Investors take a step back

Every week, Amdax summarizes what’s happening in the crypto market for you. Want to dive deeper? Click on the links in this email for more insights.

This newsletter is a co-production with our partner, Bitcoin Alpha.    

Market update

Stay informed in three steps:

1. Bitcoin falls below 100,000 dollars for the first time since June
For the first time since June, bitcoin slipped below six figures this week. The price briefly touched 99,000 dollars before recovering to just above 101,000 dollars. Market sentiment remains fragile, with prices reacting quickly to changes in appetite for riskier assets.

2. Market pressure from crypto ETF outflows
The strong inflows into United States spot ETFs have reversed in recent days. Between 29 October and 4 November, more than 2.6 billion dollars flowed out of bitcoin and ether funds, 1.9 billion from bitcoin alone. BlackRock’s IBIT fund saw the largest outflows. Without new capital entering the market, a convincing recovery remains difficult.

3. AI correction reduces risk appetite
After months of enthusiasm surrounding artificial intelligence, investors are taking a step back. On Tuesday 4 November, the S&P 500 fell 1.2 percent and the Nasdaq 2 percent. These are small declines for a typical crypto investor, but significant in traditional markets. The cooling of the technology sector is making investors more cautious, a sentiment that also spills over into crypto.
 

News overview

The key headlines from this week:

• Consensys prepares IPO with JPMorgan and Goldman Sachs
  According to Axios, the maker of MetaMask has selected the two investment banks to lead its public offering. Details on timing and valuation remain unclear. Notably, the plans coincide with upcoming token launches from Consensys projects such as Linea, MetaMask and Infura. The company was valued at seven billion dollars in 2022.
   
• Tether and Coinbase post strong Q3 results
  Tether reported more than ten billion dollars in profit this year, largely from interest on its large United States Treasury holdings. The company is increasingly behaving like a financial institution. Coinbase’s revenue rose 55 percent to 1.9 billion dollars, driven by higher trading volumes and the growth of its Base blockchain network. The company’s cost structure and regulatory challenges remain areas of concern.
   
• Revolut introduces true one-to-one stablecoin conversions
  The fintech now allows users to exchange up to 500,000 euros per month between US dollars and stablecoins USDT and USDC with no fees or spread. This removes friction between fiat and crypto for millions of customers. Revolut supports six blockchains, including Ethereum, Solana and Tron.
   
• Former FTX executive launches new exchange
  Brett Harrison, former president of FTX US, has launched Architect, a derivatives trading platform offering perpetuals on almost all financial products, from single stocks to interest rates and precious metals. While Harrison looks ahead, Sam Bankman-Fried continues to rewrite the past. This week he claimed that FTX had enough funds to repay customers at the time of bankruptcy, but that lawyers unnecessarily pushed the company into insolvency.

Amdax's take

After a period of optimism, investors are pausing for breath. While equities retreat after months of euphoria, bitcoin is also experiencing a decline. The dip below 100,000 dollars does not mark the end of the bull market, but it does serve as a reminder of how sensitive crypto remains to liquidity shifts and changes in sentiment. The outflow from ETFs shows that investors are temporarily hitting the brakes. Once stability returns and capital begins to flow again, this could mark the start of a new phase of growth.