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“Markets Daily” kicks off a new format with a minute of market updates, followed by an interview with a rotating cast of market analysts across the crypto space. Today, host Jennifer Sanasie speaks with Riyad Carey about potential room for ether price movement, the meme coin market and airdrops to watch.
This episode was hosted by Jennifer Sanasie. “Markets Daily” is executive produced by Jared Schwartz and produced and edited by Eleanor Pahl, alongside Senior Booking Producer Melissa Montanez. All original music by Doc Blust and Colin Mealey.
Audio Transcript: This transcript has not been edited and may contain errors.
JENNIFER SANASIE:
It’s Tuesday, January 9th, 2024 and this is “Markets Daily” from CoinDesk. I’m your host Jenn Sanasie and let’s dive into those prices. According to CoinDesk Indices, at 8 a.m. Eastern time, bitcoin was trading up 2.4% over the past 24 hours at $46,221. This comes after an impressive Monday where BTC topped $47k for the first time since April 2022. Ether was roughly flat over the same time period, at $2,265. Today’s ‘Mover’ in the CoinDesk Market Index is Helium, ticker HNT, up 27% on the day. In traditional markets, the NASDAQ was up 2.2% yesterday as investors appear to buy the dip in the technology sector. Meanwhile, the S&P 500 rose a more mild 1.4%. Stock futures are pointing down before today’s open. And in commodities, both gold and oil rose slightly on the day, with the Brent crude benchmark trading at $77.82 cents a barrel and gold at $2034 dollars an ounce. For more on the markets action, let’s bring in Kaiko Research Analyst, Riyad Carey.
For more on the markets action let’s bring in Kaiko Research Analyst Riyad Carey. Now everyone’s talking about the spot bitcoin ETF so we got to kick the morning off with that. We are, of course, waiting for approval. The SEC has a deadline tomorrow. What do you make of the market reaction lately?
RIYAD CAREY:
Yeah, it’s been really interesting to watch. I think so far, the pattern this week is kind of mirroring what happened last week, where we saw early in the week, price went up pretty quickly, it sort of stalled out in the $47,000 range. And actually, that’s where we saw liquidity start to deteriorate a little bit, we use like a slippage metric there to see that once price got up into that range, people were taking some liquidity off the board sort of indicating that people were happy to hold price in that level and were not trying to go beyond that. So we’ve observed something similar so far. Although obviously now the deadline is one day away. So I would expect that the market will make a decision based on whatever the SEC’s ruling is.
JENNIFER SANASIE:
Ahead of an ETF decision, what should traders be watching out for? What should they be looking for if we get an approval tomorrow?
RIYAD CAREY:
I would say, volatility. I mean, you know, it sounds obvious, but no one knows how this is gonna go. First of all, no one’s totally certain that will be approved. I think people in crypto are pretty confident they will be, people in traditional markets are maybe not as certain. And then I would also say if it is approved to watch the early volumes, I think that maybe they’re a little bit underwhelming, we could see, you know, pullback, if they’re massive, as some people have speculated there’s multiple billions on the sidelines just waiting to buy in. If they are approved, we can see a big rally. So I think watching those first couple day volumes will be pretty telling, though probably not necessarily indicative of the long term success or failure of any of these ETFs.
JENNIFER SANASIE:
Okay, based on your research at Kaiko and what’s going on in the markets this morning, if you had to pick three assets to invest in this morning, what would you be looking at?
RIYAD CAREY:
So I don’t know that I’ll make any investment predictions. I will just say, based on the narratives that I’m seeing, I think ETH is obviously one of the most, it’s really had a tough time the past couple of months. I mean, if you’ve seen the ETH-BTC ratio is like, you know, dipping to multi year lows. It’s been passed in volume by Solana on a lot of exchanges. And I think some people have started to murmur about front running potentially the next narrative, if the bitcoin ETF is approved, which would be an ether ETF. So I think that would be something interesting to watch. If I would expect that probably, if it is approved, ether would get a nice boost. And then speaking of SOL, I think it’s been pretty interesting to watch that its volumes have been really robust, even as its price has stagnated a little bit and pulled back a little bit, you know, the traders are still there. I’m actually working on my Q4 token liquidity ranking right now. And SOL has improved a lot, though I would say its liquidity has not really kept pace with its price movements. That’s pretty common. Liquidity is more of a lagging indicator. But because of that, I would expect you know, more volatility with SOL and a lot of these tokens that have rallied a lot in recent months after being kind of a little bit stagnant for most of the bear market where we saw volumes at multi year lows just in August, basically.
JENNIFER SANASIE:
All right, that was two. Do you have a third? I’ll make it a little bit easier for you. You can include crypto equities if you’d like. If not, it’s totally fine. I don’t want to put you on the spot. I just love a good prediction.
RIYAD CAREY:
I think the other ones that I’ve been watching have been Celestia and Sei, I think they both bring sort of new narratives to the market in terms of just like new functions for blockchains and sort of represent the next generation. And as we’ve seen in previous cycles, these alt L1 trades generally tend to do pretty well, though not that they’ll necessarily benefit more from any bitcoin ETF approval, but they’re just two tokens that have been really on my radar, and they’ve rallied a good bit already. So we’ll see what happens.
JENNIFER SANASIE:
Riyad, you mentioned the Solana ecosystem there. As you know, meme coin bonk had a huge rally at the end of last year, it fell 70% recently from its all time high. How are you looking at meme coins in the Solana ecosystem? Are you taking them seriously at all?
RIYAD CAREY:
Yeah, I mean, I think it’s definitely a different experience than on Ethereum because the gas fees are so low. It’s way more seamless to trade them on Solana. And I’ve used Ethereum a lot in the past, and it’s just, it is just flat out expensive these days, and Solana has less than a cent for transactions. So I think that makes the meme coin market just like really active on Solana. I think volumes have dipped a bit. But ultimately, I think it also rests a little bit on sort of the liquidity injections in the form of airdrops. We saw a lot of, you know, rallies after JITO’s airdrop, which was, you know, pretty generous to anyone who had staked with it. And we’re expecting an airdrop from Jupiter, which is the DEX aggregator on Solana that people are anticipating that will be a pretty large one as well. And I think while you know, whenever that does come to pass that I would probably expect another rally.
JENNIFER SANASIE:
Any airdrops outside of the Solana ecosystem that you’re waiting for, that you’re watching?
RIYAD CAREY:
Outside of the Solana ecosystem, I think the big one is probably EigenLayer, the restaking protocol. And there’s a lot of protocols that are related to it that are doing like liquid restaking tokens. So I think that’ll be a big one whenever that comes. And then there’s some Ethereum layer 2s, zkSync Era, Linea, Scroll, you know, we’re all sort of waiting for that. There’s actually a ton that are waiting in the wings right now. I think now that the market has picked up a little bit, I would expect that they’ll start to come sooner rather than later.
JENNIFER SANASIE:
All right, the interview has come full circle now. A year from now, if the spot bitcoin ETF does get approved this week, where do you see the price of bitcoin heading?
RIYAD CAREY:
I mean, it’s hard not to see a scenario in which the bitcoin price does pretty well from this. I think that’s obviously, you know, the caveat there being just like macro conditions, which are good, but you know, there’s some mixed signs. Opening up the market to people who are not so crypto native, who didn’t want to use a crypto exchange. I think the other good point that people have made is like, all of a sudden, you know, if it is approved, you have these massive financial firms and the entire marketing, various marketing departments pushing these ETFs, pushing bitcoin. I mean, it would seem to be a pretty substantial shift in the market.
JENNIFER SANASIE:
Are you going to give me a number?
RIYAD CAREY:
No, no number. I’m sorry.
JENNIFER SANASIE:
That’s okay. I’ve got to ask every day, I gotta ask for the prediction. Riyad, thank you very much for joining us this morning and weighing in on the markets.
RIYAD CAREY:
Thank you for having me.
JENNIFER SANASIE:
All right. That was Keiko Research Analyst Riyad Carey, thank you for joining us. That’s it for today’s show.
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