DoJ Purportedly Contemplates Filing Fraud Charges Against Binance, Egorov Sells More CRV tokens OTC
Market Update
- Equities and bond markets have extended recent losses from increased borrowing by the US. SPX and QQQ -0.07% retraced by 0.3% and 0.2%, respectively, while the US10Y edges close to November highs at 4.2%. Apart from increased issuance in longer-term treasuries, the rise in bond yields have also been spurred by America's credit downgrade and a decline in corporate profits. BTC and ETH have experienced slight gains from yesterday's bearish daily engulfing, up by 0.5% and 0.2%, respectively. CRV, after sliding from from $0.70 to $0.48 on Monday, is currently trading at $0.59. The volatile price action has seen $7m in long and $4m in short liquidations since, and current open interest is $118m on $515m market cap. As funding rates are largely flat from -251% annualized on Monday, any push down would likely arise due to spot selling.
- The United States Department of Justice is purportedly contemplating filing fraud charges against cryptocurrency exchange Binance. According to an August 2 report by Semafor, officials are hesitating due to potential detrimental effects on consumers. The concern arises from the anticipation of a possible run on the exchange, similar to the situation witnessed with FTX in November '22, if an indictment is filed against Binance. To mitigate potential harm to consumers, the department is reportedly exploring options such as fines or non-prosecution agreements instead of criminal charges. The SEC lodged a lawsuit against Binance in June, accusing the platform of offering unregistered securities and operating unlawfully. Similarly, the CFTC took aim at the exchange and its CEO, Changpeng "CZ" Zhao, in March for alleged infractions of trading and derivatives regulations. Following the release of the Semafor report, Binance Coin (BNB) price experienced an immediate drop of approximately 2.5%, settling at $241.2 at time of writing.
- Following Curve liquidation concerns that we reported this week, founder Michael Egorov's has been offloading more Curve tokens (CRV) to manage his significant loan position. Huobi co-founder Jun Du confirmed he purchased 10 million CRV for $4 million to support Egorov's endeavor. Aave, the lending protocol on which Egorov has $55m in loans outstanding, has a governance proposal to acquire $2m in CRV from its DAO treasury and lock for veCRV. To date, Egorov has sold 72 million CRV to various parties, including Tron founder Justin Sun, crypto trader DCFGod, and Mechanism Capital co-founder Andrew Kang. While the coordination by multiple parties to avoid a liquidation crisis will benefit DeFi in the short-term, multiple parties have called out the lack of 'decentralization' in the space as it would have relied on multiple large counterparties for execution.
Daily Technical Strategy
Mark L. Newton, CMT
Head of Technical Strategy
Optimism's rally has successfully avoided much of the consolidation having been seen in most other cryptocurrencies in recent weeks. Gains of nearly 35% since mid-July have lifted OP now to levels just below a very critical area of importance, which lies near $1.80. This area has an intersection of existing downtrends from February 2023 highs along with resistance caused by former lows from March of this year, just five months ago. Overall, volume has been supportive of this rally and proved to be very heavy on gains in early July. Bottom line, given OP's relative strength lately, i suspect a breakout of $1.80 very well could happen this month, and weekly closes above $1.80 would argue for a larger rally up to $2.10 and then $2.38 which likely proves to be important overhead resistance on gains.
Daily Important Metrics
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All metrics as of August 3, 2023 12:37 PM
All Funding rates are in bps
Crypto Prices
| Symbol | Market Cap | Last Price | Daily Change | Year to Date | Relative to BTC YTD |
 BTC | $570B | $29,290 | ↑ 0.41% | ↑ 77% | |
 ETH | $223B | $1,853 | ↑ 1.04% | ↑ 55% | ↓ -22% |
 ADA | $10B | $0.2977 | ↓ -1.23% | ↑ 21% | ↓ -56% |
 SOL | $9.3B | $22.99 | ↓ -0.41% | ↑ 132% | ↑ 55% |
 MATIC | $6.4B | $0.6819 | ↓ -0.16% | ↓ -11% | ↓ -87% |
 DOT | $6.1B | $5.04 | ↓ -0.44% | ↑ 16% | ↓ -61% |
 LINK | $3.9B | $7.26 | ↓ -1.92% | ↑ 31% | ↓ -46% |
 NEAR | $1.3B | $1.38 | ↓ -1.27% | ↑ 8.41% | ↓ -68% |
 DOGE | $0.0000 | $0.0001 | ↓ -4.76% | ↓ -100% | ↓ -177% |
Exchange Traded Products (ETPs)
| Symbol | Premium to Nav | Last Price | Daily Change | Year to Date | Relative to BTC YTD |
| GBTC | ↓ -27% | $19.47 | ↑ 1.62% | ↑ 135% | ↑ 58% |
| BITW | ↓ -50% | $12.56 | ↑ 0.40% | ↑ 134% | ↑ 57% |
| ETHE | ↓ -37% | $11.43 | ↑ 2.37% | ↑ 140% | ↑ 63% |
| BTCC | ↓ -0.02% | $5.38 | ↑ 0.75% | ↑ 78% | ↑ 0.75% |
News
QUICK BITS
Coin Telegraph MIT Digital Currency Initiative introduces at-scale, programmable CBDC platform PARSEC (Parallelized Architecture for Scalably Executing Smart Contracts) runs on the ERC-20 standard, so it could hav... |
DOSE OF DEFI
Coin Telegraph Curve emergency DAO terminates rewards for hack-related pools The Curve emergency DAO removed CRV rewards for alETH, msETH, pETH, crvCRVETH, Arbitrum Tricrypto, and multiBTC pools.... |
The Block Huobi co-founder Jun Du buys 10 million CRV from Michael Egorov Huobi co-founder Jun Du purchased 10 million curve tokens (CRV) for $4 million from Curve founder Michael Egorov. |
THOUGHTS AND OPINIONS
Coin Telegraph KPMG touts ESG benefits from Bitcoin, counters misperceptions in new report The report compares Bitcoin energy usage to that of clothes dryers (equal) and its emissions to those of manure (much ... |
REGULATION
The Block HashKey obtains first license in Hong Kong to offer crypto retail trading HashKey Exchange became the first in Hong Kong to obtain a license under the city’s new regime. |
CoinDesk Binance Could Face U.S. Fraud Charges, but Prosecutors Worry About Risk of Bank Run: Semafor |
NFTS
Decrypt.co Amazon Prime Is Giving Out Free NFTs for This Polygon Game Prime subscribers can now download a free Polygon NFT and in-game currency for Mojo Melee, with more freebies to come. |
CoinDesk Beeple Goes Punk With $208K NFT Purchase The artist behind the most expensive NFT ever sold bought his first-ever PFP, CryptoPunk #4593. |
PRODUCT UPDATES AND PARTNERSHIPS
The Block KuCoin to halt bitcoin and litecoin mining pool services KuCoin Pool, which supports bitcoin and litecoin mining services, is set to halt operations from Aug. 15 until further notice. |
INVESTMENT PRODUCTS
CoinDesk TradFi Giant Direxion Joins Crypto ETF Race by Filing for Combined Bitcoin and Ether Futures Fund The move comes the same week that six other companies filed to launch ether futures ETFs. |
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