Welcome to the Asia Morning Briefing, offering a concise overview of market developments during U.S. hours. Bitcoin trading remains tightly range-bound around the $110,000–112,000 region, reflecting its role as a macro hedge against policy uncertainty and a softer dollar. Institutional desks report muted BTC implied volatility, even as put-call skew remains negative, suggesting demand for downside protection. In contrast, Ethereum has emerged as the preferred vehicle for upside exposure, supported by strong call structures and recovering risk reversals, indicating broad conviction in ETH’s performance into September.
Asia-Pacific equity markets are rallying on the back of a Wall Street tech rebound, with Japan’s Nikkei 225 leading gains. Rising institutional inflows into spot Ethereum ETFs and anticipation of the Fusaka network upgrade underpin Ethereum’s structural demand. Market maker Flowdesk highlights elevated ETH positioning as clients seek performance, while BTC flows remain anchored by hedge narratives. Polymarket sentiment aligns with this rotation, forecasting a meaningful chance for ETH to breach $5,000, even as BTC trades below its year-to-date highs.
The macro backdrop continues to support hedges: elevated term premiums and lingering doubts over central bank independence weaken the dollar, bolstering assets like gold and bitcoin. Yet on-chain metrics point to diverging use cases. While Bitcoin’s supply dynamics reinforce its inflation-hedge thesis, Ethereum’s robust DeFi activity and smart contract utility sustain its outperformance. Solana options also show skewed buying interest, reflecting growing confidence in altcoin breadth as digital asset diversification gains traction.
Perpetual futures funding rates for Bitcoin have moderated from double-digit annualized levels to near 6%, signaling a cooling of speculative leverage. Open interest remains elevated above 700,000 BTC-denominated contracts, denoting persistent market engagement. Meanwhile, Ethereum funding and options open interest trends emphasize balanced flows, with calls building above key strikes. Traders are closely monitoring volatility curves for signs of renewed directional conviction.
Looking ahead, key drivers include U.S. nonfarm payrolls, central bank communications, and the upcoming Fusaka upgrade. Markets will gauge whether Ethereum’s outperformance can extend as macro risks mount. Bitcoin’s consolidation may persist until clarity on fiscal and monetary policy emerges. Collectively, these factors sketch a market landscape where BTC anchors as a hedge and ETH leads on performance, setting the tone for September’s digital asset narrative.
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