Crypto Research

Markets continue to experience turbulence in the face of growing geopolitical tensions and full-scale war between Russia and Ukraine.We examine recent growth in spreads on major exchanges, highlighting a persistent low-liquidity environment.Option volumes point to the likelihood that many investors are maintaining long positions while hedging risk with derivatives.The market is already questioning the ability of the Fed to raise rates as indicated by a decline in projected rate hikes.We...

GEOPOLITICAL NOISE After briefly eclipsing $45k and $3.2k, both bitcoin and ether tumbled on Friday afternoon following indications from the US government that a Russian invasion of Ukraine was imminent. On Tuesday, these fears were quelled when reports surfaced indicating that troops were being removed from the Ukrainian border and crypto rebounded alongside equities. At the time of writing, the global crypto market is slightly lower on the 7-day chart,...

Markets rebound sharply, with impressive price action across all major crypto sectors.On-chain and derivatives data point toward a combination of low liquidity, seller exhaustion, and short liquidations as the major catalysts for this price run.A disproportionate increase in price compared to realized cap suggests that low liquidity levels are exacerbating price movements.We review several events of the past week and discuss the major implications.BOTTOM LINE: We remain bullish on the...

OUR 2022 DIGITAL ASSETS OUTLOOK PRESENTATION COVERED TOPICS RELEVANT TO THE CURRENT TRENDS AND NARRATIVES THAT WE TYPICALLY MONITOR IN THE WEEKLY REPORTS. BECAUSE OF THIS, WE ARE SENDING OUT THE PRESENTATION FOR THIS WEEK IN PLACE OF THE USUAL WEEKLY FORMAT. [event_shortcode id="339492"] Click HERE for the full copy of this report in PDF format. ON TUESDAY, WE HELD OUR 2022 OUTLOOK CALL. SOME OF THE MAJOR HIGHLIGHTS INCLUDE:A...

On Wednesday, the Fed reiterated intentions to further reduce bond purchases in February and ultimately cease bond-buying in March, with rate increases to follow sometime thereafter.Bitcoin’s correlation with tech stocks during this drawdown is characteristically different from 2018 and suggests that we are not headed for a similar crypto winter.GBTC discount to NAV reaches an ATH as it approaches 30% for the first time, presenting a potential opportunity for the...

Macro continues to dominate the crypto discourse as the 90-day rolling correlation between BTC and the BVP Emerging Cloud Index approaches 1.We discuss our thoughts pertaining to where Bitcoin sits on investors’ risk curves, how it will move to a lower risk bucket in 2022, and why this would be a major tailwind for the asset.SOPR gives us a view into the profile of recent sellers. Meanwhile, long-term holders continue...

On Wednesday, the global crypto market experienced some partial relief as the Labor Department released a December CPI figure that met analyst expectations. Consumer prices increased 7.0% over the prior 12 months, up 0.5% from last month.Funding rates in the perpetual futures market turned negative leading up to the CPI print, reducing the near-term risk of a long squeeze.Open interest continues to climb, as we are now well beyond the...

Risk-on assets, including Bitcoin, drop upon the release of the latest Fed minutes, which signals the potential to reduce the balance sheet in Q1 2022. The 10-year has increased over 12% YTD and seems on its way to 2.0% for the first time since 2019.Contrary to apparent market trepidation, the implied volatilities of Bitcoin options have been trending downwards over the prior month.The leverage ratio has surpassed the levels witnessed...

ALPHA OPPORTUNITY: Despite a broad market shift away from DeFi, we think Sushiswap (SUSHI) presents an intriguing opportunity for investors at its current price. We discuss this further below.We note that leverage in the Bitcoin market is increasing, which may signal near-term volatility.Bullish indicators, including exchange outflows, increasing short-term SOPR, and a decreasing put/call ratio point toward a bullish breakout upon any liquidation event.BOTTOM LINE: As Bitcoin’s leverage increases, investors...

The Fed announced an expedited tapering of monetary stimulus and anticipates three rate increases in 2022. We discuss the implications.Based on recent price action, BTC still behaves more like a high-beta tech stock than an asset designed to offset the effects of inflation.This week, SOPR broke through to profitable territory. Short-term SOPR is lagging, which signifies that the market may need to shake out a few more "paper hands" before...

We see Bitcoin’s recent price action coupled with a lack of substantially leveraged positions as an encouraging sign.Hash rate has surged since Friday’s washout, pointing toward a network of miners that feel optimistic about the near-term trajectory of the BTC price.SOPR indicates that the majority of selling pressure is coming from short-term investors who lack conviction in Bitcoin’s current price trend.MVRV has decreased, implying a higher network cost basis, which...