Volatility returns to crypto markets as SEC delays spot BTC ETF decision

Hey folks!

Happy Monday! In this week’s power-packed newsletter, we discuss personal finance and investment concepts, highlight last week's developments in the crypto markets, and mention tokens that saw significant price action. We also bring to you a book that will help you understand your financial personality and wrap it up with a refreshing crossword.

Read on to improve your financial health, evaluate your investment strategies, and know what shook the crypto markets.

Are you looking for investment options, but the jargon-filled discussions around Mutual Fund Investments vs. Fixed Deposits confuse you? Your search ends here. Click on the video below to learn more about the pros and cons of both these investment alternatives, which can help you make an informed decision.

We are on a mission to help you demystify finance and investments. Hit the play button to elevate your financial literacy to make the most of your investments.

It is salary week. This means your account is enriched with vitamin M. This makes today the perfect day to revisit the technique recommended by financial experts for limiting your expenditure that we referred to in last week's Newsletter—maintaining two bank accounts for different types of expenses. Decide a fixed monthly expenditure amount and transfer it to your expenditure account.

You now have excess money in your bank account, enabling you to start your investment journey. What better way than to learn it straight from an expert? Here is what Radhika Gupta, CEO of Edelweiss Asset Management Company, has to say about saving and investments for youngsters.

Start early

Staring your investment journey early will allow individuals to ease into the investment process while allowing them the luxury to make mistakes with small capital.

Personalize asset allocation

Here, Gupta challenges the common notion of age-based investment rules and encourages youngsters to choose asset allocation that fits their risk profile, circumstances, and liabilities.

Embrace simplicity in investments

Gupta underlines that investing in complicated products is not indicative of high intelligence. After an illustrious 17-year career in finance, she believes SIP in balanced funds and mid/small cap funds are the best alternatives.

Create a clear framework

She advises young individuals to write down their goals and principles. What you would invest and what you couldn’t invest in and why. She said that a structured framework provides guidance during moments of confusion and prevents second-guessing choices.

Balance saving, investing, and enjoyment

While advocating for a financially prudent lifestyle, she also encourages young earners to enjoy their money. She stresses that investment isn't about winning and shouldn’t overshadow the joy of living.

Grab a pen and paper and write a clear investment framework that works for you. Next week, we will dive deeper into shaping your financial personality. For now, let's jump on to the market update section to see how the cryptos performed last week.

The past week was a rollercoaster for the crypto market. The week began on a positive note, as in a landmark judgment, a US federal court questioned the SEC's rationale for not allowing the conversion of Grayscale's Bitcoin Trust (GBTC) into a spot ETF. Markets cheered the news, as the verdict put the onus of approval on the SEC with several ETF filing decisions lined up for the end of the week.

But the market gyrated in prices as the initial euphoria for a possible spot BTC ETF was stunted by the SEC's further delay for approval. The total crypto market cap is back to just under $1.1 trillion, as BTC and ETH prices remain almost flat over the week, trading around their anchor levels of $26k and $1.6k, respectively.

In another legal development from the US courts, a New York judge, who is also overseeing the SEC lawsuit against Coinbase, classified BTC and ETH as commodities while dismissing a class action lawsuit against Uniswap, a leading decentralized crypto exchange.

In the broader crypto markets, there was muted token-specific action as prices for most crypto assets followed the direction of the ETF discourse. However, there were a few outliers worth highlighting.

Bitcoin Cash (BCH) has been outperforming BTC over the last few weeks as both whale accumulation and trader interest in the token have increased.

Maker DAO's governance token, MKR, has registered steady gains amid improving fundamentals as the protocol has returned to make profits again after tweaking its lending rates. They also indicated long-term plans to move onto an appchain powered by Solana.

• BTC $25,985 ⏫ 0.32%

• ETH $1,639 ⏬0.01%

• BCH $194 ⏫ 1.16%

• MKR $1,102  ⏫ 4.46%

(All data here is as of 1.45 pm, 4 September 2023.)

As a crypto enthusiast, you should understand what’s causing all the price action. So here’s some news to help you digest the market’s ups and downs.

• Jio Financial plans to foray into blockchain as Reliance Group plans to explore opportunities in blockchain and central bank digital currencies announced group Chairman Muken Ambani company’s AGM on 28th August. Read more here.

• The number of Bitcoin held in addresses tied to centralized exchanges slid to the lowest level in more than five years, partially reflecting a growing market sophistication. The exchange reserve dropped 4% to 2 million BTC in August, the fewest since January 2018. Read more here.

• Interbank messaging system Swift and Web3 services platform Chainlink have successfully transferred tokenized value across multiple private and public blockchains in recent experiments, according to a press release. Read more here.

Some financial books talk about money in terms of savings, compounding, and investing, and some talk about the whys of money. Why we spend the way we spend, why we save and invest the way we do, and so on. The books about the whys are a great source of learning as they will provoke you to question your habits and help you define your financial personality. Today, we bring a ‘why’ book to you.

The Psychology of Money

By: Morgan Housel

This gem of a behavioral finance book discusses money and finance without being overt. The book will force you to think about your financial decisions, circumstances, and personality without bringing numbers into question.

Invest in this easy-to-read, narrative-style financial book to gain insights into wealth, greed, and happiness.

This easy-to-understand book will help you understand your relationship with money and in turn, will help straighten your financial position.

Before you get on with your day, don’t forget to flex those brain muscles with our weekly crypto crossword

That’s it for now. Thanks for sticking around.

See you later, folks! 👋

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