Crypto Market

BTC and ETH Market Insight

Crypto assets experienced $346M inflows last week, the biggest in nine weeks due to expectations of a US spot-based ETF launch. Long-term Bitcoin holders currently own almost 15 million coins. CME's standard BTC futures open interest has surged by 35% in just four weeks, reaching 19,603 contracts (approximately $3.4B). This increase is a strong indication of growing investor interest in Bitcoin futures. GBTC traded at a discount of approximately -8.42%, the smallest discount seen this year.

Options Market

Recent trends showed a consistent inflow of institutional investment into cryptocurrencies. With the imminent potential ETF spot approval, BTC spot broke out to print the new year high while ETH seemed to experience a stronger resistance on the 2100 pivot level. BTC’s term structure experienced significant pressure this week- front-end IVs dipped in tandem with RVs and the longer end of the curve dropped around one point but remained relatively stable at about 58 vol. ETH’s term structure mirrored BTC’s behavior. Skew-wise, BTC was holding up better than ETH.

Altcoins and Blockchain News

• In November, the Ethereum network burned a total of 102,018 ETH, equivalent to approximately $204 million. Since the implementation of EIP-1559 in early August 2021, Ethereum has burned approximately 3.77 million ETH, equivalent to $10.51 billion.
• The Arbitrum community voted in favor of a community proposal titled "Providing Backup Funding for Successful STIP Proposals," outlining one-time funding for all "approved but unfunded proposals" of Arbitrum STIP. The proposal aims to increase the total budget by 21.4 million ARB to 71.4 million ARB and increase the number of participating protocols by 26, totaling 56 funded projects.
• Coinbase CEO Brian Armstrong stated that Coinbase has no plans to launch tokens for its Layer 2 network, Base.
• The founder of Blur, Pacman, has launched the Layer 2 network Blast, and the contract address currently holds assets worth over $670 million.
• On December 1st, according to Scopescan monitoring, Starknet confirmed that an airdrop snapshot has just taken place. The STRK token contract was deployed 379 days ago with a total supply of 10 billion tokens.
• Web3 super app ParaX has rebranded as Parallel Finance. It has raised over $30 million in funding from institutions such as Sequoia Capital, Polychain, Blockchain Capital, Coinbase Ventures, and Founders Fund.
• IOTA has announced the establishment of the first regulated and compliant foundation in Abu Dhabi, injecting over $100 million worth of IOTA tokens to support and accelerate the development of the IOTA ecosystem.
• Chaos Labs has announced a $20 million liquidity incentive program in partnership with dYdX to promote early adoption and a smooth transition to dYdX Chain. The program will run for approximately six months and aims to encourage diverse participants to migrate and interact with dYdX Chain.
• Animoca Brands has announced a strategic investment in the TON ecosystem and has become the largest validator of the TON blockchain, providing funding, research, and an analysis platform for third-party mini-applications within the TON ecosystem.

Macro

The major benchmarks recorded strongest weekly gains since November 2022:  the DJIA added +5.1%, the S&P 500 added +5.9%, and the NASDAQ +6.6%. The dovish message from the Federal Reserve led to a sharp decrease in bond yields, especially boosting the growth stocks.