Market Recap
- Trump spoke at the Bitcoin Nashville Conference on Saturday, making bold promises for the industry if elected:
- The U.S. will aim to become the global crypto capital
- The U.S. government will retain 100% of Bitcoin acquired from seized assets, making a strategic reserve
- Gary Gensler will be removed from office
- Energy costs will be reduced to support domestic mining
- The right to self-custody of cryptocurrencies will be upheld
- There will be no CBDC, as it’s against the ethos of crypto
- Operation Chokepoint 2.0 will be terminated
- Ross Ulbricht’s sentence will be commuted
- The ETH ETF launched this week
- The pace of ETHE outflows was very high. $1.5B was redeemed in just 4 trading days, about twice the pace of GBTC outflows at the launch of the BTC ETF, stifling the price of ETH despite strong inflows to offset it
- Inflows of the new ETFs amounted to $1.2B, and -340mm in net flows on the week
- While the launch had disappointing price action for ETH, the silver lining is that the interest in the spot ETH ETFs are high, and that the pace of ETHE redemptions will slow down
- While the launch had disappointing price action for ETH, the silver lining is that the interest in the spot ETH ETFs are high, and that the pace of ETHE redemptions will slow down
- Mt. Gox coins distributed last Tuesday
- BTC had a really strong bid all week, despite Mt. Gox distributions
- Seems due to the rumors of Trump announcing a Strategic Reserve for Bitcoin
- Seems due to the rumors of Trump announcing a Strategic Reserve for Bitcoin
- BTC had a really strong bid all week, despite Mt. Gox distributions
- Last Wednesday, the NQ index had its worst day since October 2022
- Russian parliament passes bill that allows for cryptocurrency to be used for international trade
- Pudgy Penguins announced a fundraising round for an L2 led by Founder’s Fund
- Toyota is looking into the potential of incorporating Ethereum blockchain technology into its vehicles
- Kamala Harris’ campaign claims to make amends with the Crypto Industry, in response to Trump’s campaigning
- AAVE looks to activate fee switch, proposal to buyback tokens from open market, trading up 16%
- JTO released code for restaking
- Fed Interest Rate decision this Wednesday, no change expected
- Earnings this week from Microsoft, Meta, Apple, Amazon, Microstrategy, and Coinbase
Upcoming Catalysts / Trade Ideas
- Wormhole $170mm unlock this week or 33% of market cap
- Total open interest is at 30m so look for $W to trade heavy relative to the market
- The sell pressure probably extends to competitors such as $ZRO as well
- $ETH
- Bitcoin’s attention may have peaked with the Trump speech, and attention may shift towards ETH, as the ETF just launched and it’s far less allocated to compared to BTC
- ETHE redemptions can only slowdown from here, as almost 20% of the aum has exited
- ETH Spot ETF interest was strong on week 1, with 1.2B in inflows to the new ETFS on a week of bad macro data and Mt Gox distributions
- Regulatory outlook has become very favorable with recent election developments
- $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
- Hester Pierce made comments that indicate the potential to walk back this lawsuit
- Recent developments on the regulatory side are looking very bright, with Trump adding crypto support officially to his campaign coupled with his odds of winning surging
- SEC allegations also seem to lose effect and mean revert over time, $SOL being the best example of this
- DeFi as a sector is likely to benefit from the ETH ETF as well as the new political climate
- 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
- 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
- Polymarket is rumored to TGE sometime soon, so it’s probably worth using the platform for an airdrop
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