Patience continues to pay off

Last week, a study went viral showing the impact of missing the best days in the S&P 500. The findings revealed that missing just 10 of these days would erase half the profits, and after 40 days, investors would face losses.

We conducted the same analysis on a $10,000 investment in crypto via the Nasdaq Crypto IndexTM(NCITM) since its inception in January 2021. The results are even more striking for this emerging asset class.

In essence, missing the 10 most lucrative days would transform a 124% gain into a 30% loss, underscoring the value of consistent investment. This highlights how crypto, with its volatile and asymmetric nature, rewards patient investors who adopt a ”time-in-the-market” approach rather than chasing the elusive goal of ”timing the market.”

Market Highlights

Stablecoins surpass $230 billion in market value

The total stablecoins market capitalization surpassed $230 billion amid growing institutional demand for dollar-backed digital assets.

This showcases one of the most successful applications of crypto in enhancing traditional financial payments. It could also pave the way for new use cases that require a strong and reliable payment system.

SEC drops lawsuit against Ripple Labs

Ripple CEO Brad Garlinghouse announced that the SEC has dropped its lawsuit against Ripple Labs, concluding a legal battle that began in 2020.

This highlights the shifting focus of the new US administration and regulatory bodies on regulating crypto by rules rather than by enforcement, and may shape future regulatory approaches, leading to clearer guidelines and fostering innovation in the industry.

Tornado Cash removed from OFAC sanctions list

The US Treasury Department has lifted the sanction on crypto mixer Tornado Cash after OFAC exceeded its authority in November 2024.

This underscores how regulatory advancements enable the development and use of crypto applications without the risk of premature bans, paving the way for future privacy-preserving protocols to not necessarily be seen as a tool for illicit activity.

Market Metrics

All NCITM constituents had positive performance last week, with UNI standing out after an impressive 9.8% gain. In contrast, XRP had a more modest 4.6% increase despite the SEC dropping its Ripple lawsuit. The strong performance of all NCITM components helped it outperform its main allocation, BTC (+2.3%), after weeks of underperformance, underscoring the importance of recent regulatory advancements for the broader crypto market as 2025 progresses.

With the 2.9% NCITM upswing last week, crypto is potentially signaling a shift in its short-term outlook after several weeks of negative momentum amid a challenging macro environment. Other risk asset classes also recovered but, similarly to crypto, remain on a negative note year-to-date. Analogously to the past few weeks, gold remains the outperformer in 2025, up 15% as it consolidates above the psychological $3,000 landmark reached recently.