Crypto Market Update

• BTC 0.89% is back in the green today, reclaiming $70k following yesterday’s dip. ETF flows appear to be returning in full force, with another strong day of inflows, capping the largest 5-day period for inflows since mid-March. ETH 0.33% is down slightly on the day, consolidating around $3750 as investors await word from the SEC on ETF approval. ETH CME futures saw outsized volume yesterday as institutional investors showed interest in ETH 0.33% for the first time in a while. SOL -2.66% has climbed back above $180, now trading at $182. Equities are mixed on the day, with investors likely sitting on their hands until NVDA reports after the close today. We should keep a close eye on AI-related tokens after the close. One trade we have recommended that is AI-adjacent is AKT -5.20% , which has performed well leading up to the last four NVDA earnings reports. The DXY N/A% is up slightly despite a hotter-than-expected inflation print in the UK. Yields are also higher, perhaps in anticipation of today’s large bond auction.

• In what could be another significant day for the industry, the Financial Innovation and Technology for the 21st Century Act (FIT21) is set to go to a vote in the House. The White House has issued a statement opposing the bill, citing inadequate investor protections. However, President Biden has notably not threatened a veto, which is a divergence from its approach to the SAB 121 vote last week. The administration has expressed a desire to collaborate with Congress to establish a balanced regulatory framework for digital assets. SEC Chair Gary Gensler also opposes FIT21, arguing that it would undermine the SEC’s regulatory efforts. The bill seeks to redefine the regulatory status of digital assets, designating either the SEC or the CFTC as the primary regulator.

• Illia Polosukhin of the NEAR -3.19% Foundation has announced that NEAR is focusing on becoming the leading platform for User-Owned AI, emphasizing user privacy and decentralization. The Foundation is investing in AI infrastructure projects, including data curation, compute access, and agentic infrastructure, to create a robust ecosystem for AI applications. The NEAR.AI R&D Lab, led by Polosukhin and Alex Skidanov, will develop tools enabling anyone to build Web3 applications without coding. Leveraging NEAR’s substantial user base, developer ecosystem, and financial resources, this initiative aims to offer a decentralized alternative to centralized AI development and drive global innovation and creativity. This could be relevant to NEAR ahead of NVDA earnings, as a closer relevance to AI could increase NEAR’s correlation to NVDA post-earnings.

Technical Strategy

• Livepeer, the decentralized video streaming network, has seen gains of over 15% in its LPT -3.14% token as a strong rebound has been happening to recoup most of the weakness from late March. From an Elliott perspective, this rally is quite bullish and should test and exceed former peaks near $27.30 en route to initial resistance near $30.73 in the weeks ahead. The structure of the rally into March proved to be an impulsive five-wave advance followed by a three-wave pullback which gave back nearly 80% of this rally before finding support in mid-April. Its subsequent rally has proven equally as strong as the initial rally during February into March, and has little resistance until $27.30 near the former peaks from two months ago. While momentum indicators like RSI have just entered overbought territory, this often is a signal for a strong move underway and not seen as a sign for concern at this time. Overall, given the recent uptick in momentum on this rally, it’s right to be bullish, expecting an upcoming test of all-time highs which should give way to a stronger breakout into the month of June. Dips, if/when they occur should find strong support near $21 before pushing back higher.

Daily Important Metrics Crypto Size Bullish signal is tied to the crypto market growing Market cap 2.59T $-39.4B (-1.50%) BTC Dominance 53.27 % (-0.25%) Stablecoins Increase in circulating stablecoins is a Bullish signal In Circulation +$111B (0.00%) In Exchanges +$19B (2.54%) BTC Metrics A decrease in Bitcoin on exchanges is bullish, indicates investors are moving coins to cold storage # BTC Exchanges +$2.3M (1.03%) Funding Rates Positive funding rates indicate traders are Bullish Aggregate +1.1202 (-0.3138) Binance +0.9917 (0.0018) Bitfinex -0.0173 (-0.5178) Bitmex +1.0000 (0.0000) ByBit +1.0000 (0.0000) Deribit +1.4046 (-0.2334) Huobi +1.0000 (1.0000) Kraken +2.4371 (-0.1588) Mean +1.1202 (-0.3138) OKex +1.5263 (-1.6337) Sentiment BMI : 45 (4.44%) Futures A positive spread between Futures Prices and Spot Prices is Bullish CME Price $70,310 (-2.07%) Spot Basis +$119 (0.17%) Volume 668,250 (-27.22%) Open Interest 268,125 (3.12%) Options all exchanges Higher open interest change in a bull market is bullish for the sector Volume 34,374 (-10.05%) Open Interest 267,373 (6.47%) Vol. Put/Call Ratio 0.4736 (-14.70%) OOI Put/Call Ratio 0.4709 (-4.89%) All metrics as of 2024-05-22 16:41:26 All Funding rates are in bps Crypto Prices Symbol Market Cap Last Price Daily Change Year to Date Relative to BTC YTD BTC $1.38T $70,239 0.61% 66.31% ETH $452B $3,766 -0.50% 65.52% -0.48% SOL $82B $182 2.59% 78.57% 7.37% DOGE $173,216 $0.0002 -17.74% -99.81% -99.88% All prices as of 2024-05-22 16:55:33 Exchange Traded Products (ETPs) Symbol Prem. to Nav Last Price Daily Change Year to Date Relative to BTC YTD BITW -0.32 $38 0.40% 60.94% -3.23% ETHE -0.09 $33 1.56% 71.58% 3.17% News Quick Bits CoinDesk London Stock Exchange Set to List Crypto ETPs for First Time WisdomTree's Physical Bitcoin (BTCW) and Physical Ethereum (ETHW) are expected to list on the LSE to professional investors on May 28 The Block Cboe BZX posts amended spot Ethereum ETF filings, marking a step forward in upcoming decision Exchange CboeBZX revamped 19b-4 forms for five spot Ethereum exchange-traded fund proposals late on Tuesday. The Block VanEck’s proposed spot ether ETF added to DTCC website The inclusion in DTCC's list does not mean the ETF has been launched, as it is still pending approval from the SEC. Market Data CoinDesk BlackRock's Spot Bitcoin ETF Records Biggest Inflows Since April as BTC Hovers at $70K Bitcoin spot ETFs in the U.S. have seen net inflows of over $1.4 billion in the past week after a timid first half of the month. Regulation CoinDesk Worldcoin Operations Violate Privacy and Should Cease, Hong Kong Regulator Says Privacy Commissioner for Personal Data personnel visited 10 of the project's locations in December and January. The Block White House opposes FIT21 but says it’s ‘eager to work with Congress’ on balanced framework for digital assets Though the Biden administration opposes FIT21, it's open to working with regulators on created balance digital asset regulatory frameworks.  The Block Nasdaq files updated 19b-4 form for BlackRock’s spot Ethereum ETF Nasdaq Stock Market LLC has filed an updated 19b-4 form for BlackRock's spot Ethereum ETF as other amended filings have begun to flood in. Fundraising and M&A The Block Lightspeed Faction leads $7.7 million Series A round for DePIN weather startup WeatherXM WeatherXM produces weather stations that collects environmental data, rewarding individuals who operate a station with cryptocurrency.  Web 3.0 CoinDesk Layer-2 Network Starknet Gets Ethereum Virtual Machine With Zero-Knowledge Proofs The zkEVM, called Kakarot, already in testing, will be available via the Starknet Stack.