Crypto Market

BTC and ETH Market Insight

All US inflation data came in as expected, while Microsoft rejected a proposal to add Bitcoin to the balance sheet. Crypto liquidations reached $1.5 billion on last Tuesday, with $1.38 billion coming from long positions as Bitcoin fell to $94,000 before rebounding. Bitcoin managed to remain above $100,000, and most altcoins recovered the majority of the value lost during the crash. The overall AI market cap increased by another 9% to reach $10.6 billion, with all leaders showing gains. The top performers last week were tokens from the DeFi sector, with assets like AAVE standing out and demonstrating resilience during the crash.

Options Market

Another abrupt pullback occurred in the market on last Tuesday with a significant liquidation on longs. BTC briefly tumbled to 94,000 and ETH to 3,500. Similar to the washout from the week before, the market quickly bounced back. The implied volatility rose on the retracement and cooled off shortly after the rebound in line with the realised volatility. The volatility carry is flattish for both BTC and ETH. Interesting to note that front-end IV edged lower with an almost certain 25 bps rate cut next week. Skew term structures are back in contango given front-end call skew cooled off.  ETH/BTC continued to be suppressed under 0.04 resistance with ETH failing to hold above 4,000 for now.

Altcoins and Blockchain News

• Trump: Will establish a strategic Bitcoin reserve in the United States similar to the oil reserve.

   

• Ethena Labs announced the launch of a new stablecoin product USDtb,  backed by BlackRock's BUIDL.

   

• Japanese publicly listed company Metaplanet announces the issuance of its fourth series of ordinary bonds, totaling 4.5 billion yen (approximately $30 million), with the funds raised to be used to purchase Bitcoin.

   

• Ether.Fi DAO releases a proposal to allocate 5% of protocol revenue for the buyback of ETHFI tokens and distribute them as rewards to ETHFI stakers, further incentivizing long-term staking.

   

• According to Token Unlocks data, ARB, APE, and QAI will have significant unlocks this week, releasing a total value of over $100 million.

   

• Pudgy Penguins launches the PENGU token with a total supply of 88.88 billion, with 47.87% allocated to community airdrops.

   

• According to Bloomberg, Australian pension and wealth management company AMP announced an allocation of Bitcoin futures products, with an investment size of 27 million AUD (approximately $17.2 million), accounting for 0.05% of its total pension assets.

   

• According to CoinDesk, Sui ecosystem lending protocol Suilend announced the completion of a $4 million funding round led by Robot Ventures.

Macro

The major benchmarks closed mixed for the week: the DJIA lost 1.8%, the S&P 500 lost 0.6%, while the Nasdaq added +0.3% and hit another record high. Chinese equities closed lower for the week: the Shanghai Composite Index lost 0.36%, the CSI 300 fell 1.01% while the Hang Seng index +0.53%.The major indices closed mixed for the week: the DJIA lost 0.6%, the S&P 500 added +1.0% and the Nasdaq added +3.3%. Chinese equities continued rally on the expectation of new stimulus policies: the Shanghai Composite Index added +2.33%, the CSI 300 added +1.44% and the Hang Seng index +2.28%.