Welcome to this week’s Market Pulse, your 5-minute update on key market news and events, with takeaways and insights from the Sidekick Investment Team.
Today, we’re looking at how crypto assets are finding new utility in the UK, Keir Starmer urging a mature reset of the UK-China relationship, and Tether building a $24 billion gold hoard to diversify away from the dollar.
But first, our number of the week…
68%
That’s how much more expensive it was to buy aluminium in the US last week compared to London, an unprecedented divergence. The gap is largely explained by a rise in US tariffs, which have made it more expensive to import certain commodities.
Sidekick Takeaway: In globalised markets, investors generally assume that there’s a single trading price for assets like gold or aluminium. But as the international trading system shifts under the weight of higher tariffs, unified prices can no longer be taken for granted, forcing a costly rethink of global supply chains.
Only have a minute to read? Here’s the TL;DR:
- The Financial Conduct Authority has revised its stance on crypto assets, moving from a strict ban to allowing access to crypto Exchange-Traded Notes (cETNs). This regulatory thaw is driven by crypto’s growing utility in payments and tokenisation, a shift Sidekick is embracing with a new institutional-grade crypto offering next week.
- Amidst deteriorating relations with the US, Prime Minister Keir Starmer used a summit in Beijing to advocate for a ‘mature’ reset of the UK-China relationship. While security concerns remain, the pivot mirrors a broader European trend toward pragmatic economic rebalancing.
- Stablecoin giant Tether has emerged as one of the world’s largest private holders of physical gold, accumulating a hoard worth approximately $24 billion. The strategy reflects a central-bank-style shift to diversify reserves and hedge against potential instability in the dollar-based financial order.
It’s important to note that the content of this Market Pulse is based on current public information which we consider to be reliable and accurate. It represents Sidekick’s view only and does not represent investment advice - investors should not take decisions to trade based on this information.
Turning the Corner: How Crypto Became Useful
Back in 2020, the Financial Conduct Authority’s view on crypto assets was stern.
Even as tokens soared in price, the FCA explicitly barred the sale of many crypto products to retail customers. That ban included crypto Exchange-Traded Notes (cETNs).
According to the body, the ‘prevalence of market abuse’ and ‘lack of legitimate investment need’ made crypto unsuitable for individual investors.
But just a few years later, the FCA’s tune slowly began to change.
Not only did the FCA expand individual access to cETNs in 2025, but these products can even be held in certain ISAs.
That regulatory shift can largely be explained by one key trend: crypto is now much more useful than it used to be.
Crypto’s new era: Utility-driven adoption
Crypto’s current era is characterised by more widespread acceptance by regulators, both in the US and Europe.
That’s driven by the fact that crypto has evolved from a vehicle for pure speculation to genuine utility:
- Tokens are becoming more viable as a payment option, especially as major platforms like Stripe have pushed to include stablecoins during checkout.
- Wall Street firms like BlackRock have moved to tokenise real-world assets, potentially providing a new way to raise funding for capital projects.
- Amidst the geopolitical uncertainty of the past few years, investors have also come to view crypto as a valuable source of diversification from traditional asset classes.
In the UK, the combination of crypto’s growing utility and the FCA’s new rules has led to the listing of numerous cETNs.
These products trade like a stock, but track an underlying crypto index. Still, cETN access remains limited to individual investors who have shown they understand the continuing risks associated with these assets.
Sidekick Takeaway: Next week, we’re excited to share details on Sidekick’s own crypto-related offering. Keep an eye on your inbox to see how we’re bringing these institutional-grade opportunities directly to your portfolio.
Note, Crypto ETNs are high-risk investments, available to eligible sophisticated and high-net-worth investors only. Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment and you should not expect to be protected if something goes wrong. Take 2 mins to learn more.
Strategic Adulthood: Starmer Urges ‘Mature’ China Relationship
Over the past few months, the UK’s special relationship with the US has deteriorated rapidly.
UK officials have maintained that the two countries remain ‘the closest of allies.’ Yet tensions over Greenland may not cool for some time.
But just as Britain’s relationship with America has declined, engagement with another country has grown: China.
The number of Britons who see China as a rising friend has grown by 10 points in the last year alone.
And while significant differences between the two countries remain, Keir Starmer used a recent visit to China to push for the development of a ‘mature’ relationship.
Starmer-Xi summit leads to relationship progress
The UK-China relationship has been rocky over the past few years.
In addition to the UK banning Huawei equipment from domestic 5G networks, the government has accused Chinese state-linked actors of spying on UK officials.
Nonetheless, the economic benefits of a deeper trade relationship with China are clear, especially when it comes to expanding the market for British services.
Starmer used this week’s visit to Beijing to call for a reset. For his part, Xi noted that China seeks a ‘long-term, stable’ relationship with the UK.
In terms of practical results, the two sides agreed to explore the potential for visa-free travel to China for UK citizens.
Sidekick Takeaway: Starmer’s views mirror those recently expressed by Emmanuel Macron, in which the French president called for a ‘rebalancing’ with China. While it’s clear that Europe and China do not see eye-to-eye on many geopolitical issues, America’s pullback from the world stage means pragmatism is winning out.
The New Gold Standard: Tether’s Overlooked Gold Hoard
Tether is widely known as one of the most influential players in the crypto market.
With a market cap of about $186 billion, the company operates the most popular stablecoin in the world.
Less well-known, however, is Tether’s influence on another global market: gold.
With a hoard worth some $24 billion, Tether has become one of the largest private holders of physical gold in the world.
What’s more, the company’s continued purchases could provide increased momentum for the gold market moving forward.
Tether’s central bank aspirations
Tether has historically focused on acquiring assets linked to traditional currencies, such as the euro and the US dollar.
But Tether’s recent gold purchases are tied to a broader shift in the company’s long-term vision:
- Part of Tether’s gold reserves are specifically used to back the company’s gold-linked token, which currently has a market cap of about $2.6 billion.
- But the rest stem from the company’s desire to diversify its reserve holdings away from the dollar, much as global central banks are doing.
- Gold now makes up over 7% of Tether’s overall reserves, more than double the amount just two years ago.
In a recent interview, Tether CEO Paolo Ardoino described how the company is seeking to build a robust ecosystem that could survive a ‘breakdown’ of the dollar-based world order.
As a result, the company will continue directing a sizeable share of its corporate profits into major gold purchases.
Sidekick Takeaway: Despite a recent pullback, gold’s price has been supported in the past few years by extensive geopolitical uncertainty and trade tensions. Tether’s continued purchases can potentially add another layer of market support for gold investors in the near term.
Notices
Sidekick Money Ltd is a company registered in England and Wales (No. 13882980). Sidekick Money Ltd is authorised and regulated by the Financial Conduct Authority (FRN 984829). Our address is 6-7 St Cross Street, London, EC1N 8UB.
𝘗𝘭𝘦𝘢𝘴𝘦 𝘳𝘦𝘮𝘦𝘮𝘣𝘦𝘳, 𝘪𝘯𝘷𝘦𝘴𝘵𝘪𝘯𝘨 𝘴𝘩𝘰𝘶𝘭𝘥 𝘣𝘦 𝘷𝘪𝘦𝘸𝘦𝘥 𝘢𝘴 𝘭𝘰𝘯𝘨𝘦𝘳 𝘵𝘦𝘳𝘮. 𝘠𝘰𝘶𝘳 𝘤𝘢𝘱𝘪𝘵𝘢𝘭 𝘪𝘴 𝘢𝘵 𝘳𝘪𝘴𝘬 - 𝘵𝘩𝘦 𝘷𝘢𝘭𝘶𝘦 𝘰𝘧 𝘪𝘯𝘷𝘦𝘴𝘵𝘮𝘦𝘯𝘵𝘴 𝘤𝘢𝘯 𝘨𝘰 𝘶𝘱 𝘢𝘯𝘥 𝘥𝘰𝘸𝘯, 𝘢𝘯𝘥 𝘺𝘰𝘶 𝘮𝘢𝘺 𝘨𝘦𝘵 𝘣𝘢𝘤𝘬 𝘭𝘦𝘴𝘴 𝘵𝘩𝘢𝘯 𝘺𝘰𝘶 𝘱𝘶𝘵 𝘪𝘯.
Crypto ETNs are high-risk investments. You could lose all your money, including if the issuer fails. There is no FSCS protection.