Market
Crypto Inflows Hit $436 Million on Anticipated Fed Rate Cuts
Digital asset investment products recorded $436 million in inflows last week, a paradigm shift after a series of outflows reaching $1.2 billion.
Crypto markets have much to anticipate this week, with a key moment on Wednesday as the Federal Open Market Committee (FOMC) decides the scale of September’s interest rate cuts.
Crypto Investments Inflows Reach $436 Million
Bitcoin (BTC) led crypto inflows last week, bringing in up to $436 million and reversing the negative flows from the week ending September 6. In contrast, Ethereum (ETH) continued to experience negative flows, with $19 million in outflows following the $98 million outflows recorded the previous week.
The latest CoinShares report attributes Bitcoin’s positive inflows to expectations of a 50 basis point (0.50%) rate cut. Regional inflows support this theory, with the US leading the way, accounting for up to $416 million.
Specifically, comments from Bill Dudley fueled optimism. The former New York Fed President stated on Thursday that there was a strong case for a 50 basis point interest rate cut.
“I think there’s a strong case for 50, whether they’re going to do it or not,” Dudley said at the Bretton Woods Committee’s annual Future of Finance Forum in Singapore.
The FOMC’s interest rate cut decision on Wednesday is a key event that crypto markets will closely watch this week. Traders and investors are preparing for the impact on their portfolios, depending on the policymakers’ chosen rate cut. Data from the CME FedWatch Tool shows a 59% probability of a 50 bps rate cut, compared to a 41% chance of a 25 bps cut.
Read more: How to Protect Yourself From Inflation Using Cryptocurrency
JPMorgan also advocates for a 50 bps interest rate cut, but uncertain times lie ahead for Bitcoin regardless of whether the cut is 50 or 25 bps. A 25 bps cut is already priced in, while analysts caution that a heavier 50 bps cut could negatively impact Bitcoin.
Regardless of the outcome, markets are eagerly awaiting Wednesday’s FOMC decision, which could bring the first rate cut since early 2020.
Rotation of ETFs Is Growing
Meanwhile, CoinShares reports that trading volumes in exchange-traded funds (ETFs) remained flat at $8 billion last week. However, Eric Balchunas notes that data shows a surge in flows into value ETFs, reaching $11.4 billion over the past 30 days. This reflects a significant shift of capital toward these financial instruments.
“If we do rolling 30 days the flows into value ETFs are $11.4b, which is huge. While many value ETFs have taken in cash a big chunk of this is via BlackRock’s model portfolio which rotated heavily into EFV,” Balchunas added.
The ETF expert acknowledges that several value ETFs have benefited from the recent influx of cash, with a significant portion attributed to BlackRock’s model portfolio. Balchunas highlights the growing rotation into value ETFs, citing $5.6 billion in inflows in the first two weeks of September.
He compares this surge to the “Great Head Fake of Late 2020,” when markets experienced an unexpected shift in trends. During that period, growth stocks, particularly in the tech sector, significantly diverged in performance from value stocks, surprising many investors.
It remains uncertain whether this value rotation will continue to strengthen or face obstacles, particularly from the dominance of tech-heavy ETFs like Invesco NASDAQ Futures (QQQs). Balchunas questions the longevity of the shift, given the continued appeal of technology-focused investments.
Reflecting on the “Great Head Fake,” which prompted a reassessment of traditional strategies and debates about its sustainability, the current rotation raises similar questions. Whether this rotation will endure or face challenges from competing investment themes is yet to be determined, but it presents a compelling development for investors to closely monitor.
Disclaimer
In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content. Please note that our Terms and Conditions, Privacy Policy, and Disclaimers have been updated.
Market
Polymarket Faces Ban in France as US Election Betting Ends
According to a report from The Big Whale, the National Gaming Authority (ANJ), France’s gambling regulator, is preparing to block the prediction markets platform Polymarket.
Polymarket, the decentralized platform that allows users to bet on the outcome of political events, sports, and other occurrences using cryptocurrency, has gained popularity in recent months, especially with bets surrounding the US presidential election. More than $3.2 billion was reportedly wagered on the platform during this high-stakes period, with a record-breaking $294 million in volume on November 5 alone.
France Users May No Longer Access Polymarket
According to The Big Whale, a French website that covers the crypto industry, the ANJ’s impending ban comes after a French trader placed a $30 million bet on a Trump victory, reportedly attracting the regulator’s scrutiny.
The trader’s wager positioned him to make approximately $19 million in profits, a sum that has intensified concerns over Polymarket’s compliance with French gambling laws. A source close to the ANJ stated that despite Polymarket’s use of blockchain and cryptocurrency, its activities are akin to gambling, making it subject to restrictions under French law.
“We are aware of this site and we are currently examining its operation as well as its compliance with French gambling legislation,” The Big Whale reported, citing an ANJ spokesperson.
Read more: What is Polymarket? A Guide to The Popular Prediction Market
Legal expert William O’Rorke from ORWL Avocats explained that although Polymarket does not specifically target French users, its activities fall squarely under gambling regulations.
“Polymarket involves betting money on uncertain outcomes, which aligns with the legal definition of gambling,” O’Rorke noted.
Against this backdrop, the ANJ is well within its mandate to block the platform’s access in France. Accordingly, the French regulator may enforce the ban by blocking Polymarket’s domain name in France. It amy also pressure third-party players, like media outlets and online directories, to limit access to Polymarket links.
However, French users may still circumvent this by using virtual private networks (VPNs). This is because Polymarket’s crypto-based infrastructure allows for relatively anonymous participation.
France’s looming ban is not the first regulatory roadblock Polymarket has encountered. In 2022, the US Commodity Futures Trading Commission (CFTC) fined Polymarket $1.4 million for failing to register as a designated contract market. The CFTC also challenged Kalshi’s operations due to questions about betting on political events.
Polymarket’s Fate After US Elections
Meanwhile, the US election was a significant catalyst for Polymarket. It drove the platform to new heights in user engagement and bet volume. Polymarket’s election-related markets have been featured on major financial platforms, including Bloomberg, highlighting the platform’s appeal to mainstream finance.
As BeInCrypto reported, Polymarket’s election betting topped $3 billion, reflecting unprecedented participation. The platform, however, faces a crossroads in its path forward. Following the climax of the US election on Wednesday, data from Dune Analytics shows a steep decline in Polymarket’s activity.
Daily active addresses and transaction volumes, which soared in the election lead-up, have notably dwindled as election-related betting winds down. For instance, Polymarket’s open interest, a key indicator of active betting engagement, dropped from $350 million to $268 million after the polls closed. Similarly, monthly new accounts have also dropped by over 41% between October and November.
Against this backdrop, Polymarket may need to diversify its market offerings or potentially embrace a new model to maintain user interest. This is considering election-related activity comprised the majority of the prediction market’s volume.
Rumors are circulating about a potential move toward a decentralized governance token, which could distribute control over Polymarket’s operations to its community. This shift would reduce the liability of the central authority by decentralizing decision-making, though it remains theoretical, with no clear timeline.
Read More: How To Use Polymarket In The United States: Step-by-Step Guide
Polymarket’s fast ascent and regulatory challenges highlight broader industry tensions between innovation and compliance. With election predictions no longer a draw and an impending ban in France, Polymarket’s future remains uncertain.
Its long-term viability may depend on how well it adapts to evolving regulatory landscapes and whether it can maintain popularity beyond election season peaks.
Disclaimer
In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content. Please note that our Terms and Conditions, Privacy Policy, and Disclaimers have been updated.
Market
XRP Price Ready to Rally? Signs Point to a Bullish Move
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Market
Solana (SOL) Rallies Strongly, Setting Sights on $200
Solana started a fresh increase above the $172 support zone. SOL price is rising and might soon aim for a move toward the $200 level.
- SOL price started a fresh increase after it settled above the $165 level against the US Dollar.
- The price is now trading above $172 and the 100-hourly simple moving average.
- There was a break above a key bearish trend line with resistance at $162 on the hourly chart of the SOL/USD pair (data source from Kraken).
- The pair could continue to rise if it clears the $192 resistance zone.
Solana Price Starts Fresh Rally
Solana price formed a support base and started a fresh increase above the $162 level like Bitcoin and Ethereum. There was a strong move above the $165 and $172 resistance levels.
There was a break above a key bearish trend line with resistance at $162 on the hourly chart of the SOL/USD pair. The price even cleared the $185 level. A high is formed at $192 and the price is now consolidating gains. It is trading above the 23.6% Fib retracement level of the upward move from the $155 swing low to the $192 high.
Solana is now trading above $172 and the 100-hourly simple moving average. On the upside, the price is facing resistance near the $192 level. The next major resistance is near the $195 level.
The main resistance could be $200. A successful close above the $200 resistance level could set the pace for another steady increase. The next key resistance is $212. Any more gains might send the price toward the $220 level.
Another Dip in SOL?
If SOL fails to rise above the $192 resistance, it could start a downside correction. Initial support on the downside is near the $188 level. The first major support is near the $180 level.
A break below the $180 level might send the price toward the $172 zone or the 50% Fib retracement level of the upward move from the $155 swing low to the $192 high. If there is a close below the $172 support, the price could decline toward the $165 support in the near term.
Technical Indicators
Hourly MACD – The MACD for SOL/USD is gaining pace in the bullish zone.
Hourly Hours RSI (Relative Strength Index) – The RSI for SOL/USD is above the 50 level.
Major Support Levels – $188 and $185.
Major Resistance Levels – $192 and $200.
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