BTC is currently trading around $28,800 and ETH around $1,900. Notable gainers in the last 24 hours are PEPE, WOO, and KAS. The global crypto market cap is ~$1.24T, up ~1.3% over the last day. DeFi Total Value Locked is ~$49b and BTC dominance is around 48%.
Equities generated small positive gains yesterday before falling more than one percent in the last hour of trading, pushing markets into the red with the downward move extending so far this morning. As expected, the Fed hiked rates by 25 bps, and Fed Chair Powell signaled a pause in hikes might be on the precipice in June. Acknowledging that the outlook for future rate hikes is uncertain and data-dependent, market-implied probabilities indicate that the most likely path ahead is an imminent pause before a series of rate cuts in Q4. Bond yields increased slightly on the initial Fed statement before moving lower during the subsequent press conference, likely due to Powell’s relatively dismissive concerns about the banking system. The S&P Regional Banking ETF fell more than 4% during the Fed’s update, falling more than 9% again this morning after PacWest (PACW) concerns emerged after yesterday’s close. Bloomberg reported at 4:44 pm EST that PacWest was weighing its strategic options, including a potential sale, and PACW is down ~56% this morning. First Horizon (FHN) is also down ~39% after TD Bank called off its acquisition. One increasingly common investor concern is that regional banks simply cannot survive being cast in any negative light right now, as the attention itself may be the killing blow as fleeing deposits become self-fulfilling. Bitcoin rallied sharply in the immediate aftermath of Bloomberg’s PacWest report, resembling the price dynamics exhibited during earlier banking collapses over the past months. Elsewhere, the ECB similarly hiked by 25 bps, and Apple reports today after the bell and will provide a gauge on consumer sentiment.
Notable news includes: the SEC is taking a step back in defining ‘digital assets’ in the rules that govern the reporting requirements for hedge funds; Franklin Templeton launched its onchain money market fund on Polygon; Coinbase is retiring its ‘Borrow’ program that enabled users to borrow USD versus their BTC collateral (no impact to existing loans); Sui mainnet went live with the token sitting at a ~$13b fully diluted value; Curve’s stablecoin went live on mainnet; TUSD lending rates spiked as the stablecoin briefly rallied to $1.20; China is attempting to spur its CBDC adoption with coupon discounts; North Carolina joined Florida in passing anti-CBDC legislation; XEN consumed more than 11% of Ethereum gas over the last day in another sign of memecoin exuberance; and, a WallStreetBets themed token joined the memecoin rally before plummeting ~90% as insiders dumped.
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Matt Kunke, Research Analyst | Twitter, Telegram, LinkedIn
Brian Rudick, Senior Strategist | Twitter, Telegram, LinkedIn
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