Welcome back to DV Chain's Weekly Market Commentary! In this edition, we discuss recent events including the impact of the Supreme Court overturning the 1984 Chevron doctrine and the SEC's unexpected legal action against Consensys. We'll also explore the latest ETF developments, including potential delays and new filings, and highlight key trade ideas to keep an eye on. Let's dive in:

Market Recap

• The 1984 Chevron doctrine was overturned
  • in the original decision, the Supreme Court decided that regulatory agencies were the "experts" in their field, and the courts should just defer to their "interpretation" of the law
  • in the context of Crypto, before the decision was overturned, courts would defer to SEC to interpret the law, but now that it’s overturned, the SEC effectively loses authority in regulating crypto as courts will no longer defer to the SEC for interpretation of the law
    
    
• On Thursday, Coinbase sued the SEC and FDIC over FOIA Requests
  
  
• After a series of wins for pro crypto regulation, the SEC surprised the markets by striking back on Friday and suing Consensys over Metamask’s swaps and staking services
  • They allege that Consensys acted as an unregistered broker and sold securities
    • the SEC claims staked ETH offered by Lido and Rocketpool are securities, as well as Matic, Mana, CHZ, Sand, and Luna
    • Markets sold off on this lawsuit headline, especially $LDO
  • This new lawsuit is just 2 weeks after Consensys announced that the SEC is closing its investigation into Ethereum 2.0 and will not pursue an enforcement action against Consensys
    
    
• The SEC’s claim of BNB secondary sales as securities under the Howey Test was dismissed, but the rest of the case continues
  
  
• Van Eck filed a Solana ETF
  • expectations on approval are pretty low
    
    
• ETF issuers were asked to refile S-1s with light amendments, so the ETH ETF is likely delayed by a week
  • previously expected to start trading this week
    
    
• Donald Trump seems to have convincingly won the debate against Joe Biden as suggested by prediction markets and the responses of most people
  • Whether Biden will remain in the race is now in question
    
    
• Stripe adds USDC on Base to its fiat to crypto onramp
  
  
• US and German government held BTC were sent to exchanges last week
  
  
• Mt Gox distributions are expected to begin in early July
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Upcoming Catalysts / Trade Ideas

• $ETH
  • The market still seems to have low expectations of the ETH ETF
  • With Derivatives lightly positioned, perps trading under spot, and much less overhang in ETHE as compared to GBTC, the launch of the ETH ETF has much less supply pressure as compared to the launch of the BTC ETF, and therefore has a lot of potential to surprise to the upside depending on flows
    
    
• $LDO
  • LDO took an outsized selloff from the SEC lawsuit against Consensys alleging Lido and Rocketpool staking pools are securities, potentially a favorable entry point ahead of the ETH etf launch
  • DeFi as a sector is likely to benefit from the ETH ETF
  • LDO fundamentally is a very strong project, clipping almost $200m in fees on an annualized basis to its treasury
  • It has maintained majority of market share in the LST/LRT space, despite higher temporary yields in new competitor’s liquidity bootstrapping farms
  • From an institutional standpoint, it is much stronger than competitors in terms of safety and network effects. The Lido Dao’s roadmap prioritizes institutional adoption, which we think is an astute plan, given the recent interest in crypto and tokenization from Wall Street
  • The ongoing developments in US Policy stance is a potential spark for the revival of DeFi tokens

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