Crypto Update: Crimson tide
Cryptocurrency analyst, Saxo Bank
This week the entire crypto market cap fell 12% to just over $200 billion. Bitcoin fell by 3%, continuing to prove use as a store of value over other cryptocurrencies during market downturns. On the other hand, Ethereum lost 24% this week. Ethereum is below levels not seen since November; volumes, however, are significantly higher now.
The future is still shaky for Ethereum as Bitcoin may still be looking for a new low. If Bitcoin does decide to trade towards new lows, Ethereum will likely follow.
Ethereum getting diced
The market is offering several narratives as to why Ethereum is falling so hard in August. First, retail investors who bought Ethereum during the ICO hype in the second half of last year, when the price of ether bounced around the $300 level, are just now holding at a loss. Second, many believe that ICOs are starting to liquidate their Ethereum holdings en masse. Third, BitMex CEO Arthur Hayes believes that the crypto hedge funds and venture capital funds that invested in Ethereum during the last year are looking to unload their mark to market losses to prevent further erosion of their balance sheets and their jobs. Ethereum along with other ICO projects face pressure from multiple fronts additionally to the systemic risk in the larger cryptocurrency market led by Bitcoin.
GMO Inc. announces huge gain in crypto business
The Japanese internet conglomerate GMO Inc. released its second-quarter results stating that the company’s crypto business saw a profit of JPY 250 million on revenue of JPY 2.65bn. The company’s exchange accounted for almost half of the revenue (JPY 1.42bn). The exchange saw a 7.3x increase in revenue over the previous quarter. Although the company’s mining business saw a 90% increase in revenue and operations are “increasing as expected,” the company realised a loss on its mining operations.
Overstock is now a crypto company
Overstock, the discount online retailer famous for liquidating the merchandise of failed dotcom era start-ups, released its earnings report recently, revealing that the company’s subsidiary tZero – a blockchain-based securities platform – is now worth more than the parent company. The company received a nice boost after its earnings announcement but is now trading close to its yearly low. Analysts predict a bright future for Overstock and tZero. However, their value will depend on adoption of the tZero platform.
Quarterly Outlook Q2 2022
Quarterly Outlook Q2 2022: The End Game has arrived
- Shocks from covid and the war in Ukraine have forced the global financial and political world to change, but what will the end game be?
Productivity and innovation have never been more importantAs the world economy hits physical limits and central banks tighten their belts, could equities be facing a 10-15% downside?
The great EUR recovery and the difficulty of trading itIf the terrible fog of war hopefully lifts soon, the conditions are promising for the euro to reprice significantly higher.
Tight commodity markets – turbocharged by war and sanctionsWith supply already tight, commodities keep powering on. But will it last for yet another quarter?
Between a rock and a hard placeGeopolitical concerns will add upward price pressures and fears of slower growth, while volatility will remain elevated.
The Great ErosionInflation is everywhere and central banks try to combat it. But will they get it under control in time?
Australian investing: Six considerations amid triple Rs: rising rates, record inflation and likely recessionWhile global financial markets are struggling in an uncertain world, the commodity-heavy Australian ASX index is poised to keep a positive momentum.
Cybersecurity – the rush to catch up with realityWith the invasion of Ukraine, governments and private companies are rushing to reinforce their cyber defenses.