BTC

ETH

S&P Futures 500

$26,248.50

$1,594.00

$4,319.00

(-0.04%)

 (+0.45%)

(-1.07%)

Note: All percentages shown above are referenced to the previous business work day's 09:00 (GMT+8)


GM Treehouser 🌳

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Our Daily View

What We Are Covering Today

  • Decline in US consumer confidence for second straight month; Turbulence in China’s property sector disturbing national housing crisis alleviation (more in Macro & TradFi)
  • SEC extends Ark, 21Shares, Global X ETF deadlines as government shutdown looms; Crypto lender BlockFi’s liquidation plan approved (more in DeFi & CeFi)
  • ETH whale liquidates 7,376 $ETH; Bitcoin trading volume at lowest levels since March 2019 (more in On-Chain)
  • Subdued BTC volatility continues post-September 20th; diverse trading patterns emerge in the current market (more in Crypto Derivatives)
  • BTC and ETH prices remain stable, anticipating minimal short-term fluctuations amid a lack of catalysts (Crypto Technical Analysis)

Macro & TradFi

The US consumer confidence has experienced a noticeable decline for the second straight month, as reported by the Conference Board. This is primarily influenced by heightened interest rates and political uncertainties, including the potential federal government shutdown looming on Saturday. Inflation persists as a concern with prices higher than pre-pandemic levels, casting a shadow on family finances and heightening recession perceptions. Despite these anxieties, consumer purchasing intentions for big-ticket items remain undeterred, though fewer anticipate buying homes, attributable to surging mortgage rates, now the highest since July 2001. This surge in rates, coupled with a significant year-on-year rise in house prices, is prompting the Federal Reserve to consider a hawkish monetary stance through 2024.

On the other hand, the recent turbulence within China's property sector is jeopardizing President Xi Jinping’s endeavors to alleviate the ongoing housing crisis. Leading property developer, China Evergrande Group, is reevaluating its debt restructuring plan and has missed a bond payment this week, further exacerbated by the detention of its former executives. This has cast a shadow on the upcoming Golden Week, a period many developers hoped would revive flagging home sales. Additionally, contrasting policies and measures, such as the easing of mortgage restrictions and various local initiatives to stimulate housing demand, have sown investor confusion. As China grapples with a blend of declining home values, housing oversupply, and an aging population, a full recovery is projected to be prolonged, with some analysts suggesting it could take up to a year.

U.S. equities all slid today as the S&P 500, NASDAQ Composite, and DJIA dropped by 1.47%, 1.57%, and 1.14%, respectively. Compared to the relative stability yesterday, these fluctuations are possibly a reaction to the recent uncertainty surrounding a Congressional disagreement which could lead to a federal government shutdown. These movements track uncertainty also seen across Asia, with the Japanese Nikkei dropping 0.74% and Hong Kong Hang Seng hovering at a 0.03% increase.

DeFi & CeFi

  • SEC extends Ark, Global X ETF deadlines as government shutdown looms
  • Court approves BlockFi’s liquidation plan
  • Circle launches native euro stablecoin on Stellar
  • US Treasury sanctions Ethereum wallet tied to cartel over ‘illicit fentanyl trafficking’
  • JPMorgan subsidiary Chase UK to restrict crypto transactions
  • Binance Japan and MUTB plan to issue stablecoin by end-2024

The U.S. Securities and Exchange Commission (SEC) has extended the deadlines for reviewing spot Bitcoin exchange-traded fund (ETF) applications from Ark Investment Management, 21Shares, and Global X. The formal deadline for a response from the SEC regarding Ark and 21Shares has been set for Jan 10, 2024, while Global X now has until Nov 21, 2023 to await its response. The SEC has traditionally taken the full 240 days to make a final decision on such applications, but the threat of a potential government shutdown seems to have pushed the interim decision earlier.

In other news, the United States Bankruptcy Court in New Jersey has approved crypto lender BlockFi's liquidation plan, moving the bankrupt cryptocurrency lending platform one step closer to paying its customers. BlockFi owes up to $10 billion to over 100,000 creditors, including $1 billion to its three largest creditors and $220 million to Three Arrows Capital. The repayment amount for unsecured creditors will depend on the outcome of BlockFi's legal battle with FTX, which it blamed for its bankruptcy and other bankrupt cryptocurrency firms. BlockFi filed its initial liquidation plan on Nov 28 but was required to submit amended plans on May 12, Jun 28, and Jul 31. The plan was approved following a settlement between BlockFi and its creditors' committee, which helped reduce additional administrative fees and expenses.

On-Chain

According to @lookonchain, significant movements from a prominent whale was observed where the entity swapped a substantial 7,376 $ETH on Uniswap, garnering a total of $11.7M at an average transaction price of $1,586. Concurrently, this whale exhibited further strategic financial activity by settling a debt of 3.62M $DAI on the Maker platform and subsequently withdrawing 6,200 $ETH, equivalent to $9.83M. Such sizable transactions hint at possible short-term strategic plays or potential anticipation of market shifts, warranting prudence and close observation.

According to recent data from @santimentfeed, Bitcoin's trading volume, in terms of dollar value, has also dwindled to its lowest levels since March 2019. Intriguingly, this lull in volume aligns with a marked reduction in the peak supply of $BTC on centralized exchanges, a trend established almost three years prior. This synchronicity suggests a potential correlation, hinting at diminished liquidity or a shift in holding strategies among decentralized investors.

Crypto Derivatives

  • Funding rates flipped to positive for both BTC and ETH
  • Deribit Implied Volatility Index (DVOL) for BTC fell to 38.27% while it retreated on ETH to 34.95%
  • 30-day 25-delta skew (C-P) on both BTC and ETH plunged to -2.36% and -3.81%, respectively
  • The futures market witnessed $31.07M worth of liquidations in the last 24 hours, with shorts representing 51.04% of the total

Top 3 USDT Perpetual Funding Rate Arbitrage Opportunities

Net Annualized APR

Perp (USDT pair)

Long on

Short On

16.41%

BTC

OKX

dYdX

12.02%

SOL

dYdX

Bybit

10.61%

ETH

OKX

dYdX

Source: @CexyArbBot Telegram Bot

Notes:

1) Pairs observed include BTC, ETH, SOL, BNB, XRP, LTC, and DOGE vs. USDT perps. 

2) CEXs observed include Binance, Bybit, OKX & dYdX.

3) Lookback period is 24 hours.


In the options market, both the 7-day and 30-day implied volatilities (IV) for BTC have been muted since their surge on September 20th. This subdued demeanor may be attributed to the US Senate's introduction of a provisional bipartisan bill, designed to extend government funding for 45 days, potentially staving off a government shutdown.

Furthermore, the term structures for both BTC and ETH consistently portray contango, with no marked deviations.

Elsewhere, the 30-day 25 delta (C-P) skew on BTC dropped to -2.36. The 30-day skew on ETH rose slightly to -3.81%, indicating a near-term bearish sentiment for both major cryptocurrencies.

During the Asia/Europe session on 26-Sep-23, @Paradigm spotlighted distinct trading patterns amid the prevailing market dynamics. Prominent BTC activities feature the acquisition of 150x 29-Dec-23 $24K put options and the purchase of 125x 29-Dec-23 $30K/$36K call spread options. In the ETH realm, standout trades include the procurement of 4000x 29-Dec-23 $1.2K/$2.2K bull risk reversal options and the acquisition of 2000x 6-Oct-23 $1.5K/$1.4K put spread options.

Crypto Technical Analysis

Shifting our focus to technical analysis, the price of BTC has maintained a relatively stable position below the 200-day Simple Moving Average (SMA) since the decline witnessed on Monday. On the 4-hour chart, a discernible head and shoulders pattern appears to have formed, potentially signaling further downside movement in the near term, despite the psychological support at $26,000. Should a deeper downturn materialize, we can identify immediate support at approximately $25,600, representing a modest 2.5% retracement. Conversely, in the event of an upward reversal in BTC's price, the next resistance level can be found at $26,800, aligning with the trendline created by local lower highs since the peak observed in late July.

In a similar context, ETH has experienced a relatively subdued trading session, characterized by minimal fluctuations in price. Over the upcoming days, it is anticipated that price movements will remain confined within this narrow range, lacking any significant catalysts. The immediate support level resides at $1,540, corresponding to the local low, while potential resistance is evident around $1,600. This level serves as both a psychological resistance zone and the intersection point between the 100-day SMA and the downward-sloping trendline formed by local lower highs.

Access institutional-grade commentary on TradFi × Crypto markets

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