Big Ban Theory Debunked — October 1

Chart of the Day

Remember September — the month in which the price of BTC and ETH fell 7.1% and 12.6% respectively on the back of China’s clampdown on crypto-related activities and the regulatory rumble stateside. The fear and uncertainties these global economic giants incited have, in turn, resulted in a decrease in AUM for digital asset investment products. Bitcoin AUM fell 7.8% in September, with its institutional AUM dominance plummeting to a yearly low of 67.9%. Ethereum-based products reached their highest market share of AUM at 25.9%, despite the price of ETH suffering severe losses. The rotation suggests that institutional investors are seeking alternatives for crypto exposure. The silver lining of this grim month is that net flows turn positive for the first time in three months, suggesting an upside outlook for the final quarter of 2021. 

Talk of the Town

Big Ban Theory; Debunked. Fed Chair Jerome Powell testified before the U.S. House Committee on Financial Services on Thursday and said he has “no intention” of banning cryptocurrencies. However, he stressed that it is appropriate to regulate stablecoins and agreed with pro-Bitcoin Senator Cynthia Lummis that stablecoins, not unlike bank deposits, should only be issued by depository institutions, or through money-market funds or similar vehicles.