BTC and Gold Shine Amid Talk Of Debasement Trade

Find out our latest reports, listed below:

• Bybit x Block Scholes August Volatility Review

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• Bybit x Block Scholes Quarterly Report: What will drive crypto in Q3 2025?

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• Bybit x Block Scholes Quarterly Report: Altcoin season and the evolving role of Bitcoin

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Market Snapshot: Overnight Moves:

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Daily Updates:

• On Sunday morning yesterday, Bitcoin set a new all-time high of $125,689. That was marginally higher than the last record of $124.5K reached in mid-August earlier this year.
• The rally in BTC and the rest of the crypto market, has occurred while the US federal government remains in a shutdown, and amongst talks of what has been referred to as the ‘debasement trade’ — the rush from fiat currencies such as the US dollar to alternative assets such as gold and Bitcoin.
• Back in June 2025 we wrote:

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“The deterioration in the US dollar, which is down -8.97% year-to-date has at least partially aided BTC’s recent run to a new ATH of $111K.”

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“Bitcoin’s recovery despite rising yields suggests that investors may be looking at the asset as a diversification away from typical dollar-denominated assets. That shift in investor preference has been further amplified by the concurrent selloff in the US dollar and US treasuries.”

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• While treasury yields across the term structure have declined since then, and more recently, the dollar strength index has been flat since BTC’s leg higher began in late September, the same drivers we discussed in June still apply: there are still fiscal concerns around government debt and deficit levels, and the dollar year-to-date remains weak (down 9.5%).
• BTC’s surge to a new ATH also coincides with gold prices hitting a new record of $3,920.63 at the start of the week, bringing its year-to-date performance just shy of 50%.
• Spot Bitcoin ETFs have seen major inflows recently too — last Friday marked the 8th largest daily inflow on record, with investors purchasing $985.1M of bitcoins. In total, across last week, the ETF products saw just shy of $3.3B in net inflows, the second largest inflows in a week since their launch back in January 2024.
• Monthly spot trading volumes across centralized cryptocurrency exchanges slipped to $1.67T in September, the lowest level since June, according to The Block’s data dashboard. The figure marks a 9.7% decline from August’s $1.85T.

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• The rally towards a new high began in late September. Since Sep 26, 2025, BTC has moved up monotonically from $109K. That date also marked the low in the 7-day put-call skew ratio when short-tenor vol smiles priced in a vol premium of 7.8 points towards OTM puts. Sentiment over the short-term then shifted bullish late last week between Thursday and Friday (3.5% call skew) and is now only modestly positive at 1.1%.  

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• The wider altcoin market has benefitted from BTC’s most recent leg higher too. Ether jumped above $4,600 during BTC’s move to new highs, while SOL reached $236. Short-tenor ETH skews have also seen a similar recovery since late September and trade just above neutral levels now.

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• Altcoins have also been bolstered by the fact that a slew of altcoin ETFs may be set to launch any day, according to Bloomberg ETF analyst Eric Balchunas.
• On Sep 29, 2025, Balchunas said that the approval of pending ETF applications tied to tokens such as Cardano, Litecoin, Solana, and XRP was now "100%" guaranteed.
• Earlier in September, the SEC voted to approve a number of proposed rule changes by three major US securities exchanges which will allow the exchanges to adopt a set of “Generic Listing Standards” for commodity-based exchange-traded products, including those related to cryptocurrencies.
• Prior to the change, the SEC handled every spot crypto ETF filing on a case-by-case basis, requiring two separate filings — a 19b-4 filing from the exchange planning to list the ETF and a S-1 filing from the asset manager issuing the ETF. These required approval from different departments within the SEC and the 19b-4 filing in particular could take up to 240 days to be approved.
• Now due to the change, an exchange no longer needs to file a 19b-4 for each ETF filing, as long as the crypto ETF meets the Generic Listing Standards.
• For an ETF to meet those standards, it must meet at least one of the following criteria: either the underlying token has a futures market that has been trading for at least six months and regulated by the CFTC, or there already exists another ETF tied to the token with at least 40% of its assets invested directly in the token itself.

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• Last Friday provided further insights into the thoughts of various Fed officials on their views for monetary policy.
• Dallas President Lorie Logan warned that “We really need to be cautious about further rate cuts from here” and that “Right now, we’re furthest away on the inflation side of those objectives, with a forecast that takes some time to get back to 2%”.
• She stated that she is more focused on the unemployment rate than payroll figures when looking at the employment report — a report which has been delayed due to the government shutdown.

• Governor Stephan Miran, a markedly more dovish member of the Fed, said on Bloomberg TV that he would amend his view on inflation if housing costs unexpectedly increased — “If something were to happen that were to tell me that that channel is invalidated, that there’s some shock that’s going to be pushing rents materially higher, the benign inflation forecast that I have would have to be adjusted as a result.”

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• China Financial Leasing Group, a Hong Kong–listed investment firm, announced plans to raise $11.1M through a share placement to Innoval Capital to fund the development of a new cryptocurrency and artificial intelligence investment platform.
• According to a Sunday filing with the Hong Kong Stock Exchange, Innoval Capital will subscribe to 69.38M new shares at HK$1.25 each, representing roughly 20% of the company’s existing share capital.
• The company said the funding will be used to establish a Crypto-AI digital asset investment platform, with investments in exchanges and a broad range of asset classes including stablecoins, bitcoin, ether, RWAs, NFTs, DeFi, and DePIN projects. It also plans to build a digital asset management platform to position itself as an “innovative digital asset investment holding group.”

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This Week’s Calendar:

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Charts of the Day:

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