🗓💊 Weekly Alpha Leak - Fear, Uncertainty & Doubt
Weekly Synopsis, Insights, Data & Highlights
Weekly Alpha Leak - February 25th-March 3rd, 2023
Today’s newsletter is 1304 words, a brisk 5-minute read.
In the past week, we saw:
- 🏛️ Continuing Regulatory FUD
- 🏦 Silvergate Banking FUD
- 👨💻 Gov ordered Wormhole hacker counter exploit
- 🌋 Mt. Gox upcoming repayments
- 🧑⚖️ Another FTX exec pleads guilty
- 🆕 Plus a heavy week in project updates
The air is filled with uncertainty, but crypto soldiers on.
Are You Concerned With What's Happening to Crypto Banking?
To wrap up the week, we’re looking at:
- 📷 Weekly Synopsis
- 📊 Market Dashboard
- 📈 Important Charts - VC Fundraises
- 🚨 Narratives Update - LSDS, AI, ZK, Chinese
- ✅ Top Crypto Highlights of the Week
- 📝 Good Tweets
📷 Weekly Synopsis
A rather uninteresting week pricewise Bitcoin spent the week grinding around $23k and ETH within $1600 before falling 4-5% on Friday. What caused the change from the bullish start of the year we saw?
Recent fear brought down by regulators, uncertainty around crypto banking services such as Silvergate and a resurgence in doubt surrounding the Fed pivoting on inflation. Many hoped we were over the macro by now but it is very much still prevalent.
- Risk-on assets facing short-term pressure due to macro narrative flipping to entrenched, sticky inflation
- PCE data for January showed an actual rate of 4.7%, higher than expected rate of 4.3%
- U.S. labor market remains hot with spiking wage growth, suggesting inflationary pressures remain
- Further hawkishness from the Fed likely to bring inflation down to 2%
- Higher Fed funds rate and keeping interest rates higher for longer creates downward pressure on risk-on assets as banks limit exposure
- Next FOMC meeting on March 22, with 70% in favor of a 25 bp hike and 30% expecting 50 bp
A few other interesting tidbits from the week to be aware of:
- Ethereum developers pushed back the Shanghai upgrade to early April
- NFT weekly trading volume on Ethereum at its highest level since May
- At least $577M of Blur-linked NFT sales are wash trades
- Liquid staking TVL now second-largest among DeFi protocols
Despite the fear, uncertainty and doubt that is currently weighing on the market, this week was still filled with countless project updates and developments. A slow week but the stage is being set for the next major moves.
📊 Market Dashboard
Crypto Market Cap: $1.028B, down from last week’s $1.09T 📉
Stablecoin Exchange Reserves: $22.702B, down from last week’s $23.159B 📉
Stablecoin Total Market Cap: $134.98B, down from last week’s $135.57B 📉
DeFi TVL: $48.48B, down from last week’s $49.62B 📉
Exchange Volume: $878.42B for the month of February vs $797.23B total in January 📈
Dex Volume: $77.23B for the month of February vs $61.31B total in January 📈
Ethereum NFT Volume: $1.51B for the month of February vs $744.48M total in January 📈
📈 Important Charts - VC Fundraises
The month of February had 143 VC fundraises for a total value of $1.13B. We saw fundraising drop off hard post-FTX and while the number of raises returned to pre-FTX collapse levels, the total value raised is still underwhelming.
We’ll want to be keeping an eye on VCs returning and putting their money where their mouth is to help gauge their risk levels.
Bitcoin Ordinals have been gaining in popularity for weeks with many new conversations occurring around BTC-Fi as a potential upcoming narrative. To check-in, there have been more than 264k inscriptions to date.
🚨 Narratives Update
Coin of the Week: $Blur 🪂 Anatomy of an Airdrop Week 2
We went from Blur airdrop where we speedran
Now we have Prime where we skipped all of that Pump/Dump/???
— Jezza (@0xJezza)
Mar 2, 2023
The Blur playbook was incredibly fascinating to watch. Many airdrops have a typical dump/pump playbook and Blur really speedran the whole experience. Last week it was struggling to hold the $1 level and now it's down to ~ 70 cents.
Moral of the story: Highly hyped airdrops also come highly farmed and with that come high sell pressure, despite how innovative the tech or idea may be.
As we approach the ETH Shanghai upgrade, which has now been pushed back to early April, this was a relatively off week for LSD coins. Big question: will the upgrade end up playing out like a buy the rumor, sell the news event similar to the Merge?
For the most part, AI coins have continued to struggle, with AGIX rallying during the week before being brought down with the rest of the market. AI is still an early sector however we’re seeing moves such as Binance releasing their AI-powered NFT generator Bicasso.
Another down week for ZK coins. Polygon, which was another recent strong performer, fell hard from its local top of $1.56. Note that Polygon’s zkEVM is launching on March 27th and early stage competitor Scroll is moving out of pre-alpha phase.
As the saying goes, what goes up must come down. Chinese coins narrative felt like the most forced out of the recent rotation and have spent the past week in the red.
✅ Top Crypto Highlights of the Week
- New details and allegations against SBF
- Former FTX Director of Engineering Nishad Singh pleaded guilty to six criminal charges
- Jump Crypto and Oasis.app counter exploit Wormhole hacker for $225M
- Mt. Gox early repayments starting March 10, with a deadline to be paid out by September 30
- Coinbase, Circle, Paxos, Gemini, Crypto.com, Bitstamp, MicroStrategy distance from Silvergate
- Signature bank now servicing multiple crypto companies in the wake of Silvergate distress
- Machi Big Brother, dumped 1,010 NFTs for 11,680 ETH or $18.6M
- SEC investigating Robinhood regarding crypto listings and custody of assets
- Digital Currency Group saw a loss of $1.1B in 2022
- Binance $1.8B in client collateral controversy
- Voyager Digital customers voted in favor of Chapter 11 restructuring plan with Binance US
- Visa denies it is looking to slow down crypto strategy
- Puerto Rico extended its 4% tax incentive to crypto assets and blockchain activities
- Starbucks's loyalty web3 program Odyssey seeing early signs of success
- Jane Street wallet may have been linked to UST depeg
- Jack Dorsey-backed Twitter alternative Bluesky hits the App Store as an invite-only app
- Coinbase launches grassroots campaign to influence US lawmakers
- Cash App integrated crypto tax and accounting software TaxBit
- Roobet, a crypto casino, added Snoop Dogg as chief ganjaroo officer
- Developers can integrate ChatGPT and Whisper models into apps and products through API
🆕 Coin/Project Updates
- Second Ethereum Sepolia testnet successfully simulates Shanghai hard fork
- Ethereum developers push back Shanghai upgrade to early april
- Binance NFT marketplace launched “Bicasso,” a new AI-powered NFT generator
- Coinbase delisted BUSD due to liquidity concerns
- Polygon zkEVM mainnet launch on 27 March
- Testnet Goerli ETH spikes as traders jump on opportunity meant for developers
- Solana network outage
- Chiliz launches $50M incubator, Chiliz Labs, backed by Jump Crypto
- The Blockspace Race, Celestia’s incentivized testnet program, starting March 7
- Yuga Labs first Bitcoin NFT Ordinals project TwelveFold
- Winning Yuga Labs Dookey Dash key sold for 1,000 ETH
- STG token address migration March 15
- Move2earn project Sweat Economy to launch its web3 elements in the U.S. in September
- Illuvium launching new game "Beyond" on March 7th
- Chainlink launches dev platform, Functions
- Polygon launches web3 identification service, Polygon ID, using zero-knowledge proofs
- IOST strategic partnership with Amazon Web Services
- Ethereum deployed ERC-4337, account abstraction, via EntryPoint
- Robinhood Wallet available to iOS customers on Polygon and Ethereum
- Coinbase lists Circle's euro stablecoin, EUROC
📝 Good Tweets
Macro and Key data, Expected outlook, Crypto market and predictions
🍿Macro Pulse Update 01.03.2023🍿
Some key macro highlights. We see China leading the prints and pump, while the US and EU are laggards. Japan is taking an uncertain stance.
— arndxt (@arndxt_xo)
Mar 2, 2023
February Data summary from The Block shows mixed sentiment
1/13 February summary 🧵
Overall a mixed month.
Total adjusted on-chain volume decreased by 0.7% to $164B (BTC: -4.3%, ETH +4.2%):
— Lars (@lars0x)
Mar 1, 2023
Comprehensive Guide on where you can find yield opportunities to put your assets to work
One powerful aspect of DeFi is the ability to earn yield on your assets instead of letting them stay idle.
Here is a Comprehensive Guide on where you can find yield opportunities to put your assets to work.
— Minty (@DeFiMinty)
Mar 1, 2023
Future of ETH Liquid Staking
Ethereum liquid staking 101.
I’ve been granted access to institutional grade research.
Here is the ultimate guide to the future of ETH Liquid Staking: 🧵
— hoeem (@crypthoem)
Mar 1, 2023
Next potential narrative BTCFi?
1/Btc-fi. You might have heard of it or you didn’t. Even though it will trigger most of BTC maxis, the market simply doesn’t care. It’s a narrative (like many others) but an interesting one: a BTC layer 2. Today, I’m going to dive into some research I’ve done over the past week.
— Zoomer Oracle (@ZoomerOracle)
Feb 28, 2023