The past 2 weeks saw market participants panicking as BTC traded lower to 54k and alts got flushed 30%. As blood flowed on the streets, we continued to hold on to our medium term bullish view.
We maintained a balanced perspective when we said the macro picture was turning rosier. Powell, in his recent communications and interviews, mentioned that a lot of progress has been made in curbing inflation. Markets are now pricing in a 100% chance of a rate cut in Sep.
The flows from the German police have concluded, and despite the impending distribution of BTC from Mt Gox, markets found a strong bid to bring BTC over 65k.
The ETH spot ETF looks like a done deal with the SEC asking for final revisions to S-1 filings and fee schedules. Analysts predict trading will begin on 23rd Jul.
Lastly, Trump picking J.D. Vance as his Vice President provides another positive catalyst. Vance is a known Bitcoin holder, and his potential influence could lead to more favorable crypto regulations under a Trump presidency.
Trade Idea
We continue to like trades with topside convexity as mentioned in our previous broadcasts. With the forward basis also moving higher (10-12% annualised yield), the payoffs are much more attractive.
ETH ENHANCED SHARKFIN
- Spot Ref: 3,500 ETHUSD
- Maturity: 27DEC24
- Base Coupon: 2% p.a.
- Max Payout: 76.64%
- Strike: 3,750 ETH/USD
- Barrier: 5,000 ETH/USD
Get paid up to 76.64% p.a. if ETH expires just below 5,000 at expiry. Even if ETH expires below 3,750 or above 5,000, you still get paid a 2% p.a. coupon.