The research report discusses the current state of the crypto market in the context of US economic conditions and regulatory clarity. The report highlights that slowing but resilient real growth and disinflation in the US can persist longer, but warns about a scenario where growth slows sharply while rates stay high. It also emphasizes the positive price momentum in equity, credit, and crypto, and the need for a risk management approach that considers this scenario. The report further discusses the implications of the XRP verdict on other crypto assets and the ongoing regulatory clarity as a sustained tailwind for institutional adoption.
- Consider the scenario of slowing growth and high rates: The report suggests that while the current economic conditions can persist, there is a need to consider the scenario where growth slows sharply while rates stay high.
- Adopt a risk management approach: Despite the positive price momentum in equity, credit, and crypto, a risk management approach should be adopted that allocates a non-negligible probability to the scenario of slowing growth and high rates.
- Regulatory clarity is a tailwind for institutional adoption: The report highlights that ongoing regulatory clarity, especially in the wake of the XRP verdict, is a sustained tailwind for institutional adoption of crypto.