Digital Asset Recap Q3 2023: Bitcoin and Ether Outperform Wider Market Amid Regulatory Pressure and the Promise of ETFs

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Todd Groth is Head of Index Research at CoinDesk Indices. . He has over 10 years of experience involving systematic multi-asset risk premia and alternative investment strategies.

Over the past quarter, the CoinDesk Market Index , which spans over 90% of the crypto market capitalization, declined -11%. Bitcoin and other digital asset protocols and projects.Looking within sector quarterly performance with the CoinDesk DACS framework, the trends and preferences towards larger capitalization tokens are less clear.

September also marked the one-year anniversary of Ethereum’s successful transition to a “Proof-of-Stake” consensus mechanism. This reduces the amount of computational work needed to verify blocks and transactions, effectively eliminating its carbon footprint. So far, the network has been operating as intended with staking assets becoming a popular way for crypto investors to enhance returns.

A catalyst to break through the macroeconomic headwinds of tightening financial conditions could come in the approval of a Bitcoin spot ETF.Firstly, it would greatly enhance accessibility, allowing a broader range of investors to easily gain exposure to Bitcoin without the complexities of direct purchase and storage, like how gold ETFs, starting in the early-2000s, simplified the process of gaining exposure to physical gold.

 

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