2024-07-17 14:21

The former White House Communications Director under President Trump spoke in an exclusive interview with CoinDesk’s Jennifer Sanasie. Democrats' failure to introduce crypto legislation is damaging the party's prospects in the coming presidential election, Scaramucci said. Although he supports Trump's stance on crypto, Scaramucci won't be voting for the former president in November. Anthony Scaramucci, Donald Trump’s former director of communications, might just turn out to be his most vocal critic. The Skybridge Capital founder and CEO, who held his position under the former president in 2017 for less than a week, will not be voting for the Republican presidential nominee this November, even though they agree on at least one political issue: the need to enact clear crypto legislation. The Democrats' failure to do so is damaging them, said Scaramucci, who nevertheless continues to support the party. “The Democrats have made a horrific mistake,” he said in an interview with CoinDesk’s Jennifer Sanasie. “They could have been neutral on crypto or positive on crypto. And I think it would have helped them in the election.” Scaramucci is also no fan of Securities and Exchanges Commission (SEC) Chair Gary Gensler, even though he “weirdly helped the industry” by delaying his decision to allow the launch of spot bitcoin (BTC) exchange-traded funds (ETFs) until crypto rediscovered its footing after a tumultuous year. "I want Gary Gensler to be fired," he said, arguing that the antipathy of Gensler and Sen. Elizabeth Warren (D-Mass.) has been an "unbelievable disaster" for the crypto industry. Regarding Trump, he says the former president is not just all talk when it comes to crypto. If Trump gets reelected in November – which traders on crypto-based prediction market platform Polymarket are signaling has a 70% probability – Scaramucci said the new administration will create a supportive environment for the crypto industry. “They'll put a pro-SEC, pro-crypto, pro-digital asset SEC commissioner in place,” he said. “This whole discussion about what is a security and what's a token and all this stuff will go by the wayside.” Trump emerged as the “pro-crypto presidential candidate” earlier this year when he reiterated his view that central bank digital currencies (CBDCs) would be a danger to freedom, and he would not allow the creation of such a product. He started accepting donations in crypto and said he would “build a crypto army” to fight the “anti-crypto army,” referring to Warren. On Monday, he announced that he had picked Sen. J.D. Vance (R-Ohio) for vice president, who is also considered crypto-friendly. Scaramucci said, however, that while he’s happy Trump is pro-crypto, he is not a “one issue voter.” “I see myself as having Trump reality syndrome. I see the man for what he is. I see the lack of intellectual curiosity. I see the danger to democracy. I see these think tanks that are working alongside of him that want to build his transition into the first few years of his presidency as a dystopian.” https://www.coindesk.com/policy/2024/07/17/democrats-have-made-a-horrific-mistake-says-skybridge-capitals-anthony-scaramucci/

2024-07-17 11:19

Wall Street investors are deserting mega-cap stocks and piling into small caps amid cooling inflation and strengthening signs of a Fed interest-rate cut. Wall Street investors are piling into small-cap stocks and exiting mega-caps on signs of cooling inflation and strengthening Fed rate-cut bets. The sector rotation could potentially lead to more capital deployment in the crypto market, according to Marex Solutions' Ilan Solot Wall Street's pivot to shares in small-cap companies at the expense of mega caps could fuel gains in the crypto market, Marex Solutions told CoinDesk Wednesday. Since July 8, Nasdaq, Wall Street's tech-heavy index of 100 shares, including the so-called magnificent seven (Mag 7) of Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia and Tesla, has traded little changed around 2,270 points. Meanwhile, the Russell 2000, a small-cap index, has surged more than 12%, according to the charting platform TradingView. It's a sign investors are pulling money out of the largest tech firms and dumping it into smaller companies which, until recently, lagged behind the broader market. The Wall Street Journal attributes the newfound love for small caps to cooling inflation and strengthening confidence that the Federal Reserve will reduce the benchmark borrowing cost this year. The sector rotation could be the most important macroeconomic factor for cryptocurrencies, according to Ilan Solot, senior global strategist at Marex Solutions, a division of global financial platform Marex specializing in creating and distributing customized derivatives products. "As the steam comes off the Mag 7, money will look for other places to deploy. Small caps are the knee-jerk reaction, but I suspect crypto will benefit from this rotation," Solot said in an interview. Solot's perspective contrasts with the crypto market's widely held perception that trends in Nasdaq alone determine the valuations of digital assets. Institutions and traditional investors could have already started allocating money to crypto, as evidenced by the renewed demand for the U.S.-listed spot bitcoin (BTC) exchange-traded funds (ETFs). The 11 funds recorded a cumulative net inflow of $422.5 million on Tuesday, the highest tally in six weeks. The total inflow for the past three days has been over $1 billion. According to Solot, the sector rotation may be particularly favorable for Ethereum's native token, ether (ETH), and the impending debut of spot ETH ETFs. "ETH ETF might land the perfect timing as the AI tech investors look for alternative themes," Solot said. https://www.coindesk.com/markets/2024/07/17/rotation-out-of-mega-cap-us-stocks-could-provide-tailwind-for-cryptocurrencies-marex-solutions-says/

2024-07-17 10:51

Binance and OKX say closing a loophole that meant crypto prime brokers could offer lower fees is about transparency and creating a level playing field. Some trading firms say it's a backward step for market efficiency. First Binance then OKX have clamped down on prime brokers who offer their clients lower fees. Some trading firms claim this is a step towards less efficient markets and a result of large exchanges looking to boost their volumes. As the world's largest cryptocurrency exchanges crack down on brokerage firms that have bundled together clients to take advantage of lower trading fees, some market participants are warning the move could harm markets. Binance was the first to prevent prime brokers from leveraging its multitiered fee system to lower their own costs and offer rebates to clients, making changes to its Link Plus interface last month. Now, OKX appears to be following suit and clamping down on access to its VIP fee program. The exchanges say they are taking these steps to foster a level playing field for their users while ensuring they have transparency into the identity of the prime brokers' customers. Others see it as a backward step, at least from the perspective of creating more efficient markets. Cryptocurrency markets were built for retail customers, first and foremost, and that’s why they differ so dramatically from traditional finance. In mature markets, prime brokers offer institutions the equivalent of a simple bank account, behind which an army of intermediaries safely stores cash and assets and facilitates trades at lightning speed across a range of venues. Prime brokers also provide credit, allowing traders to shuffle and change positions, with everything netted down and settled a day or two later. Crypto’s capacity to disintermediate and deliver real-time settlement by blockchain means large participants with multiple simultaneous trades have to fund all their positions up front across a group of large, vertically integrated exchanges. Prime brokers solve that funding problem through their lending and financing component, points out George Zarya, the CEO of Bequant, a prime brokerage firm that services crypto clients. By cutting the brokerages' access to lower fees, the exchanges may – possibly inadvertently, possibly not – be making the crypto market less attractive for them. “Exchanges have decided that intermediaries are not necessary. They can provide loans as well, right?” said Zarya in an interview. “But they can only provide loans for the positions that are based on their exchange. They cannot provide portfolio margin, which includes your positions across the entire market. So essentially we're moving towards less capital-efficient markets.” Large crypto exchanges are leaning towards “liquidity capture,” said Brendan Callan, CEO of Tradu, a recently launched crypto exchange owned by investment banking group Jeffries. In other words, they are creating a captive audience model, where trading volume is increased because a user has to continually get in and out of positions on that exchange. The result is a discrepancy in bid prices on very popular and liquid pairs like BTC/USDT from one exchange to the next, Callan said. The inter-exchange discrepancies would appear “bonkers” to a conventional currency trader, he said, because liquidity providers all clear to a prime brokerage account behind the scenes so they can make markets on any other exchange. “It means you don't have this friction of counterparty risk thresholds across all of these exchanges. But the crypto exchanges themselves are insisting on this because they want that capture,” Callan said in an interview. “They want you to have to get in and out of positions on their exchange, because it boosts their volume, but it's at a cost to the quality of their liquidity. There's not as much depth in the market behind each quote and it's very sporadic.” https://www.coindesk.com/business/2024/07/17/crypto-exchanges-clamping-down-on-prime-brokers-is-backwards-step-for-market-efficiency-traders-say/

2024-07-17 09:51

Flowdesk's CEO made a contrarian bet on the U.S. while the SEC was waging war on crypto. Fast forward a year, and the country has bitcoin ETFs, ether ETFs are imminent and pro-crypto legislation is before the Senate. A year ago, market maker Flowdesk made a contrarian bet by expanding its U.S. presence during the chill of crypto winter. That bet paid off, as winter became spring then summer, and a favorable market environment and improving regulations means Flowdesk is well positioned in the country. Guilhem Chaumont, CEO of market maker Flowdesk, is prepared to follow his convictions even when the general outlook might indicate against them. Back in 2023, days before the U.S. Securities and Exchange Commission (SEC) began a second all-out assault on the crypto industry, suing Binance and a number of protocols, Chaumont said he planned to expand the Paris-based market maker's New York office. The size and sophistication of the U.S. capital markets were a worthwhile trade-off for dealing with its regulatory regime, he said. At the time, it was a contrarian move. A few months earlier, CoinDesk ran a rare editorial piece, observing that conspiracy theories that the U.S. government was trying to kill crypto didn't seem too far off. The editorial argued that the government was intentionally suppressing the industry through punitive regulatory enforcement actions and a lack of willingness to build workable rules. "The philosophy of the company has always been the same. We have a huge conviction about where the market is going," Chaumont said this week in an interview. "Building a company, particularly in crypto, is always about making contrarian bets and seeing what others didn't see. We are not very sensitive to short-term macro events. That's why we have always been very enthusiastic about the U.S. for crypto innovation. It's a land of innovation and a huge market for everyone." Since Chaumont's comments at Consensus 2023, the price of bitcoin has climbed almost 150%, according to CoinDesk Indices data, and the U.S. regulatory environment has improved with the SEC approving the introduction of bitcoin ETFs and set to agree to ether ETFs as well. First mover advantage Expanding U.S. headcount in 2023 when things looked bleak meant Flowdesk had a first-mover advantage when the market picked up. "Now we are grabbing significant market share, and our company is in better conditions than ever – profitable with a huge increase in volumes and revenues," he said. "Fueled by the ETF approval earlier this year, we started to see more positive news, and we were like, 'Okay, our bet is probably going to pay off.'" The situation may have vastly improved, but there's still some work to be done even as the Financial Innovation and Technology for the 21st Century Act (FIT21) – which has been praised by some industry stakeholders as a step in the right direction – goes to the Senate with bipartisan support. For instance, there's an added complexity in the market when dealing with U.S. counterparties because of the layers of licenses, meaning that there are still some operational limitations in the market. Another headache is custody. Chaumont argued that the U.S. needs a simplified and globally harmonized regulatory framework for custody, which, if done right, could unlock massive business potential. Many problems could be solved with harmonization, and Chaumont points to the European Union's MiCA regulations as an instance where that works well. There are lessons to be learned from the EU's approach, he said, which rules out the need for multiple licenses from individual states. That's the situation that persists in the U.S. "In Europe, you do not need to get multiple registrations," he said. "Once you are registered in one country, you can operate across the entire region." A lot has happened in the U.S. in the past year and, who knows, maybe such harmonization will be on the agenda when it's time for Consensus 2025. "If there were not these bottlenecks and uncertainties, we could have grown three times faster, like we did in France," Chaumont said. https://www.coindesk.com/business/2024/07/17/market-maker-flowdesk-doubled-down-on-the-us-as-things-looked-bleak-now-that-bet-is-paying-off/

2024-07-17 08:49

Open interest in XRP-tracked futures has nearly doubled over the past seven days, which is indicative of traders’ expectations of price volatility ahead. XRP surged 12% to extend weekly gains to over 40%, beating other major tokens. A bullish triangle pattern on XRP's long-term price charts and a substantial increase in open interest suggest more upside in the coming weeks. XRP surged 12% in the past 24 hours to lead gains among crypto majors, beating bitcoin (BTC) and the broader CoinDesk 20 (CD20) index. The token added 5% since the start of Asian trading hours on Wednesday to extend seven-day gains to nearly 40%, making it the best-performing major despite favorable regulatory developments for ether (ETH) and demand for meme coins. "XRP has been performing worse than the market for a long time, but the reversal of sentiment in crypto has sparked a rise on steroids in the once-largest altcoin. On the latest bounce, the price rose to 60 cents, its highest since April. This is an attempt to jump back into the uptrend of the past two years, " Alex Kuptsikevich, FxPro senior market analyst said. However, it may well turn out that XRP needs to rest after the climb. And this high is appropriate, as we saw prolonged consolidations here in November-December and March, Kuptsikevich added. Gains in the token started last week as traditional futures powerhouses CME and CF Benchmarks announced the debut of indices and reference rates for XRP. And such moves have formed a triangle pattern on long-term price charts, which some popular traders say could favor bullish action in the coming weeks. “I have never seen a 7-year-long bull pennant,” posted crypto trader @MichaelXBT on X. “We might be about to witness one of the most significant breakouts in crypto history.” The triangle pattern is a popular technical analysis chart formation that helps traders understand market sentiment and spot emerging trends. It forms when an asset's price trades in a narrow range following an uptrend or downtrend. Chartists see a breakout from a triangular pattern, especially on heavy volumes, as bullish, which may favor upward price movements. Meanwhile, open interest on futures tracking XRP has more than doubled in the past seven days, suggesting increased expectations of future price volatility. Open interest is the amount of unsettled futures trades. CoinGlass data shows that XRP futures had racked up over $780 million in bets as of Wednesday, up from the $420 million on July 9, bringing it to levels last seen in mid-April. Trading volumes for the tokens have surged from $2 billion to $3.6 billion in the period, CoinGecko data shows. Over 60% of XRP futures bets opened in the past 24 hours are longs, or bets on higher prices, data from Coinalyze shows. Such a bump in open interest, alongside trading volumes, indicates new money entering the market and expecting XRP to rise higher. https://www.coindesk.com/markets/2024/07/17/xrp-surges-12-on-the-back-of-triangle-pattern-rising-futures-bets-favor-bullish-price-moves-ahead/

2024-07-17 08:28

It may not happen immediately and price action could be choppy to start due to outflows from the Grayscale Ethereum Trust, after it converts to an ETF, the report said. Launch of spot ether ETFs in the U.S. will push the price of the crypto to all-time highs above $5,000, the report said. Bitwise said money flowing into new ether spot ETFs will have a larger impact than it did for bitcoin. Ether spot ETFs are expected to draw in $15 billion of net inflows in the first 18 months. The launch of spot ether (ETH) exchange-traded funds (ETFs) in the U.S., expected to occur next week, will push the price of the second largest cryptocurrency to all-time highs above $5,000, Bitwise said. It may not happen immediately and price action may be choppy to start, due to money flowing out of the $11 billion Grayscale Ethereum Trust (ETHE), after it converts to an ETF, Bitwise chief investment officer Matt Hougan wrote in a report on Tuesday. Still, “by year-end, I'm confident the new highs will be in,” Hougan wrote, “and if flows are stronger than many market commentators expect, the price could be much higher still.” Bitwise notes that bitcoin (BTC) has risen about 25% since the launch of spot ETFs in the U.S. in January, and more than 110% since the market began pricing in a potential launch in October last year. The money flowing into new ether spot ETFs will have a larger impact than it did for bitcoin for three structural reasons, Bitwise said. Ether’s short-term inflation rate is 0% and when bitcoin versions launched the network’s inflation rate was 1.7%, so there is significant demand meeting zero supply. Unlike bitcoin miners ETH stakers don’t have to sell, and 28% of ETH is staked and therefore off the market. Ether spot ETFs are expected to be a success and garner $15 billion of net inflows in their first 18 months of trading, the report added. Steno Research expressed a similarly bullish outlook for the cryptocurrency in a report last month. It predicted that ether would reach at least $6,500 later this year due to expected inflows to spot ETFs, plus additional tailwinds. https://www.coindesk.com/markets/2024/07/17/ether-spot-etf-inflows-will-push-eth-to-beyond-5k-bitwise/