Cautious Optimism and Innovative Responses in the Rebound: BTC Market Dynamics and the Launch of Seagull Products | Weekly Market Insights Review

On the evening of September 10 at 8 PM, on the Matrixport official YouTube channel live stream, Matrixport's Head of Asset Management, Daniel, analyzed the comprehensive reasons for BTC's price breaking through $57,000 again this week (September 9-15), as well as how investors can achieve greater returns in a one-sided market.

The live stream content is as follows:

On September 10, the cryptocurrency market continued its rebound momentum, with BTC's price breaking through $57,000 again, and market sentiment improved. Although this rise boosted investor confidence, potential uncertainties and risks in the market still exist. Matrixport's newly launched structured product for one-sided markets—Seagull—provides investors with a new income strategy in a one-sided market trend.

Analysis of Market Volatility Reasons

• Market Reaction to Fed Rate Cut Expectations

Recent discussions about the Federal Reserve possibly cutting rates by 50 basis points have attracted widespread attention in the market. This expectation has provided a boost to risk assets like BTC in the short term. This is because a rate cut typically means increased liquidity and lower funding costs, which may encourage more investors to shift funds from traditional markets to high-risk assets like BTC. However, due to increasing global economic uncertainty, the market remains cautious about the long-term effects of rate cut policies.
Investors should closely monitor future economic data, employment conditions, and the Fed's policy statements to avoid excessive optimism due to short-term favorable conditions. Additionally, against the backdrop of rising global inflation, supply chain tensions, and increasing geopolitical risks, investors need to remain vigilant about the long-term market trends.

• BTC Technical Rebound

On September 10, BTC's price broke through $56,500 and further rose to $57,000, which boosted some market sentiment, with some investors viewing it as a signal of the market returning to an upward trend. However, this rise is more of a technical rebound, a correction after the previous market overselling, lacking sufficient positive catalysts to support it. Therefore, the sustainability of this rebound still needs further observation. Investors should remain cautious in the current market environment, avoiding blind chasing of prices, and should carefully assess potential retracement risks by combining technical analysis and changes in market sentiment to avoid being significantly affected by short-term market fluctuations.

• Long-term Holder Supply Hits New Highs

The supply of BTC long-term holders has surpassed 4 million for the first time, indicating that more and more investors are choosing to hold BTC for the long term, reducing short-term speculative behavior. The increase in long-term holders reflects investors' confidence in BTC's long-term value, which helps stabilize the market and reduce panic selling caused by short-term fluctuations. This trend will help alleviate market liquidity pressure and provide stable support for BTC's future price trends. Furthermore, as the confidence of long-term investors increases, the BTC market may attract more institutional investors in the future.

• Potential Link Between Politics and Market Volatility

The upcoming U.S. presidential election and Trump's campaign activities have become significant market catalysts that cannot be ignored in the coming months. If Trump is re-elected, the market expects his policies may drive investors to shift funds to safe-haven assets like BTC. Political dynamics will be an important factor in future BTC market volatility, and investors should closely monitor developments in this area and prepare corresponding market response strategies.

• Market Liquidity and Increased Volatility

Recent market trends indicate a decrease in liquidity and increased volatility. BTC's short-term rebound occurred in a low liquidity environment, which increases the market's fragility. Investors should pay special attention to risk management in the current high-volatility environment, flexibly adjust investment strategies to cope with potential drastic market changes, and avoid incurring unnecessary losses in times of insufficient liquidity.

• Impact of ETF Fund Flows on the Market

The continued outflow of ETF funds has exerted significant selling pressure on the market, especially against the backdrop of a weak U.S. market. This phenomenon further weakens market liquidity and may continue to pressure market prices in the short term. Although the current outflow of ETF funds has a certain negative impact on the market, as more institutional investors gradually enter the BTC market, liquidity issues are expected to ease in the long term. The entry of institutional funds will bring more stability and confidence to the market.

Current Context of the Options Market and Institutional Behavior

Analyzing multiple technical indicators (such as 25 Delta Skew, implied volatility curve), it can be seen that although short-term market sentiment remains cautious, investors' views on market trends remain optimistic in the long run. Due to increased speculation and hedging activities in the market, short-term volatility may continue to exist. Therefore, it is recommended that investors remain patient in the current environment and consider long-term holding strategies.

Investment Directions to Consider

• Using Financial Instruments for Market Hedging

In the current complex market environment, investors should adopt a prudent investment attitude. The uncertainty of the global macro economy is increasing, and geopolitical factors may further introduce volatility risks to the market. It is recommended that investors adopt a diversified investment strategy, reasonably allocate assets, and reduce reliance on a single market to cope with potential market fluctuations. By diversifying investments across various assets, investors can effectively reduce the overall risk of their investment portfolios and enhance their ability to respond to market uncertainties.
During periods of high market volatility, investors can use financial tools such as options and ETFs for risk management and hedging. Options can be used to hedge against market uncertainties and volatility, while ETFs provide a relatively stable investment channel.
Investors should avoid excessive trading and maintain a moderate investment strategy, especially in situations where the market experiences frequent short-term fluctuations. By reasonably using hedging tools, investors can better avoid short-term risks while retaining long-term investment opportunities.

• Pay Attention to Volatility and Consider Long-term Holding Strategies

Although the market has rebounded, it has not returned to previous highs, and the market still needs more time to confirm the sustainability of the rebound in the short term. In terms of long-term trends, market sentiment remains relatively optimistic. Market participants are still taking advantage of market downturns to lower their holding costs or increase long positions, demonstrating confidence in future long-term trends.
However, due to increased speculation and hedging activities in the market, short-term volatility may continue to exist. Therefore, it is recommended that investors remain patient in the current environment and consider long-term holding strategies.

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#### Rational Use of Tools to Enhance One-sided Market Returns

In light of the current high volatility and clear one-sided market trends, Matrixport has launched Seagull, a product suitable for one-sided markets. Seagull is based on an options combination strategy, combining the features of "dual currency" and "trend smart profit," and is divided into bullish and bearish versions, allowing investors to choose suitable strategies based on market expectations and determine different settlement methods based on the price range at expiration.
For example, taking early September 2024 as an example, with BTC's current price at $56,500, you invest in a Seagull bullish BTC-USDT product with a benchmark price of $58,000, a maximum profit price of greater than or equal to $58,500, and an expected annualized return of 18.85% to 279%. When BTC's expiration price rises to $58,000 (including $58,000) or above, this product can provide up to 279% annualized return; when BTC's expiration price is between $56,500 and $58,000, it can provide an 18.85% annualized return; when BTC's expiration price is between $58,000 and $58,500, it can provide an annualized return of 18.85% to 279%; and if BTC's expiration price falls below $56,500, this product also provides a discount entry and premium reduction protection mechanism, offering an 18.85% annualized return and purchasing BTC at $56,500.

Seagull has three notable highlights:
First, as a structured product for one-sided market returns, investors can achieve considerable returns through correct market trend judgments, regardless of whether the market is rising or falling. Under the bullish strategy, if the market continues to rise, investors will be able to lock in high returns; while under the bearish strategy, if the market falls, investors can also ensure the appreciation of their assets;
Second, Seagull's multi-layered return structure can provide flexible returns across different price ranges, ensuring that investors have opportunities for returns under various market conditions. When the market price exceeds a specified point, investors will receive higher annualized returns, while when the market remains within a certain range, investors can also enjoy basic returns. This flexibility allows Seagull to adapt to different market situations, ensuring that investors have opportunities for returns in any market environment;
Third, Seagull has a low investment threshold, requiring only 100 USDT, 0.01 BTC, or 0.1 ETH, making it suitable for both novice and experienced investors. Whether small investors wish to try new strategies or large investors seek new income opportunities, Seagull can meet their needs.

It is important to note that while Seagull performs well in one-sided markets, its returns have a cap limit. In extreme market conditions, investors may not be able to fully capture all market gains. Additionally, although Seagull products provide some downside protection, investors may still face potential loss risks during severe market downturns. Therefore, investors should allocate assets reasonably based on their risk tolerance and flexibly adjust investment strategies when using Seagull.

For more exciting content, you can check out the YouTube content replay: https://www.youtube.com/watch?v=LjyGAmdZLFY

About Matrixport Weekly Market Insights

[Matrixport Weekly Market Insights] is an interactive knowledge-sharing program newly launched by Matrixport, live-streamed weekly on the Matrixport official YouTube channel. This program regularly invites industry product leaders, top analysts, and KOLs to discuss investment logic under different market conditions, share investment insights, and help users achieve asset appreciation.

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Disclaimer: The above content does not constitute investment advice, sales offers, or purchase offers to residents of the Hong Kong Special Administrative Region, the United States, Singapore, or other countries or regions where such offers or invitations may be prohibited by law. Digital asset trading may involve significant risks and volatility. Investment decisions should be made after careful consideration of personal circumstances and consultation with financial professionals. Matrixport is not responsible for any investment decisions made based on the information provided herein.