BTC and ETH Futures ETFs To List On Hong Kong Stock Exchange For The First Time; Amber Group Acquires Crypto Exchange Sparrow

16 Dec 2022, Friday

3:23 AM

BTC	ETH	S&P Futures 500
$17,421.75	$1,273.25	$3,896.75
(-2.07%)	(-2.41%)	(-2.81%)
Note: All percentages shown above are referenced to the previous business work day's 09:00 (GMT+8)

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Our Daily View

What We Are Covering Today

Central bank hawks, dimmed economic outlook & weak Chinese growth weigh on markets (more in Macro & TradFi)
Hong Kong BTC, ETH Futures ETFs raise $79M, begin trading later today (more in DeFi & CeFi)
Movement of dormant BTC rises; USDT deposits on exchanges spikes (more in On-Chain)
On-chain data show weak end of year sentiment (more in Crypto Derivatives)
BTC and ETH reject key resistance levels, swinging lower post-FOMC (more in Crypto Technical Analysis)

Macro & TradFi

Hawkish central bank sent global markets gyrating lower, while a large downside surprise on Chinese data (Nov industrial production YoY 2.2% actual vs 3.6% forecast, among others) also triggered traders rushing to take profit from the massive rebound in the past month. ECB delivered 50bps hike, in line with market expectations, but EUR still tumbled amid broader greenback strength. On the US-China trade war front, the US Department of Commerce added a dozen more Chinese tech companies to the technology export blacklist; however, the US Public Company Accounting Oversight Board had said it was able to review sufficient accounting documents of several US/HK dual-listed Chinese companies, reducing the chance to having them delisted. These events reflect the US strategy of containing China’s new “hard technology” endeavours but letting the consumer tech oligarchs keep on.

US stocks slumped: NASDAQ -3%, SPX -2.8% and DOW -2.5%. Bonds outperformed as Fed dimmed its 2023’s US economic outlook, boosting the recession trade’s case; US 10y Treasury yields traded as much as 6bps tighter before giving up some gains. DXY rallied almost 1% against other currencies. Both oil benchmarks slumped around 1.5%.

DeFi & CeFi

First Hong Kong BTC, ETH Futures ETFs to begin trading on Friday
Trump announces his own trading card NFT
Amber Group acquires Singapore crypto exchange Sparrow
Nexo has withdrawn $227 million worth of wBTC from MakerDAO
Trust Wallet integrates with THORChain to enable cross-chain swaps
Curve to integrate with zkSync 2.0 Mainnet
Microsoft bans cryptocurrency mining on its cloud service

Temasak-backed Amber Group has acquired Singapore crypto exchange Sparrow, after it had 10% of their trading capital stuck on FTX during its collapse. Amber has also laid off more than 40% of its workforce with more rounds of layoffs to come in December. This acquisition came as a surprise as there were plans to halt its expansion after the collapse of FTX.

The first BTC and ETH Futures ETFs in Hong Kong are set to be listed on the Hong Kong Stock Exchange this Friday by CSOP Asset Management. Despite the current unfavourable market conditions, these ETFs have received more than $79 million in investments. According to CSOP, the BTC and ETH Futures ETFs are designed to track CME’s BTC and ETH Futures.

On-Chain

In a sudden turn, BTC amount of supply last active 5-7 years ago has reached a 5-year high.

On the other hand, USDT deposits to exchanges have spiked and continue to rise after they hit a 4-year high yesterday.

Crypto Derivatives

BTC and ETH funding rate remain positive
BTC and ETH 7-day ATM IV rose from 35 to 40 and 50 to 53 respectively

Total liquidations amounted to $49M with 89% belonging to long positions

BTC term structure eased over the day with IV of end of Dec expiries falling. Put skew rose back to 7.5%. For ETH, term structure remains the same but far-dated expiries have risen compared to a week ago. Put skew remains between 6-9%.

On the flows side, the most popular traded instrument in the past 24 hours continues to be calls in Mar, now higher than the previous day, at 40K 31 Mar 2023. The choice of strategy looks to be a short strangle for BTC options. The sentiment looks different for ETH as 23 Dec 1,300 calls took centre stage, with the anticipation of an end-of-year rally. However, on further analysis, strategies that have been the most popular seem to be bear call spreads and these calls seem more for hedging positions rather than bullish sentiment.

Crypto Technical Analysis

Coming to TA, BTC sharply fell 2.48% lower to $17.4K. BTC reached an intraday low of $17.3K, falling below its 50-d MA level. It is back in the resistance zone of $17K-$17.5K, in line with broader stock markets. On the daily, RSI dipped back to neutral at 52 after breaking the neutral level yesterday.

ETH fell 3.13% to $1.27K, after reaching an intraday low of $1.26K. ETH fell below the resistance zone of $1.3K-$1.34K and may find support at $12.4K. Currently, ETH shows more weakness than BTC and may further continue its downside in the Asia session.

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Treehouse Research 🌳

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