- Last week, cryptoassets generally outperformed traditional assets due to rising odds for a strategic bitcoin reserve in the US.
- Our in-house “Cryptoasset Sentiment Index” has recovered from oversold levels but still signals a slightly bearish sentiment.
- Odds for a national Bitcoin reserve in 2025 have recently increased above 50% according to the prediction market Polymarket.
Chart of the Week
Performance
Last week, cryptoassets generally outperformed traditional assets due to rising odds for a strategic bitcoin reserve in the US. More specifically, Odds for a national Bitcoin reserve in 2025 have recently increased above 50% according to the prediction market Polymarket (Chart-of-the-Week).
Today, Donald Trump will be inaugurated as the 47 th president of the United States of America and it is generally expected that he will sign more than 100 executive orders within the first week in office. Prediction markets even assess the probability of issuing crypto-related executive orders on the very first day (i.e. today) at around 45% at the time of writing this report on Monday morning.
Meanwhile, a large anomaly was Ethereum's significant underperformance vis-à-vis Bitcoin and other major cryptoassets. Ethereum underperformed Bitcoin by around -870 bps last week and Solana by even -3460 bps. This was mostly related to the fact that Solana benefited from Trump's official meme coin (TRUMP) that was issued late Friday night on Solana.
Since trading launch, Trump coin has risen to the top 20 cryptoassets by market cap which is the fastest increase since trading launch ever recorded.
The current market cap is around 12 bn USD at the time of writing this report. The fully diluted market cap, after accounting for the potential max supply of Trump coin, is around 60.4 bn USD. This launch has significantly increased Trump's personal net worth as well.
Although the reactions to this launch among industry professionals are relatively mixed, it reinforces the view that Trump's presidency will likely be very favourable towards the crypto industry in the US.
Apart from these developments, we have seen a significant reacceleration in net inflows into global crypto ETPs last week which have also supported the recent rally in prices (more details in the Fund Flows section below).
We have also seen continued buying interest for bitcoin by corporations, most prominently by Microstrategy (MSTR). Michael Saylor has once again indicated on Twitter/X that MSTR has recently made another larger acquisition of bitcoins.
In general, among the top 10 crypto assets, Solana, Chainlink, and XRP were the relative outperformers.
Overall, altcoin outperformance vis-à-vis Bitcoin increased slightly last week, with around 40% of our tracked altcoins managing to outperform Bitcoin on a weekly basis. Ethereum significantly underperformed Bitcoin last week.
Sentiment
Our in-house “Cryptoasset Sentiment Index” has recovered from oversold levels but still signals a slightly bearish sentiment.
At the moment, 8 out of 15 indicators are above their short-term trend.
We are currently observing significant increases in the BTC Put-Call Volume Ratio as well Global Crypto ETP Flows.
The Crypto Fear & Greed Index currently signals an “Extreme Greed” level of sentiment as of this morning.
Performance dispersion among cryptoassets has remained relatively stable at low levels. This signals that altcoins have continued to be more correlated with the performance of Bitcoin lately.
Altcoin outperformance vis-à-vis Bitcoin has increased slightly last week, with around 40% of our tracked altcoins managing to outperform Bitcoin on a weekly basis. Ethereum has significantly underperformed Bitcoin last week.
In general, increasing (decreasing) altcoin outperformance tends to be a sign of increasing (decreasing) risk appetite within cryptoasset markets and the latest altcoin underperformance still signals bearish risk appetite at the moment.
Sentiment in traditional financial markets as measured by our in-house measure of Cross Asset Risk Appetite (CARA) has increased last week. The index signals a slightly bullish cross asset risk appetite.
Fund Flows
Weekly fund flows into global crypto ETPs have reaccelerated significantly last week.
Global crypto ETPs saw around +2,281.5 mn USD in weekly net inflows across all types of cryptoassets, after +187.2 mn USD in net inflows the previous week.
Global Bitcoin ETPs flows have also accelerated significantly with net inflows totalling +2,000.1 mn USD last week, of which +1,866.4 mn USD in net inflows were related to US spot Bitcoin ETFs alone.
The Bitwise Bitcoin ETF (BITB) in the US also saw some decent net inflows, totalling +215.9 mn USD last week.
In Europe, the Bitwise Physical Bitcoin ETP (BTCE) saw accelerating net inflows equivalent to +1.3 mn USD, while the Bitwise Core Bitcoin ETP (BTC1) also attracted decent amounts of capital of around +6.7 mn USD.
Outflows from the Grayscale Bitcoin Trust (GBTC) continued unabated, with around -87.7 mn USD in net outflows last week. The iShares Bitcoin Trust (IBIT) saw around +745.6 mn USD in net inflows last week.
Meanwhile, flows into global Ethereum ETPs reversed significantly, with around +215.2 mn USD in net inflows after -264.1 mn USD in net outflows the week before.
US Ethereum spot ETFs also recorded net inflows with around +212.0 mn USD on aggregate. The Grayscale Ethereum Trust (ETHE) also continued to experience net outflows with around -33.2 mn USD last week.
The Bitwise Ethereum ETF (ETHW) in the US also experienced some net inflows of around +3.7 USD in net inflows last week.
In Europe, the Bitwise Physical Ethereum ETP (ZETH) also experienced minor positive net inflows of +0.1 mn USD while the Bitwise Ethereum Staking ETP (ET32) experienced some net outflows of around -1.5 mn USD.
Altcoin ETPs ex Ethereum continued to attract capital last week, with around +62.0 mn USD in global net inflows on aggregate. Both the Bitwise Physical Solana ETP (ESOL) and our newly launched Bitwise Solana Staking ETP (BSOL) had sticky AuM (+/- 0 mn USD).
Furthermore, thematic & basket crypto ETPs experienced some minor net inflows of around +4.2 mn USD on aggregate last week. The Bitwise MSCI Digital Assets Select 20 ETP (DA20) had sticky AuM last week (+/- 0 mn USD).
Global crypto hedge funds have continued to exhibit a low market exposure to Bitcoin last week. The 20-days rolling beta of global crypto hedge funds' performance to Bitcoin decreased back to around 0.55 per yesterday's close, up from 0.67 the week before.
On-Chain Data
In general, Bitcoin's on-chain developments have continued to be relatively positive.
That being said, selling pressure remained relatively high, with around -1.358 bn USD in net selling volumes on BTC spot exchanges.
On a positive note, exchange balances continued to go down last week, indicating a continuous drop in the amount of liquid supply available on exchanges, indicating that the overall supply deficit in Bitcoin is still intensifying. At the time of writing, only 2.757 million BTC remain on exchanges, according to data provided by Glassnode.
On a net basis, whales have continued to send bitcoins off exchanges. More precisely, last week, BTC whales sent -8,903 BTC off exchanges, indicating a continuously high whale buying interest. Network entities that possess at least 1,000 Bitcoin are referred to as whales.
Worth highlighting is that we are observing a decline in BTC apparent demand, which points towards a deceleration in on-chain capital inflows into bitcoin. This is a risk worth watching over the coming weeks.
Futures, Options & Perpetuals
Last week, BTC futures traders slightly increased their exposure as open interest increased by around +5k BTC. However, BTC perpetual futures open interest declined by around -10k BTC.
BTC long futures liquidations increased to the highest level since mid-December yesterday due to the sudden drop from around 105k to 101k USD.
Nonetheless, BTC perpetual funding rates soared to the highest level since early December in early Monday morning trading, which implies that perpetual traders are positioning long ahead of the inauguration.
In general, when the funding rate is positive (negative), long (short) positions periodically pay short (long) positions, which is indicative of bullish (bearish) sentiment.
The BTC 3-months annualised basis also increased to around 13.7% p.a. averaged across various futures exchanges.
Meanwhile, BTC option open interest increased significantly by around +44k BTC last week. The put-call open interest ratio also decreased significantly, signalling high call buying last week.
This was also reflected in the 1-month 25-delta skew for BTC which also decreased and signals increasing bullish sentiment.
BTC option implied volatilities also increased significantly to the highest level since July 2024 signalling increased demand for BTC options.
At the time of writing, implied volatilities of 1-month ATM Bitcoin options are currently at around 64.6% p.a.
Bottom Line
- Last week, cryptoassets generally outperformed traditional assets due to rising odds for a strategic bitcoin reserve in the US.
- Our in-house “Cryptoasset Sentiment Index” has recovered from oversold levels but still signals a slightly bearish sentiment.
- Odds for a national Bitcoin reserve in 2025 have recently increased above 50% according to the prediction market Polymarket.
Appendix
Informazioni importanti
Le informazioni contenute nel presente materiale hanno finalità esclusivamente illustrative o informative e non costituiscono consulenza in materia di investimenti, raccomandazione personalizzata, né un’offerta o sollecitazione al pubblico risparmio.
Il presente documento (che può assumere la forma di presentazione, comunicato stampa, post sui social media, articolo di blog, comunicazione audiovisiva o altro strumento analogo – di seguito, per semplicità, “Documento”) è emesso da Bitwise Europe GmbH (“BEU” o “l’Emittente”) ed è redatto in conformità alla normativa applicabile, incluse le disposizioni in materia di comunicazioni promozionali relative a strumenti finanziari.
Bitwise Europe GmbH, costituita secondo il diritto tedesco, è l’emittente degli Exchange Traded Products (“ETP”) descritti nel presente Documento ai sensi di un prospetto di base e delle relative condizioni definitive, eventualmente integrati nel tempo e approvati dalla Bundesanstalt für Finanzdienstleistungsaufsicht (BaFin). L’approvazione del prospetto da parte di BaFin non costituisce un giudizio di merito sull’investimento né un’approvazione del presente contenuto da parte di CONSOB.
Prima di effettuare un investimento in prodotti emessi da BEU, è opportuno verificare con i propri consulenti professionali e con il proprio intermediario che tali prodotti siano disponibili nella propria giurisdizione e coerenti con il proprio profilo di rischio. Ogni decisione di investimento dovrebbe essere assunta tenendo conto della propria situazione personale, dopo aver ottenuto consulenza indipendente di natura finanziaria, fiscale e legale.
Capitale a rischio. Le cripto-attività sono strumenti ad elevato rischio e caratterizzati da elevata volatilità. Il valore degli investimenti in cripto-attività e in ETP con esposizione a cripto-attività può diminuire così come aumentare e gli investitori possono perdere parte o la totalità del capitale investito. Nessun sistema di garanzia o indennizzo protegge dalle perdite derivanti dall’andamento di mercato. Le performance passate non sono indicative di risultati futuri. Le dichiarazioni previsionali non costituiscono garanzia di risultati.
Prima di investire, si raccomanda di leggere attentamente il prospetto di base e le relative condizioni definitive, in particolare la sezione “Fattori di rischio”, disponibili sul sito https://bitwiseinvestments.eu/it/
L’accesso a determinati documenti può richiedere una dichiarazione in merito alla propria giurisdizione e alla propria categoria di investitore e può essere soggetto a ulteriori avvertenze e informazioni importanti.
Ulteriori informazioni sui rischi sono disponibili al seguente indirizzo: https://bitwiseinvestments.eu/it/risk-warning/
