Unlock the Editor’s Digest for free

Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.

The idea behind the concept of generations is that people born at a certain time share similar experiences, which in turn shape common attitudes.

The “Greatest” and “Silent” generations, born in the early decades of the 20th century, witnessed economic adversity and global conflict, going on to form relatively leftwing views. Baby boomers grew up accustomed to growth and prosperity, and went on to lean strongly conservative.

It was a similar story for millennials, who entered adulthood in the aftermath of the global financial crisis to be greeted by high unemployment, anaemic income growth, and ballooning house price to income ratios, going on to champion strongly progressive politics.

A lot of analysis and discourse treats millennials and Gen Z as close cousins, united in their struggle to achieve the prosperity of earlier generations. But the validity of that elision depends a lot on where you look.

Millennials right across the western world really were united in their economic malaise. From the US and Canada to Britain and western Europe, the cohort born in the mid to late 1980s lived its formative adult years against a backdrop of weak or stagnant wage growth and cratering rates of home-ownership.

Absolute upward mobility — the extent to which members of one generation earn more than their parents’ generation at the same age — fell steadily. In the US, by the time someone born in 1985 turned 30, their average income was only a few per cent above that of their parents at the same age, a far cry from the clear, palpable generation-over-generation gains of 50 to 60 per cent made by those born in the 1950s.

On both sides of the Atlantic, the narrative of millennial malaise is no myth. They may go down as the most economically unlucky generation of the past century.

But we then hit a fork in the road. For young adults in Britain and most of western Europe, conditions have only got worse since. If you thought the sub-1 per cent annual growth in living standards endured by millennials was bad, try sub-zero. Britons born in the mid 1990s have seen living standards not merely stagnate but decline. Right across Europe, there is precious little for the youngest adults to be happy about.

But in America, Gen Z are motoring ahead. US living standards have grown at an average 2.5 per cent per year since the cohort born in the late 1990s entered adulthood, blessing this generation not only with far more upward mobility than their millennial elders, but with more rapidly improving living standards than young boomers had at the same age. And it’s not just incomes: Gen Z Americans are also outpacing millennials in their climb up the housing ladder.

All the signs are that in the US, the decades-long slowdown in generation-on-generation economic progress has not only stopped but gone into reverse. Americans born in 1995 are enjoying even more upward mobility relative to their parents than those born in 1965. Zoomers by name, zoomers by socio-economic nature.

Both the change in young Americans’ economic trajectories and the divergence from their European counterparts pose interesting questions.

From a sociological perspective, in an age of borderless social media narratives and algorithms that reward negativity, can the meme of young adult adversity survive contact with America’s Gen Z reality? And with a stream of negative social comparisons only a smartphone away, how will the growing realisation that young Americans are on a higher trajectory affect young Europeans?

Turning to politics, will the youngest cohort of American voters tread its own path? The fact that it was not only the youngest men but also young women who swung behind Donald Trump in the US election suggests this may already be happening. A group that comes to see itself as among life’s winners may not develop the same instinct for social solidarity that its downtrodden predecessors came to hold.

In an era of “vibe shifts”, the pivot from a sense of downward mobility to one of rising prosperity may prove the biggest yet. A divergence in the mood music on either side of the Atlantic will also surely inject fresh urgency into Europe’s search for an uptick of its own.

Whichever way you look at it, the restarting of the economic conveyor belt in America could prove to be a hugely significant moment.

john.burn-murdoch@ft.com, @jburnmurdoch

Seattle-based Madrona Capital is celebrating its 30 years in business by raising $770 million in fresh capital. This is the firm’s largest fundraise to date, exceeding $690 million across two funds Madrona closed in 2022. 

While an 11% capital pool upsize may not seem significant, any increase at a time when many venture outfits are forced to reduce their fund hauls is a sign that limited partners are excited about the firm’s prospects and recent track record. 

Madrona’s managing director, Matt McIlwain, told TechCrunch that it helped that last year — in a market where exits were few and far between — the firm sold a few portfolio companies and distributed capital to its investors. The firm’s recent exits include Lexion, which sold to Docusign for $165 million, and Octo AI, which Nvidia acquired for a reported $250 million.

“The LP community is generally concerned about distributions,” McIlwain said. “I think we stood out as a firm that had done really well on that front, not just this past year, but over many years.”

Madrona started as a group of “super angels” who wrote a check to an online bookseller, Amazon, in 1995. The firm has since evolved into a multi-stage investor that has backed companies like Redfin, Smartsheet, Snowflake and, more recently, AI startups Typeface and Runway.

Although Madrona undoubtedly benefited from being the largest VC firm in the same geographic location as Amazon and Microsoft, it decided to venture beyond Seattle by opening an office in Silicon Valley in 2022.

McIlwain said that the fresh capital will be used to invest in AI applications in domains ranging from travel to life sciences, as well as in infrastructure companies that “can remove friction” between foundational models and users. The firm will back about 30 pre-seed, seed and Series A startups from its approximately $490 million early-stage fund, and the remaining capital will go towards 12 companies raising their Series B or Series C.

As Madrona enters its fourth decade, it is extremely optimistic about what’s ahead in 2025. McIlwain described the current conditions as a ‘risk-on mindset’ that will help foster entrepreneurship and create value.

The Securities and Exchange Commission (SEC) has repealed a controversial rule requiring financial firms holding cryptocurrency for customers to report those assets as liabilities on their balance sheets.

In a bulletin issued on Jan. 23, the SEC announced that Staff Accounting Bulletin (SAB) 122 officially rescinds SAB 121, a policy introduced in March 2022 that faced significant pushback from the crypto industry.

SAB 121 had drawn criticism for its cumbersome reporting requirements, with industry leaders arguing it made custody of digital assets unnecessarily complicated.

The rule’s removal was met with relief, as highlighted by SEC Commissioner Hester Peirce’s celebratory Jan. 23 post on X: “Bye, bye SAB 121! It’s not been fun.”

Around 30,000 Bitcoin options contracts will expire on Friday, Jan. 24, and they have a notional value of roughly $3.1 billion.

This week’s expiry event is slightly larger than last week’s, but it is unlikely to have any major impact on spot crypto markets, which have calmed following a volatile week.

Bitcoin Options Expiry

This week’s batch of Bitcoin options contracts has a put/call ratio of 0.48, which means that there are more than twice as many call (long) contracts expiring than puts (shorts). Open interest, or the value or number of BTC options contracts yet to expire, is highest at the $120,000 strike price, which has $2.4 billion in OI, according to Deribit.

There is also around $1.7 billion in OI at the $110,000 strike price, as derivatives traders remain bullish.

The anticipated announcements and crypto executive orders following US President Donald Trump’s inauguration on Monday did not materialize, causing cryptocurrency market indicators to stabilize, reported Deribit this week.

While Bitcoin options markets still show some unusual trading patterns, overall market excitement has subsided, it added.

In addition to today’s batch of Bitcoin options, around 168,000 Ethereum contracts are expiring as well. These have a notional value of $543 million and a put/call ratio of 0.47. This brings Friday’s combined crypto options expiry notional value to around $3.5 billion.

Crypto Market Outlook

Spot markets have remained relatively stable over the past 24 hours, with total capitalization at $3.7 trillion following a volatile week. The market cap is exactly where it was last week, so the Trump pump following the US president’s inauguration on Monday was very short-lived.

Bitcoin has dropped 4% from this week’s all-time high, which was almost revisited on Thursday. The asset was trading up 3% on the day at $105,000 at the time of writing, having held above six figures for most of this week.

Ethereum is up 5% on the day at $3,370, but it remains deflated following dissent and infighting at the Ethereum Foundation.

Altcoins remain mixed with minor gains and losses across the board during the Friday morning Asian trading session.

Nevertheless, market sentiment is strengthening as the first crypto-related executive order gets the approval signature from President Trump.

I told you this was the year for Bitcoin and digital assets.

— Senator Cynthia Lummis (@SenLummis) January 24, 2025

Advertisement

• I interviewed two Assassin’s Creed Shadows devs and asked what they’re excited for fans to experience
• One dev focused on the recruitment in-game
• Another highlighted the new way that Shadows is telling its story

Excitement for Assassin’s Creed Shadows is growing as we race toward the game’s March 20 release date.

I recently visited Ubisoft Quebec to go hands-on with the game and get a behind-the-scenes look at development. During my visit, I spoke to key developers and quizzed them on their favorite elements of the game that have not been spoken about much up until now but they were most excited for fans to see.

Bitcoin price settled above the $100,500 resistance zone. BTC is consolidating gains and might aim for a fresh increase above the $105,000 zone.

• Bitcoin started a downside correction from the $106,800 zone.
• The price is trading below $104,000 and the 100 hourly Simple moving average.
• There is a connecting bullish trend line forming with support at $102,000 on the hourly chart of the BTC/USD pair (data feed from Kraken).
• The pair could start another increase if it stays above the $102,000 support zone.

Bitcoin Price Eyes Fresh Increase

Bitcoin price started a decent upward move above the $104,500 zone. BTC was able to climb above the $105,500 and $106,000 levels.

The bulls even pushed the price above the $106,500 level. However, the bears were active near the $106,800 zone. A high was formed at $106,833 and the price is now correcting gains. There was a move below the $105,000 level.

There was a move below the 50% Fib retracement level of the upward move from the $101,281 swing low to the $106,833 high. Bitcoin price is now trading below $104,000 and the 100 hourly Simple moving average. There is also a connecting bullish trend line forming with support at $102,000 on the hourly chart of the BTC/USD pair.

On the upside, immediate resistance is near the $104,000 level. The first key resistance is near the $105,500 level. A clear move above the $105,500 resistance might send the price higher. The next key resistance could be $106,800.

A close above the $106,800 resistance might send the price further higher. In the stated case, the price could rise and test the $108,200 resistance level and a new all-time high. Any more gains might send the price toward the $110,000 level.

More Losses In BTC?

If Bitcoin fails to rise above the $104,500 resistance zone, it could start a downside correction. Immediate support on the downside is near the $102,500 level or the 76.4% Fib retracement level of the upward move from the $101,281 swing low to the $106,833 high. The first major support is near the $101,250 level.

The next support is now near the $100,500 zone. Any more losses might send the price toward the $88,500 support in the near term.

Technical indicators:

Hourly MACD – The MACD is now gaining pace in the bearish zone.

Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is now below the 50 level.

Major Support Levels – $102,500, followed by $101,250.

Major Resistance Levels – $104,500 and $105,500.

Bitcoin (BTC) held steady during Friday’s Asian hours after Bank of Japan (BOJ) lifted the benchmark borrowing cost to the highest in 17 years while raising inflation forecasts.

“If the outlook presented in the January Outlook Report will be realized, the Bank will accordingly continue to raise the policy interest rate and adjust the degree of monetary accommodation,” the policy statement said, citing positive outlook on wages and maintaining guidance to keep raising rates, according to ForexLive.

The anti-risk Japanese yen rose over 0.6% to 155.12 against the U.S. dollar following the rate decision. Still, risk assets remained resilient. Bitcoin showed no signs of stress, trading little changed on the day above $104,000. The futures tied to the S&P 500 also traded flat.

This resilience in risk assets suggests that market attention is increasingly centered on potential policy developments under Donald Trump’s presidency. In comparison, the Bank of Japan’s rate hike in late July had previously shaken risk assets, including cryptocurrencies.

On Thursday, President Trump signed an executive order to ban digital dollar and promote crypto and AI innovation in the U.S. Meanwhile, the U.S. data released recently showed “all tenant rent” index, which leads shelter inflation in the CPI, rose at a slower pace last quarter. That has raised hopes that the Fed will walk back on its hawkish December rate forecasts.