- This week heralds a new regulated investment vehicle into the crypto space, the CME Ether Futures. The latter will be launched on February 8, 2021
- Ethereum may experience enhanced volatility owing to the CME Ether Futures debut
- Ever since the market rout on Sunday Feb 7, 2021, we expect the general cryptocurrency market to continue its consolidation phase
- Bitcoin fell to US$37K-ish as inflows into exchanges led outflows (inflows typically suggest that traders are looking to sell Bitcoin in anticipation of lower prices).
- We see this as a healthy correction and the fundamentals for cryptocurrency are intact
- DOGE has risen against the others. We advise caution in trading DOGE
- We expect DeFi tokens to pick up steam faster than the other cryptocurrencies such as BTC and ETH. 2021 will be DeFi thematic investment taking hold, for good projects at least
General Market Overview
The Biden administration is looking to make an important and badly-needed shift in the U.S. economy – a shift towards economic wealth from work, as opposed to asset inflation.
And while that shift is good for America, it may be bad for markets in the longer term.
Although it’s hard to see how the U.S., which all but excoriated its own manufacturing base, will make that shift, it is an important one, as the entire U.S. economy has grown to become increasingly reliant on asset inflation to create the perception of wealth.
In the meantime though, investors are just going along with the current narrative that is almost exclusively one of seemingly neverending asset price increases, even while actual economic activity is at its lowest in decades.
Over in Asia, stocks were mostly up in the morning trading session with Tokyo’s Nikkei 225 (+1.74%), Sydney’s ASX 200 (+0.76%) and Hong Kong’s Hang Seng Index (+1.16%) all up strongly, while Seoul’s KOSPI (-0.64%) was the only laggard on losses from major automakers.
