Weekly Research Report: July is Green
Market Recap
Bitcoin ended July green with +16.6% monthly return. Crypto assets slowed down on the first day of August, with Bitcoin rejecting $24.5k. The crypto market cap hovered with a narrow range over the weekend (currently at $1.1T), with BTC trading at $23k and ETH at $1.6k. July CPI (August 8) continues to be the focus of this month after Powell’s dovish speech during the FOMC meeting last week. Jobs Report released this Friday posed a threat to market stability, and expected to cause to high volatility.
Stablecoin dominance decreased accordingly ($USDT at 6.2%; $USDC at 5.2%).
Derivatives Market
General perpetual funding rates increased with price actions last week, turning BTC and ETH funding positive (annualized 7d funding: BTC +2.2%; ETH +1.5%).
Alts’ funding rates also rallied up, with ADA flipping to the positive side, from -4.4% to +3.8%.
For liquidation, Bitcoin had some notable short liquidations ($215M worth) during the uptrend, which was 1.15x that of the long liquidations’ number over the last seven days.
Altcoins Roundup
Ethereum skyrocketed after the confirmation of the final Merge schedule, recently rejected near $1.8k which coincidently was the 100dma. ($ETH +9.9%)
Cardano’s Vasil Hard Fork was delayed, originally to be released on June 29. The upgrade aimed to improve the scalability of the Cardano Blockchain. Its developer said that the team delayed the hard fork for extra testing in order to ensure users could later on enjoy a smooth process during the actual
upgrade. ($ADA +5.8%)
ApeCoin rejected at 100dma after Yuga Labs announced the 5% royalty fee for any Meebit’s sale. In the 4 hour chart, ApeCoin showed bearish divergence. ($APE +5.3%)
Other notable price actions: $DOT (+16.9%), $FIL (+56.8%), $AMPL — the rebasing token which usually hovered around $1 rise to $1.8 last week ($AMPL +80.0%)
Crypto Updates
Celsius reported that its customers’ email addresses were stolen by an employee from Customer.io during an OpenSea breach last June.
CoinFLEX which was reportedly enduring hard times in the last months, reduced 50-60% costs by significant staff cuts.
FTX.US launched stocks trading for users, with zero charge trading fees.
Kraken has reportedly been subject to federal investigation for allegedly allowing users in Iran to trade crypto assets.
English Football Association is planning for NFT platform development.
Regulatory Updates
Israel implemented restrictions for limits on cash payments to incentivize the shift to digital payments, enabling its gov’t authorities to track tax evasion, black market activities and money laundering more effectively.
UK prime minister candidates, Rishi Sunak and Liz Truss, made pro-crypto statements. The former suggested the national NFT creation, and stablecoin development to make UK become a global crypto hub, the latter called for an anti-regulatory approach to crypto and hopes to ‘welcome cryptocurrency in a way that doesn’t constrain its potential’.
Japan lowered crypto tax for industry growth, preventing talents outflow and incentivizing the ‘decentalised’ crypto talents.
Taiwan set to ban crypto purchases with credit cards.
Institutional Updates
Tiffany and Co. launched their first ever NFT collation ‘NFTiff’ by making an exclusive offer to CryptoPunk holders. Holders could purchase the NFTiff for 30ETH and also receive the physical pendant.
Meta’s metaverse division lost $2.8B in Q2.
VeeFriends which created a top NFT project with Gary Vaynerchuk, raised $50M seed funding from a16z. The fund will be used for building the intellectual property rights for the 283 unique VeeFriends characters and further expansions.
Aptos Labs, Layer-1 blockchain developer founded by former Meta’s employees, raised $150M from FTX Ventures and Jump Crypto.
Unstoppable Domains, a Web3 servicing firm that provides NFT domain names for crypto wallets, raised $65M Series A funding round, led by Pantera Capital.
Macro Front
The centre of discussion would still be the July CPI released next week, which will give insights about the next move from the Fed. Q2 GDP was reportedly -0.9% last week, 140bps lower than expected, implying a recession. Dollar’s index (DXY) dropped to 105 afterwards. Equities were generally up after Powell denying the recession (DJIA +2.7%; S&P500 +3.9%; NQ +4.2%). Elon Musk filed countersuit against Twitter for the $44B deal. Charles Schwab Crypto ETF (STCE) set to launch on the NYSE on 4 Aug. Commodities were mixed (Gold +3.2%; Oil -2.1%; Wheat +1.0%). Oil showed high volatility ahead of the OPEC meeting and Russia discussions.
Conclusion
The Ethereum Merge led the crypto market to end July green. More and more governments and institutions are opening to crypto adoptions. They are confident that cryptocurrency would enhance the financial system efficiency with proper guidance. Macro uncertainty ahead may bring in volatility. SR may continue the accumulation process for major crypto assets, 50dma level will be closely watched.
Good Luck!
