Bitcoin Surges Past $116,000 as Market Sentiment Improves: Crypto Daybook Americas

By Francisco Rodrigues (All times ET unless indicated otherwise) Bitcoin, trading as BTC at $85,387.93, reached its highest point this month at $116,430, solidifying its position above the $115,000 mark due to renewed interest in risk assets following the weaker-than-expected jobs market data from Friday. The Federal Reserve is now widely anticipated to reduce interest rates by 25 basis points in September, with the CME's FedWatch tool indicating a 93.4% likelihood of this occurrence. Meanwhile, traders on Polymarket see a 79% chance of a rate cut. Market participants are also positioning for potential reductions in the subsequent two meetings. Coupled with strong earnings from major companies and a weakening US dollar, the outlook appears more favorable for equities and other risk assets. The Nikkei 225 saw a 0.65% increase today, the Euro Stoxx 50 rose 1.2%, and the S&P 500 closed 0.73% higher on Wednesday. The Nasdaq Composite ended 1.2% higher following news of chip tariff exemptions and President Trump's signal that he may appoint dovish members to the Fed. A notable sign of long-term institutional interest is the State of Michigan Retirement System's (SMRS) decision to increase its bitcoin exposure through spot ETFs in the second quarter. However, the notable aspect might be the cryptocurrency's relatively stable movement. The 30-day implied volatility of bitcoin, as tracked by the BVIV index from Volmex, has dropped to 36.5%, a level not seen since October 2023 when bitcoin traded below $30,000. This pattern mirrors Wall Street's bull markets, where implied volatility tends to decrease as optimism grows. In previous cycles, bitcoin's price and volatility moved in tandem. Structured crypto projects allowing investors to sell out-of-the-money call options to generate yield may be contributing to the reduced volatility. Despite this, geopolitical risks persist. Trump imposed an additional 25% tariff on India over its Russian oil purchases, which could lead to supply disruptions if Delhi seeks alternative crude sources, according to Hargreaves Lansdown. This would likely force OPEC+ members to increase production to avoid a crisis. Furthermore, while Ukraine peace talks have progressed, recent nuclear rhetoric suggests a long road ahead. It's essential to remain vigilant. Upcoming Events Token Events Conferences The CoinDesk Policy & Regulation conference, formerly known as State of Crypto, is a boutique event scheduled for September 10 in Washington. This one-day event allows general counsels, compliance officers, and regulatory executives to meet with public officials responsible for crypto legislation and oversight. Registration space is limited; use code CDB10 for a 10% discount through August 31. Token Talk By Shaurya Malwa Derivatives Positioning Market Movements Bitcoin Statistics Crypto Equities ETF Flows Spot BTC ETFs Spot ETH ETFs Source: Farside Investors Overnight Flows Chart of the Day While You Were Sleeping In the Ether