“I believe by the fourth quarter we are going to see a substantial acceleration.”

Find our most recent reports in collaboration with Bybit below:

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

• Bybit x Block Scholes July Volatility Review

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

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Daily Updates:

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• Following a drop on Friday in the aftermath of another weak payrolls report, US equities bounced back in yesterday’s trading session, with the S&P 500 closing near its all-time high.
• Markets are bracing for nearly three rate cuts now before the year-end, with market-implied odds for a federal funds target range of 350-375 by the Dec 10, 2025 FOMC meeting currently at 68%.
• US treasuries continued to rise higher, with two-year treasury yields falling 4bps from 3.53% to 3.49%.

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• After mostly rangebound trading yesterday, in Asian equity hours earlier today, BTC broke out of its range and rose to $113.2K, and is now trading just above $113K.
• Over the past seven days, BTC has outperformed ETH — it is up 2.2%, relative to a 1.1% decline in ETH which equally has consolidated sideways for most of last week between $4,200 and $4,500.
• Spot Ethereum ETFs continued a six day outflow streak yesterday, selling $96.7M of Ether. Those outflows were driven entirely by BlackRock who sold $192.7M, while the remaining Spot funds either made small purchases or saw no net change in flows.
• Over those same six trading days, Spot Bitcoin ETFs on the other hand have registered 3 days of outflows, with yesterday marking a $364.3M inflow day.

• In options markets, ETH’s ATM implied volatility continues to maintain a close to 2x premium over BTC ATM IV levels. OTM puts for both assets across most of the term structure (with the exception of 180-day ETH options) also trade with a vol premium, as traders continue to demand more for downside protection.
• Since the start of the week however, the volatility smile has seen a slight cooling in its premium of OTM puts for ETH, with 7-day skew currently at -3.87%.

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• Despite labour market data surprising forecasters to the downside across a slew of recent releases, including ADP private payrolls, nonfarm payrolls and job openings, the Trump administration continues to maintain the view that a US economic boom will result from their policies.
• Speaking on NBC News on Sunday, Treasury Secretary Scott Bessent said “We believe that good policies are in place that are going to create good high-paying jobs for the American people” and that “I believe by the fourth quarter we are going to see a substantial acceleration.”
• In his election campaign, Trump touted tariffs as one way to bring back manufacturing to the US. So far, data from the BLS points in the opposite direction. Jobs in manufacturing have declined for four consecutive months, their longest consecutive streak since 2020. In response, Bessent claimed “We can’t snap our fingers and have factories built”.

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• A recent study from the Budget Lab at Yale University finds that the 10-year fiscal effect of President Trump’s tariffs, as they currently stand, would raise $2-2.4T for the US government. However, the report also states that “Tariffs shrink the overall size of the US economy in the long-run by 0.4%”, that is, each year tariffs will lead to a US economy that is persistently 0.4% smaller each year.

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• Export growth in China slowed to its weakest in six months, while exports to the US fell 33% in August, the fifth month of double-digit declines. However, data from the General Administration of Customs on Monday did also show a surge in sales to other markets beyond the US.
• Overall sales abroad rose 4.4% in August from a year earlier to $322B. That did however fall short of the median estimate in a Bloomberg survey and was weaker than a gain of 7.2% in July.

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• French Prime Minister Francois Bayrou lost a confidence motion in the lower house of parliament yesterday, which now forces the fifth premier change in less than two years. 194 lawmakers voted in support of Bayrou while 364 voted against.
• Bayrou said that the confidence motion was needed to force a “clarification” on France’s fiscal situation. Ahead of the vote, he told lawmakers that France is “drowning in a tide of debt” and “You have the power to bring down the government but you don’t have the power to erase reality.”

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• BBVA, one of Spain’s largest banks, on Tuesday announced a partnership with Ripple to bring Ripple Custody to its new retail crypto platform, supporting bitcoin and ether trading and storage for Spanish customers. The technology is already used by BBVA in Switzerland and Turkey.
• The move comes as European banks expand crypto offerings under the EU’s MiCA framework, positioning BBVA among the first in Spain to provide integrated retail crypto services.

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• Dunamu, the parent company of crypto exchange Upbit, announced on Monday the launch of its Ethereum Layer 2 chain, Giwa, currently available on testnet. Giwa—short for “Global Infrastructure for Web3 Access” and named after traditional Korean roof tiles—is EVM-compatible and built on Optimism’s OP Stack.
• The chain is designed to support future digital finance applications, including a local currency-pegged stablecoin project in development, and allows developers to build using Solidity, Ethereum’s programming language.

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This Week’s Calendar:

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Charts of the Day:

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