Daily Commentary

MarketMinder’s View: Please note, MarketMinder is neither for nor against most investment assets, cryptocurrencies included. But we highlight this piece to remind readers of the sharp, unpredictable volatility risk associated with cryptocurrencies in general. Turbulence has defined the crypto industry’s short history, and its year-to-date performance is yet another example. “The broader crypto market is still reeling from an Oct. 10 meltdown which triggered about $19 billion in liquidations and wiped out more than $1 trillion in market value across all tokens. Since then, risk appetite has collapsed, and traders continue to steer clear of the most speculative virtual currencies.” And as the story notes, this pain has extended more deeply for the market’s smallest, fringiest cryptocurrencies (called altcoins). To illustrate cryptocurrencies’ roller coaster 2025, consider bitcoin, the world’s most popular crypto. It started 2025 with a sharp drop, falling -19.7% from the year’s start through its early April low (per CoinMarketCap). It then reversed course, rising sharply through the aforementioned October peak, gaining a whopping 65.7% over this stretch. Now, just over a month later, those gains have vanished. Herein lies our point: The extreme volatility means finding investing success with cryptocurrencies—regardless of their size or profile—requires timing huge swings up and down, which is near impossible to do with any consistency. Oh, and since cryptocurrencies don’t follow the economic cycle the way stocks do, they trade mostly on short-term sentiment swings and hype. This makes an already impossible task … erm, more difficult? Again, we aren’t saying this to pick on crypto or those that own it. But this type of volatility is worth considering as some call to include cryptocurrencies in 401(k)s and other retirement accounts. We don’t think the volatility associated with cryptos, which are a speculative tool, align with the investment goals and objectives of many long-term investors.

MarketMinder’s View: This article centers on some potential policy shifts in the European Union, so please note MarketMinder is nonpartisan, preferring no party, politician or policy. We assess these developments solely for their potential market and/or economic effects. Said policy includes plans to scale back the EU’s strict regulation on the world’s largest Tech companies (many of which are mentioned here, so a quick reminder that MarketMinder doesn’t make individual security recommendations), which has weighed on innovation and increased costs. The European Commission, the EU’s executive arm, will unveil the plans later this week. “According to drafts circulated in recent weeks, which were reviewed by The New York Times, key aspects of the General Data Protection Regulation, or G.D.P.R., a data privacy law, would be rewritten. Parts of a law restricting certain uses of A.I. would also be delayed.” Now, as the article also acknowledges, it remains to be seen how far this policy shift will go. “The proposals, already the target of heavy lobbying from Silicon Valley and other interest groups, are relatively narrow. But they reflect a growing belief in Brussels that changes are needed to revive Europe’s competitiveness. … The changes may not happen for months, as they require approval from the European Parliament and a substantial majority of countries in the European Union.” That last part is key: Proposed policy isn’t implemented policy. But regulatory changes are worth keeping an eye on, so we will monitor closely.

MarketMinder’s View: Here is more evidence of inflation’s return to normal, alleviating one of investors’ biggest concerns in recent years. This time it is in Canada, where the headline consumer price index cooled to 2.2% y/y, slightly ahead of analysts’ expectations. Key to the cooling? Falling gas prices. The article notes that, “The removal of a carbon levy on gasoline this year continued to depress yearly prices increases for the past few months,” and in October, Statistics Canada reported October’s year-over-year fall in gas prices was due to a switch to cheaper winter blends and lower crude oil prices. Outside of this, food prices’ slowing to 3.4% y/y from September’s 4.0% also contributed to headline cooling, suggesting Canadians got some relief at the grocery store. Stripping out these volatile components, prices were up 2.7% y/y. This doesn’t shed any light on Bank of Canada (BoC) policy, but it is worth noting that this figure falls within the BoC’s target range and matches the disinflationary trend seen in most developed economies this year.