The TIE Weekly Insights (Apr 12, 2021)

The total crypto market cap surges +8% in anticipation of Coinbase becoming the largest cryptocurrency company to ever go public. Exchange Tokens lead the market with +16% returns.

Some highlights from last week:

  • Bitcoin ETF Approval Will Happen says Morgan Creek’s Mark Yusko
  • Coinbase and Bakkt Are Behind Paul Tudor Jones’ Bitcoin Bets, SEC Documents Show
  • CI Global Asset Management Launches Bitcoin Mutual Fund in Canada
  • Fidelity, Square, Coinbase Launch Bitcoin Trade Group
  • JP Morgan’s Jaime Dimon: Bitcoin Regulation a ‘Serious Emerging Issue’
  • Bitcoin Mining Firm Riot Blockchain to Acquire Rival Whinstone for $651M
  • Galaxy Digital Files for US Bitcoin ETF
  • Coinbase Joins DeFi Alliance Ahead of Public Listing
  • Deribit Launches Volatility Index
  • Ripple Stops SEC From Disclosing CEOs’ Financial Records to Public
  • Solana Price Rises as Airdrops Attract New Users to the Network

Market Overview

On April 14th, Coinbase will become the largest cryptocurrency company to ever go public. Coinbase gives traditional investors a way to invest in the crypto market without having direct exposure to the asset class. As we get closer to this historic date, we are seeing prices continue to climb on the back of the hype. The total cryptocurrency market cap increased by +8% over the past week, climbing from $1.97T to $2.14T. The median weekly return among major assets was +5.3%, with XRP (+112.8%), BNB (+50.8%), and LTC (+24.8%) leading the way. Every major asset saw positive returns besides DOT (-6.1%) and UNI (-3.2%). Investor sentiment continues to be positive, with a median long-term sentiment score of 72.3 (high). Trading volume was up double digits this past week (+19.6%), despite Tweet volume only increasing by +3.2%.

Weekly Performance of the Crypto Market

With the days counting down until Coinbase Class A common stock starts trading on Nasdaq Global Select Market under the ticker symbol “COIN”, crypto Exchange Tokens continue to surge and bring in the highest returns of any sector this past week (+16.8%). All sectors performed positively besides NFTs (-2.4%), which experienced the first pullback after several weeks of rising prices.

Bitcoin

The price of BTC traded within a 11% range this past week, from the low of $55,473 to the high of $61,500. Bitcoin has continued to flirt with its all time high, but hasn’t quite gotten enough momentum to push above the range. Despite some lackluster price action this week, there was plenty of positive news regarding Bitcoin. Grayscale Investments, the largest crypto fund manager, has committed to converting its Bitcoin Trust into an ETF. Additionally, Mike Novogratz’s Galaxy Digital has filed for a Bitcoin ETF with the US SEC.

BNB

Binance Coin, the leading exchange token, has been on a mission this year. Investor sentiment on BNB has surged to near record highs as the price has reached a new all time high of $620. After increasing by an extraordinary amount of +171% in 2020, BNB has seen even greater returns of +1530% so far in 2021. This tremendous growth can be attributed to many things, but the community-wide acceptance of Binance Smart Chain has certainly played its part.

Coinbase Lists 4 New Assets

On Wednesday April 7th, Coinbase Pro made an announcement that 4 new assets are now available for inbound transfers, with trading beginning on Friday April 9th. All 4 assets saw positive returns from the time of the first announcement to the time the assets were actually available to trade on the exchange. After the second announcement, prices retreated back near the origin of the move. (peak returns) 1INCH: +33% OGN: 43% NKN: +162% ENJ: +75%

The chart below shows the top 50 crypto websites by Alexa rankings. Within the top 10 sites you will see platforms that fit within a wide range of categories such as Binance (CEX), CoinMarketCap (Tool), CoinDesk (Media), Uniswap (DEX), and NBA Top Shot (NFTs).

Derivatives Overview

Futures Curve

Some small changes in overall structure from last week. Deribit’s front-end contracts are at a slight premium to other exchanges, and CME’s back-end contracts experienced a slight bump in anticipation of new all time highs.

Image courtesy of @btc_status

Funding

Aggregated funding peaked at 0.144% as price briefly poked $60,000 on Friday and took a slight hit as Bitcoin retraced through the week. Funding currently sits at 0.1%, as traders show a bullish preference in anticipation of the Coinbase IPO and Walmart accumulation rumours.

Image courtesy of CryptoQuant

Premiums

Coinbase premiums traded at an aggressive discount for most of the week as Bitcoin struggled to maintain footing at $60,000, with an almost $300 discount on its first attempt back near all-time highs.

Grayscale premium worsened through the week, closing down -9.73% from -5.29% last week, despite Grayscale’s ETF conversion announcement.

Image courtesy of bybt.com

The Korean BTC premium peaked at 22% last week before plummeting as Korean investors panicked. An emergency maintenance froze all wallet transfers, causing a sell-off that reverberated through to Western markets, as speculation ensued that someone had solved the difficult problem of arbitraging the premium.

Open Interest and Liquidations

Open interest grew marginally through the week, and despite larger liquidations coming through from Binance and Bybit, volume continues to build in those platforms.

Some of the most aggressive liquidations occurred mid-week during the Korean premium sell-off, shaving off another $1 billion in value off the market—coming mostly from Binance and Bybit yet again. Despite this, aggregated open interest across exchanges grew this week as anticipation of new all-time highs sparked aggressive traders to borrow more leverage.

We’re Hiring!

The TIE is a leading provider of alternative data for digital assets. We help businesses in the cryptocurrency industry act on market-moving information faster through our proprietary social sentiment and Crypto SigDev™ feeds. Our clients include leading hedge funds, trading venues, publications, research firms, tokens issuers, and other digital asset market participants.

Join us for a fast-paced environment with flexibility and independence to work on new projects that move the crypto industry forward.

View our open roles at https://thetie.io/careers

Business Development Representative (Remote, NY)

Ruby on Rails Developer (Remote || Austin)

Cryptocurrency Data Scientist (Remote)

Please send your resume to careers@thetie.io

Notable News

Novogratz’s Galaxy Digital Joins Growing List of Bitcoin ETF Contenders

Grayscale Bitcoin Trust to Convert to ETF

Contact us for a demo of our SigDev platform to view all market-moving events in real-time.

This Week’s Podcast Episodes

Deep Dive into DeFi with Hassan Bassiri (Arca)
Hassan Bassiri (VP Portfolio Management at Arca) joins The TIE’s Fundamental Value Podcast to discuss Binance Smart Chain, Solana, AVAX, and the heating up L1 race, trading DeFi at scale, and managing risk in a bull market. Listen here