In markets

The “main character” driving crypto markets this cycle appears to be the President of the United States. Friday saw more than US$900 million (A$1.39B) in crypto liquidations as investors realised Donald Trump really is putting tariffs on the entire world. Trump also fired the political appointee who’d released bad jobs numbers and said he’d sent nuclear subs to intimidate Russia. These macro factors hit markets hard and outweighed the incredibly bullish news that the SEC is launching Project Crypto.

Despite bizarre fake reports that China has banned crypto again, markets staged a recovery over the past day or so, perhaps looking ahead to the possibility of three interest rate cuts that Goldman Sachs suggests will now happen this year. Ethereum led the comeback with a 6.5% gain overnight, but remains down 1.4% for the week. Bitcoin is down 2.2% for the week, trading around A$178,553 (US$115,166).

Ethereum was also the big winner in July, surging 56% to clock its highest monthly gain in three years. It’s currently trading at A$5,767 (US$3,720). The CoinDesk 20 Index rose 21% in July. Base has overtaken Solana (down 7.7%) on the number of tokens launched, thanks to minting Zora posts as ERC-20 tokens. Popular newspaper USA Today this week told its 5.1 million X followers, “XRP is the smartest cryptocurrency to buy with US$500 (A$772) now.” The Crypto Fear and Greed Index is at 64, or Greed.

From the OTC desk

Cryptocurrency Market Turmoil

A surge in cryptocurrency liquidations occurred over the weekend, triggered by bearish macroeconomic developments, including a hawkish FOMC stance, increased tariffs, and reports of nuclear submarines near Russian waters. Open interest in cryptocurrencies declined from £88 billion to £79 billion, with overall market leverage notably reduced. On 1 August, liquidations reached £922 million. Amid this upheaval, investors shifted towards quality assets, with altcoins experiencing sharper declines than Bitcoin. Consequently, Bitcoin’s market dominance rose to 62.5%. Notably, the ETH/USD pair fell from US$3,875 to US$3,400 over the week.

Corporate Treasury Strategies

The corporate treasury trend is gaining momentum as a new group of publicly listed companies prioritises assets on their balance sheets over operational revenue. These firms are increasingly defining their identities through cryptocurrencies such as Bitcoin, XRP, and Ethereum, with Strategy (ticker: MSTR) being the most prominent example. Some of these companies’ shares trade at a significant premium to their actual asset holdings, leading trader Jim Chanos to suggest a spread trade: shorting MSTR while holding a long position in Bitcoin. Since 14 May, this trade has yielded 7.5% on the short leg and 10.1% on the long leg. These “asset wrapper” firms may prosper amid regulatory ambiguity, but increased adoption could attract scrutiny. If a company applied this strategy to gold, it would fall under the Investment Company Act of 1940. As intangible assets, cryptocurrencies currently enable companies to sidestep such regulation.

OTC desk activity

  • Participants remain cautious amid market volatility, with modest flows buying the dip
  • Strong one-sided off-ramp flows for stablecoins
  • TBC

Key economic calendar events (AEST)

  • Thursday, 7 Aug 2025, 11:30 AM: AU Balance of Trade (Consensus A$3.25B)
  • Thursday, 7 Aug 2025, 1:00 PM: CN Balance of Trade (Consensus $103.4B)
  • Saturday, 9 Aug 2025, 11:30 AM: CN Inflation Rate YoY (Consensus -0.1%)
  • Tuesday, 12 Aug 2025, 2:30 PM: RBA Interest Rate Decision (Consensus 3.6%)

For any further information, please feel free to reach out.

In Headlines

SEC’s Project Crypto

SEC chair Paul Atkins announced “Project Crypto” in a speech last week, which is one of the most bullish developments in recent memory. The SEC’s plan involves modernising crypto regulations and custody requirements, supporting both DeFi and centralised platforms to offer stocks and crypto, and tokenising everything. Atkins compared the impact of tokenisation to the move from paper-based stock trading to computerised trading in the 1990s. “We will not follow,” Atkins declared. “We will lead, and the next chapter of financial innovation will be written here.” Bernstein analysts called the plan “game-changing.” Meanwhile, the White House released its crypto report reaffirming it would clear up crypto regulations and review taxes.

Crypto Treasuries

Crypto treasury companies have collectively amassed more than US$100 billion (A$154B) in assets according to a Galaxy Research report. Bitcoin Treasuries are responsible for US$93 billion (A$144B) and have cornered 3.98% of the circulating supply. Ether firms hold 1.3 million tokens, representing 1.09% of the supply. The Strategic ETH Reserve site, which also includes Foundation and DAO holdings, ticked over US$10 billion in ETH this week (A$15.4B). Tom Lee’s Bitmine has now amassed 833,000 ETH worth US$2.9 billion (A$4.5B) and now has a bigger treasury than any Bitcoin companies apart from Marathon Digital and Strategy. The Ether Machine bought another 25,600 ETH this week, bringing its total to 345,362. Joe Lubin’s SharpLink Gaming now has 498,711 ETH. Listed company ETHZilla announced a US$425 million (A$657M) raise to buy ETH and said it has hired Electric Capital to juice its yields in DeFi, targeting 3-10%. Verb Technology announced that it is rebranding as Ton Strategy and raising US$558M (A$862M) to buy Toncoin. The only bum note came from analyst Ben Cowen, who suggested that the Treasury firms are just pulling forward demand and that the whole thing will end in “absolute disaster.”

Bitcoin and Ether ETFs see strongest month ever.

The US Bitcoin and Ether ETFs saw their strongest month on record, taking in US$12.8 billion (A$19.8M) in July. The Ethereum ETFs took US$5.4 billion (A$8.3B), even though ETH is just one-fifth of the Bitcoin market cap. Bitwise CIO Matt Houghan likened it to Bitcoin ETFs doing “US$27 billion (A$42B) in a month.” BlackRock’s IBIT Bitcoin ETF now has assets worth US$86 billion (A$133B), more than big-name ETFs like the S&P 500-tracking IVV. More good news: The SEC approved in-kind creation and redemption for all spot BTC and ETH ETFs to improve efficiency and appeal to institutional investors.

Crypto corporate earnings

Tether posted a whopping US$4.9 billion (A$7.6B) profit in quarter 2, a 9.6% increase on the same period last year. It is now the world’s 18th largest holder of US Treasurys and has more than South Korea, the UAE or Germany. Strategy posted nearly US$10 billion (A$15.4B) in net income, driven by US$14 billion (A$21.6B) in unrealised Bitcoin gains. It grew its Bitcoin holdings by 20% to 597,325 in the quarter. Coinbase shares slid almost 20% after the exchange unveiled a 26% quarter-on-quarter fall in revenue to US$1.497B (2.3B). This undershot expectations of US$1.59 billion (A$2.4B), possibly because Wall Street analysts aren’t very good at reading on-chain data yet.

UK opens up ETNs to retail

The United Kingdom’s Financial Conduct Authority (FCA) has lifted its 2021 ban on retail investors buying cryptocurrency exchange-traded notes (cETNs). However, the FCA has yet to decide whether to allow retail investors to invest in crypto derivatives, which it banned at the same time. Meanwhile, former UK Chancellor George Osborne was warned that Britain is being “left behind” on crypto and urged the current chancellor to establish a crypto regulation framework.

Episode 27 of the IR Bitcoin and Crypto Podcast

We’ve now completed 27 episodes of the Independent Reserve Bitcoin and Crypto podcast. This month’s episode features Joe Shew, the CEO of Crypto Consulting Institute. Beginning with a nuanced look at Bitcoin and crypto markets, this episode delves into personal growth, existentialism and suggestions on how to expand your mind, literally.

Catch the full episode here.

Hong Kong crypto fundraising

According to a Reuters analysis, at least ten publicly listed firms in Hong Kong have raised a record US$1.5 billion (A$2.3B) in July for blockchain and digital currency projects. They include OSL Group, Dmall Inc., and artificial intelligence firm SenseTime Group. The fundraising came ahead of the territory’s new stablecoin laws that took effect on August 1. “The market momentum is building fast,” said Anthony Pang of Baker McKenzie.

Korean crypto lending rules

South Korea’s financial regulators are drawing up new crypto lending regulations, after Upbit and Bithumb began allowing users to borrow crypto up to four times the value of their collateral, exposing them to big losses when prices crash.

The Moonshot Dispatch

Every Tuesday afternoon at 3 PM, Independent Reserve broadcasts a live market update that we’ve affectionately named “The Moonshot Dispatch”. Hosted by our head of sales, Lee Eaton and Nick Fletcher from the OTC desk, we cover the latest news, price movements, and crypto conspiracy theories from our specially-made HQ studio. Join the hundreds of viewers who tune in weekly across Twitter/X, LinkedIn, YouTube, Facebook & TikTok for this hilariously interactive stream.

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Until next week, happy trading!