Daily Summary:

  • The probability of the Federal Reserve cutting interest rates by 50 basis points in September has dropped significantly. Ethereum staking ETF may not be far away?

According to Farside Investor data, U.S. Bitcoin spot ETFs had a net outflow of US$81 million yesterday, of which BlackRock IBIT had a net inflow of US$2.7 million, Grayscale GBTC had a net outflow of US$56.9 million, Fidelity FBTC had a net outflow of US$18 million, Bitwise's BITB had a net outflow of US$5.8 million, ARK's ARKB had a net outflow of US$6.8 million, and Franklin's EZBC had a net inflow of US$3.4 million.

Yesterday, the U.S. Ethereum spot ETF had a net inflow of $10.8 million. Among them, BlackRock ETHA had a net inflow of $16.1 million, Grayscale ETHE had a net outflow of $16.9 million, Fidelity FETH had a net inflow of $6.7 million, Bitwise's ETHW had a net inflow of $2.7 million, and Grayscale Mini ETH had a net inflow of $2.3 million.

Federal Reserve mouthpiece: July CPI clears the way for a September rate cut

Nick Timiraos, the "Fed Mouthpiece", wrote that the July CPI data cleared the way for the Fed to start cutting interest rates at its next meeting. As the labor market has recently shown signs of potential weakness, the debate at the Fed's September meeting will focus on whether to cut interest rates by 25 basis points in a traditional way or a larger 50 basis points. The inflation data released on Wednesday did not resolve this debate. Instead, the debate may depend on labor market reports, including weekly initial jobless claims and the August non-farm payrolls report, which will be released on September 6. The inflation report released on Wednesday was mild, but the strong rise in housing costs may reduce enthusiasm for the data. However, Fed leaders have hinted that they are ready to start cutting interest rates next month, in part because inflation data in May and June were also much milder.

Grayscale ETHE has outflowed 27.8% since its listing, and it is expected to outflow 50% within 72 days

According to data, Grayscale Ethereum ETF ETHE had a net outflow of US$16.9 million yesterday. After its conversion to ETF listing, it has outflowed 27.8%, and it is expected to outflow 50% within 72 days (October 29).

Opinion: The launch of Ethereum collateralized ETF is only a matter of time

Cynthia Lo Bessette, head of Fidelity Digital Asset Management, told The Block that the company currently has no clear plans for spot ETFs other than Bitcoin and Ethereum.

Lo Bessette added that while the U.S. SEC has not yet approved an ETF that can pledge ETH, this may change in the future because staking is "an important part of the Ethereum ecosystem and an important part of Ethereum investment opportunities." He believes that it is more a matter of time rather than a question of whether it will happen. The Fidelity team has had "constructive conversations" with SEC staff to discuss the possibility of bringing a pledged ETH ETF to market.

Market analysis: The market continues to be sluggish and lacks capital inflow

Market Trends

The CPI data released last night had a significant impact on the cryptocurrency market. Bitcoin (BTC) experienced a wave of gains and then falls after the data was released. Currently, the BTC spot ETF experienced an outflow of US$80 million yesterday, and the market is expected to continue to fluctuate widely.

Ethereum is also in a volatile range. Although there are small inflows into the ETH spot ETF, the overall market sentiment has not improved significantly.

Altcoins are generally down, and there is no better performing sector in the market at the moment.

In terms of data indicators, today's AHR999 index is 0.66, which shows that the current price is still a good point to buy in batches. The fear and greed index is 29, indicating that market sentiment will continue to remain depressed for a period of time, and the market is waiting for new hot spots and narratives to emerge.

Market Hotspots

1. Public chain Ton
TON rebounded above $7 in the short term, and the leading meme coin NOT on the Ton chain also followed suit. Ton has more than 1 billion registered users worldwide, which provides a strong user base for its ecosystem. Small games in the Ton ecosystem such as Hamster Kombat and Dogs are expected to have token issuance in the near future. The launch of these new projects has increased market expectations for the Ton chain.

However, it is worth noting that TON's fully circulated market value is relatively high, which may limit its room for further growth. Therefore, although the recent performance of the Ton chain is quite eye-catching, participation should be cautious, and investors should make decisions based on their own risk tolerance.

2. AI sector
Aethir (ATH) fluctuated more than 40% during the day, and the main reason for the increase was that it was listed on a Korean trading platform. Despite this, other AI sector tokens such as FET, IO, and LAT had relatively small increases, but they still performed relatively well in the overall falling market.

The performance of the AI ​​sector shows that the market continues to pay attention to AI technology and applications, which may provide support for future market hotspots. Investors can pay attention to projects with practical applications and technological advantages in the AI ​​sector to capture potential investment opportunities.

Macroeconomics: CPI data met expectations, and the three major U.S. stock indexes closed higher

The three major U.S. stock indexes closed higher, with the S&P 500 up 0.38% at 5455.21 points, the Dow Jones up 0.61% at 40008.39 points, and the Nasdaq up 0.03% at 17192.60 points. The benchmark 10-year Treasury yield was 3.83%, and the 2-year Treasury yield, which is most sensitive to the Fed's policy rate, was 3.94%.

Among the popular US stocks, Apple rose 0.20%, Microsoft rose 0.69%, Nvidia rose 1.67%, Google C fell 2.35%, Google A fell 2.31%, Amazon fell 0.08%, Meta fell 0.34%, TSMC fell 1.37%, Tesla fell 3.10%, and AMD fell 0.27%.

Yesterday, the US July unadjusted CPI further fell to 2.9%. In the view of industry insiders, the Federal Reserve is expected to implement a "preventive interest rate cut" in September this year. For the domestic market, pro-cyclical resource products are expected to achieve excess returns, and northbound funds are expected to continue to flow in. However, considering that the capital market has priced in the Fed's interest rate cut expectations much earlier than before, the actual impact of the interest rate cut on asset prices may be relatively mild. According to CME's "Fed Watch": The probability of the Fed cutting interest rates by 25 basis points in September is 63%, and the probability of cutting interest rates by 50 basis points is 37%.

Summarize

Overall, the cryptocurrency market is currently in a state of volatility and depression, and major currencies such as BTC and ETH have not formed a clear upward trend after the release of CPI data. Market sentiment is sluggish and investors should remain cautious, especially when there is a lack of clear hot spots and narratives in the market.

However, some sectors such as the public chain Ton and the AI ​​sector have shown some market vitality. With its large user base and upcoming new projects, the Ton chain may have some performance in the short term, but we need to be wary of the limits of its high market value. The AI ​​sector is still an area worth paying attention to due to its technology and application prospects.

In the current market environment, investors should focus on risk management, and buying in batches may be a more conservative and effective strategy. At the same time, keep an eye on market hotspots and capture potential investment opportunities in a timely manner.