Amber Group Insolvency Rumors Fester; Tether Launches CNHT on Tron; Recession Fears Tanked Stocks

07 Dec 2022, Wednesday

2:54 AM

BTC	ETH	S&P 500 Futures
$17,059.75	$1,268.25	$3,946.75
(+0.09%)	(+0.10%)	(-1.58%)
Note: All percentages shown above are referenced to the previous business work day's 09:00 (GMT+8)

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What We Are Covering Today

Recession bets stack up among fund managers (more in Macro & TradFi)
Amber Group denies talks of it being “insolvent”; Tether launches CNHT on Tron chain (more in DeFi & CeFi)
200,000 BTC has flowed out of exchanges over the past 30 days (more in On-Chain)
VRP widens for BTC and ETH as IV rises (more in Crypto Derivatives)
BTC and ETH show lackluster momentum, as sideways movement continues through the week (more in Crypto Technical Analysis)

Macro & TradFi

TradFi assets took a punch on the chin from louder recession risk warnings from Wall Street, as leading bulge bracket bankers stepped up their prediction of recession and joined the layoff axe. Australia’s fresh Q3 GDP grew slower than expected QoQ (0.6% actual vs 0.7% consensus), leaving Asia markets with similar recession woes. Meanwhile, amid Apple’s planned shift of production out of China, CEO Tim Cook said Apple will ramp up chip procurement from the new Arizona factory owned by Taiwan Semiconductor Manufacturing Company.

US stocks couldn’t snap out of their losing streak; NASDAQ lost 2.07%, S&P 1.53% and DOW 1.09%. The US Treasury curve is shrieking about upcoming recession as 2s10s curve inverted to fresh steepness of more than 80bps; long-end bonds are, however, seeing a gradual comeback of investors as recession bets, which would push yields lower, rack up. Oil crashed more than 3%, with Brent giving up the entire YTD gain achieved after the Russia-Ukraine war.

DeFi & CeFi

Chainlink goes live with Staking v0.1
Tether launches offshore Chinese Yuan on Tron
Optimism to hold rehearsal of its migration from Goerli to Bedrock on 12th Dec
Maker $DAI Direct Deposit Module (D3M) will be deployed on Compound
Amber Group tweets “business as usual” amid insolvency rumors
ConsenSys clarifies that Metamask user data to be stored for only 7 days
Sushiswap CEO proposes to redirect all trading fee revenue to its treasury
Binance NFT marketplace to launch APE NFT staking program on 12th Dec
Perpetual protocol Rage Trade to launch on Arbitrum One on 12th Dec
Sui announces Testnet Wave 2 launch in early 2023

After layoffs back in September, Temasek-backed Amber group has started to lay off hundreds of employees once again. This has sparked insolvency rumors as on-chain sleuths look into the company Ethereum wallets. The company has come out to assure clients and stakeholders that it and WhaleFin, its exchange, remains functional and will pivot accordingly to weather through market cycles.

Meanwhile, Tether announced the launch of its offshore Chinese Yuan stablecoin, CNHT on the Tron network. Users will be able to deposit and withdraw the stablecoin on Tron network through several exchanges including OKEx and Huobi. Tether stated that the stablecoin is fully compliant with Chinese regulations and its reserve will be managed by Capital Union. Tether now offers four different stablecoins: USDT, EURT, MXNT and CNHT.

On-Chain

For on-chain, 200,000 BTC worth roughly $3.4 billion have been moved off exchanges over the past 30 days, which can be seen as a move towards self-custody of coins as pain from the FTX collapse is still fresh in holders' minds.

Elsewhere, the percentage of UTXO volume estimated to have been bought 1 week to 1 month increased sharply for the first time in this bear market. Similar past movements have typically been indicative that a market cycle bottom is near.

Crypto Derivatives

Funding rate remains positive on BTC and ETH
30-day IV rose for both BTC and ETH to 51.24% and 71.82% respectively
30-day 25d put skew tightened for BTC and ETH to -9.46 % and -9.72% respectively

For futures, total liquidations yesterday amounted to $24.35M, with 50.81% of that being long liquidations.

On the options front, IV rose for BTC but fell for ETH as spot rebounded slightly. Term structures are currently in contango with a kink at the 16th Dec expiration as traders bid up the tenor ahead of the FOMC meeting. Meanwhile, the VRP has increased and is still highly positive, with +23.74% on BTC and +25.73% on ETH.

On the flow side, BTC saw more bearish structures such as the bear and bull put spreads for BTC. Flows for ETH were mixed, with short straddles and bull call spreads dominating ETH flows. As noted by Blofin, block traders also share similar sentiments with contract investors and are not optimistic about the price increases, reflecting this through downside trades like bear and bull put spreads.

Lastly, the VIX extended its winning streak and is now trading at 22.16.

Crypto Technical Analysis

Looking at TA, BTC traded sideways in a tight range yesterday between $16.9K-17.1K. On the H4, RSI continues to move lower, suggesting a change in tides. While price can be expected to range sideways in the short run, a possible pullback to $16.8K-16.6K may occur given waning momentum.

ETH on the other hand, has continued to trade sideways since the weekend, now between the $1.2K-1.3K level. RSI on the H4 is trending downwards, but the large range suggests that ETH will continue to move in this range over the short term.

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