Markets have entered an arguably historical week for crypto, with a few critical events upon us, like the FTX hearing and CPI data of several countries. Bitcoin and Ethereum have barely moved over the past week, with a 0.55% and 0.27% increase in returns, respectively.

The biggest outlier within the Layer 1 subcategory is still Solana, down by almost 7% over the past week, followed by Avalanche and Binance, down by almost 5% each. Within major Layer 2s of scalability solutions, Boba stood out in TVL growth, increasing by almost 4% over the past week. Curve is the most negatively impacted in DeFi applications after being hurt by the depeg of Tron’s algorithmic stablecoin USDD, which makes up nearly 85% of the liquidity on Curve’s USDD/3CRV pool at the time of writing.

Figure 1: Weekly TVL and Price Performance of Major Crypto Categories

Source: 21Shares, Coingecko, DeFi Llama. Data from December 6 to 12, 2022.

Key takeaways

• Ahead of FTX hearing, Sam Bankman-Fried was arrested in the Bahamas and faces several criminal charges alongside an unsealed indictment in the United States.

• Binance faces potential regulatory scrutiny as well as skepticism over its Proof of Reserves

• Ethereum’s Shanghai upgrade is likely to release in March 2023

• Polygon making moves: partners with FlipKart and Warner Music Group

Spot and Derivatives Markets

Figure 2: Total Bitcoin Liquidations

Source: Bloomberg, CoinShares

The graph above shows the total number of Bitcoin liquidations in the futures markets on the likes of Binance, OKX, and Bybit. Over $150M of long positions and $88M of short positions were liquidated last week.

On-chain Indicators

Figure 3

Source: Glassnode

Bitcoins held in miners’ balances have reached a 14-month low, according to data gathered by Glassnode. These levels indicate that Bitcoin miners are increasingly selling their holdings to cover their costs unless they have already filed for bankruptcy.

Next Week’s Calendar

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Research Newsletter

Each week the 21Shares Research team will publish our data-driven insights into the crypto asset world through this newsletter. Please direct any comments, questions, and words of feedback to research@21shares.com

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