QCP Asia Colour – 08 Aug 2024

- The BOJ deputy governor downplayed the chances of another near-term rate hike.

- Crypto markets seized the opportunity to recover but ETH continues to underperform.

- There is a potential cap on the topside in the near term with Jump Trading continuing its ETH liquidations (21,394 $wstETH ~$63.6M left) and Plus Token Ponzi 2 ETH wallets moving a total of 25,757 ETH ($63.1M) in the last 30 hours.

- We remain bullish on BTC as we see significant call buying in the Dec and March expiries. Major funds also continue to roll their Sep long call positions.

Trade Idea
Receive a weekly 23% p.a. coupon while BTC continues to recover through the summer months. Downside protection - buy BTC at 21% lower from current spot (45k) only if spot price is below 40k at expiry.

FIXED COUPON CONVERTIBLE (FCC)
Weekly Coupon Rate: 23% p.a. as long as BTC/USD fixes above Coupon Level
Coupon Level: Above 45,000
Maturity: 1NOV24
Strike: 45,000
Protection Level: 40,000

(BTC Spot Ref: 57,200)