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Bitget Hot Takes (February 26 - March 03, 2024) - Market Updates

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2024-03-05 | 5m

Bitget Hot Takes is the exclusive weekly newsletter series by Bitget Academy, which sums up BGB performance, what's new at Bitget, and the latest market movements.

The latest Bitget Hot Takes can be found here: All About Bitget | Market Updates

Central Themes

• Bitcoin closed last week at US$63K and smashed US$68K yesterday; BTC funding rate is already at its all-time high.

• Ethereum prices breached US$3,700 earlier today.

• Average (weighted) return of spot Bitcoin ETFs last week stands at 22.7%, with IBIT alone registering more than US$1 billion in trading volume every single day since February 26.

• Crypto stock with the best performance last week and yesterday as well: MSTR.

• Macro events this week: U.S. February non-farm payrolls, Bank of Canada's interest rate decision, and ECB main refinancing rate.

Week 9: Extreme Greed And Divergence

With Bitcoin held above US$60K, crypto stocks sure had an awesome week with 2-digit gains - except for ProShares Short Bitcoin ETF (BITI) of course and mining stocks, who have real humble performance: Riot Platform (RIOT), Canaan (CAN), Bitfarm (BITF) and Iris Energy (IREN) are those with a negative 5D return, and TeraWulf (WULF)'s closing price shows no change from the opening price of the week.

The best explanation for this is the approach of the next Bitcoin halving, which will reduce miners' rewards by half. It seems more lucrative to switch to other investment types to join the Greedy gang, rather than to deploy funds into miners during this volatile period.

Bitget Hot Takes (February 26 - March 03, 2024) - Market Updates image 0

Spot Bitcoin ETFs continued to draw in even more institutional money, with BlackRock's IBIT still leading the race: its 5D volume (February 26 - March 01) is recorded at US$9.2 billion, its volume yesterday is already US$2.42 billion, and the net flow into IBIT accounts for 96% of the total net flow into all 11 Bitcoin spot ETFs last week. Hashdex's DEFI and Valkyrie's BRRR are the two funds with no inflows last week. In terms of performance, VanEck's HODL slightly outperformed the rest at 22.78% but saw its weekly volume declined by half - mind you, Monday February 19 was a holiday so no trading and Bitcoin definitely didn't look as attractive. The ETF issuer has announced the death of its Bitcoin futures fund (XBTF), hence HODL is the only ETF access point for those who want to invest in Bitcoin via VanEck.

Futures Bitcoin ETFs have lagged behind their spot peers for quite some time now, even BITI - cuz why short when it's up only (def NFA here). However, the only leveraged Bitcoin fund until now (BITX) remains fairly attractive for those with a large appetite out there, having netted US$44,177,000 in inflows last week.

This week is packed with some important economic events, such as the Bank of Canada's interest rate decision on March 06, ECB's main refinancing rate on March 07, and the U.S. February non-farm payroll data on March 08. The current sentiment on CME FedWatch Tool is a 97% chance that the FED keeps the current interest rate in the FOMC this month and a 52.2% chance that there'll be a rate cut of 25 bps in the June meeting.

Setting The Tone: Monday Performance

Bitcoin skyrocketing to US$68,000 yesterday sure had pamped other markets to insane highs: spot Bitcoin ETFs broke its own volume record of Day One on January 11 at US$5,667,494,309. MicroStrategy ended the day at US$1,334.01, up by 11.2% from its opening price, and is therefore the only one with a two-digit performance yesterday.

Both the OI-weighted funding rates for BTC and ETH are really close to 0.10%, with Bitget seeing the highest levels of funding rates among CEXs. This is a clear reflection of the Extreme Greed level that is even higher than the 2021 bull cycle and requires extreme alertness to avoid any potential liquidation.