Good morning. Here’s what’s happening:
Prices: Bitcoin, ether and other major cryptocurrencies were trading sideways as investors fretted over new job figures and OPEC oil cuts.
Insights: BitMEX has shifted away from Hong Kong, where it leased an entire floor of the prestigious Cheung Kong Center in 2018; the crypto exchange's largest office is now in Singapore.
● Bitcoin (BTC): $20,290 +0.4%
● Ether (ETH): $1,375 +1.6%
● CoinDesk Market Index (CMI): 990.23 +0.7%
● S&P 500 daily close: 3,783.28 −0.2%
● Gold: $1,728 per troy ounce +1.0%
● Ten-year Treasury yield daily close: 3.76% +0.1
Bitcoin, ether and gold prices are taken at approximately 4pm New York time. Bitcoin is the CoinDesk Bitcoin Price Index (XBX); Ether is the CoinDesk Ether Price Index (ETX); Gold is the COMEX spot price. Information about CoinDesk Indices can be found at coindesk.com/indices.
Bitcoin Trades Sideways Amid Disheartening Job Figures, Oil Cuts
By James Rubin
Just when prices seemed ready to lessen, new job numbers and a price-conscious OPEC damped investors' hopes.
After rising handsomely for two consecutive days, bitcoin flattened, although the largest cryptocurrency by market value remained comfortably above the psychologically important $20,000 perch it has held for much of the past week. BTC was recently trading at $20,300, up almost a half-percentage point over the past 24 hours.
Ether was recently also changing hands slightly higher from the previous day, same time, at $1,375. Other major cryptos were trading sideways and up, with XRP and LINK rising over 3% and 1.4%, respectively. The popular dog-themed meme coin DOGE recently was up about 1.5% after spending a good portion of the day in the red. Its moderate changes veered from the previous day, when DOGE soared more than 10% on news that one of its biggest champions, billionaire Elon Musk, would follow through on his original offer to purchase social media platform Twitter.
The CoinDesk Market Index (CMI), a broad-based index designed to measure the market capitalization weighted performance of the digital asset market, currently stands at 982.48, a -0.76% decrease from Tuesday.
Equity indexes were similarly sluggish with the tech-heavy Nasdaq, S&P 500 and Dow Jones Industrial Average (DJIA) all declining a smidgen of a percentage point. Investors on a two-day high after encouragingly negative job and productivity data points suggested that inflation might significantly diminish, returned to the risk averse behaviors that have colored their investment strategies for much of the past year.
Earlier in the day, ADP’s Employment report on job creation in the private sector arrived hotter than expected as businesses created 208,000 jobs in September, versus consensus estimates for 200,000, and 12% higher than August's 185,000 total. And OPEC rocked energy markets by reducing oil production by two million barrels. Brent crude oil, a widely watched measure of energy markets, is now trading at nearly $94 a barrel less than a month after dipping to about $82, a 14% gain that could foreshadow additional increases and keep prices stubbornly high.
In an email, Oanda Senior Market Analyst Edward Moya said that the jobs report and the Institute for Supply Management (ISM)'s surprisingly resilient business services reading for September on Wednesday offered false hopes that inflation would moderate enough for the Federal Reserve to pivot from its recent diet of hawkish interest rate hikes.
"Traders were quickly reminded that the economy isn’t falling off a cliff and that the Fed might have to remain aggressive with its rate hiking cycle next year," Moya wrote, adding that "bitcoin’s fundamentals still support a healthy consolidation here and that should remain the case," short of the next unemployment figures on Friday and next week's Consumer Price Index arriving higher than anticipated.
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BitMEX Shift From Hong Kong Highlights the Toll of Strict Covid Policies
By Sam Reynolds
In 2018 BitMEX made waves by leasing out an entire floor of the Cheung Kong Center in Hong Kong for approximately $600,000 a month, making it the most expensive office lease in the world. Now that office is a shell of its former self as most of BitMEX’s staff have moved from Hong Kong to Singapore and further afield.
“Our biggest office is in Singapore,” Alexander Hoeptner, BitMEX’s CEO, told CoinDesk in an interview. “We love Hong Kong so much, [but] because of the COVID-19 situation I moved out and a lot of people moved out.”
At one time having an address at Cheung Kong Center symbolized that the exchange was a serious player in the financial sector. After all, it could count Goldman Sachs, Barclays, Bank of America and Bloomberg as its neighbors in the building.
Convincing the building’s owner, Li Ka-shing, that you were worthy of inclusion in this list was a sign that you made it.
“In the past half year, we’ve seen more digital currency or blockchain companies coming to look for spaces in Central,” John Siu, managing director of Cushman and Wakefield, told the SCMP at the time. “[Central] can polish the image of a company.”
But the pandemic changed all of that, as did Hong Kong’s deteriorating political status.
Now, crypto wants to be nimble and decentralized.
Hoeptner said BitMEX has generally switched to remote work as a lot of the exchange’s Hong Kong-based expatriate staff wanted to be closer to their families, from whom they had been separated for some time because of Hong Kong’s long quarantine requirements, which at one point hit 21 days.
BitMEX is the second large crypto company to shift its physical presence focus from Hong Kong due to the city’s Covid policies. Last September, FTX moved its headquarters to Nassau, The Bahamas, citing a friendlier regulatory environment and better COVID-19 policies.
7:30 p.m. HKT/SGT(11:30 UTC): European Central Bank Monetary Policy Meeting Accounts
8:30 p.m. HKT/SGT(12:30 UTC): U.S. initial jobless claims 4-week average (Sept. 30)
11:35 p.m. HKT/SGT(15:35 UTC) Bank of Canada's Governor Tiff Macklem Speech
CFTC Commissioner Summer K. Mersinger joined "First Mover" to discuss the future of crypto regulation and her thoughts on decentralized autonomous organizations (DAO). What's the outlook for Twitter now that Elon Musk plans to acquire the social media company? CFRA Senior Equity Analyst Angelo Zino shared his insights. Plus, "First Mover" had a markets check with Nauman Sheikh of Wave Financial.
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