🌳 Real Wages In Japan Declined For The 23rd Consecutive Month; Jury Found Do Kwon And Terraform Labs Liable For Fraud

08 Apr 2024, Monday

2:45 AM

🌳 Real Wages In Japan Declined For The 23rd Consecutive Month; Jury Found Do Kwon And Terraform Labs Liable For Fraud



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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What We Are Covering Today

  • Japan faces wage declines amid inflation; Yellen navigates US-China ties with diplomacy (More in Macro & TradFi)
  • Terraform Labs and Do Kwon found liable by the jury; Aave considers activating a “fee switch” (More in DeFi & CeFi)
  • Elevated Bitcoin ETF volumes pre-halving; LTH profit-taking influences price stagnation (More in On-Chain)
  • DVOL for BTC and ETH experienced a sharp increase; BTC 7-day skew constant maturity exits negative territory (More in Crypto Derivatives)
  • BTC exhibits a bullish pattern; ETH tests key levels, showing potential bearish signs (More in Crypto Technical Analysis)

Macro & TradFi

The latest data from Japan reveals that real wages for workers continued to decline in February, marking the 23rd consecutive month of decrease. This trend suggests rising prices have kept pressure on consumers' spending capacity. The Bank of Japan closely monitors wage trends as they are essential for assessing inflation outlooks and deciding on monetary policy adjustments. In February, real wages fell by 1.3% compared to the previous year, following a revised decline of 1.1% in January. Although nominal pay increased by 1.8% year-on-year in February, it was the fastest growth rate since June of the previous year. Despite the government's calculation of a 3.3% increase in consumer inflation, which includes fresh food prices, the growth in nominal pay contrasts with the persistent decline in real wages. Additionally, recent surveys indicate that Japanese firms agreed to the largest wage increase in 33 years. The data also shows that regular base salaries grew, while special payments, including bonuses, declined. General employees increased, but part-time employees decreased compared to the previous year. These figures shed light on the ongoing challenges facing Japan's labor market and economy amid persistently low real wages and changing employment patterns.

Elsewhere, US Treasury Secretary Janet Yellen advanced US-China relations amid delivering strong criticisms regarding China's economic strategies, particularly its manufacturing overcapacity and treatment of American firms. Despite the tough talks, including explicit concerns over China's support for Russia's actions in Ukraine and the impact on global markets, Yellen's visit was marked by warm receptions from Chinese officials, showcasing her ability to balance stern discussions with efforts to foster personal ties with China's leadership. Her engagement shows a strategic attempt to influence China's economic direction while maintaining the delicate balance of diplomatic relations. This juxtaposition of firm critique and diplomatic engagement underscores the complex dynamics of US-China relations, highlighting Yellen's role in navigating these waters amidst challenges such as trade restrictions and global economic concerns.

On Friday, stocks made gains as Treasury yields surged following a stronger-than-expected jobs report, potentially altering the Fed's stance on interest rate cuts this year. The Nasdaq Composite rose 1.2%, while the S&P 500 gained 1.1%, although both closed the week lower. The Dow Jones Industrial Average added 0.8%, recovering from losses earlier in the week. Amazon (AMZN) shares climbed 2.9%, while Salesforce (CRM) and Microsoft (MSFT) saw gains of 2.6% and 1.8%, respectively. Apple (AAPL) ticked up 0.5% despite announcing layoffs related to its discontinued electric vehicle project. In contrast, Intel (INTC) slid 2.6%. GE Aerospace (GE) and Newmont (NEM) surged 6.1% and 5.1%, respectively, following dividend announcements and amid rising gold prices. Semiconductor stocks advanced, with Meta (META), Advanced Micro Devices (AMD), and Nvidia (NVDA) posting gains. However, Tesla (TSLA) fell 3.6% amid uncertainty over reports of scrapping plans for an entry-level model. Investors will anticipate the US CPI data data due Wednesday at 20:30 SGT.

CeFi & DeFi

  • Manhattan jury found Terraform Labs and Do Kwon liable for fraud
  • Aave is reportedly working on a proposal to activate the “fee switch”
  • dYdX DAO approves20M tokens to stake on the network
  • Fantom CEO defends Solana amid network congestions
  • Ethereum Foundation researcher proposes to slow issuance draws pushback

The recent verdict from a Manhattan jury found Terraform Labs and its co-founder, Do Kwon, liable for civil fraud charges brought by the U.S. Securities and Exchange Commission (SEC) concerning the $40 billion collapse of the Terra ecosystem in May 2022. The SEC accused Terraform Labs and Kwon of misleading investors about the stability of their algorithmic stablecoin, Terra USD (UST), and the applications of the Terra blockchain. The jury's decision reached just two hours after closing arguments, sided with the SEC's claims that Kwon and Terraform Labs had deceived investors regarding the nature of the algorithm maintaining UST's peg to the U.S. dollar. The SEC attorney highlighted the involvement of Jump Trading in a secret deal to rescue UST during a de-pegging event in May 2021. Terraform Labs and Kwon's legal team argued that Jump Trading's involvement was a regular aspect of their market-making activities and that investors understood the mechanics behind UST's pegging. A spokesperson for Terraform Labs expressed disappointment with the verdict and maintained that the SEC lacked the legal authority to bring the case. Meanwhile, Kwon, who was not present for the trial due to his arrest in March 2023, faces criminal charges in the U.S. and South Korea. Both countries are seeking his extradition, with Montenegro's Supreme Court deliberating over the requests.

In other news, a proposal is reportedly in the works at the decentralized lending platform Aave to activate a "fee switch" for distributing fees to holders. Marc Zeller, founder of the Aave Chan Initiative, indicated that discussions about activating this feature are set to begin soon, noting the platform's significant annual net profits. The Aave DAO, which governs the platform and its operations, is considering implementing fees for Aave stakers, potentially allowing for the distribution of fees collected from transactions. This move follows recent adjustments to staking fees for the stablecoin GHO. Additionally, the AaveDAO is discussing collateral restrictions for Dai (DAI), with proposals advocating varying degrees of reduction in loan-to-value ratios. Meanwhile, Uniswap is preparing for its fee switch proposal, expected to be introduced in mid-April after a successful temperature check.


According to an analysis by Santiment has observed that the volume of Bitcoin ETFs, including GBTC, IBIT, FBTC, ARKB, BTCO, BITB, and HODL, remains significantly elevated four weeks after Bitcoin's all-time high, continuing the trend that began in late February with a surge in individual trading activity. This sustained activity is anticipated to persist until the Bitcoin halving on April 19th, though it remains to be seen whether there will be a subsequent decline in ETF and on-chain volumes. This ongoing high level of trading activity underscores the market's heightened engagement and speculative interest in the lead-up to the halving event, suggesting a keen investor anticipation of its potential impact on Bitcoin's value.

Elsewhere, Glassnode's analysis indicates that the Realized Profit/Loss Ratio for Long-Term Holders (LTHs) has experienced an exponential increase, primarily due to the absence of LTHs in loss following the market's recent ascent above the previous cycle's all-time high. This surge is further propelled by an increase in profit-taking among LTHs, which may have contributed to the recent stagnation in BTC's price. This shows the significant impact that long-term investors' behavior has on market movements, particularly how their profit-realization strategies can influence the asset's short-term price stability. Additionally, past cycles displayed that high LTH realized profits could remain in the Euphoria zone for extended periods, particularly in 2017 where the metric stayed in the zone for a year.

Crypto Derivatives

  • Funding rates remain positive for both BTC and ETH.
  • Deribit Implied Volatility Index (DVOL) for BTC and ETH rose sharply to 76.59% and 78.34%, respectively.
  • The 30-day 25-delta skew (C-P) for BTC and ETH increased to 4.79% and 0.79%, respectively.
  • The futures market witnessed $97.71M in liquidations, with shorts representing 63.39%

Top 3 USDT Perpetual Funding Rate Arbitrage Opportunities

Net Annualized APR

Perp (USDT pair)

Long on

Short On














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

2) CEXs observed include Binance, Bybit, OKX & dYdX.

3) Lookback period is 24 hours.

Bitcoin's (BTC) implied volatility (IV) chart illustrates a sharp increase in both 7-day and 30-day maturities, with the 7-day maturities increasing by 16.7% over the weekend to 73.56. The steep increase of the 7-day IV as compared to the 30-day IV suggests that traders are pricing in higher volatility in the immediate term of up to 7 days, anticipating heightened price uncertainty in preparation for the BTC halving in 2 weeks. This market consensus may hint at potential short-term speculative positions.

The term structure for Bitcoin's implied volatility maintained a contango formation, with increased volatility in short-term tenures of up to 4 days while the term structure exhibits greater stability within medium to long-term tenures. This is possibly due to the release of US CPI data in 2 days, which saw an increase in option purchases.

BTC 25-delta call-put options skew indicates an increase in both the 7-day and 30-day periods. Notably, the 7-day volatility has increased significantly over the weekend into the positive territory, currently at 3.67%, suggesting a change of sentiment in the short-term from bearish to bullish. This change could be influenced by the recent appreciation in BTC's price or by recent news of a rebound in net positive ETF inflows coupled with news of Genesis firm completing their sale of billions worth of shares in GBTC. This reflects traders' positive market sentiment toward BTC over the short to medium-term.

Lastly, @Paradigm’s highlighted notable BTC options trades: a 1100x 26-Apr-24 66K/80K Bull Risk Reversal sold, and a 1000x 26-Apr-24 64K/71K Bear Risk Reversal sold. On the ETH front, significant trades involved the sale of a 8500x 26-Apr-24 3.1K/2.6K Put Spread, a 6759x 12-Apr-24 Call, and a 6250x 19-Apr-24 3.3K call.

Crypto Technical Analysis

Onto technical analysis for BTC, the price is interacting actively with the upper trend line of a potential ascending triangle pattern, a formation that typically indicates bullish continuation. The price oscillates at approximately $69.5K, with the lower trend line providing ascending support, indicating an accumulation of buying pressure. Should this pattern's upper boundary be surpassed, the next significant resistance lies at the $72K mark, representing a roughly 3.6% increase from the current levels. On the contrary, a breakdown from the pattern could find support around the $64K threshold, suggesting a potential 8% retracement. The RSI presents a reading of around 60, maintaining an uptrend within the neutral zone, which may signal further bullish momentum if sustained above the midline of 50.

On the 4-hour ETH chart, the price demonstrates a testing phase at a descending trendline, indicative of a larger descending triangle pattern that generally signals bearish sentiment. The price is currently stable at approximately $3.4K, however if the descending trendline is decisively breached, the next resistance to watch is near the $3.6K level, a potential increase of about 5.1%. Should the pattern persist and the price break below the horizontal support, the subsequent support area is at the $3.3K level, marking an approximate decrease of 2.74%. The RSI is hovering around 59, suggesting moderate bullish momentum; however, its position below the descending trendline indicates that caution is warranted. If the RSI starts to turn downwards, it could foreshadow a weakening of buying pressure.

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By Treehouse Research

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