S&P Futures 500
Note: All percentages shown above are referenced to the previous business work day's 09:00 (GMT+8)
GM Treehouser 🌳
Welcome to our Treehouse Daily newsletter, where Treehouse brings you financial news and insights free daily! We believe you’ll find this helpful.
In case you have missed it, check out our latest research piece 👇
Our Daily View
What We Are Covering Today
- US market reacts positively to the February CPI figures that are in line with expectations (more in Macro & TradFi)
- Shanghai upgrade finalized on Goerli; some major banks remain open to crypto companies (more in DeFi & CeFi)
- Bitcoin surges 22%, making 2.7M coins profitable, whales increase $1M+ transactions to a 4-month high (more in On-Chain)
- BTC skew flips to call premium (more in Crypto Derivatives)
- Technical shows potential fakeout in BTC and ETH (more in Crypto Technical Analysis)
Macro & TradFi
As per the February report from the US Bureau of Labor Statistics, inflation in February rose in line with expectations, with the consumer price index increasing by 0.4%, and the year-on-year rate reaching 6%, according to the Labor Department. Excluding food and energy prices, core CPI rose 0.5% in February and 5.5% annually. The inflation report is likely to keep the Federal Reserve on track for another interest rate hike next week, with markets expecting a 0.25 percentage point increase to its benchmark federal funds rate. The report showed that housing costs are a key driver of inflation figures, accounting for more than 60% of the total CPI increase.
Meanwhile, continuing with the fall of SVB, creditors of Silicon Valley Bank's parent company, SVB Financial Group, have formed an investor group in anticipation of a potential bankruptcy filing, hoping to profit from a sale of the collapsed firm's nonbank units. The investor group is being advised by PJT Partners and includes Centerbridge Partners, Davidson Kempner Capital Management, and Pimco, among others. The group wants SVB Financial to file for bankruptcy and then auction off its nonbank businesses through a court-supervised sale process. The parent company owns assets, including SVB Capital, SVB Securities, and SVB Private, that could have significant value. The bondholder group could profit if SVB Financial's assets fetch a high enough valuation in any such auction.
Lastly, largely driven by the within-expectation CPI figures, all major indices closed higher yesterday with DJIA, SPX, and NASDAQ gaining 1.06%, 1.65%, and 2.14% respectively. On the other hand, the yield on the 2-year treasury note has risen to 4.30% while 10-year treasury yield stayed relatively flat at 3.685%.
DeFi & CeFi
- Shanghai upgrade is completed on Ethereum Goerli testnet, devs to meet on Thurs to finalize a date for mainnet upgrade
- Unstoppable Domains announces the launch of .polygon domains
- DCG claims that some major banks like HSBC, Deutsche among others are still willing to work with crypto companies
- New York Department of Financial Services states that possession of Signature Bank had nothing to do with crypto
- Cybersecurity firm Halborn identifies critical vulnerabilities in Dogecoin, Litecoin and Zcash blockchains
- Filecoin Virtual Machine set to launch today
- Meta to discontinue its NFT pursuits
- Crypto platform Anchorage Digital to lay off 20% of its staff, according to Bloomberg
Firstly, the Shanghai upgrade for Ethereum was triggered on the Goerli testnet on March 14th, but it was only finalized 15 epochs later due to low network participation caused by some validators not upgrading on time. However, Ethereum core developer Tim Beiko expects the mainnet upgrade to have a smoother transition. A meeting will be held on Thursday to confirm the date for the mainnet upgrade after the successful testing on Goerli.
Several banks, including Santander, HSBC, Deutsche Bank, BankProv, Bridge Bank, Mercury, Multis, and Series Financial, are still open to working with crypto firms, according to messages exchanged by staff at Digital Currency Group (DCG). The crypto conglomerate is seeking new banking partners for its portfolio companies following the collapse of Silicon Valley Bank, Silvergate, and Signature Bank. However, banks may restrict some services, such as brokerage and money market services, and limit the ability to wire money to third parties. DCG also reached out to international banks, including Revolut, United Overseas Bank, and Bank Leumi, as well as BlackRock, JPMorgan, and Bank of America.
Lastly, Filecoin is set to launch its Filecoin Virtual Machine (FVM) upgrade, which introduces smart contracts and decentralized applications to its network. The upgrade brings user programmability to Filecoin, enabling developers to design decentralized applications, which will allow for more use cases such as perpetual storage and financial services for miners. The token, FIL, has rallied about 45% since the FVM upgrade was first announced last month.
The latest increase in Bitcoin's value, which has risen by 22%, has led to over 2.7 million coins becoming profitable. This suggests that approximately one-fifth of the adjusted circulating supply was obtained in the price range of $20,000 to $26,000. The upswing in the cryptocurrency's worth has brought substantial gains to investors who acquired their coins within this specific price bracket (@glassnode).
Bitcoin is experiencing a remarkable rebound, soaring past the $26.5k mark in response to positive Federal Reserve news regarding potential cuts in US interest rates. This bullish environment has encouraged whales to make an increased number of transactions involving over $1 million in Bitcoin. This level of high-value trading activity has not been seen in the last four months and comes as Bitcoin breaks through price highs that have been sustained for nine months (@santimentfeed).
- BTC and ETH funding rates remain positive; ETH funding rate increases to 0.0296% on Binance
- 30-day ATM IVs decreased to 59.94% and 61.33% for BTC and ETH respectively
- 30-day 25 delta put skew eased to -1.03% and -3.32% for BTC and ETH respectively as BTC returns to put premium
Top 3 CEX USDT perp funding rate arbitrage based on last 24-hour lookback:
Net Annualized APR
Perp (USDT pair)
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 24 hours amount to $302.34M with the majority coming from shorts at $178.48M.
On the options front, term structure remains in backwardation as near-term IV decreased significantly. Skew flipped back into put premium for BTC for both 7-day and 30-day as the market as price began to retrace after hitting a peak of $26.5K. Variance risk premium turns negative for both BTC and ETH, sitting at -9.85% and -11.55% respectively as IV fell after the CPI print which came mostly in line with expectation while RV continues to climb. 7-day RV for BTC is 80.94% and ETH is 79.18%.
On the flow side, the main theme was profit-taking after the CPI print rally. For BTC, 1025 contracts of 28 Apr 26K calls were sold for profit while ETH saw the main profit-taking occur with the 10K contracts of 28 Apr 1.6K/2K call spreads. The most popular strategies are short risk reversal and bull diagonal call spread on BTC.
Lastly, the VIX fell to 23.73 as the market recovers from the recent banking turmoil.
Crypto Technical Analysis
Onto TA, BTC continued with the strong bullish momentum yesterday with price increased by another 2.24%. In the 4H timeframe, price has broken the $25K key resistance zone briefly before coming back from getting rejected at the upper bound trendline. RSI, on the other hand, stays elevated at 64.5 and 67.6 respectively for 1D and 4H. As BTC continues to test the $25K level, the next zone of resistance would be seen in the range of $31.15K and $31.60K, indicating a potential 25% upside. However, if a reversal is to happen, price is likely to drop to the $20.90K support zone first before testing the $18.7K - $19.0K support zone.
As for ETH, the analysis is largely the same as BTC with the potential fakeout. However, price has not fallen below the previous resistance zone. Instead, ETH stayed above it and rebounded from the previous resistance which sits directly at the 23.6% level of the Fibonacci retracement. RSI has fallen slightly back to the normal zone and is currently sitting at 62.1 and 66.1 respectively for 1D and 4H. If the bullish rally continues, the next resistance could be observed at $1.76K - $1.77K at the daily level where support could be seen at $1.42K - $1.44K.
Access institutional-grade commentary on TradFi × Crypto markets
By Treehouse Research
Institutionalizing DeFi: Opportunities, Risks, and the Future of Finance
Uncover the world of institutional DeFi adoption and analytics. Explore how institutions are embracing cryptocurrency and DeFi.
Boeing nabs order for 78 787 Dreamliners from two Saudi airlines
TikTok mulls splitting from ByteDance if proposal with U.S. fails - Bloomberg News
Moody's changes outlook on U.S. banking system to 'negative' after SVB collapse
Charles Schwab CEO says firm has liquidity, not seeking capital or deals
Analysis: Door slams on Japan bank rally as focus turns to bond holdings in wake of SVB
Brazil development bank aims to pay out sums totaling 2% of GDP by 2026
Investors tiptoe back into US bank stocks, regulators probe SVB collapse
Little relief for US consumers as sticky rents keep inflation elevated
EU agrees on principles of new debt rules, but many details still open
Instant View: U.S. February CPI increase leaves market guessing on Fed
India's Feb wholesale inflation eases to lowest in over 2 years
Blockchain Firm RockX Unveils Institutional Liquid Staking Platform.
EU Parliament’s Smart Contract Plans Limit Standard-Setting Promise, EU Commissioner Says.
U.S. Treasury Poised to Release View on How DeFi Used in Illicit Finance.
Accounting Platform Cryptio Partners With Protocol Labs to Help Filecoin Miners Go Public.
Decentralized Borrowing Protocol Liquity’s LQTY Token Soars Amid USDC Chaos.
Gibraltar's Xapo Bank Enables GBP Payments, Prepares USDC Option Amid U.S. Crypto Banking Crisis.
Coinbase Is Adding DeFi Apps Uniswap and Aave to Its Base Blockchain: Source.
Web3 Service Unstoppable Domains and Polygon Labs Roll Out .polygon Domains.
Breaking: Shanghai upgrade executed on testnet but not without issues.
National Australia Bank makes first-ever cross-border stablecoin transaction.
MetaMask addresses privacy concerns with new features for enhanced control.
$FLEX, Exchange Token of 3AC Co-founders' OPNX, Listed on MEXC Global
HSBC, Deutsche Among Major Banks Willing to Work with Crypto Companies, DCG Says
Microsoft backed Space and Time partners with South Korean gaming firm Wemade
A16z invests in crypto wallet infrastructure startup Capsule
Digital fashion firm DressX raises $15 million in Series A funding
Blockchain infrastructure developer Smooth raises $2 million in seed funding
Crypto infrastructure provider Orbs raising $10 million from DWF Labs in token round
Treehouse Research 🌳