This year’s Super Bowl was more than an American football game. It became a chapter in financial history when the crypto-currency industry threw millions of dollars at star-studded TV commercials that played on the fear of missing the next big thing in investing.
“Capital prefers the brave,” the advertisement for Crypto.comA Singapore-based stock exchange that introduced basketball LeBron James Advises a computerized version of himself as a teenager that “if you want to make history, you have to decide.”
Two months later, discretion turns out to be the best part of the corps in the bitcoin markets and other leading cryptocurrencies. Trading became slow in the weeks following the Super Bowl commercials as basic factors – from rising interest rates to the war in Ukraine – diminished investors’ lively spirits.
“We have not seen a massive influx of retail investors into crypto after the Super Bowl commercials,” said Noel Acheson, head of market insights at Genesis Trading, a New York-based digital assets broker who claims to have handled $ 116.5 billion In spot crypto transactions last year. “Volumes are low because of a huge amount of uncertainty in the markets.”
Accurate measurement of cryptocurrency activity is difficult because of the large number of trading venues around the world that are subject to little or no regulatory oversight and produce data with uncertain reliability. Analysts like Acheson base their observations on trading numbers reported by larger and more reputable exchanges that are considered more credible.
Such measures indicate a clear decline in trading activity in recent months. God Block a legitimate index, For example, it shows that point crypto volumes remained below $ 1 billion annually after surpassing this figure in nine of the 12 months of 2021. In March, the month after the Super Bowl, the index showed activity of $ 739 billion, compared to $ 2.2 tn in May last year .
Prices went down along with trading cycles. Bitcoin fell from nearly $ 69,000 in November to just over $ 33,000 in January. Since then, it has jumped from about $ 36,000 to $ 47,000 most days.
For crypto people, recent market action suggests that larger investors, rather than retail gamblers, are taking the lead. Digital assets are increasingly being used to spice up the portfolios of larger players, they say, taking up space alongside other “risk assets”. As these investors become cautious, they cut back on their crypto holdings, and take advantage of around-the-clock trading in digital assets to make exits.
“Because Bitcoin is perceived by many of the big macro investors as a risk asset – it’s high volatility, not a bug feature – so it’s treated as a risk asset,” Acheson said. “When these large funds need to lower the risk, Bitcoin is a very liquid, highly volatile asset that trades 24/7/365, so it is relatively easy to unload it.”
Chris Zohalka, a partner at DRW, a Chicago-based trading firm and head of the company’s cryptocurrency arm, Cumberland, said he sees two groups of investors battling it in the crypto market this year. One sells in times of storm, as in other investments in promising technologies. The other buys the baptism, taking the view of the original coefficients of cryptocurrencies that they can serve as protection against the whims of fiat currencies and the governments that oversee them.
“Part of the world sees it as a risk asset and trades in it like some of the high-growth technology stocks,” he said. “Another part of the world sees it as a risk asset, or a risk hedging asset, a repository of value. It is this push and this attraction between these two camps, I think, that has defined this range we have been sitting in for the past two months.”
Another expression of the increasingly important role that large investors play in the crypto market is the growth of complex trading strategies in derivatives. in March, Announced Cumberland That it traded in over-the-counter customized options “in a number of currencies”. Zohalka said that “while vanilla options interest people, they are moving very quickly to more complex structures.”
This is an intriguing fate for a pop cultural phenomenon. Even as cryptocurrencies become the stuff of Super Bowl commercials – like cars, beer or box office hits in Hollywood – trading these digital assets becomes harder for the average person to understand.
Another report by Adam Samson and Joshua Oliver in London
Crypto industry’s Super Bowl ad blitz comes up short Source link Crypto industry’s Super Bowl ad blitz comes up short