Monthly Letters
Dear Investor,
After seven months of positive performance, bitcoin and other crypto assets ended the green streak, with the Nasdaq Crypto IndexTM (NCITM) falling over 16%.
The index remains up 36% for the year and the outlook for crypto assets—despite geopolitical and other headwinds—remains strong as network developments and institutional interest continue to drive the investment case for the asset class.
Regarding network developments, our Research Team outlines in this recent presentation some useful ways for investors to evaluate BTC in the wake of the Bitcoin Halving. Our CIO Samir Kerbage spent much of the month on the road speaking with professional investors, and in his latest Notes from the CIO he writes about some of the most pressing questions being asked about crypto investing in 2024.
As always, we are greatly appreciative of your trust in us and are here to answer any questions you may have.
-Your Partners at Hashdex
Market Review
After an impressive sequence of positive months, the crypto asset market recorded its first drop since August of last year. Indeed, a significant drop. The month was challenging for risk assets in general, given the possibility that interest rates in the US will remain high for a long period. This caused the S&P 500 and the Nasdaq 100 to fall more than 4% for the month. The Nasdaq Crypto IndexTM recorded a drop of 16.7%.
The drop was quite widespread among crypto assets, but it was more pronounced among those with lower market capitalization. Bitcoin (BTC) and ether (ETH) fell 15.4% and 18.6%, respectively, and all other constituents of the NCITM fell by more than 24%. Uniswap was especially affected, facing market turbulence after Uniswap Labs received a notice from the SEC’s Enforcement Division, resulting in a drop of 46.0%.
The sector indices of CF Benchmarks, which have significant exposure to lower market capitalization assets, suffered greatly. The vast majority of their constituents lost more than 30% of their value. The Decentralized Finance (DeFi) index fell by 35.6%, while the Digital Culture and Smart Contracts Platforms indices fell by 32.3% and 31.1%, respectively. The Vinter Hashdex Risk Parity Momentum Index performed slightly better, with a drop of 23.9%, with Tron, the second-largest asset in the index, highlighting the smallest loss among all indices tracked by Hashdex products, with a drop of 3.3%.
Despite the drop in April, the NCITM continues to show significant positive performance for the year, up 36.1%. Short-term difficulties in the macroeconomic and geopolitical fronts may have an impact, but we remain confident in the market's prospects in the medium and long term.
Top Stories
Bitcoin completes fourth halving, ushering in new era
Bitcoin completed its fourth halving, reducing the subsidy for successful miners to 3.125 BTC per block. Our research team hosted a webinar and published a comprehensive guide to discuss and explain the implications of this major development on the Bitcoin network.
Bitcoin and Ethereum ETFs launch in Hong Kong
Bitcoin and Ethereum ETFs started trading in Hong Kong. These ETFs will enhance investor access to bitcoin without the complexities of direct ownership, possibly leading to increased investment and price stability in the broader cryptocurrency market.
Latin American Fintech giant Nubank enables crypto withdrawals and deposits
Nubank, Brazil's leading digital banking powerhouse, has enhanced its platform by allowing customers to conduct transactions with Bitcoin, Ethereum, and Solana through its app. This new feature supports both deposits and withdrawals, establishing Nubank as a major player in integrating cryptocurrencies into banking services.
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