This week’s preview (12.23–12.29), Forbes predicts that G7 will establish strategic BTC reserves; Analysis of the rebound of on-site balance
December 24th, 2024

catalogue

  1. Industry headline news;

  2. Comprehensive overview of the cryptocurrency market, quick reading of the rise and fall of popular currencies/sector fund flows for the week;

  3. The inflow and outflow of funds in spot ETFs;

  4. Analysis of BTC balance in the market;

  5. Interpretation of contract funding rates;

  6. This week’s large token unlocking data.

1.Industry Headlines: Forbes’ prediction of the seven major trends in the cryptocurrency industry in 2025 reveals the possible future development directions of the industry. G7 or BRICS countries may establish strategic Bitcoin reserves, indicating the increasing importance of cryptocurrencies in the global financial system. The market value of stablecoins is expected to double to $400 billion, reflecting the increasing demand for stablecoins as a store of value and a medium of exchange in the market. The growth of the Bitcoin DeFi ecosystem, especially with the help of the L2 network, heralds the innovation and expansion of DeFi. The expansion of encrypted ETF products to tracks such as Ethereum staking and Solana demonstrates the diversification of encrypted investment products and the participation of institutional investors. Tech giants may follow Tesla’s lead in increasing their holdings of Bitcoin, which will further drive the mainstreaming of cryptocurrency. The total market value of the cryptocurrency market is expected to exceed $8 trillion, based on the current growth momentum and future development potential of the cryptocurrency market. Finally, the improvement of the regulatory environment in the United States will promote the revival of cryptocurrency entrepreneurship, bringing more innovation and vitality to the industry.

  1. Comprehensive overview of the cryptocurrency market, quick reading of the weekly rise and fall of popular currencies/sector fund flows According to CoinAnk data, in the past week, the cryptocurrency market has been divided by conceptual sectors, with significant net inflows concentrated in several major areas such as the Avalanche ecosystem, Arbitrarum ecosystem, Binance smart contracts, and Real World Assets (RWA). In the past week, many currencies have also experienced significant cyclical increases. Select the top 500 tokens by market capitalization, with ZEN, USUAL, SDEX, AIXBT, MOVE, and ZEC having relatively higher gains.

  2. The inflow and outflow of funds in spot ETFs. According to CoinAnk data, the sustained inflow of funds and growth in trading volume of US spot Bitcoin ETFs indicate a strong interest among institutional and retail investors in Bitcoin. Over the past 50 weeks, the net inflow of Bitcoin ETFs has reached $463 million, with a trading volume of up to $26 billion. The inflow so far in the fourth quarter was $17.5 billion, making it the best performing quarter and demonstrating the attractiveness of Bitcoin as an investment asset. In addition, the price of Bitcoin has fallen to $92000. Despite price fluctuations, the proportion of Bitcoin held by ETFs, government agencies, and MSTRs has risen to 31%, up from 14% last year, indicating that large investors have confidence in the long-term value of Bitcoin. The increase in concentration of such positions may have an impact on market liquidity and price stability, especially in the face of market volatility. The situation of Ethereum spot ETFs is also worth paying attention to. Last week, there was a net inflow of $62.73 million, while the Grayscale Ethereum Trust ETF had a net outflow of $99.83 million, with a historical net outflow of $3.62 billion. The comparison of inflows and outflows may reveal the market’s investment sentiment and expectations towards different Ethereum related products. ETF data reflects the trend of fund flow and investor sentiment in the cryptocurrency market, and is expected to continue influencing market dynamics as more institutional investors participate and the cryptocurrency market matures.

  3. The BTC balance on the exchange has rebounded. According to CoinAnk data, the three major trading platforms have different Bitcoin wallet balances and fund flows. Coinbase Pro and Binance have both experienced outflows in the past 30 days, while Bitfinex has seen capital inflows. But in the short term, the past 7 days have been a net inflow state, with market funds diverging. Some investors may be selling at high prices, while others may be buying at low prices. Since December 19th, there has been a significant rebound in BTC balance on the CEX exchange, which is closely related to the decline in BTC prices after last week’s hawkish interest rate cut decision by the Federal Reserve. We speculate that this may be due to the main funds choosing to reduce their holdings and cash out at relatively high levels in a timely manner to prevent market uncertainty, causing some selling pressure and leading to a market pullback. Another piece of data can also assist in verification, such as the fact that holding BTC is no longer the default behavior of the entire market participants as BTC sales have accelerated over the past 30 days. The supply ratio of long-term/short-term holders has dropped to 3.78, the lowest value since the beginning of this cycle, which means that trading activity in the market has increased, short-term holders are more active, market sentiment is complex and volatile, and investors have divergent views on the future trend of Bitcoin.

  4. Interpretation of BTC contract funding rates and long short ratios. According to CoinAnk contract data, BTC contract funding rates have remained at a positive level of around 10000 since December 10th. Short term contracts are not the main drivers of market trends, and more pricing power occurs in spot trading. Combined with the BTC balance on our previous exchange and the turnover of long-term/short-term coin holders, it is evident that spot trading has been more active in recent times. Last week, we mainly talked about the detailed concepts and long short logic of funding rates and long short ratios. Here is a brief summary: the current Bitcoin funding rate of around 10000 yuan is at a normal and healthy level, and has been maintained at this level since December 10th. Even if the market rose sharply yesterday, there has been no extreme deviation. Calculated at 10000 RMB, the annualized return of fund rate arbitrage can reach 10.95%. A funding rate of around 10000 indicates a relatively high proportion of long positions in the market, but there has been no excessive imbalance, indicating a relatively stable and healthy market. There is a difference between the ratio of long to short positions and the ratio of long to short positions. In a stage uptrend, it is normal for the ratio of long to short positions to be slightly lower than 1, while the ratio of long to short positions held by large investors can better reflect the main trend and have a greater impact on the market. Investors should comprehensively grasp market sentiment and trends by combining data such as long short ratio and long short ratio of positions.

  5. This week’s large token unlocking data. This week, tokens such as IMX and DBX will be unlocked in large amounts. The following is the UTC+8 time: Ethena (ENA) will unlock approximately 12.86 million tokens at 15:00 on December 25th, with a ratio of 0.44% to the current flow and a value of approximately 13.22 million US dollars; Cardano (ADA) will unlock approximately 18.53 million tokens at 8:00 am on December 26th, with a ratio of 0.05% to the current flow and a value of approximately 16.3 million US dollars; Immutable (IMX) will unlock approximately 24.52 million tokens at 8:00 am on December 27th, with a current flow ratio of 1.45% and a value of approximately 32.12 million US dollars; Beldex (DBX) will unlock approximately 330 million tokens at 8:00 am on December 30th, with a current flow ratio of 4.78% and a value of approximately $25.46 million. This week, pay attention to the negative effects of unlocking these tokens, avoid spot trading, and seek short selling opportunities in contracts. Among them, DBX and IMX have a relatively large proportion and scale of unlocked circulation, so pay more attention.

Article: laolibtc

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