Crypto Market Update

Equities are gaining alongside rates today as Fed Chair Powell provides testimony to Congress. He reiterated that recent progress on inflation has been welcomed, but more is needed before reducing the restrictiveness of monetary policy. He also acknowledged that risks are beginning to become two-sided, citing recent cooling in the labor market. The SPY 0.09%  and QQQ have both gained approximately 0.21% as they hover near all-time highs. Crypto assets are building on yesterday’s gains, with BTC trading at $57.3k, supported by close to $300 million in ETF inflows yesterday. ETH is showing slight outperformance, rising to $3,060 following multiple ETF issuers submitting revised S-1 statements yesterday afternoon, which should likely be the final round of revisions before approvals, with trading potentially starting next week.

Hut 8 Agreement for 205-Megawatt Texas Site

Bitcoin miner Hut 8 has reached a power purchase agreement for 205 megawatts at a site in West Texas. Hut 8 previously announced a development pipeline of 1,100 megawatts of exclusive energy capacity, with this being the first disclosed project. The site is next to a wind farm and connected to the ERCOT grid, giving Hut 8 some of the cheapest wholesale energy in North America. The site’s engineering, procurement, and construction efforts are ongoing, and once the purchase is finalized, Hut 8 should have close to 1.3 gigawatts of capacity across owned and managed services. The new power should help Hut 8 execute high-performance computing (HPC) use cases along with Bitcoin mining operations. Miners continue to explore use cases beyond pure Bitcoin mining as a way to diversify revenue streams and reduce the effects of Bitcoin cyclicality. Miners have been reducing bitcoin positions to account for the April halving, but going forward, HPC revenues may provide a solution to improve operational efficiency. HUT has gained approximately 84% since the start of June as investors are optimistic about revenue diversification and potential.

Worldcoin Foundation Unveils World Chain

The Worldcoin Foundation, the development company behind Worldcoin (WLD), has released a developer preview of its new layer-2 network, World Chain. The preview allows developers to start exploring, building, and testing applications on World Chain ahead of its mainnet launch later this summer.  World Chain will leverage the OP Stack and join the “superchain” of Optimism L2s. Worldcoin user transactions have grown to over 50% of OP Mainnet’s total activity since July 2023, and the introduction of World Chain will solve scalability issues when activity surges. World Chain will supposedly be able to process approximately twice as many transactions as OP Mainnet before the fee market is impacted. Developers can now begin setting up their deployments before migrating over 10 million World App users to World Chain.

Technical Strategy

Similar to ETH comments yesterday, Chainlink also has pulled back to a “Make-or-Break” area of technical support which has marked lows along a neckline established last November, 2023. This managed to bottom near an exact 50% absolute retracement of its March peaks and makes LINK a more appealing risk/reward given its well defined risk levels at $11.   Movement back over $14 would help this surpass a minor downtrend from late May, arguing for a likely bounce up to initial resistance near $17.  This approximates a 50% retracement of LINK’s high to low range since March as well as intersecting a downtrend from March peaks.  Over $17 would add some conviction to the idea of a larger rally getting underway.  Conversely, patience is required under $11 which would postpone its advance, allowing for movement down to $8.50-$9. Overall, the next few weeks should decide which scenario should be correct, but LINK looks more appealing at these levels given stabilization near important support.

Daily Important Metrics Crypto Size Bullish signal is tied to the crypto market growing Market cap 2.12T +$9.2B (0.44%) BTC Dominance 53.51 % (0.08%) Stablecoins Increase in circulating stablecoins is a Bullish signal In Circulation +$112B (0.00%) In Exchanges +$20B (-0.17%) BTC Metrics A decrease in Bitcoin on exchanges is bullish, indicates investors are moving coins to cold storage # BTC Exchanges +$3.0M (0.37%) Funding Rates Positive funding rates indicate traders are Bullish Aggregate +0.7374 (0.3232) Binance +0.9989 (0.0000) Bitfinex +0.3707 (0.0895) Bitmex +0.9900 (0.3065) ByBit +0.9095 (0.8694) Deribit +0.1080 (0.1081) Huobi +0.9413 (0.9413) Kraken +0.5849 (0.5902) Mean +0.7374 (0.3232) OKex -0.3255 (-0.6625) Sentiment BMI : 28 (100.00%) Futures A positive spread between Futures Prices and Spot Prices is Bullish CME Price $57,620 (0.07%) Spot Basis +$212 (0.37%) Volume 1.1M (123.54%) Open Interest 279,576 (-3.38%) Options all exchanges Higher open interest change in a bull market is bullish for the sector Volume 35,591 (243.04%) Open Interest 225,620 (5.44%) Vol. Put/Call Ratio 0.6475 (-27.10%) OOI Put/Call Ratio 0.5048 (-2.43%) All metrics as of 2024-07-09 12:00:23 All Funding rates are in bps Crypto Prices Symbol Market Cap Last Price Daily Change Year to Date Relative to BTC YTD BTC $1.13T $57,283 2.31% 35.63% ETH $367B $3,056 2.69% 34.30% -0.98% SOL $65B $140 1.94% 37.49% 1.37% DOGE $435,401 $0.0004 -8.79% -99.51% -99.64% All prices as of 2024-07-09 11:50:11 Exchange Traded Products (ETPs) Symbol Prem. to Nav Last Price Daily Change Year to Date Relative to BTC YTD BITW -32.38% $34 3.20% 47.94% 9.08% ETHE -1.92% $29 2.61% 47.76% 8.94% News Quick Bits CoinDesk BlackRock's BUIDL Fund Tops $500M as Tokenized Treasury Market Soars The overall market of tokenized U.S. Treasury products has reached $1.8 billion, up from $780 million in January, rwa.xyz data shows. CoinDesk VanEck, 21Shares Solana ETF Plan Confirmed in Cboe Filing The Chicago Board Options Exchange (Cboe) has officially asked the SEC to let asset managers VanEck and 21Shares bring a Solana-based exchange-traded fund (ETF) to the market. The Block Bitfarms appoints new CEO amid rift with rival Riot Bitfarms has appointed Ben Gagnon as its CEO, effective immediately, amid its ongoing tussle with rival Riot. CoinDesk Digital Asset Trader Auros to Invest Over $50M in Crypto Startups Through Its Newly Established VC Arm To lead the investment efforts, the company appointed Julien Auchecorne as head of Auros Ventures. The Block German government sends $177.5 million in bitcoin, receives $96.9 million The German government received more than 1,690 bitcoins from Bitstamp this morning, though it sent more than that to other entities. Market Data CoinDesk First Mover Americas: Bitcoin Regains $57K Following $300M of ETF Inflows The latest price moves in bitcoin (BTC) and crypto markets in context for July 9, 2024. First Mover is CoinDesk’s daily newsletter that contextualizes the latest actions in the crypto markets. Fundraising and M&A CoinDesk Blockchain Startup Rome Raises $9M to Serve Ethereum Layer-2s Through Solana Shared sequencers and data availability (DA) are services that Rome could provide, as blockchain builders increasingly rely on "modular" networks to handle Ethereum's myriad components and functions. Mining The Block Bitcoin miner Hut 8 enters into agreement for 205-megawatt Texas site The deal is the first transaction in Hut 8’s development pipeline of 1,100 megawatts of exclusive energy capacity. Product Updates and Partnerships The Block Zodia Custody announces partnership with crypto lending firm Maple Finance Zodia Custody has announced a partnership with Maple Finance, providing custodian solutions for Maple Finance's global lending arrangements.