Podcast: Hear Truvius on CoinDesk’s Markets Daily Podcast
Feb 5, 2024
Check out this week’s CoinDesk Markets Daily Podcast to hear Truvius CEO & Co-Founder Connor Farley provide market commentary on last week’s price action and insights on a multi-sector approach to the crypto economy: Listen here
Transcript of commentary:
Digital asset markets started 2024 with an uptick in volatility and wide performance dispersion across sectors, generally selling off overall.
A portion of this volatility may be attributable to the overall macro environment as investors grapple with rising geopolitical tensions, particularly in the middle east and eastern Europe. However, the macro environment has also been stabilized by a cautiously dovish Federal Reserve and stronger-than-expected economic data showing accelerated hiring and a robust U.S. labor market.
The choppy and negative price action for digital assets follows a significant months-long run-up in prices that culminated in the SEC approval of Bitcoin spot ETFs in January of this year. With the SEC’s approval in the rear-view, crypto markets appear to be finding their footing with the passing of the bull narrative that helped drive the run-up.
That said, not everything was in the red, particularly over the trailing week. Performance, while generally down, has varied widely across crypto sectors, with digital assets generally falling into two categories: high-beta assets that have trended downward or listlessly approximately in line with megacap assets bitcoin and ethereum, and assets whose fundamental value has led to meaningful gains in the face of a broader bear market.
In particular, the Computing Sector was a key recent outperformer, gaining more than 12% over the trailing week while other sectors were more modestly positive or down. The CoinDesk computing sector includes assets that strengthen and decentralize the computing resources and data pipelines used by blockchain applications. Key assets from this sector include Chainlink (a network that bridges non-blockchain data onto the blockchain) and Render (a network that lends high-capacity graphical computing to digital artists), with Chainlink and Render gaining 27% and 12%, respectively, on the week.
Recent industry partnerships with other crypto teams that may bolster Chainlink’s reputation for ushering the tokenization of traditional financial assets as well as speculation surrounding M&A activity for Chainlink appear to have helped drive the asset to fresh highs. Both events may position Chainlink as a leader for bridging blockchain technology with traditional capital markets at institutional scale. The computing sector overall may have also benefitted from its beta to AI and metaverse markets, as these networks have close business overlap with AI and gaming.