Market

Weekly Market Commentary - DV Chain - May 6, 2024

May 6, 2024

Welcome back to DV Chain's Weekly Market Commentary! In this edition, we'll delve into recent market movements from the past week and weekend, upcoming airdrops, product inflows, and offer a preview of potential market catalysts and trading opportunities. Let's get started:

Market Recap

  • Risk assets started the week off weak, selling off into FOMC but a dovish Powell presser marked the local bottom and markets climbed up into the weekend
    • Powell was quoted saying “I don’t see the stag or the flation”
    • Crypto followed equities and risk assets for the most part

  • Coinbase posted a large earnings beat of $4.4 EPS vs $1.09 Estimated and a Q1 revenue of $1.64B vs $1.34B expected, but had a muted move in stock price
    • Retail trade volume remains below all-time highs, at $56b in Q1 '24, compared to $177b in Q4 '21.
    • Institutional trade volume shows a stronger recovery, reaching $256b in Q1 '24, up from $371b in Q4 '21.

  • While Eth and Alts were strong relative to BTC to start the week, BTC had strong relative performance to end the week
    • BTC seemed to do well in the macro driven rally post FOMC
    • GBTC posted $63mm of INFLOWS on Friday, for pretty much the first time since BTC ETFs were approved
    • Friday was also a strong day for net ETF inflows across the board after 7 consecutive trading days of net outflows that had traders fearing that the inflows have stopped
      • It’s interesting and notable to see that the market still responds to daily ETF inflow/outflow data

  • The weekend move was relatively muted following a volatile week, but memecoins pumped, with Doge and WIF both up double digit percentages from after the Friday close
  • Since the April 13th liquidations, it’s interesting and noteworthy that normal market structure has yet to return, as a lot of perps are trading below spot and funding negative, and open interest is sitting at multi month lows for most tokens
    • suggests that short positioning in perps is consensus and potentially crowded


Upcoming Catalysts / Trade Ideas

  • Hong Kong Bitcoin Conference, 5/9-5/10
    • a lot of speakers and potential announcements this week in the Bitcoin ecosystem
    • BTC L2s such as Stacks and Merlin will both have speaker slots

  • $ETH, 5/23
    • Deadline for SEC to make a decision on spot ETH ETF

  • Eigen TGE, claims 5/10
    • mainnet is live
    • Most anticipated airdrop of this cycle yet

  • $LDO
    • We think $LDO is poised to outperform as it should benefit from a re-staking narrative that’s heating up into the Eigenlayer airdrop
    • Having a whopping $30B in TVL, LDO is one of the biggest and fundamentally strong Defi Protocols that exists, and has a first mover advantage in the liquid staking space
    • There are rumblings that Lido is working on re-staking as well, which is very sensible given their current position and moat in Liquid staking, which may result in a price re-rating as investors draw comps towards Eigenlayer

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➡️ https://trade.dvchain.co/api/availableTickers

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