Global Liquidity and Digital Assets Report by Two Prime

First day of ETH ETF trading:

The inflow is $590.7 million.
The outflow is $484.1 million.

-> The net inflow is $106.6 million.
For comparison, average net inflows per day into #BTC ETFs during first 10 days: $75.7M.

The supply increase of #ETH this year is $155 million.

The demand in one day is almost the same as the supply in 2024.

Introducing the Q3 Guide to Crypto Markets by Coinbase Institutional and Glassnode.

This third installment highlights the ongoing bull market, ETF impact, and surge in on-chain activity.

Key points from the 65-page guide:

- Bull Market Dynamics: Since November 2022, Bitcoin prices have quadrupled. This cycle had drawdowns of 5%-30%, with none exceeding 30%, a rarity in past cycles.

- ETF Influence: Spot Bitcoin ETFs, launched in January 2024, amassed $50B in AUM within six months, boosting crypto interest and trading volumes. ETF inflows have outpaced new Bitcoin issuance, indicating strong demand.

- On-chain Growth: On-chain activity is up, with daily active addresses on Ethereum and Layer 2 solutions increasing by 127% in 2024. Despite a 58% drop in user fees post-Ethereum's Dencun upgrade in March 2024, transactions rose by 59%, showing real utility.

Download the guide here: https://glassno.de/4ddXPSn

Bitcoin 2050 Valuation Scenarios: Global Medium of Exchange and Reserve Asset

According to Glassnode, 59,000 of Mt.Gox's 142,000 BTC have been distributed to creditors through Kraken and Bitstamp, and another 79,600 BTC will be redistributed to creditors soon. The identity of the creditors seems to represent HODLers or long-term investors, which may reduce the extent of seller pressure. On Tuesday, the estate moved roughly 33,964 BTC, worth $2.25 billion to a new wallet, data from blockchain analytics firm Arkham Intelligence shows. The market share of decentralized exchanges (DEXs) compared to centralized exchanges (CEXs) has hit an all-time high. According to The Block's Data Dashboard, the monthly trade volume of DEXs relative to CEXs is already at its highest ever, at 14.22%. The previous record high occurred in May 2023 at 13.7%. Bitcoin exchange reserves hit multi-year low signaling a shift to long-term hodling potentially. BoJ raised rates by 15bps to 0.25%. This is the second rate rise since 2007. QCP: Macro volatility has intensified. The NASDAQ has declined by 10% from its peak as the Magnificent 7 pulls back. FX carry trades like long USDJPY and short USDMXN are being unwound as volatility increases. The VIX topped at 19.50 after trading in a range of 12-14 for the past 2 months. Elevated equity valuations and lofty earnings targets are causing companies to disappoint. Commodities such as Oil and Copper have declined by 10-15% for the month, due to increased fears of a global slowdown. We anticipate increased volatility ahead of the FOMC. We do not expect a cut and place higher importance on the statement and Powell's presser after. Our base case is for 1 cut in September and December each. We remain wary of a deviation from current expectations, which would trigger risk-off moves across all assets, including crypto. Such a scenario would indicate the Federal Reserve's perception of heightened economic challenges. In the crypto space, we finally saw net inflows of USD33.7mil in ETH spot ETFs. This gave a much needed boost to ETH prices which have been lagging behind BTC for the past month. Nonetheless, we foresee continued outflows from ETHE in the next 2 weeks. BTC has failed to break above the 70k for the 6th time. We maintain our view that BTC will continue to trade within a range. ETH longs are preferred as ETHE outflows subside over the next 2 weeks and ETH catches up to BTC. We target a break of 4000 which is the 2024 high.

Derivatives Trader Commentary: Perpetual funding rates on the low end for BTC and higher for ETH. Index showing +4.6% for BTC and +10.1% ETH. Option exchange fairly flat for both. Basis is lower for both. BTC Sep basis is 1206 vs 1450 yest; still okay yield 11.3%. ETH $60.3 (66 yest) at 11.2%. Option implied volatility is in — partly due to volatility and partly due to us being a little lower and tracking skew by strike. Market prefers calls to puts overall. 25D BTC skew still favors calls but at about half of what it was prior to Trump’s speech (think favoring calls 3-4% rather than 6-7%). Realized volatility still looks subdued for BTC at 38% for the last 7 days which is below the average. However, the ranges are still impressively volatile at $2034 vs the average of $1456. Given the event risk this week and the ranges, there does not appear to be a huge risk premium in BTC options. ETH realized is still around 60% so, strictly speaking, no variance risk premium there.

BTC ATM IV
1W: 47.14%
1M: 48.09%
3M: 52.29%
6M: 57.63%
Deribit Volatility Index: 49.67
Index Price: $65801.83

ETH ATM IV
1W: 50.3%
1M: 54.21%
3M: 61.3%
6M: 65.85%
Deribit Volatility Index: 55.73
Index Price: $3277.71

SOL ATM IV
1W: 70.68%
1M: 67.48%
Index Price: $179.1252

"The information in this message is for information purposes only and not to be construed as investment or financial advice. All information contained herein is believed to be accurate and is not a solicitation or recommendation to buy or sell any digital assets or other financial products."

https://x.com/thestalwart/status/1819355060792443207?

QCP: For equities, momentum traders and trend-followers are reportedly re-leveraging, amplified by August's lower liquidity. Corporate share buybacks have surged to $1.15 trillion this year. Goldman Sachs' trading unit has seen record client demand for dips. The market is eerily optimistic with US equities at all-time highs and Asian equities largely in the green today in anticipation of an imminent rate cut and a soft landing. However there are still signs of nervousness as the options market is pricing in a 1% swing on the S&P 500 for Powell’s Jackson Hole speech this Friday. In contrast to equities, crypto sentiment is strikingly bearish. BTC perpetual funding rates dropped to -13% over the weekend, the lowest since 2022. U.S. elections remains a key focus, with BTC skew favoring puts pre-election, and a steep 6-point vol spread between pre- and post-election expiries. Kaiko: Ethereum’s gas fees have recently hit five-year lows. This fee reduction has implications for ETH, as lower fees mean less ETH is burned, increasing the token’s supply. ETH’s total supply has risen consistently since April. Despite demand drivers like spot ETH ETFs, this growing supply could dampen potential price increases in the near term. Glassnode: The LTH Sell-Side Risk ratio remains lower than during previous ATH breaks, indicating that the LTH cohort is taking smaller profits compared to past cycles. This suggests they may be waiting for higher prices before increasing their selling pressure. Greekslive: Block trading, which has been dormant for days, is back on fire, with significant growth in block trades traded today, with a notional value of over $500 million. From the distribution of options, the main focus is on selling call options and buying put options.

Derivative Trader Commentary: Perpetual funding rate indexes are both negative and look negative across the major exchanges. Short dated basis has followed with BTC September and short solidly under 10% and this week 3.3% (although with a negative perp basis, maybe that is higher than it ought to be). ETH Basis is lower still with 8/23 negative, 8/30 under 2%. December and longer basis is decidedly higher for both assets. Implied volatility is a bit lower than we ended the week but still low 50’s for BTC and low 60’s for ETH. Longer dated volatilities are higher and skew to match. This solves a bit of the mystery of the longer dated basis being high in spite of low funding rates: flows like buying longer dated calls. That said, puts are favored in ETH all the way to October options and for BTC September. After that, back to what has been the norm — long dated call buying.

BTC ATM IV
1W: 48.96%
1M: 51.3%
3M: 60.1%
6M: 62.57%
Deribit Volatility Index: 53.45
Index Price: $60918.76

ETH ATM IV
1W: 59.22%
1M: 62.12%
3M: 70.67%
6M: 72.64%
Deribit Volatility Index: 64.56
Index Price: $2666.55

SOL ATM IV
1W: 78.0%
1M: 86.48%
3M: 88.88%
6M: 89.47%
Index Price: $147.1558

"The information in this message is for information purposes only and not to be construed as investment or financial advice. All information contained herein is believed to be accurate and is not a solicitation or recommendation to buy or sell any digital assets or other financial products."

PSA: Mac users warned about 'Cthulhu' malware targeting popular crypto wallets like MetaMask, Coinbase, and Binance. - CoinTelegraph

TAC to Announce New Member Cohort and Release of 2024 State of Tokenization Report
The Tokenized Asset Coalition (TAC) released its second State of Tokenization Report, highlighting industry insights and welcoming 21 new members, bringing its total to over 40. The report covers regulation, institutional adoption, and innovations, noting that tokenized assets could reach $2-30 trillion in the next decade. Currently, tokenized assets are valued at $176 billion.
- Link