The State of Crypto: Slow Money vs. Fast Money in Today’s Market

Let's get to the big story breakdown.

Well, Bitcoin is struggling to hold on to momentum, but back above the 109,000 level this morning.

Bitcoin touching its lowest level in more than three months this week after reclaiming 114,000.

And despite the pullback, Bitcoin does remain up roughly 16% year to date.

And Ether also extended its decline, falling to a two-month low, but we We are looking at currently up around 14.5%.

And joining me this morning to weigh in is Andy Beer, head of product and research at Coin Desk Indexes.

Andy, good morning.

Welcome back.

Thank you so much for joining us.

Good morning.

So we've been seeing plenty of volatility across crypto, especially after that flash crash.

So what do you make of where we are right now?

There's a slow money story and a fast.

Money story.

The slow money is as strong as ever, right?

We see M&A activity.

We saw Coinbase purchasing Echo yesterday there was an announcement that Falconex was a prominent market maker purchasing 21 shares, a really well known ETF issuer that's crypto focused.

We also see valuations for private companies, both the polimarket and Calsci, those two betting markets.

The news stories are reporting.

Very rich valuations for those things.

So the consolidation of the business and the growth of the business is slow money ETF filings over 150 ETF filings, including yesterday Pro shares filed for a Coin desk 20 ETF right here on the New York Stock Exchange.

So there is a lot of building and slow growth happening growth in stablecoins, minting of new stablecoins, all of that looks pretty solid.

The fast money is where where the issues are.

So tell us about some of these issues here despite what we're seeing on the institutional side.

Well, we talked last week at the end we ended by saying that the market fell tender and it continues to feel tender.

We know what the catalysts are.

The October 11th, you know, event.

I hesitate to call it a flash crash because these things have special meanings, but we'd say, you know, what's called a super liquidation event exposed how some centralized exchanges deal with with gay, very gappy situations when they get exaggerated and that took a lot of the wind out of the market.

The continued closure of the government takes wind out of the market.

The fading hope that Clarity Act can get done in 2025 kind of removes a positive catalyst from the market.

And you know volatility is a little higher, so the market's still tender and what happens when the markets tender is that Bitcoin kind of sags but stays in a range, which it has done.

The other tokens tend to fall back.

The growthier tokens tend to kind of lose their lift from, you know, from sustained money, which is momentum money right now and growth oriented money.

So even seeing a little fast money pull out of gold the other day.

Demonstrates that a lot of money is kind of moving to the sidelines.

Yeah, and I think perspective is key here because when we're talking about some of these pullbacks, especially gold, gold does remain above that 4000 level and it's up over 50% year to date.

So that is significant.

And even when we're looking at Bitcoin or ether, they are up double percentage points year to date here and we're also seeing that in equities as well.

So as we move forward. you mentioned the macro.

There are a lot of things that are happening in the nation's capital in DC.

So what catalysts are you paying attention to as we head into your end?

I wish you can't tell the fast money where to go, right?

Over time, look year on date, Bitcoin, Ethereum, Salon, XRP, they're all kind of up similarly on the year.

Coin desk 20, they're up in the teens this year, so that shows kind of progression over a longer period of time.

Um, where's the next catalyst going to go for the next quarter higher?

We don't really know.

We need the government to reopen.

We need some more regulatory progress.

We need more announcements, but I think over the long term, the investment case for growth in things like stablecoins and tokenization remains stronger and more socialized than ever.

So yeah, it's, you know, this is turning, there's a phrase in crypto October, which crypto tends to do well in October.

We know that equities tend to sag or experience tumult in October.

It's looking more like an equity October than in October, so I would say hang on, mind the tenderness, manage risk, but understand that you know that growth is still ahead.

And finally, Andy, before I let you go, we have around 60 seconds here, so quickly that event that happened on October 11th, yes, now that it is in the rearview mirror, how are you digesting what happened?

It was really interesting.

It caused a lot of us to go back and reread documentation about how a lot of these centralized exchanges work.

Some traditional market participants, and I wouldn't say that I'm like I'm kind of in the same camp a little bit, is that when you have exchanges that You know that perform all the functions from brokerage to exchange to custody to clearing, and they each have their own kind of procedures for things like perpetuals that investors really need to make sure that they understand the rules of what happens when gaps happen.

Crypto is a lot less volatile than it used to be, but there is still Opportunities, especially in periods like Friday nights in Eastern Time when liquidity thins out where people have to mind themselves.

So standard risk management practices are always a good idea.

Perpetuals are really powerful and interesting, relatively new instruments, so we want to see them flourish, but people have to sort of mind the risk.

OK, Andy, as always, thank you so much for joining me here at the New York Stock Exchange and thank you so much for breaking down a lot of the complicated subjects here.

Thank you.