LSDs Continue to Shine, GBTC Discount Compresses
Markets are picking up where they left off on Friday, rallying on the back of a weak ISM services report, intimating that investors might be starting to price in impending dovishness from the Fed. This was the first ISM report in 30 months to show an economic contraction within the services sector of the economy and negated market participants’ wariness following the stronger-than-expected jobs report that morning. The NDQ (+2.1%) and ^SPX -2.36% (+1.2%) are considerably up while rates move lower. At the time of writing, the U.S. 10Y is approaching 3.5% while the 2-year steadies just above 4.2%. The USD is trending commensurately lower, with the DXY down 0.8% on the day. Crypto prices are finally showing signs of life as BTC (+2.0%) and ETH (+4.8%) rally in concert with equities. Meanwhile, SOL (+20.0%) continues to show strength off of its bounce from $8 lows, and LDO remains the best-performing cryptoasset in the top 50, up 58% over the previous seven days. Lido may have inspired a slight resurgence in DeFi activity on Ethereum. Below we chart the changes in the 7-day moving average of transactions on Ethereum since the start of the year segregated by transaction type. Despite the overall flat transaction levels, there has been a noticeable increase in DeFi activity that might be emanating from increased interest in liquid staking providers. Lido’s TVL is up 10% on the week.Â
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