Overview
- Global markets are beginning to show cracks.
- Bitcoin survives September, heading into a historically bullish Uptober.
- Mashinsky withdrew $10m in funds from Celsius.
- Another Solana outage.
Good morning Banter Fam,
It’s been a few months of quantitative tightening (QT) by the US Federal Reserve, and the reaction of global markets has been ugly.
According to the reserve balance chart provided by the St. Louis Fed’s economic data,
the Federal Reserve began reducing its balance from $8.96 trillion in April 2022 to what is now $8.79 trillion, a difference of only 2%.
Source: FRED
Meanwhile, the impact of these reductions on global markets is genuinely astonishing and highlights the lack of resiliency of seemingly overleveraged markets.
Some recent complexities devolving from QT:
- China begins dumping US treasuries.
- One of the largest banks in the world, Credit Suisse, nears collapse.
- The UK’s emergency bond purchases to save pensions.
- The fall of the EUR and Japanese Yen versus the USD.
The effects of quantitative tightening from the Federal Reserve appear to be causing widespread damage across markets. For this reason, many analysts guess it won’t be long until nations restart stimulus or bond purchases. The UK has already commenced, Japan is not far behind, and there’s likely more to follow. Eventually, the Fed will have to pivot in the name of damage control.
How to spot a looming pivot by the Fed:
- Before rate cuts, expect rate slow-downs.
- Rate cut then follows.
- Stimulus to citizens in various forms.
- Foreign bond purchases by the Federal Reserve.
Market update 🌍
The much-dreaded month of September is over, and hope glistens entering the new month. Historically, October is very bullish for Bitcoin and equities. That’s why they call it Uptober! In October, the average return for bitcoin was 26.39%, with cumulative gains of 369%.
Source: bitcoinmonthlyreturns.com
On the other hand, Ethereum (ETH) hasn’t fared as well, with an average of -2.63% returns and a cumulative return of -13.19% in October.
Source: bitcoinheat.com
BTC/USD 1M
Phew, September is over, and it wasn’t as bad as expected despite what feels like impending doom for traditional financial markets. BTC fell by -3.13% this month and continues to hover over the $19.2k support zone for the fourth straight month. With the fiat debasement narrative in full bloom, October will be a vital month in which BTC could impress its intended purpose as a currency debasement hedge.
High-resolution chart
ETH/BTC 1M (Logarithmic)
The Ethereum/Bitcoin ratio monthly chart shows ETH lost significant ground to BTC, despite Ethereum’s historic Merge upgrade last month. It’ll be interesting to watch if ETH price continues its uptrend on the monthly charts alongside the new era of reduced issuance.
High-resolution chart
ATOM/ETH 1M (Logarithmic)
The Cosmos ATOM token has broken downtrend resistance (on the monthly chart) that began after the network’s inception in 2019. Supported by the Cosmos 2.0 catalyst, ATOM may continue as one of the few altcoins that outperforms the overall crypto market. Of course, much of this will depend on many factors, such as the condition of global markets. But if BTC begins a turnaround, expect ATOM to continue outperforming ETH and BTC.
High-resolution chart
| US markets close | Gain/Loss |
| S&P 500 | *Weekend Closed |
| Nasdaq | |
| Dow | |
| VIX |
Notable Gainers (7d):
| Protocol (Coin) | Price ($) | Gain (%) |
| Terra Luna Classic (LUNC) | 0.00032 | +67.5 |
| Reserve Rights (RSR) | 0.0097 | +23 |
| Tokenize Xchange (TKX) | 8.99 | +20 |
| Quant (QNT) | 131.11 | +13 |
| Terra (LUNA) | 2.44 | +12 |
| Helium (HNT) | 4.94 | +10 |
| Uniswap (UNI) | 6.22 | +10 |
| Bitcoin Fear and Greed Index | 24 Extreme Fear |
| “Crypto” Google Trends 90d | 54 |
| “Bitcoin” Google Trends 90d | 56 |
Newswatch 📰
Mashinsky’s suspicious withdrawal. Former CEO of embattled crypto lender Celsius removed $10 million from the network in May before stopping customer withdrawals in June. A spokesman for Mashinsky stated the crypto withdrawn was used to pay taxes and that the family still has $44m frozen in Celsius.
Solana experiences a six-hour outage. Not again! The Solana network stopped processing transactions for nearly 6 hours on Friday. According to Joe McCann, the outage was due to an extremely rare consensus bug.
News tidbits:
- Crypto Banking platform Juno raises $18m in Series A.
- Indian crypto exchange WazirX lays off 40% of its workforce.
- Coinbase halts bank transfers and withdrawals for six hours.
NFT & metaverse update 🐵
- OpenSea delisted Azuki NFTs for unknown reasons.
Banter’s take
Keep your expectations modest while global markets continue to suffer. While times are tough, the crypto market will likely continue to range. Moreover, prices are at historic lows, making it an excellent time for long-minded investors to begin accumulating positions. Don’t expect things to flip overnight, but with patience and perseverance, you can outlast the bear market until we see greener fields ahead.
Gabri
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Disclaimer
Good Morning crypto (issued by Crypto Banter) is a newsletter for entertainment purposes only.
All opinions expressed by the publisher, writers, and chartists should not be construed as financial advice and do not necessarily reflect the views of Crypto Banter. The publisher, writers, and chartists may hold positions in the tokens and assets discussed. Readers are encouraged to do their own research.
