Something to remember: 

“Time is the one thing that can’t be stopped. Like a sharp blade, it silently cuts through hard and soft, constantly advancing. Nothing is capable of jolting it even the slightest bit, but it changes everything.”

The Week Ahead

What’s driving markets?

• Following a series of misfires and a disorderly approval week which disrupted the locus of traders’ concentration leading up to the event, a Bitcoin Spot ETF approval was officially granted for 11 issuers on January 10th.

• Bitcoin traded up to a high of ~$49k in the immediate aftermath of the official approval shortly before dropping ~15% from the highs, vindicating “Sell the News” traders who saw the immediate short term impact of structural BTC ETF related flows as insignificant or likely underwhelming.

• In the midst of BTC’s price decline post-approval, the ETH/BTC ratio climbed to 0.06, its highest level since Q3 2023. With BTC spot ETFs approved and trading, The market’s source of “hopium” has shifted to analysis of ETF AUM and associated flows, as well as the proposition of an Ethereum spot ETF.

• Here is the final 11 approved BTC spot ETFs with all of their details regarding fees. Grayscale charges the highest management fee at 1.5%.

• Centralized exchange 7 day weekly moving average volume has consistently hit highs, reaching $50B this past week for the first time in multiple years– signaling the return of retail traders as the market heats up.

Catalysts

• Tuesday, January 16th @ 11:00AM ET: Fed Member Waller Speech.

Charts

• Crypto VC market activity took a significant hit in 2023, but it was still the 3rd highest year in terms of capital invested.

• Leading up to the January 2nd liquidation cascade, perpetual futures funding rates hit their highest levels since November 2021.

• BTC’s correlation to Nasdaq has declined to near zero, indicating that for the first time since before 2019, there is basically no meaningful relationship between price action in traditional and crypto markets.

• The number of inscriptions on EVM chains has decreased significantly since peaking in mid-December.

• Grayscale GBTC discount has narrowed to 1.9% post ETF approval.

Research Content

• Kaiko flash liquidations post-mortem.

• Crypto VC funding 2023 recap.

• EVM Inscriptions activity dashboard.

• BitMEX Research ETF flow analysis.

• BTC spot ETF AUM napkin math.

• CoinShares miner profitability report.

• $1.18b inflows into Digital Asset Investment Products.

• TD Cowen does not expect ETH ETF anytime soon.

• Bankrupt lender Celsius selling off ETH.

• Circle plans 2024 IPO.

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