Market Update

U.S. equities are declining as investors derisk ahead of tomorrow’s speech from Fed Chair Powell at the Jackson Hole Economic Symposium, expected at 10 AM EST. The SPY -1.13%  has declined to $555, and the QQQ -0.71%  to just below $475. Crypto rallied yesterday afternoon after it was reported that, if elected, Kamala Harris will support policies that ensure technologies like digital assets can continue to grow. BTC 4.80% rallied to $61.8k, and ETH 0.24% gained to $2,660, but both have pared those gains, trading at $60.5k and $2,610, respectively. Avalanche is displaying strength today following two positive headlines, with Grayscale launching an Avalanche Investment Trust and Franklin Templeton expanding access to its MMF fund on Avalanche (more below). AVAX 3.01% has gained over 6%, surpassing the $25 mark.

Franklin Templeton Expands On-Chain MMF to Avalanche

Asset manager Franklin Templeton is expanding access to its On-Chain U.S. Government Money Fund (FOBXX) to the Avalanche Network (AVAX 3.01% ). Avalanche is the fourth blockchain supporting the MMF, joining Arbitrum, Polygon, and Stellar. FOBXX launched in 2021 and was the first U.S. registered mutual fund to leverage a public blockchain to issue tokenized shares. The fund has grown to over $420 million in AUM and invests 99.5% of funds into U.S. government securities, cash, and repurchase agreements, with the objective of offering investors a high level of current income. The tokenized treasury market has rapidly expanded to $1.92 billion as blockchains have unlocked efficiencies for asset managers and increased accessibility for investors. Currently, FOBXX is the second largest tokenized fund, only behind Blackrock’s BUIDL fund, which has approximately $500 million in AUM.

Near Completes Nightshade 2.0 Upgrade

Near Protocol, a layer-1 blockchain network, has completed its “Nightshade 2.0” upgrade on mainnet, introducing stateless validation and scalability improvements to the network. Near operates with a sharding architecture where network data gets broken up into multiple “shards,” with each being validated in parallel. Nightshade 2.0 introduces stateless validation, where validators no longer need to maintain local records of all shards and can instead retrieve all necessary data directly from the network, improving single-shard performance and adding capacity for additional shards. Near currently operates with six shards and hopes to have ten by the end of the year. The upgrade will also reduce costs and hardware requirements for validators, lowering the barrier to entry for new validators to join the Near ecosystem. NEAR 6.53% has gained approximately 1.10% following the news of the successful upgrade.

Technical Strategy

LDO’s push to the highest levels since 8/9 gives some minor evidence of a bottoming out following a difficult stretch in recent months.  Following its recent stabilization at support levels which lined up with 2022 lows, and also marked a 61.8% alternative retracement target, LDO -1.01% began some neutral consolidation over the past couple weeks.   While it would take a rally back over $1.80 to exceed the ongoing downtrend from January peaks, the near-term technicals have improved given its uptick in strength this week.  Rallies up to $1.29 look likely, then a push to $1.52 thereafter.   The act of getting back above $1.52 will be important technically,  as this approximates both May and July 2024 lows.  Thus, if/when LDO can exceed this level, it would give much greater confidence of an intermediate-term bottom.

Daily Important Metrics Crypto Size Bullish signal is tied to the crypto market growing Market cap 2.14T +$36B(1.69%) BTC Dominance 55.85 % (-0.02%) Stablecoins Increase in circulating stablecoins is a Bullish signal In Circulation +$117B (0.11%) In Exchanges +$21B (-0.23%) BTC Metrics A decrease in Bitcoin on exchanges is bullish, indicates investors are moving coins to cold storage # BTC Exchanges +$3.0M (0.01%) Funding Rates Positive funding rates indicate traders are Bullish Aggregate -0.0563(0.4778) Binance +0.9961(1.1407) Bitfinex +0.1765(0.1765) Bitmex +0.0106(0.8018) ByBit -0.1652(0.0425) Deribit +0.2149(0.2253) Huobi -1.4773(-1.4773) Kraken -0.1357(0.6043) Mean -0.0563(0.4778) OKex +0.6321(1.8292) Sentiment BMI : 44 (100.00%) Futures A positive spread between Futures Prices and Spot Prices is Bullish CME Price $60,785(1.83%) Spot Basis $-81(-0.13%) Volume 660,954(-8.84%) Open Interest 292,017(2.00%) Options all exchanges Higher open interest change in a bull market is bullish for the sector Volume 22,442(-16.23%) Open Interest 293,823 (1.77%) Vol. Put/Call Ratio 0.7094 (7.81%) OOI Put/Call Ratio 0.4799 (-0.07%) All metrics as of 2024-08-22 13:55:09 All Funding rates are in bps Crypto Prices Symbol Market Cap Last Price Daily Change Year to Date Relative to BTC YTD BTC $1.19T $60,321 0.63% 42.82% ETH $314B $2,606 -0.72% 14.55% -19.80% SOL $67B $143 0.79% 40.66% -1.51% HNT $1.1B $6.75 -1.68% -82.11% -87.48% DOGE $198,116 $0.0002 0.34% -99.78% -99.84% All prices as of 2024-08-22 13:35:28 Exchange Traded Products (ETPs) Symbol Prem. to Nav Last Price Daily Change Year to Date Relative to BTC YTD BITW -24.74% $33 -1.01% 43.35% 0.37% ETHE 0.63% $22 -1.67% 13.59% -20.47% News Quick Bits Coin Telegraph Harris aide suggests VP will ‘support policies’ for crypto industry growth The Democratic presidential candidate has been largely silent on digital assets since launching her campaign on July 21. An aide to Kamala Harris has reportedly said the Democratic presidential nominee will support policies favoring the digital asset industry if she wins the November election.According to an Aug. 21 Bloomberg report, Harris senior campaign adviser Brian Nelson said the Democratic candidate would “support policies that ensure that emerging technologies and that sort of industry can continue to grow” in response to questions on engaging the crypto community. Nelson added that the industry needed “rules of the road” following the collapse of some firms, hinting at the cryptocurrency exchange FTX.The comments from the Harris aide came during a roundtable event at the Democratic National Convention in Chicago. At the event, the Vice President will officially accept her party’s nomination for president in 2024 after Joe Biden’s departure. Read more Dose of DeFI The Block Franklin Templeton brings its tokenized money market fund to Avalanche Asset manager Franklin Templeton is bringing its OnChain U.S. Government Money Fund to Avalanche, its fourth network launch to date. Fundraising and M&A The Block Web3 oracle provider Stork Network raises $4 million in seed funding The Lightspeed Faction, CMS and Wintermute-backed firm will use the funds to bolster its product offerings — particularly Stork Perps. Product Updates and Partnerships CoinDesk Stablecoin Issuing System M^0 Employs Fireblocks for Crypto Custody M^0 allows stablecoin issuers to incentivize distributors, liquidity providers and so on by programmatically sharing yield among an ecosystem of users. The Block NEAR launches new scalability measure originally proposed by Vitalik Buterin The Nightshade 2.0 update introduces stateless validation, which aims to lessen the burden on individual validators. BTC Manager Aave V3 goes live on ZKSync’s Era mainnet Aave V3 has launched on the ZKSync Era mainnet to unlock liquidity and yield generation for users of the zero-knowledge-powered blockchain ecosystem. Aave Labs said in a blog post that the deployment of Aave (AAVE) V3 on Era will see… The Block Coinbase will enable 1:1 conversions between the euro and MiCA-compliant stablecoin EURC The one-to-one conversions between EUR and EURC, which will be available on Coinbase Advanced, will have no associated fees. Investment Products The Block Grayscale unveils investment trust for Avalanche’s AVAX token Grayscale Investments has expanded its portfolio by launching a new investment trust focused on Avalanche's AVAX token.