BTC US$72.9k. Sharp rally amid regulatory clarity push.

IN MARKETS

Digital assets posted strong gains this week as regulatory momentum and institutional positioning drove risk-on sentiment across crypto markets. Bitcoin advanced 6.8% to US$72,873, while Ethereum gained 6.9% to US$2,125, outpacing broader risk assets. XRP and Solana followed with gains of 4.8% and 4.2% respectively, reaching US$1.43 and US$90.

The rally occurred against a backdrop of heightened political engagement on crypto policy, with the Trump administration publicly backing stablecoin legislation and attacking traditional banking opposition. Bitcoin briefly touched US$74,000 intraday before consolidating, demonstrating continued institutional accumulation despite elevated volatility. Altcoin performance remained mixed, with meme tokens and DeFi protocols showing divergent flows as capital rotated toward large-cap assets.

Market structure improved notably, with funding rates normalizing and open interest expanding across major perpetual contracts. The Fear & Greed Index registered 22 (Extreme Fear), presenting a contrarian signal that historically precedes relief rallies. This disconnect between price action and sentiment metrics suggests institutional participants are accumulating positions while retail sentiment remains depressed—a pattern consistent with early-stage trend reversals.

FROM THE OTC DESK

The dominant narrative driving institutional flows this week centers on the escalating stablecoin regulatory debate in Washington. President Trump publicly urged passage of the GENIUS Act and Clarity Act while attacking traditional banks for "undercutting" crypto-friendly legislation. JPMorgan CEO Jamie Dimon's testimony arguing that yield-bearing stablecoins should face bank-level regulation drew sharp rebukes from White House crypto advisor Patrick Witt and Eric Trump, co-founder of World Liberty Financial.

This political theater has direct market implications. The prospect of regulatory clarity on stablecoins—particularly regarding yield distribution—could unlock significant institutional capital currently sidelined due to compliance uncertainty. Coinbase CEO Brian Armstrong's confirmed meeting with Trump immediately preceding the president's public statements suggests coordinated industry lobbying efforts are intensifying.

OTC Desk Activity:

• Net buying observed in BTC and ETH spot from Asian institutional accounts, particularly following the US$74,000 test
• Increased hedging flows via put spreads as funds protect gains while maintaining long exposure
• Stablecoin rotation accelerating, with USDC and USDT balances on exchanges declining as institutions move to custody solutions ahead of potential regulatory frameworks

KEY ECONOMIC CALENDAR

Friday, March 6, 21:30 SGT – US Non-Farm Payrolls (Consensus +185k) Friday, March 6, 21:30 SGT – US Unemployment Rate (Consensus 4.1%) Wednesday, March 11, 21:30 SGT – US CPI (Consensus +0.3% MoM) Thursday, March 12, 21:30 SGT – US PPI (Consensus +0.2% MoM) Wednesday, March 18, 02:00 SGT – FOMC Rate Decision (Consensus hold at 4.25-4.50%) Thursday, March 19, 20:30 SGT – Bank of Japan Policy Decision Friday, March 20, 20:00 SGT – China Loan Prime Rate Announcement

IN HEADLINES

A16z Targets US$2 Billion for Fifth Crypto Fund

Andreessen Horowitz is seeking to raise US$2 billion for its fifth dedicated crypto fund, according to Fortune reporting. The fundraising effort comes as venture deployment in digital assets remains subdued relative to 2021-2022 peaks, with total crypto VC investment declining 68% year-over-year in 2025. A16z's continued commitment to the sector signals conviction that current market conditions present attractive entry points for long-term capital. The firm's previous crypto funds totaled approximately US$7.6 billion across four vehicles. For institutional desks, sustained VC interest from tier-one firms supports the thesis that infrastructure development continues despite price volatility, potentially creating medium-term catalysts as portfolio companies mature and launch products.

Federal Reserve Grants Kraken Master Account, Drawing Banking Industry Criticism

The Federal Reserve approved Kraken's application for a master account, enabling the exchange to access the central bank's payment systems directly without intermediary banks. Traditional banking groups expressed being "deeply concerned" about the decision, arguing it sets precedent for crypto firms to bypass conventional banking oversight. The master account grants Kraken enhanced settlement capabilities and reduced counterparty risk—a significant competitive advantage. This development follows the OCC's more accommodating stance under new leadership and represents tangible regulatory progress for crypto infrastructure. For trading desks, improved settlement infrastructure reduces operational friction and could accelerate institutional adoption, particularly for firms requiring real-time settlement capabilities.

Morgan Stanley Names Coinbase and BNY as Custodians in Bitcoin ETF Filing

Morgan Stanley updated its proposed Bitcoin ETF filing to name Coinbase Custody and Bank of New York Mellon as custodians, advancing the traditional finance giant's entry into spot crypto products. The dual-custodian structure addresses institutional concerns around single points of failure while leveraging Coinbase's crypto-native expertise and BNY's traditional finance credibility. Morgan Stanley's US$1.5 trillion in client assets represents substantial potential inflows if the product launches and gains traction with wealth management channels. The filing follows BlackRock's iShares Bitcoin Trust surpassing US$50 billion in AUM, demonstrating sustained institutional demand. For OTC desks, additional ETF products from major wirehouses could drive significant spot accumulation flows in coming quarters.

Zerohash Applies for National Trust Bank Charter from OCC

Crypto infrastructure provider Zerohash submitted an application for a national trust bank charter with the Office of the Comptroller of the Currency, seeking to expand its regulated service offerings. The charter would enable Zerohash to provide custody, settlement, and payment services under federal banking supervision—a strategic move as regulatory frameworks crystallize. The application reflects growing confidence that crypto firms can navigate traditional banking regulation while maintaining operational flexibility. Zerohash currently provides B2B infrastructure for embedded crypto services, processing billions in transaction volume for fintech and trading platforms. For institutional participants, the emergence of federally chartered crypto-native banks could resolve longstanding banking access issues that have constrained market development.

Sui Network Launches Native Stablecoin USDsui on Mainnet

Layer-1 blockchain Sui launched its native stablecoin USDsui on mainnet, entering the increasingly competitive stablecoin market. The launch comes as stablecoin regulatory clarity appears imminent in the US, with multiple bills advancing through Congress. USDsui aims to leverage Sui's high-throughput architecture for payments and DeFi applications, though it faces entrenched competition from USDT (US$140 billion market cap) and USDC (US$55 billion). The timing aligns with broader industry efforts to establish compliant stablecoin infrastructure ahead of potential licensing requirements. For trading desks, proliferation of blockchain-native stablecoins creates arbitrage opportunities and liquidity fragmentation risks that require monitoring as adoption patterns emerge.

Fairshake PAC Secures Early Wins in 2026 Congressional Primaries

Crypto-focused super PAC Fairshake celebrated victories for several pro-crypto candidates in the opening 2026 midterm congressional primaries, including Texas Democrat Al Green. The PAC, backed by Coinbase, Ripple, and a16z, has committed over US$200 million to influence congressional races and maintain bipartisan support for digital asset legislation. Early primary success suggests crypto industry political spending is translating into electoral outcomes, potentially strengthening the sector's lobbying position. The 2026 midterms will determine whether crypto-friendly majorities in both chambers can advance comprehensive regulatory frameworks. For institutional market participants, sustained political engagement reduces tail risk of adverse regulatory outcomes while increasing probability of constructive policy development.

Until next week, happy trading!