Crypto Market

BTC and ETH Market Insight

The robust employment situation implies additional inflationary pressures and therefore the expectation of rate cuts has been weakened. The rate futures now price in just one 25-basis-point cut from the Fed this year. Interest rates are skyrocketing as the 10-year note yield approaches 4.70%. The S&P 500 erased $800 billion of market cap during Friday and crypto markets were also affected. Bitcoin's price dipped to 91k, marking its lowest level since it hit 90k in early December last year, and the total liquidations across centralised exchanges amounting to $524.8 million.

Options Market

Even though BTC revisited the 100k mark early in the week, the unexpected strength in the labour market triggered a broad sell-off in risk assets across equities as well as crypto. The release of Fed Minutes reflects an increasingly hawkish stance which lowers the market’s expectation on the rate cut. The front-end implied volatility rose in tandem with the realised volatility whereas the back-end volatility drifted lower. As a result, the volatility carry narrowed down. Near-term skew shifted towards OTM puts while the long-term skew remained bullish. Trump’s inauguration is approaching. A more crypto-friendly government and regulation could potentially serve as a new catalyst for the market.

Altcoins and Blockchain News

• Glassnode: The current BTC price is approximately 7% higher than the cost for short-term holders; falling below this level indicates a weakening sentiment among new investors.

   

• Tianfeng Securities: AI and cryptocurrency represent Plan A and Plan B, respectively, for maintaining the dominance of the US dollar.

   

• Usual will launch the "1:1 Early Unstaking" and yield toggle functions to stabilize its ecosystem.

   

• According to Jinshi, Kenya's Cabinet Secretary for the Treasury, John Mbadi, stated on Friday that Kenya is preparing legislation to legalize cryptocurrency.

   

• As reported by The Block, the Arbitrum DAO has initiated voting on an improvement proposal (AIP) to upgrade the Arbitrum One and Nova chains to the Bounded Liquidity Delay (BoLD) protocol.

   

• ElizaOS has released version 0.1.8, adding eight network integrations including Hyperliquid and Lens.

   

• Polymarket has been classified as a gambling website in Singapore and has been blocked.

   

• The DePIN+AI project Privasea AI announced the completion of a $15 million Series A funding round, with a valuation of $180 million, participated by GSR, Amber, Echo, and early investment institutions such as Binance Labs, OKX Ventures, Gate Labs, and Laser Digital.

Macro

The major benchmarks closed lower for the week: the DJIA lost 1.9%, the S&P 500 -1.9%, and the Nasdaq -2.3%. Chinese equities retreated further for the week: the Shanghai Composite Index lost 1.34%, the CSI 300 -1.13% and the Hang Seng index -3.52%.