Monthly Letters
Dear Investor,
The US elections have set up an exciting year ahead for crypto. The new House and Senate will include close to 300 pro-crypto policymakers and many of the most important roles in the Trump administration are being filled by proponents of bitcoin and other crypto assets.
The Nasdaq Crypto IndexTM (NCITM) responded to this new environment, returning over 45% in November. A number of altcoins within the index had triple-digit returns during the month, as optimism over the future of crypto in the US was widespread.
Samir Kerbage wrote about what the US elections mean for investors in his most recent Notes from the CIO. He will be joined by our Head of Research Pedro Lapenta on Wednesday to discuss our team’s 20254 Crypto Investment Outlook, which will be released tomorrow. You can register for the webinar here.
As always, we are greatly appreciative of your trust in us and are here to answer any questions you may have.
-Your Partners at Hashdex
Market Review
“In the near future, the US election results could serve as a trigger for a new all-time high in Bitcoin, as well as a recovery for smaller assets that are lagging this year.” This statement, taken from our last Monthly Letter, is an excellent summary of what unfolded in November.
Indeed, the day after the elections, with the confirmation of Donald Trump’s victory, Bitcoin reached a new all-time high, surpassing $75,000. However, that was only the initial surge. Throughout the month, its appreciation continued, stopping just short of $100,000 by month’s end. For November as a whole, Bitcoin saw a 38% increase.
Despite achieving one of the best monthly performances in recent years, Bitcoin was the worst performer among the ten constituents of the Nasdaq Crypto IndexTM (NCITM). As we anticipated, Trump’s election was interpreted as signaling the end of the US government and its agencies' crackdown on crypto assets, particularly those with smaller market capitalizations. This perception led to even sharper surges among these assets compared to Bitcoin. Within the NCITM constituents, the best performers were XRP and Cardano, which rose 274% and 219%, respectively. The NCITM closed the month with an impressive gain of 45.7%.
A similar trend was observed in the sectoral indices, among which the most modest performance came from Decentralized Finance, with a rise of “only” 61.6%. The Digital Culture index gained 75.6%, with four of its constituents more than doubling in value (Gala, The Sandbox, Decentraland, and ENS). The best performance was seen in the Smart Contract Platforms index, which climbed 87.9%, led by Cardano, Hedera, and Algorand, all delivering returns exceeding 200%. The Vinter Hashdex Risk Parity Momentum Index rose 62.5%, tempered by TRON—the asset with the largest weight—which returned just 21.9%. Despite these strong monthly results, all four indices remain well behind the NCI in year-to-date performance, with the NCITM up 116%.
November’s outstanding results are cause for optimism, but we must not lose sight of the broader picture. The rise of a pro-crypto government in the world’s largest and most influential economy marks a significant step toward accelerating the widespread adoption of this technology. Ultimately, this will drive prices to even greater heights. We are increasingly optimistic about the medium- and long-term development of the crypto asset class.
Top Stories
Bitcoin becomes world's seventh-largest asset
Bitcoin surpassed Saudi Aramco to become the world's seventh-largest asset by market capitalization, valued at $1.82 trillion, just days after overtaking silver. This achievement places BTC behind only Alphabet, Amazon, Microsoft, Apple, NVIDIA, and gold. This milestone symbolizes BTC's remarkable evolution as it approaches 16 years since its creation, solidifying its position as one of the world's most valuable and influential assets.
SEC commissioner pledges crypto-forward approach after Gensler resignation
SEC Commissioner Mark Uyeda has pledged to prioritize regulatory clarity for crypto assets if selected and criticized Gensler’s “anti-crypto” stance, proposing the creation of regulatory sandboxes to foster innovation in the US. This potential appointment could mark a turning point for the crypto industry, bringing clearer regulations, encouraging innovation, and creating a more favorable environment for market growth in the US.
Bitcoin reserve bill introduced in Brazil
The bill proposes the creation of a Sovereign Strategic Bitcoin Reserve (RESBit) to diversify the National Treasury's financial assets, protect international reserves against exchange rate fluctuations and geopolitical risks, and foster blockchain technology adoption. The bill outlines a gradual acquisition of up to 5% of Brazil's international reserves in Bitcoin, managed by the Central Bank and the Ministry of Finance using advanced monitoring technologies. If approved, this project could mark a milestone in integrating cryptocurrencies into Brazil's economy, drawing global attention and strengthening the country's economic sovereignty.
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