Crypto holds steady in volatile 3rd quarter

Yahoo Finance’s David Hollerith joins the Live show to discuss crypto's third-quarter performance, bitcoin gains, volatility, transaction volumes, and the outlook for crypto markets.

Video transcript

BRIAN SOZZI: All right, it hasn't just been a wild third quarter for stock markets around the world. Crypto had seen its fair share of violent swings. Yahoo Finance crypto reporter David Hollerith is here with a look into this, in the flesh to talk about crypto.

DAVID HOLLERITH: Yeah, good to be in the studio.

BRIAN SOZZI: Take us through this one.

DAVID HOLLERITH: So, essentially, what's happening is crypto is actually holding up a little bit better for the third quarter so far. The day is obviously not over, and things could change in crypto. That happens all the time. But overall, Bitcoin and the wider crypto market, so an aggregate of all market capitalization of the coins, where it's looking at maybe about a 6% gain since July 1. So the gains are not significant, but it does show that despite how volatile crypto has been, it's been primarily stagnant in net over the last three months.

And there have been a few interesting developments. One was on Tuesday while the British pound was plunging. Actually, we saw the highest amount of trading volumes for Bitcoin, euro, and Bitcoin British pound pairs since March 2020, which was slightly odd.

But, you know, I think we saw something that was a little bit of a wider move to risk assets during that time. That being said, I think that cryptocurrencies do tend to lead other risk assets in that they trade 24/7. So some people are actually looking at this-- some analysts I've spoken to as maybe sort of a leading indicator that October might look better for crypto assets and potentially higher risk stocks.

BRAD SMITH: You've got some of the stocks that are correlated, though, to the cryptocurrency landscape, whether it's a Coinbase, whether it's a Robinhood, that are also going to be closely watching to see what the fanfare is that persists even amid the washout. What are the expectations for how this is going to impact over the longer term in this crypto winter some of the equity traded companies as well?

DAVID HOLLERITH: Yeah, Brad, that's a great point. And it's actually looking to be slightly different in that transaction volumes are down a lot for the year since the year started. Obviously, when prices fall, people lose interest in crypto trading. But that being said, there's sort of a thesis people are posing, which is that buyers and sellers have left. And for companies like Coinbase, you know, that means lower trading volumes. And we've seen JPMorgan and Wells Fargo both downgrade their price targets for the stock in the last week or so.

BRIAN SOZZI: Well, hopefully, fourth quarter's a little bit better for crypto than it was in the third quarter. David Hollerith, good to see you in person.

DAVID HOLLERITH: Yeah.

BRIAN SOZZI: Thank you, man.