21Shares Research Newsletter - Issue 93

Market Outlook

Over the last few days, we saw a large focus around a specific online Reddit community, Wall Street Bets, and the community’s attempts to fight back at the short-selling of a once-beloved stock, Gamestop. Since the start of the year, as users within the Wall Street Bets community have tried to incite a gamma and short squeezes against short sellers and market makers, Gamestop’s stock returned as much as 2,000%. There have been many takes on this topic, but please look at the following Guardian article if you are out of the loop.

A decentralised community’s ability to coordinate and attempt to “fight back” at the establishment hints at the appeal of decentralised finance which can't be quickly shut down on a whim unlike services such as Robinhood. We expect the success and failures of the WallStreetBets movement to act as an impetus behind the further interest in decentralised finance and protocols.

As evidenced by the recent comments in the aftermath of this incident, Elon Musk admitted in an interview on Clubhouse to regret not having bought Bitcoin in 2013 while showing strong support for the cryptoasset and recognition for its growing acceptance amongst conventional finance. Ray Dalio, long-time Bitcoin sceptic and founder of the largest hedge fund globally Bridgewater, has had a somewhat more positive tone towards Bitcoin calling it a “hell of an invention” in his newsletter.

And finally, in the main Bitcoin subreddit, a participant admitted to understanding the potential of Bitcoin fully: "All the years I talked trash about bitcoin, I apologise, now I genuinely understand the value of having a system not controlled by the government, where they can not on a whim decide to inflate the money supply and bail out their friends, while you carry the load in the form of additional taxes and inflation."

Weekly Returns

The returns of the top five cryptoassets over the last week were as follows — BTC (2.84%), ETH (0.595%), DOT (-3.93%), XRP (40.7%), and ADA (17%).

Monthly ETP Returns

The performance of our line of ETPs over the last 30 days is as follows: ABTC (12%), AETH (39.7%), ABCH (7.3%), AXRP (70.9%), ABNB (32%), AXTZ (36.6%), HODL (25.1%), ABBA (20%), KEYS (18.5%), and SBTC (-30.4%).

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Media Coverage

Our Managing Director, Laurent Kssis, was interviewed by Carolane de Palmas of Coin24, wherein he shed some light on the regulatory environment in Europe alongside the adoption of institutional-grade products like the 21Shares' product suite. Give it a read below and learn more about our ETPs here and you can read the full article here.

Our response to Bitcoin’s double-spend misinformation, which caused a double-digit market correction, featured in Wiener Zeitung, an Austrian newspaper. It is one of the most famous newspapers in Europe and one of the oldest, still published newspapers globally. It is the official publication used by the Government of the Republic of Austria for its formal announcements. Read the full article here.

21Shares Launches The World's First Polkadot ETP — Yahoo Finance

What Happened?

Without further ado, we are excited to announce the launch of the world’s first Polkadot ETP on the regulated segment of the Swiss Exchange on Thursday 4 February 2021.

Why Does It Matter?

Since the launch of our basket ETP HODL in November 2018, the top 5 most valued crypto tracker has changed with the addition of Polkadot to HODL due to its growing interest among investors reflected in its current market valuation of over US$15 billion. This is atestament to the fact that the crypto-asset industry is evolving and maturing at high speed. Today, more than half a dozen blockchains offer different use cases such as applications in the decentralised finance sector built mainly on the Ethereum's Blockchain.

However, the communication between these different blockchains is similar to that of mobile operators at the beginning of the 2000s, so connecting them is a Herculean task because they each have distinct structures preventing interoperability. Therefore, Polkadot presents itself as a solution to this critical problem, which allows the transfer of data and economic activities between all kinds of blockchains, using the crypto-asset (DOT) to encourage the right behaviour from the different actors of its ecosystem.

The Polkadot ETP's launch is the answer to the increasing demand from the European market to invest in cryptoassets on the stock exchange in a simple, regulated, and secure way, similar to the purchase of shares. As evidence of crypto-assets’ interest and recognition investments in 21Shares trackers have increased five-fold in the third quarter of 2020.

Learn more here.