Crypto Market Insights

The 50bps rate cut from the US Federal Reserve was followed by the People’s Bank of China unveiling the largest stimulus package since the pandemic last week. The PBoC shared plans to lower borrowing costs, inject more funds into the economy and ease household’s mortgage repayment burden.  The PBoC also cut the RRR (reserve requirement ratio, or the amount of cash that banks must hold as reserves) by 50bps, releasing about 1 trillion yuan for new bank lending activities. For more on this topic, see China's central bank unveils most aggressive stimulus since pandemic | Reuters.

Chinese stocks rallied strongly after the news, with the Shanghai Composite index closing out the quarter up an incredible 17%! The yuan gained to trade at levels not seen since May 2023 and the spill over into risky assets globally has not gone unnoticed. China Markets Surge in Wild End to the Quarter - WSJ. The S&P trades at all-time highs, the Nasdaq is not far off and BTC breached 66k on Friday as we wrap up quarter end portfolio rebalancing.

Helping the crypto market may be more conciliatory rhetoric from China’s former vice minister of finance over the weekend. Zhu Guangyao spoke at a roundtable discussion at the Tsinghua PBCSF Chief Economists Forum in Beijing, noting the shift in international policy towards cryptocurrencies and stressed the importance of staying informed of global developments in the sector. China’s former vice finance minister calls for deeper study of crypto amid global policy shifts | The Block.

Macro developments helped ETF flows keep up the positive momentum, with BTC funds logging just over $1.1bn of inflows last week. ETH ETFs finally saw a positive week with $85mm of inflows, although flows are still dwarfed by BTC ETFs. Bitcoin ETF Flow (US$m) – Farside Investors / Ethereum ETF Flow (US$m) – Farside Investors.

Notable Crypto News

Ethena Labs Unveils New Stablecoin UStb Backed by BlackRock BUIDL Fund | Coinspeaker

Harris and Trump tied in race for crypto voters, new poll shows - MarketWatch

Former Binance CEO Changpeng Zhao released from custody on Friday: Bloomberg | The Block

China’s former vice finance minister calls for deeper study of crypto amid global policy shifts | The Block

CleanSpark CEO expects bitcoin to peak near $200,000 this cycle: Bernstein | The Block

US Foreign Affairs Committee passes resolution demanding Binance exec Tigran Gambaryan's release in Nigeria | The Block

BlackRock's spot Ethereum ETF surpasses $1 billion in value for the first time | The Block

The Macro Week Ahead

The week ahead will focus on tonight’s speech by Fed Chair Powell and US labour market data on Tuesday (JOLTs) and Friday (Non-Farm Payrolls / unemployment rate). Euro Area inflation will inform the ECB ahead of their next policy meeting on 26 October.

Financial Advice Disclaimer: Nothing in this article constitutes professional or financial advice, performance data or any recommendation that any specific cryptocurrency, portfolio, index, investment product, transaction or investment strategy is suitable for any specific person. You assume the sole responsibility of evaluating the merits and risks associated with all financial decisions and should seek the advice of a registered financial advisor when in doubt.