The cryptocurrency market is having a green start to the new month as the price of Bitcoin surged past $28,450 early on Monday, and the total crypto market cap went on to climb $1.16 trillion. As of writing, BTC/USD has been trading at $28,283 while Ether is exchanging hands at $1,728.
Among altcoins, SOL is leading the charge, which is up more than 30% since the middle of last week. BSV, RUNE, RNDR, STX, OP, MATIC, LPT, and FLOKI, too, are in the fray as other prominent gainers of this latest price action.
This surprise jump in the price of Bitcoin, Ether, and other crypto assets resulted in the liquidating of 29,666 traders in the past 24 hours, with the total liquidations coming in at $115.32 million, according to data from Coinglass. These liquidations were led by crypto exchanges Binance, OKX, and Bybit, with the majority being short liquidations at 73.2%, 75.5%, and 76%, respectively.
Bitcoin accounts for $46 mln of these liquidations, with $41.81 mln of these being short. Meanwhile, out of Ethereum's $28.78 mln of total liquidation, $25.5 mln was yet again short — those betting on price drops.
The latest uptrend in price was also accompanied by an increase in open interest (OI), which is the total number of open derivative contracts that have not been settled. In the past 24 hours, Bitcoin's OI increased by 9.5% to 446.93K BTC (worth $12.69 bln) and Ether's by almost 2.3% to 3.25 million ETH (worth $5.64 bln). For Bitcoin, the biggest increase in OI was recorded on crypto exchange BingX by 121.7% and OKX by 10%, while for Ether, it has been on BingX by 41% and Kraken at 33.6%.
This comes after a subdued September as Bitcoin fell to $27,000 at the end of the month, marking the first quarterly decline of the year. However, the price started Sept. just above $26K and ended at around $27K. So, it wasn't as dreadful as expected. Now, the market is expecting an “uptober,” with the monthly generating negative monthly returns only twice since 2013.
Monday's price jump is certainly a good start to October, which is typically a bullish month for the price action of Bitcoin and other cryptocurrencies. Now, let's take a look at the upcoming events this week that could potentially affect crypto prices.
For starters, a government shutdown was averted when the US Congress, acting with bipartisan backing, passed legislation over the weekend. This legislation extends funding through mid-November, thereby avoiding a government shutdown.
Now, on Monday, Federal Reserve chair Jerome Powell will participate in a roundtable discussion with Philadelphia Fed President Patrick Harker to address workers and small-business leaders. However, it's unclear whether he'll touch on monetary policy. Fed's Cleveland President Loretta Mester will also speak on the economic outlook before the 50 Club of Cleveland Monthly Meeting. Powell's European Central Bank counterpart, Christine Lagarde, is also due to speak this week.
It is actually a data-heavy week, which will be kickstarted by the US manufacturing ISM on Monday, which is predicted to see a minor increase. Also known as the purchasing managers' index, it is a monthly indicator of US economic activity.
This will be followed by JOLTS job openings, ADP employment, the services ISM, weekly jobless claims, and payrolls. The latest employment figures will be released before the weekend, on Thursday and Friday. Unemployment numbers are a key gauge of the economy's health, which are expected to improve marginally from the previous month. As per the Fed's latest forecast, the jobless rate is to edge higher from 3.8% in 2023 to 4.1% in 2024, in a continuation of the current trend.
Moreover, a slowdown in US hiring is anticipated for September. It has been expected that the US economy only added 150,000 jobs last month compared to 187,000 jobs in August. This, coupled with a slight drop of 0.1% in the unemployment rate, has the landscape mixed.
With the labor market expected to weaken further but inflation unlikely to reach the US central bank's target of 2% anytime soon, the Fed will have to keep rates elevated for longer than anticipated.
Adding fuel to the economic fire is crude oil prices showing bullish tendencies, having approached the $100 per barrel benchmark, driven by tighter supplies and rising demand. The market is abuzz with speculation, with oil prices surging to their highest levels this year. International standards like Brent crude also touched $97 a barrel, not seen since last year, due to a drop in US oil inventories and export curtailment by heavyweights Saudi Arabia and Russia.
An OPEC meeting will take place on Wednesday, addressing oil output policy, but no changes are expected. The Organization of the Petroleum Exporting Countries (OPEC) is optimistic about demand, said Secretary-General Haitham Al Ghais at an energy industry event in Abu Dhabi on Monday.
Ethereum Futures ETF Launch
Now, if we take a look inside the crypto market, one of the events traders and investors are looking forward to with optimism is the potential approval of a Spot Bitcoin exchange-traded fund (ETF) by the SEC, and most analysts are expecting this to happen most likely early next year.
While the Spot Bitcoin ETF isn't here yet, the first US Ethereum futures ETF could be here this week. Late last week, asset manager Valkyrie said that its Bitcoin Strategy ETF (BTF) will allow investors access to both Bitcoin and Ether futures “under one wrapper.” This week, the fund's name will be updated accordingly and will come with the lowest expense ratio of 0.6%.
However, in an SEC Form 497 filing, the investment firm said it would unwind any Ether futures purchases it had already made. Valkyrie also said it won't be purchasing any ETH futures until the SEC approval is effective, backtracking its comments from a day ago that it had begun adding Ethereum futures exposure to BTF.
Asset manager VanEck also disclosed its upcoming Ethereum Strategy ETF, which will be listed on the CBOE in the coming days. The firm said it will donate 10% of all profits from its upcoming ETF to Ethereum core developers via Protocol Guild for ten years.
Several other Ether futures ETFs can also begin trading in the US, with ProShares, Bitwise, and Hashdex confirming as much in SEC filings on Friday morning. Bitwise CIO Matt Hougan said the portfolio opportunity with Ethereum is broader than Bitcoin. He further said that some investors deem ETH an alternative, and others see it as a traditional growth investment while adding that the asset has “elements of both.”
“Ethereum now has billions in revenue, millions of users, and thousands of distinct apps and developers. As the leading operating system for crypto, Ethereum has spread like wildfire. With blue-chip brands like Nike, Starbucks, Adidas, Pepsi, PayPal, JPMorgan, and others building and using applications on Ethereum, the momentum is only building,” said Bitwise CEO Hunter Horsley.
But while the SEC seems to be expediting Ethereum futures funds approvals, it has opted to postpone the processing of applications for similar funds tied to spot Ethereum. Still, the line for a spot Ether ETF also keeps growing, with Invesco Galaxy and ARK 21Shares waiting for regulatory approval. The SEC recently delayed a decision on them until December.
Amidst this, four US lawmakers called upon the securities regulator recently to promptly approve a spot ETF, arguing that it was illogical for the regulator to prioritize futures ETFs over spot products when there's no clear distinction between the two.
FTX's SBF's Trial Finally Begins
The former CEO of bankrupt crypto exchange Sam “SBF” Bankman-Fried's trial will begin in a Manhattan federal court this week on Oct. 4 and will last until Nov. 9. As part of his criminal trial, SBF will spend at least 21 days in court. For now, he has been serving pre-trial detention at the Brooklyn Metropolitan Detention Center since Aug. 11.
The trial on Tuesday will start with jury selection, and participants will begin discussing seven fraud charges laid against SBF. Among these, two are substantive charges where the prosecution must convince a jury that SBF committed the crime. Meanwhile, the remaining “conspiracy” charges involve the prosecution convincing a jury that SBF planned to commit the crimes. If considered guilty of fraud, the FTX founder is likely to spend the rest of his life in prison.
Amidst this, the federal judge overseeing SBF's case on Sunday ruled that he can't blame FTX's lawyers for its collapse or operations in his opening statements. However, a so-called “advice-of-counsel” defense can be made later, that is, if they notify the judge and DOJ first, without jurors in the room.
This comes after SBF's defense team told the court and the Department of Justice (DOJ) earlier this year that he intended to argue that FTX counsel “were involved” in certain company decisions. But Judge Lewis Kaplan wrote in an order this weekend that this argument, without specifics, may confuse or prejudice a jury.
Meanwhile, DOJ prosecutors have been adding to their list of witnesses who plan to testify against SBF. In their latest court filing on Saturday, prosecutors said they plan to call “multiple” FTX customers to the stand to detail how the crypto exchange's collapse cost them. These customers include both retail customers, who lost tens of thousands of dollars, and institutional customers, who lost millions.
According to the filing, the customers transferred the funds to the platform with the “expectation and understanding that FTX would custody their assets separate from those of the company, would not transfer customer assets to Alameda Research, and would not use their assets for FTX's or Alameda's own expenses.”
One of the customers is a young Ukrainian who lost a substantial portion of his life savings, which were transferred to FTX after Russia invaded Ukraine last year, as per a separate filing. Prosecutors have requested that he be allowed to testify remotely, which SBF's lawyers are trying to challenge.
Besides FTX customers, the DOJ also plans to call its investors as witnesses to describe their understanding of how the exchange claimed it managed customer funds as per investor pitches to help demonstrate that a “reasonable investor would find the misrepresentation important in making an investment decision.”
Once one of the world's largest crypto exchanges, FTX declared bankruptcy in November after it was revealed that the firm was using customer money to cover shortfalls at its sister trading firm, Alameda Research.
The collapse of FTX led to several criminal charges against SBF and FTX insiders. And ever since then, the DOJ has been working to flip former executives with former Alameda CEO Caroline Ellison, CTO Gary Wang, and ex-engineering chief Nishad Singh agreeing to cooperate with prosecutors. Most recently, former FTX co-president Ryan Salame also pleaded guilty.
Prosecutors further plan to call witnesses who entered guilty pleas as well as those who will testify “pursuant to grants of immunity.” However, these individuals associated with FTX have yet to be revealed.
This week, several token unlocks are scheduled. To begin with, 34.62 million SUI tokens, worth just over $17 million, will be released in the market on Oct. 3 as part of the community access program. Also scheduled for release are 60.48K JOE tokens belonging to liquidity providers, the dev team, the treasury, and future investors.
Furthermore, 2.16 million DYDX tokens, valued at $4.51 million, will be unlocked as part of trading rewards and liquidity provider rewards. On this same day, the market will see the release of 56.09K PENDLE in liquidity incentives and 22.84K TORN tokens belonging to the team and investors.
By Thursday, there will be more releases, including 287.14K 1INCH tokens, 416.67K GAL tokens, and 657.35K LQTY, all belonging to the respective project teams. Following closely, the next day, 12.50 million NYM tokens will be released, belonging to the reserve and community as per TokenUnlocks.
Concluding the week, over the weekend, the market will witness the addition of 3.23 million HFT tokens aimed at community rewards and ecosystem development, 18.08 million IMX tokens in private sale and project development, and 3.04 million GLMR tokens allocated for founders, early employees, and future employee incentives.
Overall, given the number of important events due to take place this week and the market already seeing some action, more volatility is to be expected for markets.