Injective and Eclipse Collaborate to Bring Solana's High-Throughput Capabilities to Cosmos; Trump Faces Historic Criminal Charges

31 Mar 2023, Friday

3:23 AM

Injective and Eclipse Collaborate to Bring Solana's High-Throughput Capabilities to Cosmos; Trump Faces Historic Criminal Charges

BTC

ETH

S&P Futures 500

$28,264.00

$1,807.50

$4,092.25

(-0.36%)

 (+1.07%)

(+0.91%)

Note: All percentages shown above are referenced to the previous business work day's 09:00 (GMT+8)

GM Treehouser 🌳

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Our Daily View

What We Are Covering Today

  • Donald Trump becomes the first US president in history to be officially indicted by criminal charges (more in Macro & TradFi)
  • Injective and Eclipse launch first interchain Solana SVM rollup; Ledger close to hitting its $109M funding round (more in DeFi & CeFi)
  • Volume on Binance BTC/USDT plummets after discontinuation of zero fees (more in On-Chain)
  • Bulls look to profit from end-of-month options; bullish play of 3K contracts of BTC 50K/65K call spread expiring next March (more in Crypto Derivatives)
  • Golden cross observed for both BTC and ETH at the 1H timeframe (more in Crypto Technical Analysis)

Macro & TradFi

Former US President Donald Trump has been indicted on charges of hush-money payments to a porn star on the eve of the 2016 election, marking the first time in American history that a former president has faced criminal charges. The indictment was sought by the office of Manhattan District Attorney Alvin Bragg. While the case is far from a sure bet if it goes to trial, a conviction would almost certainly require a jury to credit the testimony of former Trump attorney Michael Cohen, who has faced his own legal troubles and pleaded guilty to an array of federal felonies in 2018. Nevertheless, Trump's lawyers have stated that he did not commit any crime and that they will vigorously fight this political prosecution in court.

According to the Investment Company Institute, investors added $66 billion to money-market funds this week, driving total assets to a record $5.2 trillion. The bulk of the weekly inflows, $71 billion, went into government funds. However, overall asset holdings were offset by $5.4 billion of weekly outflows to prime money-market funds. The increased investment in government funds can be attributed to the six-month Treasury rate being close to 4.88%, up from above 1% a year ago after rising concerns over the stability of the US banking system.

Lastly, major equity indices closed higher yesterday, with the SPX, DJIA, and NASDAQ up by 0.57%, 0.43%, and 0.73%, respectively. Treasury yields dropped slightly, with the 2-year and 10-year Treasury yields currently sitting at 4.114% and 3.560%, respectively.

DeFi & CeFi

  • Layer 1 network Injective partners with rollup provider Eclipse to launch Cascade, an interchain Solana SVM rollup for IBC ecosystem
  • Polytrade raises $3.8M in seed round led by Polygon Ventures and Coinswitch Ventures
  • Hong Kong-based ProDigital Future Fund plans to raise $100M for new digital asset fund
  • Hardware wallet maker Ledger raises most of its $109M target at $1.4B valuation in its Series C extension round
  • Ssv.network introduces Jato, the latest public testnet before its mainnet launch
  • Payment solutions provider Alchemy Pay announces its on-ramp solution is live on OKX
  • NFT derivative DEX NFEX lists Nakamigos, Otherdeed for Otherside and CryptoPunks perpetual contracts with up to 50x leverage
  • Deri protocol launches Gamma Swap to trade on Gamma and price fluctuations
  • Gemini plans to launch an international derivatives exchange
  • Magic Eden to launch Ethereum NFT marketplace beta on 6 April

A partnership between Injective and Eclipse aims to bring the Solana Sealevel Virtual Machine (SVM) into the Cosmos ecosystem and enable Solana developers to deploy their contracts and dApps onto Injective. The Solana SVM is capable of parallel processing, which allows for a high throughput of transactions. The Cascade launch will occur in several phases, with the first being the testnet beta involving an SVM sequencer operated by the Eclipse team. This sequencer will receive transactions from Solana wallets and smart contract deployments from the Solana command-line interface (CLI). The blocks produced by the sequencer will be posted to a data availability layer, and the plan is to integrate Celestia as the data availability provider in the future.

Elsewhere, ssv.network introduces Jato, the latest iteration of their public testnet, before launching on mainnet. Ssv.network aims to decentralize Ethereum's proof-of-stake consensus through Distributed Validator Technology (DVT). Jato offers several improvements, including gas cost optimization, improved validator account management, and an increase in the number of nodes that run a validator. It also introduces private networks for tailored user bases, more customization, and more control over staking operations. Lido, a decentralized Ethereum 2.0 staking solution, is set to join hands with the Jato version 3 Testnest during the SSV Network version 2 pilot program. This update was disclosed under the Lido Finance Node Operator Community Call #5 by Lido's Chinese ambassador on Twitter with the pseudonymous ‘satBalwyn.’

Lastly, Ledger has raised €100 million ($109 million) in a funding round, with a valuation of €1.3 billion ($1.41 billion), and will use the funds to expand its network of distributors, boost production, and develop its products. The company says it stores over 20% of the world's cryptocurrencies and 30% of the world's non-fungible tokens. It has also partnered with luxury brands, launched a platform for artists and brands to release their NFTs, and unveiled a new version of its hardware wallet designed by Tony Fadell, the builder of the iPod and co-founder of Nest.

On-Chain

Traders are cautiously borrowing $WBTC now that shorters got wiped out in the mid-March dip. Since mid-March, there has been a slow increase in the amount of $WBTC being borrowed as the price of $BTC continues to climb (@santimentfeed).

A week after Binance discontinued zero fees for BTC/USDT trading, there has been a steep drop in volume. This suggests that traders/bots were a major driver for liquidity on the platform (@DylanLeClair_).

Crypto Derivatives

  • BTC funding rate goes negative while ETH funding rate remains positive
  • 30-day ATM IVs decreased to 59.15% and 61.30% for BTC and ETH respectively
  • 30-day 25 delta call skew for BTC and ETH decreased to 3.49% and 1.75% 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

17.24%

SOL

OKX

BYBIT

10.28%

XRP

OKX

BYBIT

8.85%

BTC

OKX

BYBIT

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

The futures market saw total liquidations of $123.44M in the past 24 hours, with longs accounting for the majority at $73.74M.

In the options market, the BTC term structure reverted back to contango as near-term IV fell while long-term IV rose. There is a slight kink in the near-term, presumably due to the IV being bid up before the end of the month contract. Meanwhile, the ETH term structure remained flat. The longer-term BTC skews (30-180 days) remained in call premium for the entire week, despite the macro banking turmoil and the broader crypto crackdown.

On the flow side, apart from the volume coming from the end of month 31 Mar contract, traders are looking bullish on BTC long-term with large call volume for 30 Jun and 25 Mar 2024. There is a notional value of $3.98B of BTC contracts expiring today.

The bears were caught off-guard when BTC jumped 32% from 12 Mar to 17 Mar, as they were looking at the sub-$26.5K level. If BTC were to remain near $28K at 8AM UTC when the contracts expire, only $25M of the $1.71B puts will expire in-the-money (ITM). For the bulls, even if BTC were to fall to $27K, there would still be $1.2B of BTC contracts that expire ITM. And if the price were to rise to $29K, there would be $1.4B of BTC that expires ITM (@cointelegraph).

The most significant trade was 3K contracts of BTC 29 Mar 2024 50K/65K call spread being bought as the trader looked to be super bullish on BTC long-term. Other noteworthy trades include 1.5K contracts of BTC 30 Jun 35K/40K call spread and 1.5K contracts of BTC 30 Jun 29K/35K call spread being bought (@tradeparadigm).

Finally, the VIX falls for the fifth day in a row and sits at 19.02.

Crypto Technical Analysis

On the TA front, the BTC pullback at the 4H level has rebounded roughly at the historical trendline and is currently moving toward the $28.4K resistance zone. Looking closer at the 1H timeframe, a double bottom has been formed, which could indicate a potential reversal pattern to the upside for the short term. On the other hand, a golden cross appeared yesterday with the 50D SMA crossing over the 200D SMA, a potential indicator of a short to medium-term bull run. However, we have yet to see the trend confirmed at a higher level timeframe. As such, if BTC breaks through the $28.4K level, the next thin resistance soon awaits at $28.8K. However, if price pulls back, we might see BTC retesting the $27.3K 1H support zone before moving into the $26.9K level observed at the 4H timeframe.

Moving onto ETH, with the price movements yesterday, we can confirm that the technical patterns have switched from broadening to a slightly downward parallel channel. A golden cross has also appeared at the 1H timeframe. As a result, the $1.82K-$1.83K range, where both the horizontal resistance and the upper bound of the parallel channel converge, now acts as an important resistance zone for ETH price. If price crosses over, the next key resistance is only found at the 1D timeframe at $2K, which also acts as a key psychological level. This indicates a potential 11.5% upside. However, if the channel continues to hold, the support lies at the $1.72K level before hitting the lower bound of the channel at $1.7K.

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