Bitfinex alpha | BTC works more as a risk-on asset and less as a value store

February 10th Bitfinex alpha | BTC works more as a risk-on asset and less as a value store

Bitcoin is stagnating between $91,000 and $102,000 as global geopolitical tensions are rising and extending the integration phase, which is currently running for more than 75 days.

However, this long-term action reflects an increase in Bitcoin’s maturity as an asset, bringing the yearly realised volatility to an all-time low. Nevertheless, the BTC continues to be highly responsive to macroeconomic development, falling after Trump’s tariff announcements targeting Mexico, Canada and China, among other things.

Recent trends suggest that BTC is increasingly being treated as a risk-on asset rather than a pure reservoir of value. The correlation with the S&P 500 remains strong, and the relationship with gold has weakened. Bitcoin has won 3.5% so far this year, but gold has risen 9%, reaching a new all-time high of $2,880 per ounce. The Gold Rally added $1.5 trillion to its market capitalization this year. Bitcoin is growing by $66.5 billion. This difference is driven by the purchase of institutional and sovereign wealth funds that have largely bypassed Bitcoin due to regulatory concerns and volatility.

However, there may be a shift in progress. Currently, over $1.9 billion in Bitcoin is held by ETFs, public and private companies, and even the nation. The fixed supply narrative of Bitcoin is becoming increasingly fascinating as central banks increase the risk of money supply and fiat devaluation.

If macro conditions deteriorate, it is expected that BTC bound behavior will last in the short term. But in our view, despite the institutional sentiment regarding the shift in Bitcoin, the long-term value story remains the same.

Data affecting future central bank movements continues to be closely monitored. The US job market showed signs of slowing down in January, adding 143,000 new jobs, but upward revisions of figures over the past few months have strengthened the labor market resilience. The unemployment rate remains stable at 4%, reflecting a stable workforce supported by immigration-led growth. Wages rose 0.5% in January, showing an annual increase of 4.1%, continuing to drive consumer spending. This is an important driver of economic activity.

However, rising labor costs and slowing productivity growth contribute to inflationary pressures and complicate the Federal Reserve decisions on interest rates. Meanwhile, trade tensions between the US and Canada have been temporarily eased after a 30-day tariff suspension, but unresolved trade disputes could disrupt supply chains and raise consumer prices Because of the nature of the matter, uncertainty remains.

With job growth easing, unemployment claims increase, and trade risks continue to remain uncertain about future economic outlooks, policymakers are entitled to economic stability, control of inflation and the future It faces growing challenges in managing the impact of months of workforce dynamics.

However, the crypto industry remains bullish. After SEC Chairman Gary Gensler left office, crypto-related ETF applications have skyrocketed, including over 45 active filings on assets such as Solana (SOL) and Ripple (XRP) including Spot ETFs and futures products. The SEC evaluation of these applications focuses on market stability, particularly liquidity and sensitivity to operation. Meanwhile, the Commodity Futures Trading Commission has also stepped up regulatory debate and has organized CEO forums with industry players such as CILS, Coinbase and Ripple.

The initiative aims to gather insights into the proposed Stablecoin and collateral management pilot program, reflecting the broader drive of structured regulatory oversight in the digital asset space.

As regulatory debate progresses, the adoption of crypto continues to expand into traditional industries. In the UAE, Tether partnered with Reelly Tech to introduce USDT Stablecoin payments to real estate transactions. This will enable more than 30,000 agents to efficiently promote cross-border property purchases. The partnership coincides with the growing reputation of the UAE as a global crypto hub, where real estate sales of plans are surged, reflecting strong investors’ interest in digital assets integration.

On the recovery front, FTX announced the commencement of the initial distribution to creditors following approval of Chapter 11’s reorganization plan. Payments will begin on February 18, 2025 through Bitgo and Kraken, marking key milestones in the exchange’s efforts to compensate affected customers. While the asset recovery is still underway, the development shows progress in dealing with the fallout of FTX collapse.