DAFM

Category: Australian Domiciled Investors

Trading conditions remained challenging throughout June, beginning with low-volume price weakness and ending with a peak below the February lows. Price action remained subdued, with markets trading largely within range-bound structures and only brief isolated periods of volatility. Bitcoin (BTC) yields however, appear to have found a base, remaining resilient despite persistently bearish market sentiment. have certainly found a base, holding up despite the continued bearish sentiment.
Despite the month beginning with renewed optimism that the conflict in the Middle East could be nearing an end, the absence of any meaningful positive developments led bearish sentiment to take over. Market uncertainty kept many participants on the sidelines throughout the month, resulting in subdued trading volumes and volatility. On a positive note, yields have steadied and begun to turn to the upside, bringing some carry back into the market structure.
Prolonged conflict in the Middle East and broader geopolitical uncertainty has, for the most part, kept institutional players on the sidelines this month. Cryptocurrency majors closed April with surprising resilience, as Bitcoin (BTC) and Ethereum (ETH) looked set to retest the top of their recent ranges, around US $80,000 and US $2,500 respectively. While the global outlook remains uncertain, markets have shown signs of relative strength, leading to cautious optimism in the coming months.
Following Bitcoin’s (BTC) sharp sell-off in February, March was marked by low volume capitulation near the lows, with subdued market participation resulting in minimal trading opportunities throughout the month. The ongoing conflict in the Middle East is continuing to stoke uncertainty into April, keeping yields suppressed at the lows and awaiting some good news to get the side-lined institutional interest flowing again.
In the first week of February, Bitcoin (BTC) fell by more than 30%. Most of that decline occurred on 5 February, making it one of the fastest declines on record.   This drop was mainly caused by broader market pressures driven by a reduction in leverage, rather than a full panic sell-off. Liquidations in the futures market were around average levels during this time. After this sharp and busy start, activity slowed down significantly. Although BTC’s price fell, volatility was lower than in previous bear markets. For the rest of the month, there were very few opportunities to supplement the very low yields on offer.  
Cryptocurrency markets started the year strongly, rallying steadily through the first half of January with Bitcoin (BTC) just short of the $100,000 USD mark mid month. Sentiment then deteriorated in line with broader macroeconomic concerns. Risk-off trades put downward pressure on crypto prices through the remainder of the month. This culminated in a sharp fall in BTC at the end of January, with liquidations pushing a shaky market towards 12-month lows. The trading desk saw limited opportunities to build on stubbornly low yields.
The Digital Income Class (the Fund) rose 0.08% over the month of December, bringing its 12-month performance to14.64% net of fees. Trading opportunities were limited due to the quiet end to the year in cryptocurrency markets. However, low market yields still allowed the Fund to generate a small positive return.
November was volatile for cryptocurrency markets. Bitcoin fell from above US$100,000 to just over US$80,000 before recovering to around US$90,000. The decline reflected ongoing market caution from October’s tariff news and higher-than-expected U.S. inflation, which pushed investors toward safer assets.
October’s trading opportunities capitalised on the volatility driven by the US and China events on 10 October. The largest single day return of the year again demonstrated the value of our market neutral approach and proprietary trading systems. The Fund consolidated profits through the rest of the month, delivering strong consistent performance.
DigitalX ASX Announcement "DigitalX board has resolved to allocated approximately A$4.96 million into the Lime Street Capital SPC fund, run by Australian manager Digital Asset Funds Management (DAFM), which is expected to generate significant free cash flows based on the Fund's historical performance."