripple on Thursday, as the market hopes for a possible resolution to the legal battle between the two entities.
However, the cryptocurrency market remains relatively bearish, with the price and trading volume of XRP down in the last 24 hours.
Ripple holders take no risk
At press time, XRP is trading at $0.60. The altcoin’s price has dropped 6% over the past 24 hours. During that time, trading volume was $27 million, down 27%.
The SEC met before with the digital payment company on July 25. While the outcome of that meeting remains unknown, the Sunshine Act Notice for Thursday’s meeting includes one additional topic of discussion from the July 25 closed meeting: the instituting and resolving injunctive relief. That has market participants speculating whether a settlement is imminent.
In an exclusive interview with BeinCrypto, Ryan Lee, Lead Analyst at Bitget Research, noted that:
“This meeting will discuss possible resolution options for the Ripple Lawsuit. The founder of Ripple Labs said that a legal settlement could be announced soon. If an official settlement plan is released, it could positively impact XRP’s price movement.”
However, an assessment of XRP’s price movements on a 4-hour chart shows a spike in bearish bias as the market awaits the outcome of this crucial meeting. Its Moving Average Convergence/Divergence (MACD) indicator readings show that its MACD line (blue) has crossed below its signal line (orange).
XRP 4 Hours Analysis. Source: Trading View
Traders use this indicator to gauge price trends, momentum, and potential buying and selling opportunities in the market. When an asset’s MACD is set this way, it is a bearish signal that suggests selling activity is outweighing buying momentum.
Additionally, the altcoin relative strength index (RSI), at 46.08, is currently below its neutral 50 line and in a downtrend. This indicator measures overbought and oversold market conditions for an asset.
To know more: How to Buy XRP and Everything You Need to Know
XRP 4 Hours Analysis. Source: Trading View
At 43.83 at the time of writing, XRP’s RSI suggests a growing preference among the market participants for tokin distribution.
XRP Price Prediction: Derivatives Traders Exit Market
The XRP derivatives market has also seen a decline in trading activity over the past 24 hours. According to Coinglass, derivatives trading volume has plummeted 18% and open interest has dropped 10% during that period.
Open interest refers to the total number of outstanding derivative contracts, such as options or futurethat have not yet been resolved. When it drops, traders close their positions without opening new ones. This is a bearish signal that reflects a lack of confidence in any potential positive price movement.
According to Lee, the outcome of the meeting with the SEC “would have a significant impact on the price movement of the token.” If the outcome is favorable, the price of the token could rise towards $0.75 in August.
To know more: Ripple (XRP) Price Prediction 2024/2025/2030
XRP 4 Hours Analysis. Source: Trading View
On the other hand, if no favorable resolutions are reached, the price could plummet to $0.50.
Disclaimer
In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto strives to provide accurate and unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult a professional before making any financial decisions. Please note that our Terms and conditions, Privacy PolicyAND Disclaimers They have been updated.
Bitcoin is now the dominant force in the cryptocurrency market, surpassing 53% of the total cryptocurrency market, a stronger share than it has been in the past three years.
Bitcoin’s market cap now stands at $1.27 trillion, second according to CoinGecko data. In contrast, the total cryptocurrency market cap is $2.43 trillion, with Ethereum occupying 15.9% of the market, worth $389 billion.
Bitcoin’s rise to dominance this year is unusual, as altcoins typically do better than Bitcoin in a bull market. While meme coins made a strong comeback during Bitcoin’s rally to all-time highs earlier this year, the so-called “wealth effect” It has not been appreciated as much by mid-range coins, such as Ethereum and Cardano.
“ETF flows fundamentally alter market dynamics,” he wrote Meltem Demirors, former chief strategy officer at CoinShares, tweeted Wednesday: “BTC gains no longer translate to alts and the longer tail of crypto.”
Bitcoin’s takeover has continued even as the market cap of Tether (USDT) continues to grow, the world’s largest stablecoin and the third-largest cryptocurrency after BTC and ETH. Stablecoins are backed by fiat currencies and are excluded from some measures of Bitcoin dominance due to fundamentally different value models.
The surge continued to pace even after the launch of Ethereum spot ETFs last week, which ironically culminated in a news sell-off event, and net outflows from new investment products since they were launched. This went against the predictions of K33 Search so far, which predicted that ETFs would catalyze ETH’s growth over the next five months.
Despite the poorer performance of the alts, there is reason to believe that they are ready to bounce back very soon.
CryptoQuant CEO Ki Young Ju said Tuesday that whales are “preparing for the next altcoin rally,” as limit buy orders for assets other than BTC and ETH are on the rise.
The executive shared a chart showing how the “cumulative difference between purchase volume and sales volume” has increased in recent months.
“The indicator measures the difference between buy and sell orders over a year,” CryptoQuant told Decrypt. A buy/sell order is a pre-set request to buy or sell a cryptocurrency if it hits a certain price level, which creates resistance and support levels.
“If the trend is up, it means that more people are placing buy orders, showing strong interest in buying,” CryptoQuant said.
By Ryan-Ozawa.
After Monday’s crash, in which BTC fell by several thousand dollars, the scenario has repeated itself once again in the last 12 hours, with the asset falling to a 2-week low of $63,300.
Alt coins followed suit, with most of the market in the red today. SOL and XRP lead the way from the higher cap alts.
BTC Drops To $63.3K
After a violent Thursday last week, when BTC crashed to $63,400, the asset went on the offensive over the weekend and surged above $69,000 on Saturday, as the community prepared for Donald Trump’s appearance at the 2024 Bitcoin Conference in Nashville.
His speech was followed by more volatility before the cryptocurrency settled around $67,500 on Sunday. Monday started off rather optimistically for the bulls as bitcoin hit a 7-week high of $70,000.
However, he failed to maintain his run and conquer that level decisively. On the contrary, he was rejected bad and dropped to $66,400 by the end of Monday. Tuesday and Wednesday were less eventful as BTC remained still around $66,500.
The last 12 hours or so have brought another crash. Bears have pushed the leading digital asset down hard, which has fallen to a 2-week low of $63,300 (on Bitstamp), leaving over $200 million in liquidations.
Despite the current rebound to $64,500, BTC’s market cap has fallen to $1.270 trillion, but its dominance over alts is recovering and has reached 52.6%.
Bitcoin/Price/Chart 01.08.2024. Source: TradingView
The Alts are back in red
Ripple’s native token has been at the forefront of the market challenge in recent days as pumped up to a multi-month high of over $0.66. However, its run was also interrupted and XPR fell by more than 6% in the last day to $0.6.
The other big loser among the larger-cap alternatives is SOL, which has lost 8% of its value and is now struggling to get below $170.
The rest of this altcoin cohort is also in the red, with ETH, DOGE, BNB, AVAX, ADA, SHIB, and LINK all seeing drops between 2 and 5%.
The total cryptocurrency market cap lost another $70 billion overnight, falling below $2.4 trillion today on CG.
Cryptocurrency Market Overview. Source: QuantifyCrypto SPECIAL OFFER (sponsored)
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Disclaimer: The information found on CryptoPotato is that of the authors cited. It does not represent CryptoPotato’s views on the advisability of buying, selling, or holding any investment. We recommend that you conduct your own research before making any investment decisions. Use the information provided at your own risk. See Disclaimer for more information.
Cryptocurrency Charts by TradingView.
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