BTC, GME and WLF

Daily Updates:

• BTC is currently trading close to a two-week high of $88K, a price reached at the start of the week amidst a broader rally in risk-on assets. That move up in spot hasn’t been met with the same bullish momentum in derivatives markets, however: BTC’s funding rate, whilst now no longer negative, is currently flat and close to 0%. That suggests an unwillingness to pay a premium in anticipation of further moves up by the perp market. 
• Equally, since mid-March, at-the-money implied volatility has continued to trend down, with the term structure of volatility for both BTC and ETH continuing to steepen as front-end expectations decline. 

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• The cautious approach currently adopted by market participants is likely a by-product of the more uncertain macro environment. So far this week, various soft economic data releases in the US have disappointed:

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1. According to the Conference Board’s consumer confidence index, confidence amongst households in March fell to a four year low – the indicator dropped 7.2 points down to 92.9, below economists’ expectations of 94. The forward-looking measure of expectations for the next six months dropped to 65.2, the lowest in 12 years. 
2. The Philadelphia Fed Non-Manufacturing Activity Index fell to -32.5 in March, its lowest reading since May 2020, and down from an already contractionary -13.1 level in February.
3. The Richmond Fed Manufacturing Index fell to -4 in March from a level of 6 in February, whilst expectations were for the index to come in flat at 0. 

See the above in more detail in the ‘Charts of the Day’ below.
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• While much of the soft-data and survey-based inflation expectations are showing deteriorating sentiment, Chair Powell, has, however, emphasised in the March FOMC meeting that the “hard data” is still “pretty solid” and inflation expectations still remain “well-anchored”.
• Amongst the weaker soft data, however, a more positive reading came from the S&P Global's U.S. Composite PMI Index, which tracks manufacturing and services in the U.S. That index increased in March by 1.9 points from February. 

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• President Trump-backed crypto project World Liberty Financial plans to launch USD1, “a stablecoin redeemable 1:1 for the US dollar”.
• USD1 will be “100% backed by short-term US government treasuries, US dollar deposits and other cash equivalents” and will be initially minted on the Binance Smart Chain and Ethereum blockchain, with an initial supply of 3.5M on each. 

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• Cboe filed a 19b-4 form with the SEC on behalf of Fidelity to launch a Solana ETF yesterday. The news comes as the Cboe also filed a Solana ETF earlier this month, sponsored by Franklin Templeton. 

• GameStop Corp. confirmed in a statement that its board has “unanimously approved an update to its investment policy to add Bitcoin as a treasury reserve asset”. The firm plans to follow in the footsteps of Strategy, which has acquired more than 2% of the total BTC supply as its primary treasury reserve asset. The announcement came as the company reported a fourth-quarter decline in revenue of 28%. GME shares were up 12% in after-market hours yesterday following the announcement. 

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• Pump.fun’s native DEX Pumpswap has reached over 1.6B trades in volume since launch a week ago, equating to over $500m and generating over $800,000 in protocol fee generation. 

• Revolut released plans to expand its stand alone crypto trading app, Revolut X to retail traders, initially based in Europe and UK, in the upcoming future.

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This Week’s Calendar:

Charts of the Day: