Digital Assets

Viewpoint: After the launch of the SOL ETF, it is unlikely to see a sell-off, while the LTC ETF is the opposite

ChainCatcher news, according to The Block, the digital asset brokerage and research firm K33 stated that as the U.S. Securities and Exchange Commission (SEC) becomes more favorable towards cryptocurrencies, it may approve the launch of new spot altcoin ETFs in the coming months, providing investors with some compelling long-short strategy opportunities.Currently, eight institutions have submitted applications for a spot Solana (SOL) ETF, and the SEC has proactively contacted asset management companies, requesting them to include staking provisions in their updated application documents. K33 analyst Lunde pointed out that this indicates an increased level of engagement from regulators and raises the likelihood that Ethereum and Solana ETFs may include staking features. Additionally, there are ETF applications for other crypto assets such as LTC, XRP, and DOGE, besides Solana.Lunde mentioned that when Bitcoin and Ethereum ETFs were launched, a so-called "Grayscale effect" occurred—where Grayscale's trust funds, after converting to ETFs, saw a massive influx of holdings into the market, leading to over 50% of assets under management being sold off within 200 days. However, the situation for potential new ETF assets differs from Grayscale's case. Unlike XRP and Dogecoin, Grayscale's Solana and Litecoin trusts have been trading on the public market, thus serving as a more direct reference.Lunde stated that Grayscale's Solana trust launched in 2023 has never traded at a discount and only holds 0.1% of the total SOL supply, resulting in a lower risk of market sell-off. In contrast, Grayscale's Litecoin trust frequently trades at a discount, holding 2.65% of the total LTC supply, and is facing discount pressure again after recent physical purchases. Furthermore, currently, only two institutions, Canary Capital and CoinShares, have applied for a Litecoin ETF, which means market liquidity may be low, making it difficult to absorb potential sell-off pressure.Lunde believes that the structure of the Solana ETF is clearer, while the Litecoin product may face capital outflows similar to what happened after the conversion of GBTC and ETHE. Therefore, after the ETF launches, a trading strategy that goes long on SOL while shorting LTC may be attractive, especially if both are listed simultaneously.

Chen Maobo: Allow licensed issuers to choose different fiat currencies as the anchor for stablecoins

ChainCatcher news, Hong Kong Financial Secretary Paul Chan published a secretary's essay titled "Speeding Up and Steady Sailing," pointing out that the development of digital assets has driven related business in financial institutions. Last year, the total trading volume of digital assets and related products by local banks in Hong Kong reached HKD 17.2 billion, and by the end of last year, the total amount of digital assets held in custody by banks reached HKD 5.1 billion.The "Stablecoin Regulation" has been passed by the Legislative Council and will take effect on August 1. Hong Kong is cautiously advancing the development of stablecoins, providing a new paradigm for the global stablecoin market. This is also reflected in the firewall and experimental field functions under the "one country, two systems" principle, providing experience and reference for national financial development. For example, Hong Kong has adopted a more open model, allowing licensed issuers to choose different fiat currencies as the anchor currency for issuing stablecoins, which is beneficial for attracting more institutions from various parts of the world to issue stablecoins in Hong Kong based on actual application scenarios, significantly enhancing the liquidity of related activities and the competitiveness of the Hong Kong market.

QCP Capital: The macro environment remains favorable for institutions to further participate in digital assets and allocate capital

ChainCatcher news, QCP Capital stated in an official channel that the market welcomes the tentative progress in Sino-U.S. relations. President Trump announced a partial withdrawal of the proposed tariff increase plan, and the agreement has entered its final stage, awaiting formal approval. However, the optimistic sentiment remains subdued. The U.S. Secretary of Commerce has taken a hard stance on technology exports, clearly stating that the U.S. "will not provide China with advanced chips." This highlights the trend of divergence in the global supply chain, as the market increasingly incorporates this factor into the pricing considerations of cross-border trade dynamics.Geopolitical tensions have escalated again, as nuclear negotiations have stalled, and the U.S. begins to withdraw diplomatic personnel from the Middle East. Reports indicate that Washington has received warnings about Israel potentially striking Iranian nuclear facilities, triggering a sharp reaction in the oil market. Brent crude oil rose by 7%-9% during the day, as investors shifted to defensive assets, leading to a sell-off of risk assets.Additionally, speculation about Bessent potentially succeeding Jerome Powell as the Chairman of the Federal Reserve has intensified but was quickly downplayed. Bessent publicly reiterated his commitment to serve at the Treasury until 2029. Meanwhile, after U.S. CPI data came in below expectations, President Trump once again pressured the Federal Reserve to "fully cut rates by 100 basis points," citing the unsustainable high cost of debt servicing.In summary, QCP Capital believes that despite a slight pullback, the macro environment remains favorable for institutions to further engage in digital assets and capital allocation.
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