2023-12-28 11:30
The expiry is Deribit's largest so far and a record of almost $5 billion of options will expire in the money. Bitcoin, ether options worth over $11 billion will expire on Deribit on Friday. Both cryptocurrencies are trading well above their "max pain points." The market is unlikely to see major volatility ahead of the expiry, one observer said. Bitcoin (BTC) remains well supported, holding above $40,000 as the clock ticks down to 2023's last quarterly options expiry. On Friday at 08:00 UTC, a staggering $7.7 billion worth of options tied to bitcoin (BTC) and $3.5 billion of options linked to ether (ETH) will expire on the crypto exchange Deribit. "The total of over $11 billion marks Deribit's largest expiry thus far, of which almost $5 billion will expire in the money, the largest amount ever as well, potentially resulting in above average hedging and trading activity," Luuk Strijers, the exchange's chief commercial officer, told CoinDesk. Options are derivative contracts offering the purchaser the right, but not the obligation, to buy or sell the underlying asset at a predetermined "strike" price at a later date, the expiry date. A call offers the right to buy; a put confers the right to sell. On Deribit, one options contract represents one BTC or one ETH. An in-the-money call option is one with a strike price lower than the market rate. For a put, an in-the money strike price is higher than the going rate. This quarter's 60% upswing in the bitcoin price and ether's 43% gain have investors scrambling to add upside exposure through calls. That explains the record notional open interest for in-the-money call options. According to Strijers, clients have been rolling their positions from the December expiry to contracts expiring in January and subsequent months, and the process could continue into Friday's quarterly settlement. "Beyond hedging, we also see clients rolling positions to 2024 expiries and expect to see more of that closer to the expiry as well as afterward," Strijers said. "After the expiration, all eyes and trading activity will be focused on the upcoming ETF decision." The U.S. Securities and Exchange Commission is said to have set Jan. 10 as the deadline for approving or rejecting an exchange-traded fund (ETF) that invests directly in bitcoin, a so-called spot ETF, rather than one investing in futures tied to BTC. Many industry participants expect it to give the green light to a spot fund, paving the way for continued upside price volatility in the historically bullish reward halving year. The chart shows notional open interest for the BTC call and put options at various strikes expiring on Friday. It also shows bitcoin's max pain point (MPP), or the level at which options buyers stand to lose the most on expiry. The theory is that options sellers, typically institutions with ample capital supply, look to push the underlying asset's spot price toward that level to make their counterparties, the buyers, suffer the most. In late 2020 and most of 2021, bitcoin saw volatility in the direction of the max pain point in the lead-up to the expiry, only to resuming the uptrend following the settlement. Still, market analyst Chang expects prices to remain steady before Friday's expiry. "BTC MPP is $33,000 and ETH MPP is $1,900, very far from current prices. MPP can provide important points from time to time, but for now, we expect BTC and ETH to move to MPP very little. There is no need to worry much about MPP at the moment. If something like that were to happen, it would only be possible if there was a disaster on Earth," Chang told CoinDesk. "I plan to keep a close eye on any new options trading tapes after the big options expirations. I also think the market is heading towards the final spark and I expect the last real move to be very soon," Chang said. https://www.coindesk.com/markets/2023/12/28/a-record-11b-crypto-options-expiry-looms-as-btc-shows-little-volatility/
2023-12-28 10:18
Depositors will receive an airdrop that can be redeemed in May 2024. Blast, the recently announced layer 2 blockchain set up by the developers of non-fungible token (NFT) platform Blur, has surpassed $1.1 billion in deposits, attracted by an airdrop promised for May even though the platform is not due to go live until February. Speculators, unperturbed by the controversial one-way bridge to Blast, have deposited $1 billion worth of staked ether (stETH) and $103 million worth of the dai (DAI) stablecoin since the website went live last month, according to DefiLlama. In return, depositors receive a yield of around 5% on their staked assets as well as "Blast Points," which can be redeemed for an airdrop that will be distributed in May. Users can also accrue points by referring others to the platform. Blur ran a similar airdrop after setting up an NFT marketplace in February. The BLUR token now has a market cap of $500 million, having risen by 23% over the past month. The idea of allowing deposits to a platform that is not yet live has attracted criticism from sections of the crypto industry, with some suggesting that the project has the hallmarks of a pyramid scheme where early depositors and affiliate marketers will receive a lion's share of the eventual airdrop. Some of that criticism even came from Blast's backers, venture capitalist firm Paradigm. Paradigm Head of Research and General Partner Dan Robinson said Blast's marketing campaign "crossed lines" and that Paradigm doesn't agree with rolling out deposits before the blockchain or withdrawals are live. Robinson did, however, say that he is excited about several components of Blur. It's worth noting that crypto asset prices have surged across this board this year. Bitcoin (BTC) has risen more than 150% to around $43,000 while ether (ETH) has doubled to $2,400. The increase has spurred a wave of optimism across investors, which is highlighted by the rapid rise of projects like Blast. https://www.coindesk.com/business/2023/12/28/blast-hits-11b-in-deposits-more-than-a-month-before-its-due-to-go-live/
2023-12-28 10:17
The investment fund bought $9.2 million worth of BITO shares and also sold $27.6 million worth of Coinbase stock. ARK Invest bought 4.3 million shares of ProShares Bitcoin Strategy ETF (BITO) yesterday after dumping its remaining holdings of the Grayscale Bitcoin Trust (GBTC). The ProShares stake is valued at $9.2 million based on closing prices. Cathie Wood's investment vehicle also sold $27.6 million worth of Coinbase (COIN) stock and bought 20,000 shares of the Ark 21Shares Active Bitcoin Future Strategy ETF, according to an emailed transaction notice. The ProShares exchange-traded fund, which started trading in October 2021 as the first U.S. bitcoin-linked ETF, now accounts for 5.03% of the ARK Next Generation Internet ETF (ARKW), its sixth-largest holding. The fund no longer holds any GBTC shares, with the last reported sale on Dec. 20. At just under 12%, Coinbase remains the fund's largest holding even after Wednesday's sale of 148,885 shares. The change in holdings comes ahead of next month's expected decision by the Securities and Exchange Commission on whether to allow spot bitcoin ETFs to trade in the U.S. Both Grayscale and Ark 21Shares have ETF applications filed with the regulator, which has been meeting with applicants. https://www.coindesk.com/business/2023/12/28/cathie-woods-ark-invests-in-proshares-bitcoin-etf-after-dumping-grayscale-holdings/
2023-12-28 08:52
More than 99.95% of the community, representing 70,000 votes from CAKE holders, favored the proposal shortly after it went live. Decentralized crypto exchange PancakeSwap's Thursday proposal to reduce the supply of its CAKE token by 300 million was welcomed by most of its voting community. The decentralized autonomous organization (DAO) controlling the governance of PancakeSwap floated a vote proposal to reduce the maximum supply of CAKE from 750 million to 450 million. The voting period began in early European hours on Thursday and will last until 8:00 am UTC on Friday. If the proposal is passed, the reduction will be implemented by January 4th, 2024. Over 99.95% of the community, representing 70,000 votes from CAKE holders, favored the proposal shortly after it went live. In a message to CoinDesk, a PancakeSwap team member said the reduction in CAKE puts the project “in a position to pursue further growth across all deployments.” “With a current circulating supply of 388 million CAKE, the team believes this new and lower cap will be sufficient to gain market share across all chains and sustain the veCAKE model,” Chef Mochi, head of PancakeSwap, said in a Telegram message. CAKE token prices are up nearly 10% in the past 24 hours, with most of the movement taking place shortly after the proposal was floated, data from CoinGecko shows. https://www.coindesk.com/markets/2023/12/28/pancakeswap-proposes-to-reduce-cake-token-supply-by-300-million/
2023-12-28 07:15
A wallet flagged as owned by Trump sent ETH to Coinbase in the past three weeks, where it was presumably sold. A wallet linked to former U.S. President Donald Trump moved over $2.4 million worth of ether (ETH) to crypto exchange Coinbase in the past few weeks where they presumably sold those holdings, on-chain firm Arkham Intelligence said in a Thursday post. “3 weeks ago, he started sending ETH to Coinbase after months of accumulating Trump NFT royalties. His peak balance was $4 million,” Arkham posted on X. “Based on the deposits, so far, he's sold 1,075 ETH for $2.4 million.” These ether were generated as royalties from the official Trump non-fungible token (NFT) collection on marketplace OpenSea. Sending holdings to an exchange often implies sales for other tokens or U.S. dollars, although this isn’t compulsory. Arkham tracks the wallet on its platform and it holds $2.2 million worth of various tokens as of Thursday. It tied the wallet to Trump in August based on public financial disclosures, which mentioned the same amounts of token holdings as found in a wallet holding the largest royalties derived from the Trump NFT sale. Despite being a crypto skeptic during his term as president, Trump appears to have been a crypto user in recent years – likely even sitting on profits from the industry’s price gyrations. An April filing revealed Trump made anywhere between $500,000 and $1 million from sales of his NFT collection. These earnings were derived via a licensing agreement CIC Digital LLC has with NFT INC LLC, and not from individual sales of the NFTs. https://www.coindesk.com/markets/2023/12/28/crypto-wallet-linked-to-donald-trump-sent-24m-in-ether-to-coinbase/
2023-12-28 06:59
Early investors in MSTR can consider taking profit as shares appear overvalued and could fall by 20%, according to 10x Research. Investors wondering what's next for shares in business intelligence firm MicroStrategy following this year's 343% surge may want to look at what 10x Research, led by Markus Thielen, who predicted this year's BTC rally, is saying. Per 10x's latest research note, MSTR's shares appear overvalued by 26%. The conclusion is based on the firm's regression model, studying the relationship between the dependent variable, MSTR, and the independent variable, BTC's spot price. "As the regression model shows, MicroStrategy is +26% overvalued and has a 20% downside based on the current Bitcoin prices. It is time to take profit," 10x said. Shares in bitcoin-holder MSTR have more than quadrupled this year, reaching a 25-month high of $673 on Wednesday to become one of the best-performing crypto-related stocks of 2023. The Nasdaq-listed firm holds 189,150 BTC as of writing, having begun accumulating the cryptocurrency as a reserve asset three years ago. Bitcoin, the leading cryptocurrency by market value, has gained 160% this year, with prices surging 60% this quarter alone, mainly on the back of the spot ETF narrative. The performance of crypto-related stocks like MSTR and shares in Coinbase relative to bitcoin is often touted as a proxy for institutional interest in digital assets. These listed instruments allow market participants to gain exposure to digital assets without having to own them. The chart shows the upward-sloping (green) line of best fit drawn through a maximum number of points on a scatter plot, ensuring almost an equal number of points above and below the line. The upward-sloping nature of the line shows a positive relationship between bitcoin and MSTR. In other words, as the price of BTC goes up, MSTR's market value rises. The R² (R-squared or the coefficient of determination) of 0.8232 indicates that 80% of the variation in MSTR can be explained by BTC's price. The analysis shows that at Thursday's closing price of $673, MSTR is overvalued by 20% relative to bitcoin's going market rate of around $43,000. According to 10x, several crypto-related stocks are trading at close to fair value based on bitcoin's price. "We suggest taking profit and cutting long positions. HIVE, HUT, and GALAXY still offer some value here, but the BIG money has been made in those stocks," 10x said. https://www.coindesk.com/markets/2023/12/28/microstrategy-stock-is-overvalued-by-26-analyst-who-predicted-btc-rally-says/
