Crypto Long & Short: Fast Money, Slow Money

Welcome to the institutional newsletter, Crypto Long & Short. This week:

CoinDesk Indices’ Andy Baehr provides a “Vibe Check,” telling the story of two markets — the fast money and the slow money.
CoinDesk’s Sam Ewen says that it’s no surprise that internet-native communities want internet-native currencies, and why stablecoins are the logical bridge. .
In “Chart of the Week,” we examine Ethena’s USDe drop and what caused the decline.

As always, connect with me on LinkedIn to share topics you’d like covered in upcoming newsletters. Thanks for joining us!

-Alexandra Levis

Vibe Check

Fast Money, Slow Money

– By Andy Baehr, CFA, head of product and research, CoinDesk Indices

The fast money has kept its distance lately. Two months ago on a Sunday afternoon Eastern time, a whale dumped 24,000 bitcoins into thin liquidity, spooking the market and sending prices lower. ETH’s all-time high of $4,955 was just hours old. The broad six-month rally that pushed the CoinDesk 20 Index to its own all-time high of 4,493 came to an end. SOL tried to carry the baton another leg, but the market didn’t follow.

The Fed’s September 17 rate cut — a quarter point and two more signaled — couldn’t reignite momentum. Geopolitical tensions and tariff fears weighed on risk appetite. DATs corrected from sugar-high levels. When bitcoin logged a new all-time high in early October, it looked like the coast was clear. Then came October 10: President Trump’s announcement of 100% tariffs on Chinese imports triggered the most severe liquidation event in crypto history. Questions about market structure and fragility grew louder. Folks AI’d “auto deleveraging.” The ongoing government shutdown hasn’t helped the mood, either. Even gold, defying gravity all year, fell 5.7% from its peak last week, the largest one-day drop in over 10 years. My YouTube feed showed Moses the Jeweler taking an iced-out Audemars Piguet to the melter, harvesting the gold. If that’s not a top, what is?

Top names and benchmark indices had a rough ride the last two months

Source: CoinDesk Indices

The slow money, however, never stopped.

M&A kept moving: Coinbase acquired Echo for $375 million. FalconX bought 21Shares. Ripple completed its $1.25 billion acquisition of Hidden Road, rebranding it Ripple Prime.

Regulation advanced: the SEC approved generic listing standards on September 17, cutting crypto ETF review times from 240 days to 75. The SEC also approved GDLC, the first crypto ETF in the U.S. to track a market index, the CoinDesk 5.

Integration accelerated: JPMorgan will accept bitcoin and ether as collateral for institutional loans. Jamie Dimon’s “pet rock” now backs loans at the world’s largest bank.

The asset class kept building, integrating and maturing — even as prices tested faith. Now, bitcoin sits right where it was two months ago, before the whale struck. ETH and SOL have recaptured key levels and have room to run. The fast money may be back, but the slow money never left.

Expert Insights

Stablecoins and Internet-Native Money

– By Sam Ewen, head of social media, multimedia and media innovation, CoinDesk

Vice is 31 years old.

The Sims is 25.

Facebook is 21.

Roblox is 19.

Minecraft is 16.

Instagram is 15.

All but two of those existed before Bitcoin.

The rise of crypto didn’t just create a new form of money — it matured alongside an entire generation that grew up living inside digital economies. Gamers and social media participants — the true internet generation — built, traded, collected and socialized in virtual worlds long before “Web3” had a name. Now they’re adults with spending power, investment theses and a deep intuition for how value moves online.

It’s no surprise that internet-native communities want internet-native currencies. Stablecoins are the logical bridge — the technology best positioned to capture this generational and behavioral shift.

If you were 30 in the year 2000, typing your credit card into a website felt risky. Today, over $16 billion is spent every day on e-commerce. Trust evolved with time and experience. The same will happen with digital money. Age matters — and today’s younger consumers, entrepreneurs and investors are native to digital value.

Now zoom out. Between 75–88% of the world still falls under what’s called the Global South: those living outside of the first world, so-called ‘western’ countries. Places where traditional banking infrastructure lags behind connectivity. An example is sub-saharan Africa where, as recently reported by Chainaylsis, “a sudden currency devaluation prompted increased crypto adoption…[and] more users move[d] into crypto to hedge against inflation.” Combine necessity with a population becoming more digitally fluent by the day and money moving at the speed of light, and the stablecoin thesis becomes impossible to ignore.

Over the past month, I’ve been on the ground in Rio, Seoul and Singapore. Three wildly different cities — yet the same conversation everywhere: stablecoins and cross-border payments.

Make no mistake: the digitization of currency is accelerating, and the traditional gatekeepers are officially on notice. Evolve — or be disrupted. Leading that disruption? Blockchain and stablecoins.

Chart of the Week

Let’s look at Ethena’s USDe, which has recently dropped from $14 billion to $10 billion over the past 30 days. This decline stems directly from compression in USDe’s yield, driven by BTC and ETH perpetual funding rates. The blended rate recently dipped into negative territory on multiple occasions but has now recovered to a more favourable 2-4% range. This fundamental recovery in funding will quickly restore USDe’s yield proposition, thereby encouraging capital to flow back to the stablecoin and reversing the recent downward trend in its market capitalization.