1) Markets: risk stabilizes; BTC leads, ETH lags
- BTC rebounded to ~$110–114K as ETFs turned net-positive on the week; US spot BTC ETFs saw ~$446–447M net inflows into Oct 24, while spot ETH ETFs posted net outflows—a rotation that kept ETH below prior highs.
- Macro tailwind: the US 10-year Treasury yield dipped below 4% during the week (Oct 22), easing financial conditions and supporting risk assets.
2) Tokenization: institutional product momentum ticks up
- Federated Hermes × Archax unveiled tokenized UCITS money-market funds (London, Oct 22) — a materially “TradFi-native” RWA use-case with FCA-regulated plumbing (exchange, broker, custodian).
- Nomura’s Laser Digital launched a tokenized ‘Carry’ fund on Sei (Oct 22–24 window), underscoring tokenization moving from pilots to income-oriented strategies.
3) Europe: MiCA era shaping capital flows & supervision
- EU supervisors underscored that MiCA implementation and supervisory convergence remain top priorities (ESMA Sept–Oct newsletter; published this week). Expect continued scrutiny of CASP authorizations and market integrity.
- Policy backdrop: The European Commission (Oct 10) reiterated that existing MiCA rules adequately address stablecoin risks, even as the ECB continues to flag financial-stability concerns — a gap we expect to influence bank integrations and euro-stablecoin initiatives into Q4
Morgan House View — implications for institutional portfolios
Digital asset sleeve (near-term):
- Overweight BTC vs. ETH tactically given flow leadership (BTC ETF inflows vs. ETH outflows). Maintain strict risk budgets after the early-October drawdown; use strength to rebalance rather than chase beta.
- Stablecoins & payments rails (EU): prioritize MiCA-compliant issuers in eurozone payment and treasury workflows; expect bank partnerships to expand as supervisors push convergence.
- RWA/tokenized cash management: the tokenized MMF path is becoming institutionally executable (KYC/CSD-adjacent control and FCA-regulated custody). We see scope to pilot tokenized liquidity buckets alongside T-bill strategies for operational efficiency and 24/7 settlement.
Macro overlay:
- With the 10-year UST <4% during the week, digital-asset beta can remain sensitive to duration moves; hedge rate shocks around key data and the upcoming FOMC (Oct 29).
What we’re watching next
- FOMC (Oct 29) and downstream ETF flow reaction — whether BTC’s weekly inflow trend persists and if ETH outflows stabilize.
- Further TradFi tokenization prints (MMFs, credit, and alternatives) following this week’s launches.
- EU supervisory communications on MiCA authorizations and stablecoin risk guards into November.
Notes: This briefing is informational and not investment advice. Figures reflect public sources during Oct 20–26, 2025 (local time UK).