0/ In today’s Delphi Daily, we examined the leverage wipeout that the market experienced.
We also looked at NFT volume cooling off and $ETH emissions being deflationary for the first time.
For a deeper dive into today’s report 🧵👇
1/ Market Update-
🔹The crypto market experienced a flash crash as BTC moved downwards to ~$42k and ETH to ~$3k.
🔹A negative feedback loop of liquidations seems to be the primary cause, as the market punished over-leveraged apes.
2/ Open interest in ETH futures hits an all-time high, pushing ETH above $4,000.
High OI can be seen as traders starting to open more futures positions, often with some amount of leverage.
Low, stable funding implies balance as demand isn’t skewed towards either longs or shorts
3/ However, in the last few hours we’ve seen carnage. Over $2.1B of liquidations were reported by exchanges per @Skewdotcom, and the real number is likely higher.
BTC and ETH price decreased by a double digit percentage over the last 24 hours.
4/ On the 3rd of September, ETH had its first deflationary day, meaning more ETH was burned as base fees than ETH minted for block rewards.
The biggest culprit for ETH’s deflationary day is the recent NFT frenzy.
NFT gas wars have become common as everyone races to mint NFTs.
5/ @OpenSea activity is slowing down; daily volume fell 50%, from its late Aug. peak of $322M to ~$133M today.
Daily transactions cooled down as well from ~80k at their peak to ~55k today.
However, this doesn’t mean NFT season is just over yet.
0/ In today’s Delphi Daily, we examined the state of crypto derivatives.
We looked at open interest, BTC options, and trading of leveraged funds.
For a deeper dive into the state of derivatives 🧵👇
1/ Quick Market Update-
🔹BTC and ETH are finding strength, but what’s more surprising is today’s biggest winners are DeFi blue chips.
🔹DeFi coins have seen muted price action for months now, and a strong trend could catch several who ditched the sector.
2/ Looking at the global open interest, we see a concentration of capital at $50K, $60K, $80K, and $100K.
This doesn’t necessarily infer bullish sentiment, as for every ape buying an out-of-the-money call, there’s a seller who believes the option will expire worthless.
0/ In today’s Delphi Daily, we published a post mortem of yesterday’s sell-off.
We examined market leverage, liquidations, open interest, and implied volatility.
For a deeper dive into today’s report 🧵👇
1/ Market Update-
🔹The last 24 hours have been chaotic for crypto markets, with a liquidity crisis causing some of the sharpest candle wicks we’ve ever seen.
🔹L1 tokens are rebounding the hardest with NEAR and ALGO outperforming everything, and LUNA not too far behind them.
2/ $4B and $3.6B of BTC and ETH OI were respectively wiped out yesterday.
Looking at the absolute OI levels, it’s quite clear we were growing too fast. But looking at OI growth relative to market cap helps us discern if leveraged traders were getting ahead of themselves.
0/ In today’s Delphi Daily, we took a brief look at market structure.
We examined the impact of leverage in the market, implied volatility of $BTC, CME’s open interest, and Ethereum DEX volume.
To dive deeper into this analysis 🧵👇
1/ Market Update-
🔹The markets are red again, with BTC and ETH both nuking into the Asia session and consolidating near the lows.
🔹AVAX is down 18% over the last 2 days, and Avalanche ecosystem coins took a hit too.
🔹SAFEMOON and SOL are unfazed by the downturn.
2/ A useful metric to gauge leverage is the ratio between BTC’s OI across futures and perps, and its total market cap.
On its own, this probably isn’t a very useful data point. But with the context of price and trend structure, we can actually pull away some useful insights.
0/ In today’s Delphi Daily, we examined the recent habits of $BTC whales.
We also analyzed USDT outpacing USDC, Ethereum hash rates, and adopting on the Lightning Network.
To dive deeper into todays daily 🧵👇
1/ Market Update-
🔹The market is continuing on yesterday’s consolidation, with BTC and ETH moving lower.
🔹L1s like SOL, LUNA, and FTM were affected the most given the L1 run-up the past week.
🔹AVAX and BNB, however, remained resilient during this pullback.
2/ USDC issuance falls, and USDT slips back into pole position.
However, Cirlce recently announced a re-allocation of assets backing USDC into safer investments like bank deposits and short-term treasuries, which could inspire more confidence in USDC and push issuance back up.