China Sets Modest Growth Forecast For 2023; Metis Unveils New Rollup, Combining Both Optimistic and ZK Tech

06 Mar 2023, Monday

3:16 AM

China Sets Modest Growth Forecast For 2023; Metis Unveils New Rollup, Combining Both Optimistic and ZK Tech



S&P Futures 500







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

  • China announced a lower-than-expected GDP target of 5% (more in Macro & TradFi)
  • Metis announces to build the first-ever Hybrid Rollup, Wormhole integrates with Circle's $USDC Cross-chain Transfer Protocol (CCTP) (more in DeFi & CeFi)
  • ETH supply on exchanges hits 5-year low; Bearish sentiments dominates Twitter (more in On-Chain)
  • Term structure normalized back to contango; skew remains slightly bearish after Friday’s sharp drop (more in Crypto Derivatives)
  • BTC and ETH stabilizes with no clear trends in the near term (more in Crypto Technical Analysis)

Macro & TradFi

China’s daily oil consumption hits an all-time high of 16M barrels a day after exiting the COVID-19 lockdown. However, major oil producer OPEC does not budge from its production target set in October 2022 to meet the increase in oil demand. On Sunday, China announced its target for economic growth at 5% which was the low end of market expectations. Commodities from copper to oil fell after China’s announcement. South Korea’s National Pension Service (NPS) looks to revive the currency swap arrangement which expired last year with South Korea’s central bank despite the won depreciating against USD.
US stocks closed higher on Friday with SPX up 1.6%, NASDAQ up 2.0% and DJIA trading 1.2% higher. US Treasury inversion steepens as the yield on long-term bonds fell, the yield on the 10-year bond closes 11bps lower, falling below 4% while the 1-year bill remains at 5.03%. Traders will likely focus on this Friday’s non-farm payroll for more clues on rate hikes path.

DeFi & CeFi

  • Vela Exchange launches Multichain Deposits on its Arbitrum-based perpetual DEX.
  • Metis announces to build the first-ever Hybrid Rollup
  • US SEC Chair Gensler says that crypto exchanges are not necessarily qualified custodians
  • Lido's $LDO token fell after rumors emerged that the SEC serves the leading Ethereum staking service with a Wells Notice
  • Bybit suspends USD payments via bank transfer
  • Uniswap announces the launch of a self-custodial, open-sourced crypto wallet mobile app and creates Bridge Assessment Committee
  • Wormhole integrates with Circle's $USDC Cross-chain Transfer Protocol (CCTP) to provide a seamless cross-chain development experience.
  • Pendle Finance announces its expansion to Arbitrum, a yield management platform
  • Crypto folk anthem sang at ETH Denver goes viral

Metis announces that it is building a Hybrid Rollup using a combination of optimistic rollup architecture and zero-knowledge proofs. This pioneering technology will give developers a user-friendly blockchain while also providing users with the security, finality, and decentralization that zero-knowledge rollups can provide. Metis intends to reduce transaction finality time from 7 days to roughly 4 hours by using zero-knowledge proofs with its optimistic rollup architecture. This will improve throughput and reduce Ethereum congestion, as well as provide users with increased capital efficiency and faster fund withdrawals from L2.

Wormhole, a cross-chain interoperability protocol, has integrated Circle's $USDC Cross-chain Transfer Protocol (CCTP) to create a seamless cross-chain development experience. The integration is live on testnet, and Wormhole is launching a new set of contracts that integrate CCTP to enable developers to create generic messages on top of cross-chain, native $USDC transfers. Last September, Circle announced CCTP to enable users and developers to send and transact in $USDC natively across different blockchains. By integrating CCTP, Wormhole aims to allow developers to use native $USDC transfers to implement cross-chain swaps between native assets on different chains, creating more powerful cross-chain applications. When a user initiates a $USDC transfer from one chain to another, the $USDC on the source chain will be sent to a smart contract and burned, and the same amount of $USDC will be minted natively on the destination chain.


Looking on-chain, ETH continues to see its supply moving off exchanges and into self-custody. Since March 2020, 16% of ETH's total supply has moved from exchanges into self-custody. Ethereum’s supply on exchanges has hit a 5-year low, only 11% of the total ETH supply remains on exchanges (@Santiment).

Bearish sentiments seemed to have taken over social media as the social volume of bearish words such as “sell” and “bearish” hit a 2-year ATH. Looking closer at the specific platforms, it seemed that this spike of negative words came mostly from Twitter. However, funding rates on perps seemed unaffected as they remained positive (@Santiment).

Crypto Derivatives

  • BTC and ETH funding rates have fallen over the past 3 days
  • 30-day ATM IVs dropped to 46.69% and 51.70% for BTC and ETH respectively
  • 30-day 25 delta put skew dropped to -1.39% and -4.63% for BTC and ETH respectively

Top 3 CEX USDT perp funding rate arbitrage based on last 24-hour lookback:

Net Annualized APR

Perp (USDT pair)

Long on

Short On













Source: @CexyArbBot Telegram

1) Pairs observed include BTC, ETH, SOL, BNB, XRP, LTC, DOGE vs USDT perps 

2) CEX observed include Binance, Bybit, OKX & DYDX

@CexyArbBot allows you to customize CEX, 100+ pairs & lookback periods combo

For futures, total liquidations over the past 72 hours has jumped to $313.9M, the majority coming from Friday longs at $218.5M.

On the options front, IVs collapsed across the curve over the weekends as term structure normalized back to contango for both majors despite the sudden plunge in prices on Friday. The price decline did however result in skew and vol surface of front-month options to be slightly bearish (@Blofin_Academy). Currently, only back-end skew in BTC remains in call premium while ETH skew is in favor of puts across all maturities. 7-day RV has also dropped to 43.26 for BTC and to 47.84 for ETH. Carry on BTC has once again flipped to negative at -0.32% while carry fell to 2.27% for ETH.

On the flow side, most of the volume comes from near-dated expiries on 6-March and 10-March with strikes around $22K-$22.5K and $1.6K-$1.7K for BTC and ETH respectively.

Lastly, the VIX fell once more to 18.49.

Crypto Technical Analysis

Onto TA, BTC price was relatively stable during the weekend and have traded mostly sideways. On a 4H timeframe, price has fallen to the $22.4K support level. However, there has yet to be a clear sign of break-out. RSI has also recovered slightly to around 37. If the bearish momentum continues, we could see the next support level at $21.55K before going into the daily support range of $20.8K to $21.1K. On the other hand, if a reversal is observed at the current support level, we could expect a retest of the $23.9K level which was rejected 3 times in the past month.

On the daily level, however, BTC remains to be roughly traded within the prior horizontal channel without hitting any key support zones. This could indicate that BTC has reached a relatively fair value to long term investors. RSI has also been stable at around 43.5.

As for ETH, the narrative is largely the same as BTC. However, a rising channel can be observed at the daily level in which the ETH price is approaching the lower border. No other noteworthy support level was observed in the current trading range. If price breaks below the lower bound, the next support zone could be the $1.49-1.50K range which also serves as an important psychological support level at $1.5K.

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