Welcome back to DV Chain's Weekly Market Commentary! In this edition, we cover the market's recovery throughout last week following a sharp selloff, along with significant developments like hints from Eric Trump and Donald Trump Jr. about launching a DeFi project. We also discuss ETF inflows and outflows, and upcoming catalysts. Dive in for insights and trade ideas:

Market Recap

• Crypto and broader markets recovered throughout the week following the sharp Sunday/Monday selloff
  
  
• Eric Trump and Donald Trump Jr hint that they’re launching a DeFi project
  
  
• Trump odds falling, now Kamala leads betting odds at 52%
  
  
• Sol briefly reached an ATH in ETH terms

• Slew of economic data this week, most notably CPI on 8/14
  • Current rate cut odds next month is a toss up between 25 bps and 50 bps
                 
• Net inflows for ETH ETF at +105mm, while BTC saw -167mm in outflows
  • The ETH ETF inflows came in on Monday and Tuesday, suggesting ETF buyers bought the dip
  • ETHE outflows continue to slow, while new ETF inflows continue, marking the first week (currently week #3 since launch) that ETH ETFs saw Net inflows, so this weeks data should be important as it potentially marks an inflection point

• • BTC ETFS net inflows this year sits at about 17.3 Billion dollars
    
    
• Elon - Trump interview tonight at 8pm EST
  
  
• Looking head, we have FTX returning about $13B in cash to customers sometime in Q4
  
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Upcoming Catalysts / Trade Ideas
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• $ETH
  • ETH has been crushed in the recent selloff, and seems to be the most dislocated token due to the path of events post ETF launch
  • If the ETF flows are at a turning point, which the data seems to suggest, then the daily inflows will be a good tailwind for price each U.S session and the market may price in the future flows
  • The launch of the ETF allows easy access and establishes ETH as a ‘real’ asset class along with Bitcoin
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• $LDO
  • LDO took an outsized selloff from the SEC lawsuit against Consensys alleging Lido and Rocketpool staking pools are securities
    • Hester Pierce made comments that indicate the potential to walk back this lawsuit
  • Recent developments on the regulatory side are looking very bright, with Trump adding crypto support officially to his campaign coupled with his odds of winning surging
  • SEC allegations also seem to lose effect and mean revert over time, $SOL being the best example of this
  • DeFi as a sector is likely to benefit from the ETH ETF as well as the new political climate
  • LDO fundamentally is a very strong project, clipping almost $150m in fees on an annualized basis to its treasury
  • It has maintained majority of market share in the LST/LRT space, despite higher temporary yields in new competitor’s liquidity bootstrapping farms
  • From an institutional standpoint, it is much stronger than competitors in terms of safety and network effects. The Lido Dao’s roadmap prioritizes institutional adoption, which we think is an astute plan, given the recent interest in crypto and tokenization from Wall Street
  • See AAVE and MKR price action for forgotten DeFi tokens that generate earnings, once the value is tapped into by implementing a fee switch
    
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• Polymarket is rumored to TGE sometime soon, so it’s probably worth using the platform for an airdrop

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