Mars Finance Crypto Weekly | Bitcoin ETF-related developments have stirred the market, and BTC market volatility has increased, and SEI has risen more than 25% in the past 7 days

1. Important events have occurred in the industry in the past week

1. Industry

BC Technology, the parent company of OSL, a licensed virtual asset trading platform in Hong Kong, has received investment from new investor Liang Xiangrong, who has increased its holdings of 28.41 million shares of BC Technology Group at the end of 2023, at HK$8.7501 per share, with a total amount of about HK$249 million, and the latest shareholding ratio has reached 6.5%.

It is reported that Liang Xiangrong's shareholding scale has surpassed that of Fidelity Fund, and he has become the third largest shareholder of BC Technology Group for the first time.

Previously, according to the announcement issued by BC Technology Group, the board of directors recommended that the company's English name be changed from "BC Technology Group Limited" to "OSL Group Limited", and the company's Chinese name should be changed from "BC Technology Group Limited" to "OSL Group Co., Ltd."

Sleepless AI announced the airdrop rules as follows: 1. All 20 Genesis NFT holders, the top 10 bidders, and participants in the staking program will receive AI; 2. Users who participate in the poll and check in more than 10 times per day will receive an airdrop to the top 100 users with the highest rank who pre-order the game. 1% of the total amount of Sleepless AI tokens will be used for airdrops, and additional reward programs will be announced in the next 1-2 days, where users who stake AI will receive an additional 2-5 million AI tokens as special rewards.

PancakeSwap tweeted that it has reduced its maximum supply of CAKE from 750 million to 450 million. From CAKE tokenomics v2.5 to the recent release of veCAKE, it marks that CAKE has entered a period of deflation.

It's been 15 years since Satoshi Nakamoto mined Block #0, Bitcoin's genesis block, on January 3, 2009, in a small server in Helsinki, Finland.

Satoshi Nakamoto recorded the day's front-page headline for The Times in the CoinBase data for the genesis block: "The Times 03/Jan/2009 Chancellor on brink of second bailout for banks." There is only one transaction in the block, and the block reward is 50 BTC.

According to CoinGecko data, the price of Bitcoin was $45,274 at the time of writing, with a market capitalization of over $889.4 billion.

Starknet has updated its 2024 roadmap with a reduction in transaction fees on the v0.13.0 testnet in Q1 and will launch a new transaction type, v3 transactions, where users can pay transaction fees using STRK. At the same time, Starknet will open community voting on January 10 to deploy the above updates on mainnet.

Grayscale Bitcoin Trust (GBTC) has filed a written prospectus with the U.S. Securities and Exchange Commission (SEC) pursuant to U.S. Securities Act 163/433.

Note: A corporate prospectus is a legal document that fully discloses the company's financial, operational, governance and other information to investors when it raises funds from the public.

Solscan, a blockchain explorer and data analytics platform for the Solana ecosystem, has announced that it has been officially acquired by block explorer Etherscan. In addition, Solscan says it will continue to optimize and integrate additional features to enhance the user experience with the assistance of Etherscan.

Celsius Network said in a post on the X platform that in the process of preparing for asset allocation, Celsius has begun the process of asset recovery and rebalancing to ensure sufficient liquidity.

Celsius will unstake existing ETH holdings to offset certain costs incurred throughout the restructuring process. Large-scale unlocking staking activity in the coming days will release ETH to ensure timely distribution to creditors.

2. Sound

Adam, a Greeks.live macro researcher, said in a post on the X platform: "Although there are rumors in the market that the BTC spot ETF may pass this week, the options market data shows that the highest IV is still the option expiring on January 12.

At present, the at-the-money IV expiring on January 12 is close to 70%, which is significantly higher than before the holiday, and significantly higher than the average of 60% for medium and long-term IV. ”

Bitfinex analysts said derivatives traders expect "unprecedented" volatility in the Bitcoin market. While the industry awaits news of the approval of more than a dozen spot Bitcoin ETFs, signals from the options market suggest that derivatives traders are currently expecting more volatility than observed across the market in 2023. Implied volatility has reached recent highs above the all-time average volatility of 41.1%, and Bitcoin is currently surging to a multi-month high of 70.1%, according to The Block's Data Dashboard. "Based on signals from the options market, traders are bracing for unprecedented price volatility in Bitcoin," the analysts said. ”

Matrixport reiterated in a post on the X platform that it expects Bitcoin to soar to $50,000 in January and potentially usher in an altcoin season, driven by factors such as imminent spot Bitcoin ETF approvals, institutional buying, and supply shortages and historical trends.

Bloomberg ETF analyst Eric Balchunas said that while he and ETF analyst James Seyffart still believe there is a 90% chance that a Bitcoin spot ETF will be approved by Jan. 10, they have not raised that probability above that number.

Although unlikely, the rejection of spot bitcoin ETFs this month is likely due to the SEC's desire for "more time" rather than outright rejection. Because the time and effort invested by the SEC and Bitcoin ETF issuers means that Bitcoin ETFs are unlikely to be rejected outright at the last minute. If the SEC refuses, the fund issuer may follow in Grayscale's footsteps and file a separate lawsuit against the regulator.

"We strongly believe that AI is now undervalued, and we will certainly provide long-term value to all stakeholders," Sleepless AI said in a post on the X platform. We are announcing the AI Together program, into which Sleepless AI Lab will invest all proceeds from NFT auctions (approximately $2.5 million), with the primary aim of guaranteeing the long-term cost-effectiveness of AI. ”

On January 3, UniSat posted, "We are sorry that we have to postpone the development of other tasks at hand to ensure that the Ordinals Jubilee upgrade for the BRC-20 proceeds as scheduled. For us, the schedule was tight. But we will do everything to prevent the BRC-20 from splitting with the Ordinals. 」

BRC20 founder Domo retweeted UniSat's posting that it would comply with the Jubilee upgrade, saying: "Given the serious consequences and valuations involved, I believe that the hasty rollout of these BRC20 updates is reckless, ignores their peer indexers, and could harm the overall interests of the BRC20 user community." The 0.8/0.9 incident highlighted the complexity of integrating new updates into the BRC20 standard, and while I was eager to implement protocol improvements, it was clear that these changes might not be secure without the robust testing, coordination, and validation infrastructure being built.

In addition, the timing and pending incentive structure suggest that this is not just a one-time technology-driven action by Unisat, but part of its thoughtful, ongoing strategy to take control of the protocol. "L1Fxyz, a non-profit foundation dedicated to ensuring that the BRC20 standard is free from the control of centralized enterprises, is currently maintaining an indexer with the express intent of ensuring the security of all funds in BRC20 assets," Domo further stated. Together, we implore the entire BRC20 community to reject Unisat's proposed fork and support a not-for-profit, security-first approach to upholding the protocol. ”

Previously, UniSat issued a document on the X platform that it will follow the Ordinals Jubilee (Jubilee) upgrade to ensure that the BRC-20 is still running on Ordinals and not split into a separate protocol. In addition, UniSat announced that the white paper will be released on January 31.

According to a report published by Matrixport, it believes that all current spot Bitcoin ETF applications fail to meet one key requirement, so it expects the SEC to reject all proposals in January, which could materialize in the second quarter of 2024. Since the approval of traders to start betting on ETFs in September 2023, at least $14 billion in additional fiat and leverage has been deployed into the crypto space.

Some of these flows may be related to the easing of macro conditions, as the Fed has turned dovish. However, of the $14 billion in additional long positions, $10 billion may be related to the ETF approval expectations. If the SEC refuses to approve the ETF, there will be a mass liquidation in the market, and it is expected that most of the $5.1 billion long position will be unwound, and the price of bitcoin could quickly fall by 20% and fall back to the $36,000/$38,000 range. Even so, Matrix on Target expects bitcoin to remain above $42,000 at the beginning of 2024 by the end of 2024, even if the SEC vetoes the ETF.

Eric Balchunas, an ETF analyst at Bloomberg, said in a social media post that if the SEC intends to continue to delay or reject the Bitcoin spot ETF decision, it will not hold meetings with major exchanges (NASDAQ, Chicago Board Options Exchange, NYSE) to determine the comments on the 19b-4s submitted by the issuers of the Bitcoin spot ETF. The SEC has been in close contact with issuers offline to refine their 19b-4s, rather than doing a lot of refiling like the S-1s. As previously reported, Fox reporter Eleanor Terrett posted on social media that the SEC is holding a meeting with exchanges today to finalize comments on 19b-4s submitted by Bitcoin spot ETF issuers.

According to two people familiar with the matter, Goldman Sachs looks likely to play a key role in the Bitcoin ETF that BlackRock and Grayscale hope to launch in the United States, according to two people familiar with the matter. The company is in talks to become an authorized participant (AP) in exchange-traded funds. This is one of the most important jobs in the trillion-dollar ETF industry, and this position involves creating and redeeming ETF shares to ensure that the product is traded in sync with its underlying asset. Regulatory filings disclosed last week show JPMorgan Chase, Jane Street, and Cantor Fitzgerald as APs for several other Bitcoin ETF issuers.

On January 4th, Arbitrum ecological game Layer3 XAI announced the details of the token airdrop, which will account for 5% of the total supply, with a total of 125,000,000 tokens. Among them, Vanguard NFT holders will receive 1,307 XAI per NFT, Legendary NFT holders will receive 290 XAI per NFT, and Sentry Node Operators will receive 1,658 XAI. Previously, Binance announced the launch of the 43rd project XAI of Launchpool.

In response to the "Matrixport report caused a crash", Wu Jihan posted again on the X platform: "This sudden incident slightly disrupted my vacation, and when I woke up, I found that Matrixport's analyst report was actually responsible for the market crash." The pot is heavy and not carryed. ”

Wu added: "Markus, an analyst at Matrixport, did not express conflicting views on the same day. He posted one opinion on Tuesday and the opposite on Wednesday. Our analyst did adjust his view. In this ever-changing market, it should be seen as a capability and advantage to calmly do 'today is not yesterday' and adjust your views in a state of 'turning your face faster than turning a book'. If you're a trader, you don't want to work with an analyst who is stubborn about what he saw yesterday. It is possible that he has realized that he was wrong yesterday, but he is too embarrassed to admit and tell you. Matrixport works with many talented analysts, and their ability to quickly change views continues to be highly appreciated by Matrixport's clients. ”

3. Data

According to RootData, the amount raised in the crypto market in December 2023 was $909 million, down 6.5% from December 2022 ($973 million) and down 25.6% from November 2023 ($1.222 billion). In addition, the number of financings in December 2023 was 98, a year-on-year increase of 5.3%.

According to a report released by Messari, the amount of funding in the fourth quarter of 2023 surged by 81% to $3.83 billion, and the number of transactions was 397, up 28% quarter-on-quarter, due to the steady growth of early-stage transactions and the significant spike in bitcoin mining transactions. This growth trend is highlighted by large deals such as Blockaid ($33 million Series A) and Ritual ($25 million Series A), driving the average deal size in Q4 to $8 million from $5.8 million in Q3.

According to the annual funding report released by CoinShares, the annual inflow of digital asset investment products in 2023 reached $2.25 billion, 2.7 times that of 2022 and the third largest year since 2017.

Bitcoin was the biggest beneficiary of improved investor sentiment, with inflows of $1.9 billion, accounting for 87% of total inflows.

Ethereum inflows picked up, reaching $78 million.

Meanwhile, Solana saw inflows of $167 million, or 20% of AUM.

Total assets under management (AuM) of crypto investment products reached $51 billion, up 129% year-over-year and the highest since March 2022.

The platform contract price for "SEC through Bitcoin ETF by January 15" is 0.89 cents, meaning traders believe the probability of passing is 89%, compared to 50% last month, according to Polymarket data.

According to Dune Analytics data, the total amount of ETH pledged on the Ethereum Beacon Chain reached 29,136,108 ETH, accounting for 24.28% of the total ETH supply. Among them, the staking share of the liquid staking protocol Lido reached 31.73%. In addition, there was a net inflow of 10,962,105 ETH since the Shanghai upgrade.

Data released by on-chain analyst Ali on the X platform shows that in the past 10 days, Bitcoin miners have sold about 4,000 BTC, totaling more than $176 million.

According to The Block Pro, the open interest in Bitcoin options decreased by 15.6% and the open interest in Ethereum options decreased by 5.5% in December 2023. The monthly trading volume of Bitcoin options increased by 17.3% to a record high of $37.9 billion, while the monthly trading value of Ethereum options increased by 5.9% to $15.3 billion.

According to The Block Pro, BTC miner revenue increased 21.7% month-over-month to $1.59 billion in December 2023, while ETH staker revenue increased 17.1% to $185 million. The average daily trading volume of GBTC, a grayscale bitcoin trust, increased by 63.4% to $195 million in December. A total of 127,110 ETH was burned in December, equivalent to about $286 million. Since the implementation of EIP-1559 in early August 2021, a total of 3.89 million ETH, or about $10.8 billion, has been burned. The trading volume of the Ethereum NFT platform increased by 39.8% to $780 million in December.

In addition, the spot trading volume of compliant CEXs increased by 34.5% to $598.7 billion in December. Binance has a market share of 72.3%, Coinbase has a market share of 11.7%, Kraken has a market share of 4.9%, and LMAX Digital has a market share of 3.2%.

According to data from The Block Pro, the adjusted total on-chain trading volume of Bitcoin and Ethereum increased by 29.1% month-on-month to $328 billion in December 2023, with the monthly trading volume of Bitcoin increasing by 34.4% and the monthly trading volume of Ethereum increasing by 21.6%. In December, the adjusted on-chain trading volume of stablecoins increased by 1.9% to $608 billion, and the issued supply increased by 0.57% to $120.8 billion, with USDT having a market share of 76% and USDC having a market share of 18.3%.

CoinGecko research data shows that among the top 100 tokens by market capitalization in 2023, BONK rose by 7302.9%, ranking first. Injective ranked second with an increase of 2,976.4%. Among them, Ethereum's gain was only 98.6%, much smaller than Bitcoin's 162.5%.

4. Safety

According to Paidun's monitoring, in December 2023, hackers stole about $99.3 million in crypto assets through more than 36 attacks. Among them, the Orbit Bridge was attacked on New Year's Eve and lost $81.5 million, becoming the ninth largest hack against cross-chain bridges in the past three years.

On January 3, Radiant Capital, a multi-chain lending protocol, officially stated that it had received a report of issues with the protocol's newly created native USDC marketplace in Arbitrum, and that the Radiant DAO Council temporarily suspended the lending marketplace on Arbitrum in order to further investigate the matter after being verified by Radiant developers and the broader Web 3 security community. Radiant Capital said that no funds are currently at risk.

According to Paishield monitoring, the multi-chain lending protocol Radiant Capital lost 1,900 ETH ($4.5 million) due to a hack. According to the analysis, the hackers basically took advantage of the window in which a new market in the lending market (derived from Compound/Aave) was activated. The vulnerability also relies on a known rounding issue in the current Compound/Aave codebase.

Earlier today, Radiant Capital officially posted on the X platform that the community reported that there are problems with Radiant's newly created native USDC market on Arbitrum, and after verification by Radiant developers and the broader Web3 security community, Radiant DAO has suspended the lending market on Arbitrum, and is further investigating the problem, and no funds are currently at risk.

The multi-chain lending protocol Radiant Capital said that the hack caused the protocol to generate bad debts in the WETH market, which accounted for about 1.3% of the protocol's TVL, and that the Radiant DAO Council suspended the lending market on Arbitrum, and has now developed a technical method to safely lift the suspension of the lending market on Arbitrum, which is being reviewed by OpenZeppelin, independent Ethereum researchers, and white hat hackers.

Radiant emphasizes that the protocol is solvent and will implement a bad debt remediation program to completely recapitalize the protocol and allow users to fully access their deposits. For users who are at risk of liquidation during the suspension period, the proposed plan will also be implemented to ensure that no user is unfairly penalized.

According to CertiK's monitoring, there have been flash loan attacks targeting Gamma Strategies contracts on the Arbitrum chain. Through price manipulation, the attackers obtained 1,535 ETH (worth about $3.43 million) and bridged it to Ethereum.

Gamma posted on platform X that it had initially found the cause of the attack on the vault and closed the vault for the public out of an abundance of caution. Gamma said that Gamma's vault has 4 main sources of deposit protection to prevent flash loans, one of which is "set a price change threshold that will not allow deposits when the price changes exceed a certain amount", and the main problem is that this price change threshold is set too high, resulting in price changes of up to 50-200% in some LST and stablecoin vaults. This allows the attacker to manipulate the price up to the price change threshold and mint a large number of LP tokens. Gamma further stated: "In the coming days, we will release a detailed post-mortem analysis and proposed remediation plan. We will make every effort to recover funds and mitigate future risks. ”

2. An in-depth article worth reading and re-reading

BakerySwap's first Launchpad project, Bitcoin Cats, managed to attract a large number of investors, TurtSat launched a new staking mechanism, Bounce and Bitswap partnered to launch the "Two Birds, One Stone" token AMMX, LeverFi announced the launch of the BRC20 Launchpad platform LeverPro, Binance With every project launched on Launchpad, the price of BNB rises. Investors are seizing opportunities in the DeFi space, but the quality and profitability of today's projects are no longer as strong as before, requiring project owners to improve their projects or rush to the next hot spot.

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The SEC is likely to approve Bitcoin spot ETFs on or before January 10, ETF analyst Seyffart James said it is likely to be approved, and there is growing interest in Bitcoin spot ETFs from mature financial institutions, the approval of Bitcoin ETFs could lead to billions of dollars in assets flowing into the cryptocurrency market, and the addition of trading platforms such as Coinbase could also drive the development of the RWA tokenization space.

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2024 is an extraordinary year in the crypto field, with meme coins with the concept of dragon appearing on many public chains, such as SILLY, BLACKDRAGON, LOONG, etc., as well as derivative concepts of Dragon Ball and Saiyan. In the crypto world, the dragon symbolizes dignity and majesty, while the pinyin "long" means "bullish", which has a positive meaning.

The ARB price broke through $1.94, a 24-hour increase of 10.33%, and was worth more than $20 billion, making it the largest L2 rollup. EIP-4844 will improve Ethereum L1+L2 performance and reduce transaction fees, Metis and ZKFair have also launched solutions, Starknet mainnet is launched, Particle launches Taiko Alpha-6 testnet, MantaManta public chain raises $60 million in funds, and New Paradigm liquidity incentive campaign is launched.

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20 projects launched points or reward systems to incentivize user participation and increase retention and loyalty. friend.tech launched Web3 social platforms, Scallop, Grass, Rainbow and other companies launched airdrop point activities, and Markets, marginfi, Tensor and other strategies such as deposits, loans, and referrals, and users can obtain points and rewards according to their activity.

The BRC20 indexer war sparked a BRC20 fork power fight, and Unisat insisted on following the Ordinals upgrade, but was opposed and criticized by BRC20 founder Domo in order to seize control of the protocol. There are three points of view in the crypto community: the coexistence, the freeze, and the upgrade. The BRC20 is at a crossroads, and whichever direction it ultimately chooses, it will have a profound impact on its future.

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