Privacy Coins Outperform as Bitcoin Price Nears June Low: Crypto Daybook Americas

Market Overview - The crypto market is experiencing a risk-off session, with Bitcoin (BTC) down 3.5% in the past 24 hours, nearing October lows around $103,600, potentially marking its lowest price since June [1] - The CoinDesk 20 Index has decreased by 5%, with major altcoins like ether (ETH) and solana (SOL) also reaching their lowest levels since August [1] Contributing Factors - Hawkish comments from Fed Chair Jerome Powell, a strengthening dollar index, and persistent selling from long-time wallets are blamed for the market downturn [2] - Market maker Wintermute noted that while global liquidity is expanding, capital is not flowing into crypto, with ETF inflows stalling and only stablecoins showing growth [2] - The bearish sentiment may also be linked to the October 17 flash crash, where several arbitrage bets lost money, leading firms to potentially liquidate long spot positions, adding downward pressure on prices [2] Specific Incidents - Stream Finance's stablecoin, xUSD, collapsed by 80% to 30 cents, resulting in a reported $93 million loss due to issues with an external fund manager [3] - The investigation into the xUSD collapse has raised concerns within the crypto community about broader market implications [3] - Lenders of xUSD are reportedly earning over 500% daily interest, indicating potential trouble for the protocol's treasury [3] Market Trends - Despite the overall market decline, some privacy coins like Zcash, Decred, and DASH have surged by as much as 200% in just 24 hours, suggesting traders are seeking refuge in these assets [4] Traditional Market Insights - In traditional markets, a rise in credit default swaps tied to Oracle reflects investor concerns over the company's significant AI-related spending [5] - The dollar index has reached 100 for the first time in months, complicating the outlook for Bitcoin bulls [5] - Gold prices remain steady around $4,000 per ounce [5]