Digital Asset Weekly, Sep 21

Digital Assets ended the week modestly higher – gaining +0.9% – as another week of BTC price consolidation was offset by strength in 2nd tier digital assets.  XRP led gains amongst major coins/tokens, surging > +30% this week.  ETH bucked a week of skinny trading with volume +12% WoW for the 3rd consecutive week of volume gains.  Amongst the top 200 coins/tokens, breadth was narrowly skewed to the positive with 52% of major coins/tokens ending the week higher

Headlines were largely exchange dominated.  The top story of the week was a critical report on the exchange space by the New York Attorney General and subsequent rebuttals from Coinbase and Kraken.  New York has long been a challenging regulatory regime for digital asset projects; while the story generated a lot of conversation it seemed to have little impact on this week’s trading and was largely negated by a number of positive headlines in the space, including: Binance expansion plans and reports of US$350M of profits in 1H1, more new hires at Coinbase, and ongoing maturation at Poloniex.

Negative headlines were led by a small hack at NewDex and a larger (US$60M) hack at Zaif (a Japanese exchange).

Continue to expect an uptick in BTC volatility in coming weeks given very slim volume, shorts plateauing, 4Q seasonality and ahead of a number of events (Mt Goxx creditor meeting on Sep 26, VanEck ETF decision on Sep 30th and Bakkt’s physical BTC futures expected by Nov 5th).  Likewise, we remain cautiously constructive on ETH given improving volumes and signs of price stabilization.

Read the full report here: Digital Asset Weekly Sep 21 2018

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