Lido Inflows Top 150k ETH, Technicals Suggest ETH/BTC Strength
Market Update
- Equities are rising this Monday afternoon following their worst week of the year. The SPX and NDQ are trading 0.4% and 0.7% higher, respectively. Interestingly, the US 2Y yield pushed higher in the early morning hours to reach its highest level in over 15 years but has since retreated to below 4.8%. The crypto market rallied following the local peak in rates this morning but has since retraced some of those gains. The majors remain higher compared to 24 hours prior, with ETH (+2.0%) showing relative strength compared to BTC (+0.7%) for the first time in a while. Among the top large-cap performers are LDO (+5.5%), which appears to be benefitting from a significant increase in TVL over the weekend (more on that below), and STX (+20.8%), the native token for Stacks. Stacks is the bitcoin sidechain has garnered considerable attention lately due to an impending upgrade that should lower its current glacial block time and perhaps attract developers/users to bitcoin-native DeFi.
Source: Fundstrat. Glassnode
- In addition to the Shanghai-related tailwinds that have persisted from the start of the year, Lido may be outperforming due in large part to a massive inflow over the weekend into the Lido staking protocol from none other than Tron founder Justin Sun. Over 150k ETH was staked to Lido on Saturday, bringing Lido's total TVL to nearly $9.5 billion and forcing Lido to activate the Staking Rate Limit, which essentially throttles the speed at which a user can mint stETH in order to mitigate any potential negative consequences of rapid minting such as rewards dilution. In total, the day saw over 200k ETH staked to the beacon chain, bringing the total percentage of circulating ETH supply staked to just over 14%. Currently, the Shanghai upgrade, which will allow for the unstaking of ETH, is scheduled to occur towards the end of Q1 or the beginning of Q2.
- After nearly four months without incident, Solana experienced a major outage on Friday night into Saturday morning, lasting over 18 hours. Node operators and developers are still investigating the root cause of the performance degradation, but it did occur around the same time that an update to the Solana code was pushed to validators. A bug in the update likely caused the network to cease processing transactions. The network attempted to restart the first time, but that effort was paused when validators realized they had chosen the wrong point to resume. Had they continued, valid transactions would likely have reverted, a problem much more severe than the downtime experienced. As we have repeatedly discussed, Solana is a network that will likely continue to carry the risk of downtime due to its relative lack of ossification and anticipated upgrades. This dynamic implies an added risk for those storing sizeable funds on the network. That said, we maintain a bullish outlook on its native asset, hence its incorporation into our Core Strategy. At the time of the writing, the network is fully operational and processing transactions normally.
Daily Technical Strategy
Mark L. Newton, CMT
Head of Technical Strategy
Ethereum has started to show some recent evidence of outperformance vs Bitcoin after breaking out of the minor downtrend from mid-January. This ETHBTC chart shows the choppiness in recent months, but generally Ethereum has underperformed over the last six weeks. This looks to be changing, and this early week strength is positive towards expecting better relative strength in the weeks ahead along with anticipating an ETHBTC rally back to challenge the upper trendline marking this entire consolidation from last year. The ability to exceed 0.076 argues for a much larger rally out of ETHBTC which should challenge and exceed last September's highs. Overall, the rebound in recent days looks appealing technically towards expecting better strength in the weeks to come.
Daily Important Metrics
All metrics as of February 27, 2023 11:47 AM
All Funding rates are on bps
Crypto Prices
Symbol | Market Cap | Last Price | Daily Change | Year to Date | Relative to BTC YTD |
BTC | $452B | $23,398 | ↑ 0.84% | ↑ 41% | |
ETH | $200B | $1,638 | ↑ 2.15% | ↑ 37% | ↓ -4.58% |
ADA | $13B | $0.3634 | ↑ 0.29% | ↑ 47% | ↑ 6.00% |
MATIC | $11B | $1.25 | ↓ -1.51% | ↑ 64% | ↑ 23% |
DOGE | $11B | $0.0812 | ↓ -0.24% | ↑ 16% | ↓ -26% |
SOL | $8.6B | $22.82 | ↓ -0.17% | ↑ 131% | ↑ 89% |
DOT | $7.7B | $6.64 | ↑ 0.71% | ↑ 53% | ↑ 12% |
LINK | $3.7B | $7.30 | ↓ -0.82% | ↑ 31% | ↓ -9.82% |
NEAR | $2.0B | $2.36 | ↑ 1.43% | ↑ 86% | ↑ 44% |
Exchange Traded Products (ETPs)
Symbol | Premium to Nav | Last Price | Daily Change | Year to Date | Relative to BTC YTD |
GBTC | ↓ -46% | $11.59 | ↑ 1.13% | ↑ 40% | ↓ -1.43% |
BITW | ↓ -59% | $8.85 | ↑ 0.80% | ↑ 65% | ↑ 24% |
ETHE | ↓ -54% | $7.31 | ↑ 1.35% | ↑ 54% | ↑ 12% |
BTCC | ↓ -0.13% | $4.32 | ↑ 1.05% | ↑ 43% | ↑ 1.34% |
News
QUICK BITS
CoinDesk Allure of Bitcoin Ordinals, DeFi Drives Crypto Funds to Bitcoin Layer 2-Token Stacks The price of Stacks’ native STX token has doubled in two weeks on the back of strong growth for Bitcoin-based non-fungible tokens. |
The Block Coinbase to halt trading of Binance USD for not meeting listing standards The crypto exchange said the decision was based on its most recent review of the stablecoin. The post Coinbase to halt trading of Bi... |
The Block Solana network back online following second restart The Solana blockchain is back online after two attempts to restart the network, according to network monitoring site Solana Status. ... |
The Block Mining difficulty up 9.95% with more machines coming online amid recent rally Mining difficulty jumped 9.95% on Friday, as the network hashrate rose over 300 EH/s. The post Mining difficulty up 9.95% with more ... |
MARKET DATA
CoinDesk STX Perpetual Futures Open Interest Doubles to $80M as Traders Take Shorts I suspect traders are betting that there isn't a follow-up to Bitcoin NFTs and this is more of a flash in the pan, one analyst said. |
CoinDesk Short-Bitcoin Funds Record $10M in Weekly Inflows: CoinShares A "short" position in financial markets is a bet on a price decline. |
DOSE OF DEFI
CoinDesk DeFi Giant MakerDAO Rejects $100M Loan to Cogent Bank The rejection follows less than a year after Maker approved a similarly structured loan to Huntingdon Valley Bank. |
Coin Telegraph Jump Crypto & Oasis.app counter exploits Wormhole hacker for $225M The counter exploit came after the High Court of England and Wales ordered Oasis.app to work with Jump Crypto to retri... |
Coin Telegraph Lido Finance activates staking rate limit after more than 150,000 ETH staked Lido Finance had to activate its safety feature — staking rate limit — after over 150,000 ETH was staked in a single d... |
CRYPTO INFRASTRUCTURE
Bitcoin.com Citizens Trust Bank to Hold $65 Million in USDC Reserves as Circle Expands Bank Partnerships On Friday, the cryptocurrency firm and stablecoin issuer Circle announced that the financial institution Citizens Trust Bank will hold $65 million in usd coin c... |
REGULATION
CoinDesk SEC’s Coinbase Insider Trading Case Is ‘Backdoor Rulemaking,’ Trade Association’s CEO Says The government agency not only “piggybacked” off of the DOJ’s case, but is using it as a way to define some tokens as securities, Perianne Boring, the Chamber o... |
NFTS
Decrypt.co NFT Royalties Are 'Not Going Away on SuperRare': Co-Founder Jon Perkins The NFT space is a much bigger picture than just the recent Blur versus OpenSea controversy, according to SuperRare founder Jonathan Perkins. |
HACKS, EXPLOITS, AND SCAMS
CoinDesk Binance Moved $1.8B in Stablecoin Collateral to Hedge Funds Last Year: Forbes This meant that over $1 billion worth of tokens called B-peg USDC – digital replicas of dollar-pegged stablecoin USDC – were uncollateralized despite Binance's ... |
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