Portfolio Vault Update - Week 7

Vault rebalances

In a recent update, it was reported that weekly jobless claims in the U.S. saw a decrease, falling by 8,000 to a seasonally adjusted 212,000 for the week ended February 10. This decline in jobless claims indicates a resilient labor market, where companies are hesitant to lay off workers, especially after facing challenges in filling job vacancies during and after the COVID-19 pandemic. This would indicate that the federal reserve doesnt need to cut rates Despite this negative market news, there's an interesting lack of response from both equity and cryptocurrency markets.

Typically, such labor market strengths might be expected to influence investor sentiment positively, reflecting confidence in economic stability and consumer spending power. However, the current situation suggests that other factors are at play in the financial markets, overshadowing the impact of the labor market's performance. These could range from macroeconomic concerns, such as inflation rates and monetary policy adjustments, to sector-specific issues affecting investor outlook. The disconnection between a strong labor market indicator and the muted reaction in equity and crypto markets underscores the complex interplay of variables that drive market dynamics.

Risk profile

We have decided to flip ultra bitcoin bullish as our indicators are flashing an ultra bullish crypto environment. While it's not an alt season environment, we are observing certain altcoins outperforming the market. Consequently, we have decided to maintain our current portfolio assets and add to our current winners. Therefore, our risk profile can be classified as ultra bullish.

Portfolio Vault Assets update

Bitcoin

The recent surge in Bitcoin ETF inflows is nothing short of remarkable, marking a significant milestone in the cryptocurrency investment landscape. Over just the past four days, Bitcoin ETFs have seen an influx of $2.3 billion, a figure that surpasses the total inflows recorded in the first four weeks of trading. This influx amounts to 43,300 Bitcoin, demonstrating a growing confidence and interest from investors in the cryptocurrency market.

This notable increase in investment has coincided with a bullish trend in Bitcoin's price, which recently soared past the $52,000 mark. The rapid accumulation of assets under management (AUM) in several Bitcoin ETFs underscores the increasing mainstream acceptance of Bitcoin as an investment asset. Notably, four spot Bitcoin ETFs have now joined the "billionaire club," with Bitwise's Bitcoin ETF being the latest to achieve this milestone, highlighting the fund's success among its peers.

The significant inflows into Bitcoin ETFs, particularly in such a condensed timeframe, reflect a broader market optimism. The achievement of BlackRock’s iShares Bitcoin Trust, which became the first Bitcoin ETF to surpass $5 billion in AUM, holding over 105,280 BTC, exemplifies the scale of investor enthusiasm and the potential impact of institutional investment on the cryptocurrency market.

The correlation between the influx of capital into Bitcoin ETFs and the upward movement in Bitcoin's price suggests that the increased investment vehicle options are likely contributing to Bitcoin's price momentum. As Bitcoin continues to break through key price thresholds, the role of Bitcoin ETFs in providing a more accessible and regulated way for investors to gain exposure to Bitcoin cannot be understated. This trend not only highlights the growing confidence among investors but also points to a maturing market that is increasingly integrating with traditional financial systems.

Pax Gold

Over the last week, Pax Gold has experienced a slight decrease of 1.5%. As political unrest and conflict in the Middle East remains uncertain, the price of gold seems to remain in range for now. We will be monitoring the situation closely.

The Open Network

Over the past week, TON has seen a 7.84% increase. The thesis for TON has not changed, as the integration of wallets is fostering more dapp development within the TON ecosystem, further strengthening its position. 

Pendle Finance

Pendle has increased by 12.31% over the last seven days, continuing both its long-term and short-term trends. The Total Value Locked (TVL) has consolidated after reaching a new all time high this week, but Pendle keeps achieving milestones on a weekly basis.

Solana

Solana has increased by 14.80% in the last seven days, with the chance of it breaking out of its range. With Solana overtaking Ethereum on DEX volumes, it seems that most on chain participants have flipped over to Solana because of the cheap fees. We are now seeing a new wave of innovation with the SPL token standard.

Fetch

Fetch is up 21.94% in the last seven days. Fetch's usecase is somewhat similar to the new release of OpenAI, Custom GPTs. OpenAI saw a surge of new users after the annoucement of this feature, as has temporarily stopped the onboarding of new users because of a network

Bittensor

Bittensor is up 46.28% in the last seven days. The launch of subnets in October was a tremendous success, with subnet slots filling up with exciting projects. Subnets have allowed the creation of a plethora of mechanisms on Bittensor, but the design is not complete. Subnet emissions are currently determined by a group of validators on Subnet 0. This was a good initial way to bootstrap the system, but is not sustainable long term, as it creates centralization around subnet 0.

Celestia

Celestia is down 0.72% in the last 7 days. Celestia is a modular consensus and data network that enables anyone to easily deploy their own blockchain with minimal overhead. Celestia is built on the Cosmos SDK and uses Tendermint as its consensus mechanism. Celestia has a huge hype for airdrop farmers, as every celestia partner is airdroping tokens to Celestia stakers.

Pyth

Pyth Network is up 28.49% in the last 7 days. The core application of Pyth Network lies in providing real-time, accurate financial data to blockchain-based DeFi applications, thereby enhancing their functionality and reliability. With new applications being launched everyday, more and more of these are picking Pyth over Chainlink as an oracle provider. This has caused the gap in market cap to diminish. There is a lot of speculation going around that Pyth Stakers will also be receiving numerous airdrops in the future.

Vault Composition

Due to the recent price action and market circumstances, we have decided to stop allocating to stablecoins and PaxG. Instead we are fully allocating towards crypto with a heavy allocation toward BTC.

Until next week,

Flagship’s Captain team