BTC Breaks Through $68,000 Resistance, NVIDIA Reaches New All-Time High, Funds Continue to Flow into the Cryptocurrency Market.
Cryptocurrency Market Summary:
1. Since the National Day holiday, the overall cryptocurrency market has been trending upwards. BTC broke through the $68,000 resistance level and reached a new all-time high, surpassing the $70,000 mark. Based on previous BTC halvings, BTC tends to reach new highs within 10-15 months after the halving. With the upcoming US presidential election, which is the biggest uncertainty factor, it is highly likely that the cryptocurrency market will experience another round of skyrocketing after the election.
2. Currently, the data for US CPI and initial jobless claims are mediocre, making it difficult to provide strong support for further interest rate cuts. However, the fundamentals are still positive, and it is not ruled out that there may be a downward test before the launch of BTC, with the help of unclear market sentiment.
3. NVIDIA and the AI sector have driven the rise of the US stock market, and the AI concept deserves special attention.
Market Overview:
1.1 FutureMoney Group DePIN Index
The FutureMoney Group DePIN Index is a high-quality token index constructed by FutureMoney, selecting the most representative 24 DePIN projects. Compared to the previous report, the NAV value has slightly decreased from 10.12 to 9.79. The spot price has also fallen, as many DePIN application projects have started to adjust their prices this week, while storage and infrastructure DePINs such as Storj and IOTA still have strong momentum for growth.
1.2 Cryptocurrency Market Data
From October 7th to October 16th, stablecoins remained stable at around $159 billion. BTC’s proportion of the total cryptocurrency market value has slightly increased and is currently at 57.42%.
Observing the trend of Coinglass contract positions, the open positions of BTC contracts across the network have increased since October 7th, from $34 billion to $38.5 billion. In the few days after the National Day holiday, the BTC contract positions experienced fluctuations, and as BTC surged again on October 11th, the contract positions began to steadily rise.
The overall open positions of ETH contracts across the network have increased in the past week, from around $11.5 billion on October 7th to around $12.8 billion on October 15th.
Currently, the trend of BTC is in a phase of confidence recovery. With the recent breakthrough of BTC’s interim high, new players who entered the market earlier have exited with profits. Coupled with the overall improvement in the fundamentals of cryptocurrencies, there has been a net outflow of BTC spot positions. As of now, there is a net outflow of $167 million in BTC spot positions and a net inflow of $151 million in ETH spot positions. There is a net inflow of $2.031 billion in BTC contracts and a net inflow of $587 million in ETH contracts.
1.3 CPI Data and Market Reaction for Market Judgement
1. Macro Perspective: On October 11th, the US Bureau of Labor Statistics announced that the US CPI rose 2.4% year-on-year in September, which is a slowdown from the previous value of 2.5% but higher than the expected value of 2.3%, reaching the lowest level since February 2021. Coupled with the strong non-farm payroll report last week, there may be a debate within the Federal Reserve on whether to choose a small rate cut next month or to pause after a significant rate cut in September.
The number of initial jobless claims jumped by 33,000 to 258,000 on September 28th, far exceeding the expected 230,000, marking the highest number of applicants since early August 2023. One of the reasons for the increase may be the impact of Hurricane “Helen,” which has led to a significant increase in unemployment claims in states such as Florida and North Carolina, as well as a surge in claims in states affected by the storm, such as Tennessee, Virginia, and Kentucky.
2. Cryptocurrency Perspective: In the past week, BTC has shown a short-term rebound from the bottom of around $59,000 and quickly surged above the $69,000 resistance level. At the same time, the liquidity of BTC spot ETF has increased, attracting more institutional investors to enter the market. Overall, the US stock market is reaching new highs, but with increased global market uncertainty, the market’s safe-haven sentiment has significantly increased, leading to an inflow of funds into BTC. Against the backdrop of increasing political and economic uncertainty worldwide, the cryptocurrency market will continue to be supported by capital inflows, especially with the positive long-term prospects of BTC. BTC may test new price highs in the coming months.
3. Sectors Worth Investing In: Based on the performance of the US stock market, on October 14th, driven by technology stocks and chip stocks, the major US stock indices collectively rose, with the Dow Jones and S&P reaching new highs. With the general rise of chip stocks, NVIDIA has reached a new all-time high. Therefore, the AI sector is still the strongest narrative in the current Web3. In addition, the RWA concept closely related to traditional finance is also becoming hot.
Hot Market News:
2.1 Fed Voting Member Daly: Must Protect Economic Growth, Open to Only One More Interest Rate Cut This Year
FOMC voting member and President of the Federal Reserve Bank of San Francisco, Mary Daly, stated that based on the median estimate released in September, officials still expect the Federal Reserve to further reduce borrowing costs by 50 basis points during the remaining time in 2024. Despite the cooling of inflation, last month’s rate cut was a “reset” of policy and emphasized that interest rates are still restrictive. Daly stated last week that she believes the Federal Reserve may cut interest rates one to two more times this year, each time by 25 basis points.
2.2 Carrie Lam: Promoting the Application of Artificial Intelligence in Central Bank Digital Currency and Virtual Asset Trading and Other Innovative Financial Services
Hong Kong Chief Executive Carrie Lam stated that the government will continue to promote the policy stance and guidelines for the application of innovative financial services using artificial intelligence, including central bank digital currency, mobile payments, virtual banks, virtual insurance, and virtual asset trading.
Measures include: 1) promoting cross-border payment applications with central bank digital currency. The Hong Kong Monetary Authority is actively testing and exploring more technical solutions and scenarios related to cross-border trade settlement on various central bank digital currency networks, and expanding the participation of public and private institutions. 2) Improving the regulation of virtual assets and trading. The Treasury Department will complete the second round of consultations on the regulation of virtual asset over-the-counter trading and submit a virtual licensing system for virtual asset custodial service providers. 3) Promoting the tokenization of real-world assets and the digital currency ecosystem. The Hong Kong Monetary Authority is promoting the Ensemble project.
2.3 A16Z Invests $50,000 in AI Bot GOAT
GOAT is based on the OPUS large language model Truth Terminal, which is trained on data from websites such as Reddit and 4chan that focus on extreme subcultures. Its design purpose is to debate AI-generated belief systems combined with meme elements. On July 9th this year, A16Z’s official Twitter interacted with Truth Terminal and invested $50,000 in it. As of now, the market value of GOAT tokens has exceeded $300 million, with a 24-hour increase of 133%.
2.4 Trump Family’s Cryptocurrency Project WLFI Token Sales Exceed $10 Million
The sales of WLFI tokens, the cryptocurrency project of the Trump family’s World Liberty Financial, have exceeded $10 million, accounting for about 3.4% of its $300 million target. WLFI started its sales on October 15th, offering a total of 20 billion tokens. 6.87 billion tokens were sold in 14 hours, worth about $10.3 million. According to Etherscan data, there are 6,832 independent wallet addresses holding WLFI, which is currently lower than the more than 100,000 registered users announced by the project team the day before the token launch.
Regulatory Environment:
TD Bank Fined $3 Billion for Failing to Report Suspicious Cryptocurrency Transactions
The US Financial Crimes Enforcement Network (FinCEN) stated that banking giant TD Bank failed to report suspicious activities of an anonymous customer organization involved in international cryptocurrency transactions. TD Bank processed over 2,000 transactions from a company named “Customer Group C” over a period of 9 months, which was identified as “allegedly conducting business in sales financing and real estate industry.” The organization lied to TD Bank about their international wire activity plans, claiming that their annual sales would not exceed $1 million. In reality, they conducted over $1 billion in transactions through TD Bank.
As a result, TD Bank violated the Bank Secrecy Act and faced multiple charges, including money laundering, resulting in a $3 billion fine.
