Summary of favorable factors for the industry's deep V rebound this week

Author: Revc, Golden Finance

Foreword

The crypto industry fell sharply on Monday, and then rebounded in a V-shape driven by favorable factors in the financial market and policy supervision. On August 8, crypto assets rebounded sharply, with the average increase of the top 50 currencies approaching 10%. It took less than a week from the plunge to the recovery. Driven by a series of positive news, the market gradually got rid of the haze before the start of the bull market. The following is a recent inventory of positive factors for investors' reference.

Summary of positive factors

1.US recession concerns eased,market information recovered.

Golden Finance reported that Gennadiy Goldberg, head of U.S. interest rate strategy at TD Securities, said the initial jobless claims data was a positive signal for the market as a whole. The data showed that the growth momentum of the labor market was not slowing down as shown in the non-farm payrolls report, and there were no signs of large-scale layoffs in the economy.

The better-than-expected report on initial jobless claims in the United States eased market concerns about a weak labor market and pushed U.S. stocks to rebound after a week of slump. The S&P 500 index posted its biggest one-day gain since November 2022, with all sectors on an upward trend. Meanwhile, U.S. Treasuries fell across the board as economic concerns receded. This market rally was mainly driven by expectations adjustments, especially after last week's manufacturing PMI and non-farm data raised concerns about the Fed's policy. The improvement in initial jobless claims data helped restore market confidence, and all three major stock indexes rose sharply.

2.Putin:Digital currency is full of prospects, Russia must seize the opportunity

On August 8, Russian President Putin signed a law legalizing cryptocurrency mining in Russia. It is reported that only registered Russian legal entities and individual entrepreneurs have the right to mine. The signed law introduces new concepts, including digital currency mining, mining pools, mining infrastructure operators, address identifiers, and individuals who organize mining pool activities. In the future, Russia will further attract industry investment due to its crypto-friendly policies.

3.American politics shows crypto-friendliness

Harris:

Golden Finance reported that on Thursday local time, a group of cryptocurrency industry executives held a conference call with White House officials and advisers to Vice President Kamala Harris to provide their opinions as Democratic presidential candidates formulate policy positions on cryptocurrency issues.

Trump:

Former US President Donald Trump said on his social media platform Truth Social that the United States must maintain its leading position in the cryptocurrency industry.He emphasized his positive and open attitude towards cryptocurrency companies and related fields, and criticized the position of current President Joe Biden. In addition, the large amount of donations Trump received from the crypto industry also promoted the continuity of his crypto-friendly attitude to a certain extent.

Donald Trump Jr.:

Donald Trump Jr. said in a live Q&A session on the subscription platform Locals that he personally likes Memecoin and this culture, and said when talking about the prepared crypto project: "I think what we want to do is to take over most of the banking industry. This concept of decentralized finance is obviously very attractive to people like me who have been deprived of funds by banks or cannot get insurance."

4.Positive judicial progress

U.S. District Judge Peter Castel finally approved the $12.7 billion settlement agreement between the defunct cryptocurrency exchange FTX and its sister trading company Alameda Research and the CFTC. FTX and Alameda signed the consent order to resolve the CFTC's 20-month lawsuit.

After Ripple Labs reached a settlement with the U.S. Securities and Exchange Commission (SEC), XRP soared 17%. The settlement caused the price of XRP to jump from $0.50 to $0.65, and trading volume also increased significantly. The settlement agreement stipulates that Ripple pays a civil penalty of $125 million and agrees to an injunction against future violations of securities laws.

5.Institutional representatives recognize

Golden Finance reported that Chris Burniske, former head of Ark Invest's crypto business and current partner of Placeholder VC, wrote in X that market sentiment has been reset and leverage has been cleaned.Most high-quality crypto assets have a much higher low point in this round than we saw in 2023. At the same time, global central banks are about to be forced to ease policy, and market volatility is expected to intensify in the third quarter. In any case, the current situation is a good early bull market.

6.The Bank of Japan releases dovish signals

The deputy governor of the Bank of Japan made unexpected dovish remarks on Wednesday, saying that it would not raise interest rates during periods of market instability. This statement directly led to a cliff-like drop in the yen exchange rate. The US dollar rose by more than 2.5% against the yen at one point, setting a new low for the yen in recent times. At the same time, global stock markets were also boosted by domestic dovish remarks and the depreciation of the yen. The Nikkei 225 index rose sharply, recovering Monday's losses.

7.The Brazilian Securities and Exchange Commission has approved the first Solana spot ETF

Golden Finance reported that the Brazilian Securities and Exchange Commission (CVM) has approved the first Solana spot ETF. The investment product is provided by QR, the Bitcoin and Ethereum ETF management company, and will be managed by Vortx. The ETF is still in the early stages of operation and still needs to be approved by B3 for regulatory reasons. It will be launched within 90 days at most.

Summary

This week, the crypto industry rebounded sharply driven by positive factors in financial markets and policy supervision. If the Federal Reserve successfully implements the interest rate cut, the industry will usher in new development opportunities. However, with the increase in global market volatility, as well as the impact of the yen rate hike and geopolitical conflicts in the Middle East, investors still need to remain vigilant and guard against the impact of black swan events.