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Bitcoin News Today: Weaker Jobs Data Sparks 70% Odds of 25-Basis-Point Fed Rate Cut in September

Anndy Lian
Bitcoin News Today: Weaker Jobs Data Sparks 70% Odds of 25-Basis-Point Fed Rate Cut in September

Summary

– Weaker U.S. jobs data (73,000 new jobs in July) has raised 70% odds of a 25-basis-point Fed rate cut in September, boosting crypto markets like Bitcoin and Ethereum.

– Analysts highlight reduced opportunity costs for holding non-yielding crypto assets under lower rates, though market reactions depend on Fed communication clarity.

– Despite optimism, experts warn of traditional crypto weakness (August-October) and risks from economic deterioration or geopolitical tensions undermining gains.

– Political pressures on the Fed, including Trump’s criticism of Powell, complicate policy decisions while inflation and volatility remain key concerns.

 

The U.S. jobs market has weakened significantly, increasing speculation that the Federal Reserve will implement a 25-basis-point rate cut in September. This development has sparked renewed optimism in the cryptocurrency market, with Bitcoin, Ethereum, and XRP showing signs of stabilization after a period of underperformance [1].

Ask Aime: What will happen if the Federal Reserve cuts interest rates and how will it affect Bitcoin?

According to Polymarket data, the probability of a Fed rate cut in September has climbed to 70% as of August 1, up sharply from earlier in the week. The odds of a more aggressive 50-basis-point cut stand at 6.8% [1]. These expectations follow a disappointing July jobs report, which revealed a mere 73,000 new jobs, far below the estimated 110,000. This figure was compounded by downward revisions to May and June job figures, marking the largest two-month adjustment since the onset of the pandemic in 2020 [1].

The unemployment rate rose to 4.2%, and wage growth remained robust at 0.3% month-on-month and 3.9% year-on-year. Analysts suggest that the weaker labor market narrative weakens the Fed’s rationale for maintaining higher interest rates, potentially opening the door for easing measures without appearing to capitulate to political pressure [1].

Greg Magadini, Director of Derivatives at Amberdata, emphasized the market’s surprise at the sharp downward revisions and weak July data, which caused the U.S. dollar to weaken and bond yields to fall. He noted that this scenario provides the Fed with flexibility to cut rates without appearing to act under external pressure [1].

Anndy Lian, a blockchain advisor, pointed out that lower interest rates reduce the opportunity cost of holding non-yielding assets like Bitcoin and Ethereum. He stressed, however, that the market’s response will depend on the Fed’s communication strategy [1].

Prediction markets reflect this shift in sentiment. A contract for a December rate cut now shows over 60% of participants anticipating another 25-basis-point reduction [1].

Despite this optimism, experts caution that crypto markets face a traditionally weak period from August through mid-October. Tom Bruni of Stocktwits highlighted that recent ‘good news’ has failed to significantly boost prices, and while a Fed rate cut could provide support, economic deterioration could undermine any positive momentum [1].

Sunil Raina, CEO of CereBree, echoed these sentiments, stating that a September rate cut appears to be the only viable option unless the Fed risks damaging the economy. However, he warned that inflation and geopolitical risks remain, contributing to ongoing volatility [1].

The broader context is a divided Federal Reserve navigating political pressures, particularly from President Donald Trump, who has publicly criticized Jerome Powell and urged direct intervention by the Fed. While the Fed has avoided premature action, the weaker labor data may now serve as cover for a policy shift without appearing politically compromised [1].

This evolving situation has significant implications for Bitcoin and other risk assets in the coming weeks as investors closely watch for further developments in both the labor market and monetary policy [1].

Source: [1] Bitcoin, Ethereum, XRP Struggle After Underwhelming Jobs Report: Will A September Rate Cut Save The Bull Run? (https://www.benzinga.com/crypto/crypt...)

 

Source: https://www.ainvest.com/news/bitcoin-news-today-weaker-jobs-data-sparks-70-odds-25-basis-point-fed-rate-cut-september-2508/

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Bitcoin, Ethereum, XRP Struggle After Underwhelming Jobs Report: Will A September Rate Cut Save The Bull Run?

Anndy Lian
Bitcoin, Ethereum, XRP Struggle After Underwhelming Jobs Report: Will A September Rate Cut Save The Bull Run?

The odds of a Federal Reserve interest rate cut in September surged following a surprisingly weak U.S. jobs report, reigniting bullish sentiment across crypto markets heading into a traditionally volatile trading season.

What Happened: According to Polymarket data as of August 1, there is now a 70% chance the Fed will cut rates by 25 basis points at its September 17 meeting, a significant jump from just days prior.

Meanwhile, bets on a 50-basis-point cut stand at 6.8%.

This comes after the U.S. economy added only 73,000 jobs in July, far below the consensus estimate of 110,000.

Markets were further rattled by a downward revision of 258,000 jobs from May and June, the sharpest two-month downgrade since the onset of COVID-19 in 2020.

The unemployment rate ticked up to 4.2%, while wage growth remained stronger than expected at 0.3% month-on-month and 3.9% year-on-year.

Why It Matters: For crypto investors, these signals are meaningful.

“This is absolutely a game changer,” Greg Magadini, Director of Derivatives at Amberdata, told Benzinga. “The Fed has had the luxury of holding rates higher-for-longer because the jobs market remained strong. That narrative is now in question.”

Magadini explained that the sharp revisions and weak July headline caught markets off guard, pushing the U.S. dollar lower and sending bond yields falling.

“This gives the Fed room to cut without appearing to cave to political pressure,” he said, referring to the Trump administration’s public criticism of Fed Chair Jerome Powell.

Speaking with Benzinga, Anndy Lian, a blockchain advisor and author, said the rate cut odds lean favorably for crypto.

“Lower interest rates reduce the opportunity cost of holding non-yielding assets like Bitcoin and Ethereum,” he noted, but added that the market’s reaction will also depend on how the Fed communicates its strategy.The shift in expectations is playing out in prediction markets.

Data from Polymarket shows a sharp rise in bets favoring a September rate cut.

A separate contract for a December decision also now leans heavily toward further easing, with over 60% expecting another 25-basis-point cut.

Tom Bruni, VP of Community at Stocktwits, noted that crypto is entering a seasonally weak window from August through mid-October.

“We’ve already seen ‘good news’ fail to drive prices higher. With the Fed now more likely to ease, that could support prices — but only if economic deterioration doesn’t accelerate into something more serious.”

Sunil Raina, CEO of CereBree, echoed those thoughts: “Unless the Fed wants to risk breaking the economy, a September rate cut now looks like the only sensible move.” But he warned that inflation and geopolitical risks remain, keeping volatility elevated.

What’s Next: In the background is a deeply divided Fed navigating political pressure.

President Donald Trump has continued his public attacks on Powell, calling him a “stubborn MORON” in a Truth Social post and urging the Federal Reserve Board to intervene directly.

While the Fed has so far resisted acting prematurely, the weakening labor data may offer cover to make a policy shift without appearing politically compromised, a dynamic that could heavily influence the path of Bitcoin and risk assets in the coming weeks.

 

Source: https://finance.yahoo.com/news/bitcoin-ethereum-xrp-struggle-underwhelming-163451562.html

The post Bitcoin, Ethereum, XRP Struggle After Underwhelming Jobs Report: Will A September Rate Cut Save The Bull Run? appeared first on Anndy Lian by Anndy Lian.

Bitcoin, Ethereum, XRP Struggle After Underwhelming Jobs Report: Will A September Rate Cut Save The Bull Run?

Anndy Lian
Bitcoin, Ethereum, XRP Struggle After Underwhelming Jobs Report: Will A September Rate Cut Save The Bull Run?

The odds of a Federal Reserve interest rate cut in September surged following a surprisingly weak U.S. jobs report, reigniting bullish sentiment across crypto markets heading into a traditionally volatile trading season.

What Happened: According to Polymarket data as of August 1, there is now a 70% chance the Fed will cut rates by 25 basis points at its September 17 meeting, a significant jump from just days prior.

Meanwhile, bets on a 50-basis-point cut stand at 6.8%.

This comes after the U.S. economy added only 73,000 jobs in July, far below the consensus estimate of 110,000.

Markets were further rattled by a downward revision of 258,000 jobs from May and June, the sharpest two-month downgrade since the onset of COVID-19 in 2020.

The unemployment rate ticked up to 4.2%, while wage growth remained stronger than expected at 0.3% month-on-month and 3.9% year-on-year.

Why It Matters: For crypto investors, these signals are meaningful.

“This is absolutely a game changer,” Greg Magadini, Director of Derivatives at Amberdata, told Benzinga. “The Fed has had the luxury of holding rates higher-for-longer because the jobs market remained strong. That narrative is now in question.”

Magadini explained that the sharp revisions and weak July headline caught markets off guard, pushing the U.S. dollar lower and sending bond yields falling.

“This gives the Fed room to cut without appearing to cave to political pressure,” he said, referring to the Trump administration’s public criticism of Fed Chair Jerome Powell.

Speaking with Benzinga, Anndy Lian, a blockchain advisor and author, said the rate cut odds lean favorably for crypto.

“Lower interest rates reduce the opportunity cost of holding non-yielding assets like Bitcoin and Ethereum,” he noted, but added that the market’s reaction will also depend on how the Fed communicates its strategy.The shift in expectations is playing out in prediction markets.

Data from Polymarket shows a sharp rise in bets favoring a September rate cut.

A separate contract for a December decision also now leans heavily toward further easing, with over 60% expecting another 25-basis-point cut.

Tom Bruni, VP of Community at Stocktwits, noted that crypto is entering a seasonally weak window from August through mid-October.

“We’ve already seen ‘good news’ fail to drive prices higher. With the Fed now more likely to ease, that could support prices — but only if economic deterioration doesn’t accelerate into something more serious.”

Sunil Raina, CEO of CereBree, echoed those thoughts: “Unless the Fed wants to risk breaking the economy, a September rate cut now looks like the only sensible move.” But he warned that inflation and geopolitical risks remain, keeping volatility elevated.

What’s Next: In the background is a deeply divided Fed navigating political pressure.

President Donald Trump has continued his public attacks on Powell, calling him a “stubborn MORON” in a Truth Social post and urging the Federal Reserve Board to intervene directly.

While the Fed has so far resisted acting prematurely, the weakening labor data may offer cover to make a policy shift without appearing politically compromised, a dynamic that could heavily influence the path of Bitcoin and risk assets in the coming weeks.

 

Source: https://www.benzinga.com/crypto/cryptocurrency/25/08/46802086/bitcoin-ethereum-xrp-struggle-after-underwhelming-jobs-report-will-a-september-rate-cut-sav

The post Bitcoin, Ethereum, XRP Struggle After Underwhelming Jobs Report: Will A September Rate Cut Save The Bull Run? appeared first on Anndy Lian by Anndy Lian.

From dollars to digital coins: Tariffs shake the financial world

Anndy Lian
From dollars to digital coins: Tariffs shake the financial world

Solid earnings from megacap technology firms have failed to buoy broader market confidence, while movements in currencies, stock indices, Treasury yields, commodities, and even cryptocurrencies like Bitcoin reflect a pervasive sense of caution.

I will walk you through what’s driving this retreat, weaving in my perspective on its implications for investors and the global economy.

Trump’s tariffs: The spark of uncertainty

At the forefront of this market unease is President Trump’s tariff policy update. The White House has confirmed that a minimum global tariff of 10 per cent will persist, with countries enjoying trade surpluses with the United States facing steeper duties of 15 per cent or more. Specific nations have been hit harder: Canada now faces a 35 per cent levy, and Switzerland a hefty 39 per cent.

What amplifies the market’s anxiety is the lack of clarity on when these new rates will take effect. This ambiguity leaves businesses and investors grappling with unanswered questions about how these tariffs will reshape global trade flows, corporate profitability, and economic growth.

This tariff strategy reflects Trump’s ongoing commitment to addressing perceived trade imbalances, but it risks igniting a broader trade conflict. Tariffs of this magnitude could disrupt supply chains, particularly for countries like Canada, a key US trading partner, and Switzerland, known for its precision exports. The absence of a timeline only deepens the uncertainty, forcing companies to delay investment decisions and prompting markets to price in potential downside risks.

I see this as a double-edged sword: while it may bolster certain domestic industries, it could also inflate costs for consumers and businesses reliant on imported goods, potentially stoking inflation at a time when central banks are already on edge.

The immediate market response underscores this concern. US stock markets closed lower, with the S&P 500 slipping 0.4 per cent, the NASDAQ holding flat, and the Dow Jones dropping 0.7 per cent. These declines suggest that investors are prioritising the macroeconomic fallout of tariffs over other positive signals, a theme that recurs across asset classes.

Tech earnings: A bright spot overshadowed

Amid this tariff-induced turbulence, megacap tech firms have delivered robust earnings reports. Companies like Apple, Microsoft, and Amazon have showcased strong quarterly results, buoyed by resilient demand for technology products and services. Under normal circumstances, such performances might spark a rally in equity markets. They have failed to lift broader sentiment, a telling sign of the market’s preoccupation with larger forces.

In my view, this disconnect highlights a critical shift in investor psychology. While these tech giants demonstrate operational strength, their success cannot offset the uncertainty surrounding trade policies. Investors appear more focused on how tariffs might erode profit margins for multinational corporations, many of which rely on global supply chains.

For instance, higher duties on imported components could squeeze profitability, even for firms reporting solid earnings today. This suggests to me that the market is in a risk-off mode, where macroeconomic narratives trump individual company fundamentals.

Currency markets: Diverging reactions

Currency markets offer a mixed picture, reflecting the varied impacts of Trump’s policies. The US Dollar Index climbed 0.2 per cent, signaling a modest strengthening of the dollar. This uptick likely stems from its safe-haven status amid uncertainty, as well as expectations that tariffs might bolster US economic activity in the short term by favouring domestic production.

However, other currencies tell a different story. The Swiss franc edged lower, likely pressured by the 39 per cent tariff on Swiss exports, which could dent its export-driven economy. Meanwhile, the Canadian dollar held steady despite a 35 per cent levy, perhaps buoyed by its linkage to commodity prices, particularly oil.

The dollar’s modest gain suggests cautious optimism about US resilience, but the stability of the Canadian dollar surprises me given the tariff burden. It may indicate that traders see Canada’s energy exports as a buffer, though I suspect prolonged trade tensions could eventually weigh on the loonie. The franc’s decline, conversely, aligns with expectations, as Switzerland’s smaller, trade-dependent economy has less room to absorb such shocks.

Treasury yields and commodities: Inflation fears and demand worries

In the bond market, US Treasury yields rose, with the 10-year yield increasing 0.4 basis points to 4.374 per cent and the two-year yield climbing 1.7 basis points to 3.957 per cent. This upward movement stands out against the risk-off backdrop, where yields typically fall as investors seek safety in bonds.

To me, this suggests that markets are anticipating higher inflation, possibly driven by tariffs raising the cost of imported goods. It could also reflect concerns about the fiscal implications of trade policies, as reduced trade volumes might not offset the revenue gains Trump envisions.

Commodities present a contrasting narrative. Gold rose 0.5 per cent to US$3,290 per ounce, reinforcing its role as a safe-haven asset during uncertain times. I view this as a classic flight to safety, with investors hedging against both geopolitical risks and potential economic slowdowns.

Brent crude, however, fell 1.0 per cent to US$72.5 per barrel, driven by expectations of increased OPEC+ output following their upcoming meeting to set September quotas. This decline puzzles me somewhat: while higher supply makes sense, softening global demand due to trade tensions could also be at play, signalling broader growth concerns.

Jobs report: A looming test

The market’s gaze now shifts to the upcoming July jobs report, due Friday, which economists predict will show a more deliberate pace of hiring and an unemployment rate rising to 4.2 per cent. This data point carries significant weight.

A softening labor market could amplify fears of an economic slowdown, especially if paired with tariff-related headwinds. Conversely, a stronger-than-expected report might offer temporary relief, though I doubt it would fully dispel the tariff overhang.

In my opinion, this report will serve as a litmus test for US economic resilience. A tick up in unemployment could prompt the Federal Reserve to reconsider its rate stance, particularly if inflation pressures from tariffs persist. For investors, it’s a moment to watch closely, as it could either reinforce or challenge the current risk-off sentiment.

Bitcoin’s plunge: A crypto microcosm

The cryptocurrency market, particularly Bitcoin, mirrors this broader retreat. Bitcoin’s price dropped 2.18 per cent to US$115,621 over 24 hours, a decline fuelled by leveraged liquidations, technical breakdowns, and waning institutional enthusiasm. Between July 31 and August 1, over US$560 million in crypto positions were liquidated, with US$153 million tied to Bitcoin alone.

This cascade of forced selling intensified as Bitcoin breached the US$118,859 support level (the 23.6 per cent Fibonacci retracement of its 2024-2025 rally), turning it into resistance and accelerating technical selling.

Technical indicators reinforce this bearish turn. The Relative Strength Index (RSI) is at 49.44, and a MACD histogram at -630 signals weakening momentum, with the next support at US$114,500 (38.2 per cent Fibonacci) in sight. If breached, an additional US$149 million in liquidations could follow, per technical analysis data.

Beyond technicals, institutional demand has cooled, with spot Bitcoin ETF assets under management stagnating at US$151.48 billion despite US$47 billion in corporate purchases. Meanwhile, a shift toward altcoins has seen Bitcoin’s dominance dip 0.51 per cent, as capital flows to riskier crypto assets.

Coinglass data paints a stark picture: in one hour on August 1, US$284 million in liquidations hit the crypto market, with US$276 million from long positions, including US$91.6493 million for Ethereum and US$76.0871 million for Bitcoin. Over four hours, liquidations exceeded US$409 million. The Fear & Greed Index slid to Neutral (57) from Greed (62), capturing this sentiment shift.

To me, Bitcoin’s woes encapsulate the broader market’s struggles. The liquidation wave reflects overleveraged optimism meeting harsh reality, while the technical breakdown and institutional pullback suggest a maturing market reacting to global cues. I see this as a warning sign: if even speculative assets like Bitcoin falter, the risk-off mood may be deeper than it appears.

For me, the key takeaway is adaptability. Investors must brace for volatility, balancing safe havens like gold with selective exposure to resilient sectors. The interplay of inflation risks, trade disruptions, and labor market signals will shape the near-term outlook.

 

 

Source: https://e27.co/from-dollars-to-digital-coins-tariffs-shake-the-financial-world-20250801/

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The Fed, tariffs, and Bitcoin: Unpacking the market dynamics

Anndy Lian
The Fed, tariffs, and Bitcoin: Unpacking the market dynamics

Global risk sentiment holds steady, yet an undercurrent of caution persists, shaped by a blend of robust economic data, trade policy turbulence, and a Federal Reserve that refuses to tip its hand.

Federal Reserve Chair Jerome Powell recently signalled that no firm decision has been reached for the September Federal Open Market Committee (FOMC) meeting, leaving investors guessing about the likelihood of a rate cut. With interest rates unchanged at 4.25 per cent to 4.50 per cent for the fifth consecutive meeting, the Fed aligns with market expectations but offers little clarity on its next move.

Meanwhile, economic indicators like a strong US GDP and employment figures paint an optimistic picture, only to be muddied by new tariffs and a volatile commodity market. Add to this mix the evolving cryptocurrency narrative, highlighted by Bitcoin’s potential to hit US$141,000, and the stakes for understanding these dynamics grow even higher. What does this all mean for traditional markets and digital assets alike? I will try to explain.

Global risk sentiment and the Federal Reserve’s stance

Global risk sentiment remains balanced, neither plunging into panic nor surging with unchecked optimism. This stability stems from a tug-of-war between encouraging economic signals and unsettling policy developments.

The Federal Reserve plays a central role in this narrative. By maintaining rates at 4.25 per cent to 4.50 per cent, the Fed reinforces a wait-and-see posture, a decision that met market forecasts but left room for debate. Two voting members dissented, the most since 1993, hinting at internal divisions over the path forward.

Powell’s remarks during the post-meeting news conference underscored this uncertainty, dampening expectations for a September rate cut. According to the CME FedWatch tool, the odds of a cut dropped to 47 per cent from 63 per cent just a day prior, reflecting a market recalibration after the Fed’s cautious tone collided with upbeat economic data.

This steady sentiment faces pressure from external forces. New tariffs on India and Brazil, coupled with the removal of the “de minimis” exemption for small packages, signal a tougher US stance on trade. The White House’s proclamation of 50 per cent tariffs on “processed” copper (but not “refined” copper) starting August 1st sent shockwaves through commodity markets, with Comex copper prices plummeting by as much as 20 per cent at one point.

These moves threaten to disrupt global supply chains and stoke inflation, challenges the Fed must weigh as it plots its course. For now, the central bank opts for patience, balancing the vigour of the US economy against these looming risks.

Economic data: A bright spot amid uncertainty

The US economy offers compelling reasons for optimism. Second-quarter GDP growth clocked in at a robust 3.0 per cent quarter-over-quarter seasonally adjusted annual rate, surpassing expectations and signalling resilience. July’s ADP employment report added to the good news, revealing a surprising 104,000 new private-sector jobs.

These figures suggest a labor market and broader economy that continue to defy slowdown fears, providing a counterweight to global uncertainties. Investors and policymakers alike find reassurance in these numbers, which bolster the case for the Fed’s steady-hand approach.

Yet, this strength does not exist in a vacuum. Rising Treasury yields hint at underlying concerns. The 10-year US Treasury yield climbed 5 basis points to 4.370 per cent, while the 2-year yield jumped 7.2 basis points to 3.941 per cent. Higher yields often reflect expectations of inflation or a belief that rate cuts remain distant, both of which align with the Fed’s current rhetoric and the tariff-driven pressures on prices.

The US Dollar Index advanced 0.93 per cent, buoyed by the Fed’s stance and perhaps some safe-haven demand amid trade tensions. Gold, typically a refuge in uncertain times, slipped 1.5 per cent to US$3,275 per ounce, possibly due to the stronger dollar or profit-taking after recent gains. Brent crude oil, however, rose 1.0 per cent to US$73 per barrel after President Trump threatened tariffs on India over its energy purchases from Russia, a reminder of how geopolitics can sway commodity prices.

Market reactions: A mixed bag

US stock markets mirrored the broader uncertainty, closing with varied results. The S&P 500 dipped 0.12 per cent, the Dow Jones fell 0.38 per cent, and the NASDAQ eked out a 0.15 per cent gain. This patchwork performance reflects investor efforts to parse positive economic data against trade policy risks.

In Asia, early trading showed similarly mixed equity indices, while US equity futures pointed to an indecisive opening. The day ahead promises more clues, with China’s July manufacturing and non-manufacturing PMI data, alongside Taiwan and Hong Kong’s second-quarter GDP figures, set to influence sentiment further. These releases could either reinforce the steady outlook or tip the scales toward caution, depending on their strength.

Commodity markets, meanwhile, felt the tariff fallout acutely. The copper price collapse underscores how swiftly policy shifts can ripple through global trade. Such volatility could feed into inflation, challenging the Fed’s efforts to maintain stability. For now, markets navigate a landscape where economic growth coexists with policy-induced turbulence, leaving investors on edge but not in retreat.

Bitcoin and the cryptocurrency angle

Bitcoin offers a compelling subplot in this financial drama. On-chain analytics firm Glassnode highlights US$141,000 as a potential next significant resistance if Bitcoin breaks higher with conviction. This projection ties to the Short-Term Holder (STH) Cost Basis, which tracks the average acquisition price for investors holding coins for less than 155 days.

Currently at US$105,400, this level shows STHs enjoying an 11.5 per cent unrealised profit at recent prices. Historically, trading above this basis signals bullish momentum, a pattern Bitcoin has followed since breaching it earlier this year.

Glassnode’s analysis adds depth with standard deviation bands. The +1 SD band, at US$125,100, has repeatedly capped Bitcoin’s upward moves, with two rejections in recent months. A decisive break above this could target the +2 SD level at US$141,600, where STH profits would swell, possibly triggering profit-taking and new resistance. For now, Bitcoin hovers between US$105,000 and US$125,000, a range that may hold until a catalyst, be it policy or market sentiment, sparks a breakout.

The Fed’s announcement and Powell’s remarks dented cryptocurrency prices, with Bitcoin sliding in afternoon trading. This sensitivity to monetary policy underscores Bitcoin’s role as a barometer for risk appetite and expectations of Fed action. Matthew Sigel of VanEck argues Bitcoin serves as a hedge against monetary debasement, suggesting that signals of easier policy could ignite crypto enthusiasm.

Historical data support this: Bitcoin rose after four of the year’s prior FOMC meetings, though it dipped post-June before recovering. Lower rates, by reducing borrowing costs, often drive investment into alternative assets like Bitcoin, a dynamic worth watching if the Fed shifts gears.

The White House’s digital asset vision

The White House’s new report, Strengthening American Leadership in Digital Financial Technology, adds another layer to the crypto story. Compiled by the Working Group on Digital Asset Markets, it champions digital assets and blockchain as transformative forces for finance and beyond.

Legislative priorities like the Genius stablecoin act and the Clarity Act aim to provide structure. At the same time, recommendations urge the SEC and CFTC to clarify rules on trading, custody, and record-keeping at the federal level. Support for decentralised finance through safe harbors and regulatory sandboxes signals openness to innovation, a boon for the sector.

The report’s stance on a Bitcoin reserve stands out. Administered by the Treasury, this stockpile of seized digital assets will be held, not sold, as reserve assets. This move could legitimise Bitcoin further, boosting confidence among investors wary of regulatory hostility.

Conversely, the report opposes a US central bank digital currency, aligning with the Anti-CBDC Act and reinforcing a decentralised ethos that crypto advocates cherish. These developments suggest a regulatory tailwind for Bitcoin, though their full impact will unfold over time.

My take on the situation

I see a world of opportunity and risk in equal measure. The US economy’s strength, evident in GDP and jobs data, offers a solid foundation, but trade tensions and tariffs threaten to erode it. The Fed’s caution makes sense given these crosscurrents, yet its indecision leaves markets vulnerable to swings.

For traditional assets, volatility seems likely as investors grapple with these forces. Bitcoin, meanwhile, intrigues me most. Its potential to hit US$141,000 hinges on breaking key resistance, a feat that regulatory clarity and a dovish Fed could enable. The White House’s embrace of digital assets feels like a game-changer, though execution will matter.

I lean cautiously optimistic on crypto, believing its hedge appeal and policy support could shine amid uncertainty. Still, prudence dictates watching the Fed and global data closely—volatility cuts both ways.

 

Source: https://e27.co/the-fed-tariffs-and-bitcoin-unpacking-the-market-dynamics-20250731/

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Blurring the Lines: The convergence of traditional finance and crypto

Anndy Lian
Blurring the Lines: The convergence of traditional finance and crypto

The global financial markets are currently experiencing a period of uncertainty, with risk sentiment retreating due to stalled progress in US-China trade negotiations and investor caution ahead of the Federal Open Market Committee (FOMC) decision. These factors are creating a challenging environment for investors, who are grappling with mixed economic signals, shifting market performances, and significant developments in the cryptocurrency space.

This article explores the current state of the global economy, delves into key corporate strategies involving digital assets, and examines the implications of new regulatory changes from the US Securities and Exchange Commission (SEC).

Economic data and market performance

Recent economic data from the United States paints a picture of an economy at a crossroads. The US Conference Board’s July Consumer Confidence Index rose to 97.2, up from 93, surpassing analyst expectations. This increase suggests that American consumers are feeling more optimistic about their financial prospects, possibly due to stable income levels or an improving outlook on inflation.

However, this positive signal contrasts sharply with signs of a cooling labour market. Job openings in June dropped by 275,000 to 7.437 million, while the job openings rate fell from 4.6 per cent to 4.4 per cent. These declines indicate that employers are pulling back on hiring, which could foreshadow slower economic growth if the trend continues.

This mixed economic backdrop has had a direct impact on financial markets. US stock markets closed lower, with the S&P 500 declining by 0.30 per cent, the NASDAQ by 0.38 per cent, and the Dow Jones by 0.46 per cent. Investors appear to be reacting to the uncertainty surrounding trade negotiations and the upcoming FOMC decision, which could influence interest rates and monetary policy.

At the same time, US Treasury yields fell across the curve, reflecting a shift toward safer assets. The 10-year UST yield dropped by 8.9 basis points to 4.320 per cent, and the two-year UST yield fell by 4.7 basis points to 3.869 per cent. Lower yields often signal investor concerns about economic growth, as they seek the relative security of government bonds.

Currency and commodity markets also reflect this cautious mood. The US Dollar Index climbed by 0.25 per cent, reinforcing the dollar’s role as a safe-haven currency during turbulent times. Gold prices, meanwhile, rebounded by 0.36 per cent after four consecutive sessions of losses, suggesting that investors are turning to traditional hedges against uncertainty.

In Asia, stock markets opened with mixed results, indicating regional variations in how investors are processing these global developments. However, US equity index futures point to a higher opening for US stocks, hinting at a potential rebound as new data and events unfold.

Key events on the horizon

The coming days promise to bring clarity or further complexity to this evolving situation. Monetary policy decisions from the Bank of Canada and the Federal Reserve loom large, with the Fed’s announcement drawing particular attention. Investors are eager to understand whether the central bank will adjust interest rates or signal changes in its approach to inflation and growth.

Additionally, second-quarter GDP data from the United States and the Eurozone will provide a broader view of economic health in these critical regions. Strong GDP figures could bolster confidence, while weaker numbers might deepen concerns about a slowdown.

Earnings releases from the tech sector also feature prominently on the calendar. Companies in this influential industry often serve as bellwethers for the broader market, and their performance could sway investor sentiment. These events collectively represent a packed docket that will likely shape market trajectories in the near term, making it a pivotal moment for financial observers.

Michael Saylor’s strategy: A bold bet on Bitcoin

Amid this uncertain economic climate, some companies are making striking moves in the cryptocurrency space. Michael Saylor’s Strategy, formerly known as MicroStrategy, recently purchased 21,021 Bitcoin after raising US$2.5 billion through its fourth preferred stock offering, dubbed STRC.

This transaction stands out as the largest US initial public offering (IPO) in 2025 so far, surpassing even the much-anticipated US$1 billion IPO of stablecoin issuer Circle Internet Group in June. Strategy acquired the Bitcoin at an average price of US$117,256 per coin, bringing its total holdings to 628,791 BTC, the largest stash among public companies according to BitcoinTreasuries.NET.

This acquisition underscores Strategy’s unwavering commitment to Bitcoin as a core component of its corporate treasury. The company raised US$2.5 billion by selling 28 million shares of Variable Rate Series A Perpetual Preferred Stock at US$90 each, a deal that ballooned from an initial target of US$500 million due to strong investor demand. This move is not just a financial play but a statement of belief in Bitcoin’s long-term value.

By amassing such a significant position, Strategy positions itself as a pioneer in corporate adoption of cryptocurrencies, potentially encouraging other firms to follow suit. For investors, this strategy raises intriguing questions about the role of digital assets in hedging against inflation and diversifying traditional portfolios.

Windtree Therapeutics: Biotech meets blockchain

While Strategy’s Bitcoin haul grabs headlines, Windtree Therapeutics is charting an equally bold path in the crypto realm. This biotech company, listed on NasdaqCM under the ticker WINT, has secured up to US$520 million in new funding, with 99 per cent of the proceeds earmarked for acquiring BNB, the native cryptocurrency of the Binance ecosystem.

The funding package includes a US$500 million equity line of credit (ELOC) and a US$20 million stock purchase agreement with Build and Build Corp, reflecting a deliberate pivot toward digital assets.

Windtree’s CEO, Jed Latkin, emphasised the strategic importance of this move, noting that the opportunity to bolster BNB holdings aligns with the company’s broader vision. Unlike Strategy, which focuses solely on Bitcoin, Windtree is diversifying its treasury with BNB, a token tied to one of the world’s largest cryptocurrency exchanges. This approach suggests confidence in the Binance ecosystem’s growth potential and its utility in decentralised finance.

For a biotech firm traditionally focused on healthcare innovation, this aggressive shift into blockchain-based assets marks a hybrid strategy that blends cutting-edge medicine with cutting-edge finance. It also highlights how companies across industries are rethinking their financial strategy in light of cryptocurrency’s rising prominence.

SEC’s new rules: A game-changer for crypto ETPs

Regulatory developments are adding another layer of intrigue to this narrative. The US Securities and Exchange Commission recently approved new rules that allow authorised participants to create and redeem shares of crypto exchange-traded products (ETPs) using in-kind transfers of Bitcoin and Ether.

This decision departs from the previous cash-only requirement for spot crypto funds, bringing these products in line with commodity-based ETPs like those backed by gold or oil. The change promises to reduce operational costs and enhance efficiency for issuers, potentially making crypto ETPs more appealing to a wider range of investors.

SEC Chairman Paul Atkins hailed this as a step toward a more tailored regulatory framework for crypto markets, emphasising that it benefits investors by lowering costs. Beyond in-kind transfers, the SEC also greenlit additional enhancements to the crypto ETP ecosystem.

These include approval for a mixed ETP holding both spot Bitcoin and Ether, authorisation of options and FLEX options on certain Bitcoin ETPs, and an increase in position limits on listed Bitcoin options to 250,000 contracts, matching thresholds for other high-volume options. These moves signal a maturing infrastructure for cryptocurrency investments, bridging the gap between traditional finance and the digital asset frontier.

Conclusion

The global financial markets stand at a fascinating juncture. Economic data reveals an uneasy balance between optimism and caution, while upcoming events promise to steer the course ahead.

Meanwhile, Strategy and Windtree Therapeutics are redefining corporate strategy with their crypto ambitions, and the SEC is paving the way for a more integrated digital asset market. For investors, this convergence of factors demands vigilance and adaptability.

The interplay of trade negotiations, monetary policy, and cryptocurrency innovation will likely define the financial landscape for months to come, offering both challenges and opportunities in equal measure.

As this story unfolds, one thing is clear: the boundaries between traditional finance and the digital frontier are blurring, and the implications will resonate far beyond today’s headlines.

 

Source: https://e27.co/blurring-the-lines-the-convergence-of-traditional-finance-and-crypto-20250730/

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Global sentiment lifts off: The US-EU agreement’s ripple through stocks, commodities, and digital currencies

Anndy Lian
Global sentiment lifts off: The US-EU agreement’s ripple through stocks, commodities, and digital currencies

The announcement of a US-EU trade agreement on Sunday has acted as a catalyst, easing tensions that had previously weighed on investor confidence. This development has had a ripple effect across various markets, influencing equities, bonds, commodities, and cryptocurrencies.

As we approach a week marked by high-stakes economic events and corporate earnings, understanding these dynamics becomes increasingly crucial. In my view, the renewed optimism is a welcome change, though the mixed signals in some markets suggest that caution remains warranted.

Let me tell you more.

A boost from the US-EU trade agreement

The US-EU trade agreement has emerged as a pivotal factor in lifting global risk sentiment. For months, trade uncertainty had cast a shadow over markets, with investors wary of escalating tariffs and disruptions to global supply chains.

The deal announced on Sunday has alleviated some of these concerns, fostering a more risk-on environment. Investors are now more inclined to allocate capital to growth-oriented assets like stocks, rather than seeking refuge in traditional safe havens like bonds or gold.

This shift reflects a broader belief that economic stability might be within reach, at least in the short term. However, with major events like the Federal Open Market Committee meeting and US payroll data looming, the sustainability of this optimism remains an open question.

US markets: Choppy trading and rising yields

In the United States, stock markets closed mixed after a volatile session, capturing the complexity of the current environment. The S&P 500 inched up by 0.02 per cent, signalling modest gains, while the NASDAQ climbed 0.33 per cent, driven by strength in technology stocks.

Meanwhile, the Dow Jones Industrial Average dipped by 0.14 per cent, hinting at lingering caution among traders. This uneven performance suggests that while the trade agreement has bolstered confidence, investors are still grappling with uncertainties tied to upcoming economic releases and corporate earnings.

US Treasury yields, which often serve as a barometer of market sentiment, edged higher across the curve. The 10-year Treasury yield rose by 2.2 basis points to 4.410 per cent, and the two-year yield ticked up by 0.2 basis points to 3.926 per cent.

These increases suggest that investors are shifting away from the safety of government bonds, aligning with the broader risk-on sentiment. Higher yields also reflect expectations of stronger economic growth, though they could pressure equity valuations if the trend accelerates.

The US Dollar Index, a measure of the dollar’s strength against major currencies, advanced by 1.01 per cent. A stronger dollar typically accompanies periods of economic optimism, as it did here, fuelled by the trade deal and improving risk appetite. This dollar rally could pose challenges for US exporters, but it also underscores the market’s faith in the resilience of the US economy.

Commodities: Diverging paths for gold and brent crude

Commodities have displayed divergent trends amid the shifting sentiment. Gold, a classic safe-haven asset, extended its retreat, falling by 0.68 per cent to US$3,315 per ounce.

This decline is understandable in the context of a rising risk appetite, as investors reduce their holdings of gold in favor of assets with higher potential returns. I see this as a natural response to the trade agreement, though gold could regain favor if new uncertainties emerge.

In contrast, Brent crude oil surged by 1.9 per cent to US$70 per barrel, propelled by President Trump’s proposal to impose secondary tariffs on nations purchasing Russian oil ahead of a 50-day deadline. This move has raised concerns about a tighter oil supply, which is expected to boost prices.

The rally also reflects the improving global economic outlook, which tends to lift energy demand. The energy market remains vulnerable to geopolitical shifts, and any escalation in trade disputes could alter this trajectory.

Asian markets and US futures: A mixed outlook

Asian stock markets mirrored the uneven performance seen in the US, with Japan’s Nikkei 225 pulling back by 1.1 per cent. This decline likely stemmed from profit-taking after recent gains, though it highlights that not all regions are fully embracing the risk-on wave. Despite this, US equity index futures suggest that US stocks will open higher, pointing to sustained positive momentum.

Investors are now fixated on a packed week ahead, featuring the FOMC meeting, US ISM manufacturing data, non-farm payrolls, second-quarter GDP figures, and earnings from four of the “Magnificent Seven” tech giants. These events will likely determine whether the current optimism persists or wanes.

Cryptocurrencies: Ethereum’s surge and Bitcoin’s mining milestone

The cryptocurrency market has also captured attention, with Ethereum briefly topping US$3,900, its highest level since December, before pulling back. This surge underscores growing investor enthusiasm for Ethereum, driven by its expanding role in decentralised finance and smart contract applications.

Bernstein analysts have noted that Ethereum treasuries, companies holding Ethereum as a reserve asset, are adopting a distinct approach compared to their Bitcoin-focused counterparts. These treasuries generate staking rewards, providing a yield on their holdings, which marks a significant evolution in how institutions utilise cryptocurrencies.

The analysts caution that this model introduces liquidity and security risks. Staking contracts, while generally liquid, can require days-long queues to unstake, forcing Ethereum treasuries to balance availability with yield optimisation. More advanced strategies, such as restaking or DeFi-based yield generation, further complicate matters by exposing firms to vulnerabilities in smart contracts.

This trade-off between yield and risk highlights the maturing nature of the crypto market, where innovation often comes with growing pains. Companies will need to navigate these challenges carefully to sustain Ethereum’s momentum.

Bitcoin, meanwhile, has seen its mining power approach a new record, with the 7-day average hashrate reaching 942 exahashes per second. This figure sits just below the all-time high of 943.6 exahashes per second set in mid-June, according to data from Blockchain.com.

The hashrate, which tracks the total computing power dedicated to mining Bitcoin, offers insight into the network’s security and the confidence of miners. The recent surge suggests that miners remain bullish on Bitcoin’s long-term prospects, despite its price cooling off in recent weeks.

This increase in mining power has persisted despite a new all-time high in Bitcoin’s difficulty, which adjusts to make mining more challenging as more power is added. Miners’ willingness to expand operations under these conditions reflects their belief in future price gains, likely driven by Bitcoin’s historical resilience and growing institutional adoption.

I find this development encouraging, as it signals a robust foundation for Bitcoin, though it also raises questions about energy consumption and profitability if prices stagnate.

My perspective: Optimism tempered by caution

From my standpoint, the advance in global risk sentiment is a positive development, particularly after months of trade-related uncertainty. The US-EU agreement has provided a much-needed lift, and its effects are evident across equities, currencies, and commodities.

The strength in the US dollar and Brent crude, coupled with Ethereum’s price surge and Bitcoin’s mining milestone, paints a picture of a market eager to move forward. Yet, the mixed performance of US and Asian stock markets, along with gold’s decline, reminds us that not all investors are thoroughly convinced.

The week ahead will be crucial in determining whether this momentum is sustained. The FOMC meeting could signal shifts in monetary policy, while economic data, such as payrolls and GDP, will shed light on the health of the US economy. Earnings from tech giants will also play a role, given their outsized influence on market indices.

In my opinion, the current risk-on environment offers opportunities, but investors should remain vigilant. The cryptocurrency space, with its blend of innovation and risk, exemplifies this duality. Ethereum treasuries and Bitcoin miners are pushing boundaries, yet they face hurdles that could temper their progress.

 

Source: https://e27.co/global-sentiment-lifts-off-the-us-eu-agreements-ripple-through-stocks-commodities-and-digital-currencies-20250729/

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Anndy Lian’s New Book- Discovering Singapore By Chance

Anndy Lian
Anndy Lian’s New Book- Discovering Singapore By Chance

When a canceled flight detours an American traveler to Singapore, what begins as a brief stopover evolves into a three-year odyssey of discovery. Blending personal narrative with incisive analysis, Discovering Singapore By Chance peels back the veneer of this enigmatic city-state to reveal the systems, values, and people that transformed a resource-poor island into a global beacon of prosperity, harmony, and innovation.

Through intimate encounters, from morning coffee rituals with Chinatown vendors to conversations with policymakers and tech entrepreneurs, the book explores how a nation built on compromise and long-term vision became a masterclass in multiculturalism, urban design, and pragmatic governance.

Readers will uncover:

A Political Paradox: How Singapore’s “soft authoritarianism” fosters stability and efficiency while navigating the tensions between collective progress and individual freedoms.Economic Reinvention: The story of a trading post turned financial hub, where government strategy and private enterprise dance in constant adaptation.Cultural Alchemy: How ethnic diversity thrives not through separation, but through daily, lived integration—from HDB housing policies to hybrid cuisines and multilingual conversations.Urban Innovation: The hidden engineering behind Singapore’s seamless infrastructure, green spaces, and “Smart Nation” ambitions.

Part travelogue, part societal deep-dive, this book challenges assumptions about what makes a nation successful. As the American visitor transitions from curious tourist to adopted resident, the narrative grapples with Singapore’s contradictions: a place both meticulously planned and organically evolving, efficient yet human, globally connected yet fiercely self-defined.

For readers fascinated by governance, urbanism, or cross-cultural understanding, Discovering Singapore By Chance offers not just a portrait of a nation, but a lens to reimagine what societies can achieve when pragmatism meets purpose.

“Singapore is not just a place; it’s a state of mind.”- Authors, Jenny Zheng & Anndy Lian

About the Authors:

Jenny Zheng is a global citizen whose journey, from China to South Korea to Singapore, has shaped her unique lens as an outsider falling unexpectedly in love with Singapore. Her perspective as a newcomer, navigating the city-state’s complexities with fresh eyes, provides the narrative heart of this book. A passionate observer of cultural fusion and human adaptability, Jenny’s storytelling bridges the gap between Singapore’s polished surface and the layered realities that make it a living laboratory of modern society.

Anndy Lian is an investor and technology advisor with over two decades of experience at the intersection of finance, governance, and digital transformation. A trusted consultant to listed companies and government leaders, he has witnessed how Singapore is shaped into a global hub for innovation and policy excellence. Born and raised in Singapore, Anndy brings an insider’s perspective to the nation’s political, economic, and social systems, offering readers a nuanced understanding of how Singapore’s “impossible” success was engineered.

 

Find out more on:

Amazon Books: https://www.amazon.com/Discovering-Singapore-Chance-Personal-Discovery-ebook/dp/B0FGHZVRHQ?ref_=ast_author_dp

Google Books: https://www.google.com.sg/books/edition/Discovering_Singapore_By_Chance/68FqEQAAQBAJ?hl=en&gbpv=1&dq=anndy+lian+discovering+singapore+by+chance&printsec=frontcover

 

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US-Japan ties strengthen markets, crypto rides the wave

Anndy Lian
US-Japan ties strengthen markets, crypto rides the wave

The US-Japan trade deal stands out as a major driver, signalling stronger economic ties between two of the world’s largest economies. Over the weekend, the US and the European Union also finalised a trade agreement, albeit one that introduces 15 per cent tariffs on European exports to the US.

Despite the tariffs, the resolution of this deal has been broadly welcomed as a step toward easing trade tensions, fostering a risk-on environment where investors feel emboldened to dive into equities and step back from safe-haven assets like gold.

I see a complex but largely encouraging picture emerging, though one that’s not without its potential pitfalls. Let’s talk about it.

Trade deals fuelling optimism

The US-Japan trade agreement has injected a dose of positivity into global markets. By reducing uncertainties and paving the way for increased trade, this deal promises to strengthen economic activity between these two powerhouses.

Japan, a major player in manufacturing and technology, stands to benefit from easier access to US markets, while American firms could see new opportunities in Japan. This development aligns with a broader narrative of thawing trade relations, which had been strained in recent years by tit-for-tat tariffs and geopolitical friction.

Meanwhile, the US-EU trade deal adds another layer to the story. The inclusion of 15 per cent tariffs on European exports might seem like a wrinkle, but the fact that negotiators reached an agreement at all has outweighed that concern for many investors. After months of saber-rattling and fears of an all-out trade war, this deal offers a measure of stability. It suggests that both sides prefer cooperation over confrontation, even if the terms aren’t perfect.

This resolution reflects a pragmatic approach by the Trump administration, avoiding the escalation that markets had braced for. The tariffs will undoubtedly raise costs for some European exporters, but the clarity provided by the deal could encourage businesses to adapt and invest with greater confidence.

US markets riding the wave

The US stock markets have wasted no time capitalising on this upbeat mood. The S&P 500 climbed 0.40 per cent to notch a fresh record high, while the Nasdaq followed suit with a 0.24 per cent gain. The Dow Jones Industrial Average also joined the rally, posting a 0.47 per cent increase.

These gains underscore the strength of the US corporate sector, which has delivered a solid earnings season so far. Companies across industries have reported resilient profits, defying earlier worries about slowing growth. For investors, this combination of strong fundamentals and positive trade news has been a green light to push equities higher.

The VIX, often dubbed Wall Street’s fear gauge, offers another clue to the prevailing sentiment. It slipped from 15.39 to 14.93, a modest but meaningful drop that signals reduced anxiety about market volatility.

Historically, a VIX below 20 indicates a relatively calm market, and this easing aligns with the risk-on vibe. This decline reflects a collective sigh of relief among traders, who see fewer immediate threats on the horizon. However, it’s worth noting that the VIX remains above its long-term average, suggesting that some underlying caution persists.

Bond yields and the dollar tell a mixed story

In contrast to the stock market’s exuberance, US Treasury yields have painted a more complicated picture. The 10-year yield edged down by 0.8 basis points to 4.388 per cent, while the two-year yield ticked up by 0.7 basis points to 3.923 per cent. This divergence hints at differing expectations for the short and long term.

The dip in the 10-year yield suggests that investors anticipate stable or even lower interest rates over the longer haul, perhaps due to confidence in the Federal Reserve’s ability to keep inflation in check. Conversely, the slight rise in the 2-year yield could reflect near-term uncertainty, possibly tied to upcoming economic data or speculation about rate hikes.

The US Dollar Index, up 0.28 per cent, has also benefited from this environment. A stronger dollar often accompanies positive sentiment about the US economy, and the trade deals have reinforced that narrative.

Meanwhile, gold took a hit, dropping 0.93 per cent as investors shed safe-haven assets in favour of riskier bets. Brent crude oil also slipped 1.1 per cent to US$68 per barrel, which might signal concerns about global demand despite the trade optimism.

Asian markets and crypto add context

Across the Pacific, Asian equities have shown a more cautious response. Last week, many markets closed lower as investors eyed this week’s Federal Open Market Committee meeting and the approaching US trade tariff deadline.

Today’s early trading saw a mixed start, contrasting with US equity index futures, which point to a higher open stateside. This regional divergence suggests that while the US enjoys a tailwind, Asia remains wary of unresolved trade issues and their local economic implications.

The cryptocurrency market, however, has mirrored the broader risk-on sentiment with its flair. Bitcoin, hovering near US$119,000, shrugged off a massive sale by Galaxy Digital, which unloaded 80,000 BTC worth over US$9 billion for a Satoshi-era investor.

Prices dipped briefly from $118,000 to $115,000 before bouncing back by Sunday. Analysts point to this resilience as evidence of Bitcoin’s maturation into a liquid, robust market. It’s a testament to how far the crypto industry has come since its volatile early days.

Ethereum, meanwhile, has stolen the spotlight. It’s spot ETFs raked in US$1.85 billion in net inflows for the week ending July 25, 2025, dwarfing Bitcoin ETFs’ US$72.06 million. Over the past three weeks, Ethereum ETFs have amassed US$4.94 billion, bringing their total net assets to US$20.66 billion.

This surge ties into what some refer to as the Utility Season narrative, where investors are drawn to Ethereum’s versatility in decentralised finance, NFTs, and beyond. Bitcoin’s store-of-value appeal remains strong, but Ethereum’s growth hints at a shift toward assets with broader functionality. I see this as a fascinating evolution in how investors weigh risk and reward.

What’s next?

From my perspective, the global risk sentiment feels like a tightrope walk. The trade deals and US earnings have laid a solid foundation, but the mixed signals from bonds, Asia, and commodities remind us that confidence is fragile.

The crypto market’s strength, particularly Ethereum’s rise, adds an intriguing dimension, suggesting that risk appetite extends beyond traditional assets.

Looking ahead, this week promises a deluge of data that could either solidify or shake this optimism. The US second-quarter GDP report, the July Personal Consumption Expenditures (PCE) index, and the July jobs report will provide a clearer view of the economy’s health.

Monetary policy decisions from the US, Canada, and Japan will also loom large, as central banks grapple with growth and inflation. The August 1 reciprocal tariff deadline adds another wildcard; any misstep could dent the current mood.

 

 

Source: https://e27.co/us-japan-ties-strengthen-markets-crypto-rides-the-wave-20250728/

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KYC in Banking and Cryptocurrency: A Necessary Hassle or Essential Protection?

Anndy Lian
KYC in Banking and Cryptocurrency: A Necessary Hassle or Essential Protection?

The financial world has experienced rapid changes, driven largely by technological advancements and the rise of digital currencies. Amid these shifts, the concept of “Know Your Customer” (KYC) has become increasingly important in both traditional banking and cryptocurrency sectors. While many customers view KYC procedures as tedious and intrusive, these processes are crucial for protecting financial institutions, safeguarding consumers, and maintaining the integrity of the global financial system. In this article, I’ll share my perspective on the current state of KYC practices, highlighting their importance, examining the challenges they present, and suggesting ways to improve them.

The idea behind KYC isn’t new. Banks have long been required to verify their customers’ identities and assess potential risks associated with their financial activities. These requirements stem from international regulations designed to combat financial crimes such as money laundering, terrorist financing, fraud, and tax evasion. According to the United Nations Office on Drugs and Crime (UNODC), between 2% and 5% of global GDP—roughly $800 billion to $2 trillion—is laundered each year. These alarming figures underscore the necessity of robust KYC procedures to detect and prevent illicit financial activities.

In traditional banking, KYC typically involves collecting and verifying personal identification documents, proof of address, financial history, and details about business operations. Banks also continuously monitor customer transactions to identify suspicious activities. Although these processes can be time-consuming and frustrating for customers, they are essential for banks to comply with strict regulatory requirements, such as the Bank Secrecy Act (BSA) in the United States, the European Union’s Anti-Money Laundering Directives (AMLD), and guidelines issued by the Financial Action Task Force (FATF).

The emergence of cryptocurrencies has introduced new complexities to the KYC landscape. Cryptocurrencies inherently offer a degree of anonymity and decentralization that traditional financial systems lack. This anonymity has made digital currencies attractive to criminals seeking to launder money or finance illegal activities. According to TRM Labs, in 2024, crypto transaction volume grew to over USD 10.6 trillion, up 56% since 2023. Illicit volume dropped to USD 45 billion, down 24% since 2023. In its 2025 crypto crime report released on February 10, the firm said the volume of illicit transactions dropped 24 per cent year on year to US$44.7 billion (S$60 billion) in 2024. but use in terrorist financing up. It also said that they are particular concern is cryptocurrency’s growing role for ISIS’ affiliate in Afghanistan, the Islamic State Khorasan Province (ISKP). This troubling trend has prompted regulators worldwide to impose stricter KYC and Anti-Money Laundering (AML) requirements on cryptocurrency exchanges and virtual asset service providers (VASPs).

The FATF introduced the “travel rule,” requiring VASPs to collect and share specific information about their customers’ transactions, including sender and recipient names, addresses, account numbers, transaction amounts, and transaction purposes. Although these recommendations aren’t legally binding, many jurisdictions have adopted or are currently implementing them. The travel rule aims to enhance transparency in cryptocurrency transactions, making it harder for criminals to exploit digital currencies for illicit purposes. This has to be enforced strictly in my opinion.

Despite the clear benefits of KYC in both banking and cryptocurrency sectors, several challenges remain. One significant issue is the lack of standardization in KYC processes across different jurisdictions and institutions. This inconsistency can confuse customers and create inefficiencies for financial institutions. For instance, a customer might be required to submit different sets of documents and information to multiple banks or cryptocurrency exchanges, causing unnecessary friction and frustration.

Another challenge is the rapidly evolving regulatory environment surrounding cryptocurrencies. Regulations vary significantly from country to country, and new rules are frequently introduced or amended. This dynamic landscape makes it difficult for cryptocurrency businesses to maintain compliance and implement effective KYC procedures.

Identity verification in the cryptocurrency industry also presents unique difficulties. The pseudonymous nature of many cryptocurrencies, combined with decentralized wallets and privacy-enhancing technologies, complicates the task of accurately identifying users. Traditional methods of identity verification, such as government-issued IDs and proof of address, may not always be sufficient or applicable in the digital currency context. As a result, cryptocurrency businesses must explore innovative solutions, such as biometric verification, blockchain-based identity systems, and advanced analytics tools, to enhance their KYC capabilities.

Balancing security and user experience is another critical consideration. While rigorous KYC processes are necessary to prevent financial crimes, overly burdensome procedures can negatively impact customer satisfaction and deter potential users. Based on a closed door feedback group that I have attended in South Korea, more than 80% of the group members feedbacked that they will abandon digital onboarding processes due to complexity or length. Financial institutions and cryptocurrency businesses must therefore strive to streamline their KYC processes, leveraging technology to automate verification tasks, reduce manual intervention, and provide a seamless user experience.

Proof of funds is another essential aspect of KYC, particularly in the cryptocurrency industry. Demonstrating financial capability through bank statements, letters of credit, or cryptocurrency wallet balances helps businesses assess the legitimacy of transactions and mitigate risks associated with fraud and money laundering. Verifying proof of funds in the cryptocurrency context can be challenging due to the volatility of digital assets and the difficulty of accurately assessing wallet ownership and transaction histories. Developing standardized methods and tools for verifying proof of funds in cryptocurrency transactions is crucial for enhancing transparency and trust in the industry.

From my perspective, while KYC processes may seem intrusive and burdensome, their importance cannot be overstated. Financial crimes pose significant threats to global economic stability, national security, and public trust in financial institutions. Robust KYC procedures are essential for detecting and preventing these crimes, protecting consumers, and maintaining the integrity of the financial system. There is considerable room for improvement in how KYC processes are implemented, particularly in the cryptocurrency industry.

Regulators, financial institutions, and cryptocurrency businesses must collaborate to develop standardized, clear, and consistent KYC frameworks. International cooperation and harmonization of regulations can help reduce confusion and inefficiencies, making it easier for businesses to comply and for customers to navigate onboarding processes. Additionally, investing in innovative technologies, such as blockchain-based identity verification systems, artificial intelligence, and machine learning, can significantly enhance the effectiveness and efficiency of KYC procedures.

Financial institutions and cryptocurrency businesses must also prioritize user experience when designing and implementing KYC processes. Simplifying onboarding procedures, minimizing manual interventions, and providing clear guidance and support to customers can help reduce frustration and abandonment rates. By striking the right balance between security, compliance, and user experience, businesses can build trust and credibility with their customers and regulators, ultimately driving growth and innovation in the financial sector.

In conclusion, KYC processes are a necessary hassle in today’s complex financial landscape. While they may be perceived as intrusive and cumbersome, their role in preventing financial crimes, protecting consumers, and maintaining the integrity of the global financial system is undeniable. By addressing the challenges associated with standardization, regulatory clarity, identity verification, and user experience, financial institutions and cryptocurrency businesses can enhance the effectiveness of their KYC procedures, fostering greater transparency, trust, and security in the financial industry. As we continue to navigate the evolving landscape of digital finance, embracing robust and efficient KYC practices will be essential for safeguarding our financial future.

 

Source: https://www.securities.io/kyc-in-banking-and-cryptocurrency-a-necessary-hassle-or-essential-protection/

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