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Key Trends in 2024’s Crypto Market Rally

Talos, Hex Trust, Kaiko, and Infinity Exchange in Hong Kong

Media
Media

Key Trends in 2024’s Crypto Market Rally

Introduction

Talos, Hex Trust, Kaiko, and Infinity Exchange in Hong Kong

On April 3rd 2024, Talos, Hex Trust, Kaiko, and Infinity Exchange hosted a panel on "Exploring Key Trends in this Crypto Market Rally" at Hex Trust's Hong Kong office. The speakers, Neelabh Dixit (Commercial Product Manager, Talos), Ed Zhao (Head of Markets, Hex Trust), Sean Lawrence (Head of APAC, Kaiko), and Chris Brewer (COO, Infinity Exchange) shared their views on the following areas:

There’s a lack of short-term cues in the market today

As we approach the completion of the Bitcoin Halving, the market has begun pricing in a low probability of an ETH ETF approval in May. However, barring any major macro or geopolitical events, the market currently lacks clear short-term cues. They discussed how the high funding rate for leveraged long positions could become costly if the market remains stagnant for too long, with summers traditionally slower in market activity until late July or August.

It’s still too early to assess institutional ETF participation

For interested firms, changes to the investment prospectus are a time-consuming process. They involve proposal creation, compliance checks, and board approvals before implementation. Despite most ETF flows currently coming from individual traders and a few hedge funds, analyzing these flows in Q4 or year-end could provide insights into institutional interest from Traditional Finance (TradFi) firms. Meanwhile, there are concerns surrounding the potential delay or approval of an ETH ETF. While regulatory issues regarding price manipulation persist, the classification of ETH's staking rewards as securities adds another layer of complexity. The panel felt that the approval of an ETH ETF could trigger a broader tokenization trend, presenting both immediate challenges and long-term expansion opportunities.

The current market environment favors the inflation hedge thesis

With rising concerns over escalating US debt levels, gold recently reached all-time highs, solidifying its position as a reliable hedge against inflation. Bitcoin, on the other hand, is still gaining wider adoption and offers unique benefits within a portfolio context due to its convexity.

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DISCLAIMER: The views and opinions expressed herein are those of the author(s) and do not necessarily reflect the views of Talos Global, Inc. or its affiliates (collectively, "Talos") and summarizes information and articles with respect to cryptocurrencies or related topics. This material is for informational purposes only and is only intended for sophisticated institutional investors, and is not (i) an offer, or solicitation of an offer, to invest in, or to buy or sell, any interests or shares, or to participate in any investment or trading strategy, (ii) intended to provide accounting, legal, or tax advice, or investment recommendations, or (iii) an official statement of Talos. No representation or warranty is made, expressed or implied, with respect to the accuracy or completeness of the information or to the future performance of any digital asset, financial instrument or other market or economic measure. The information is believed to be current as of the date indicated and may not be updated or otherwise revised to reflect information that subsequently became available or a change in circumstances after the date of publication. Talos and its employees do not make any representation or warranty, expressed or implied, as to accuracy or completeness of the information or any other information transmitted or made available. Investing in cryptocurrency comes with risk. Certain statements in this document provide predictions and there is no guarantee that such predictions are currently accurate or will ultimately be realized. Prior results that are presented here are not guaranteed and prior results do not guarantee future performance. Recipients should consult their advisors before making any investment decision. Talos may have financial interests in, or relationships with, some of the assets, entities and/or publications discussed or otherwise referenced in the materials. Certain links that may be provided in the materials are provided for convenience and do not imply Talos's endorsement, or approval of any third-party websites or their content. Any use, review, retransmission, distribution, or reproduction of these materials, in whole or in part, is strictly prohibited in any form without the express written approval of Talos.

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