$FTT, LayerZero, $ARB STIP, Arca == Bearish? & More
The Castle Chronicle: Volume 43
👀 What’s to Come in Volume 43
🔑 Key News: Headlines, Exploits, Continued Adoption, DeFi Updates, New Projects & more from CJ
⛓ On-Chain Sleuthing: feature along with Smart Money Moves from Cl
🔥 Hot Narratives: LayerZero Stablecoin & Arbitrum Farms from unexployed
📈 Macro Outlook: Simplified Round-up and Implications from Hansolar
📉 HTF Price Action Scenarios from Vlad
⚔️ A Call to Arms
Think you have what it takes to enter the Castle and contribute to funding and advising projects across the space?
🔑 Key News
BlackRock filed to register a new iShares Ethereum Trust entity in Delaware
Kraken plans to launch their own L2
Binance Launches Binance Web3 Wallet
HSBC to Offer Tokenized Securities Custody Service for Institutions
Ark Invest launching a new suite of digital asset ETFs with 21Shares
FTT rallies over 80% after Gary Gensler's nod to possible FTX reboot
FTX sues Bybit to recover assets worth $953M
Exploits that Happened this Week
The Standard exploited for $290k
rBalancer (Aura) rETH-WETH pool exploited
CoinSpot wallets appear to have lost around $2 million of crypto in possible hack
Raft Fi exploited, causing $6.7M R stablecoin to be unbacked
Aave lending markets resume normal operations after security scare
Evmos plans to deprecate Cosmos transactions, signals Ethereum alignment
Arbitrum Proposal to Backfund Successful STIP Proposals
Optimism introduces Canyon Hardfork
Nil Foundation introduces Ethereum ZK-Rollup with sharding support
Graph Protocol shares new roadmap
Illuviumio live on EpicGames store
Synthetix discussing turning off SNX inflation
Dydx chain staking and bridging live
Circle releases v2.2 for USDC and EURC stablecoins
Filecoin introduces InterPlanetary Consensus
Pika Protocol retiring the PIKA token
OKX most likely launching their L2 using Polygon CDK
Network State Co: Protocol focusing on sovereignty, governance and maximizing personal freedoms
Nil Foundation: zkRollup that scales Ethereum to 60,000+ TPS through zkSharding
Ritual: Community-owned AI network
Witness Chain: Security for optimistic rollups
isGranted: Go-to grants aggregator
Gasilon: Infrastructure layer that abstracts gas fees on Solana
⛓ On-Chain Sleuthing
Arca Buying $RLB
Arca investment fund has been building a $RLB position in the last few weeks.
They now hold over $1 mln in $RLB. Note that Arca buying marked the local top in the past for $GNS and $GMX. Will this time be different?
Arca’s Wallet [only visible for free subs]
Searching For Alfa
Research and analysis by Cl
🔥 Hot Narratives
LayerZero Suspense Suspensening
Right now, LayerZero is the most anticipated project to launch a token. With their unique tech and infrastructure, they fulfill an important role in the crypto ecosystem. And now, they are strengthening this narrative with their announcement yesterday:
Introducing ColorTrace - a practical implementation of the colored coin problem.
— LayerZero Labs (@LayerZero_Labs)
Nov 14, 2023
Their first tweet is not really revealing, but let me explain:
The ColorTrace is a new algorithm that lies at the foundation of LayerZero’s very own stablecoin called USDV backed 1:1 with tokenized short-term treasuries and repos. This will be the first stablecoin that rewards verified minters based on their contribution to the active circulation of tokens meaning minters will actually profit off USDVs stablecoin expansion.
Find full information here: USDV docs.
This will definitely count towards the airdrop. And this omnichain, treasury-backed stablecoin is a big step forward for this space.
With volatility increasing and prices going upwards, farms are becoming interesting as well. At Castle, we like to catch two birds at once and farm two protocols at the same time.
Up first is a niche protocol on Metis called Gravita Protocol that allows you to mint stablecoins against Ether and related LSDs. This one is a fairly risky one as it involves using a very small and niche stable, $GRAI, that is minted against your collateral.
You can pair GRAI and LUSD, and pool them on Velodrome for 35% APR whilst at the same time qualifying for the Gravita airdrop.
For more information, refer to the guide by Aidrop Adventure:
Full Guide on Gravita Potential Airdrop! 🪂
@gravitaprotocol is a decentralized protocol that allows Ether or liquid staking derivatives (LSDs) holders to obtain maximum liquidity against their collateral without paying interest.
Gravita's governance token $GRVT is confirmed.… twitter.com/i/web/status/1…
— Airdrop Adventure 🧭 (@Airdrop_Adv)
Nov 3, 2023
Arbitrum STIP: Dolomite
With the Arbitrum STIP being distributed, the yields on a lot of our favorite protocols are increasing significantly.
Take for example Dolomite which distributes oARB on the blue-chip pools ($USDC, $ETH, $WBTC, $ARB, or $LINK). Now the yields on those assets are quite juicy with 30% on USDC of course.
The caveat is that the rewards are in $oARB and not in $ARB directly. Read on for a refresher on $oARB 👇👇
Dolomite distributes $oARB weekly to its depositors based on their liquidity on the platform. The tokens can be claimed through the rewards page. Then users can vest their $oARB to purchase $ARB at a discount from the market price pocketing the difference. The discount increases according to your lock time (the maximum discount is 20% for 4 weeks).
Despite the yield not being directly in $ARB and the involvement of vesting, still makes Dolomite a worthwhile venue to farm as you also increase your chances of qualifying for a potential $DOLO airdrop.
Arbitrum STIP: WINR
Second is WINR, a gambleFi protocol on Arbitrum. They received over 450k in ARB and will be distributing them over the coming 12 weeks to users and liquidity providers as follows:
Source: WINR STIP Incentives by 0xroll
We will mainly focus on the rewards to WLP providers.
Currently, the APR on the pool is 2.74% and does not include the additional $ARB. Note that WINR has opted to distribute the ARB directly and not in the form of $oARB.
Using rough calculations, the APR on the pool with ARB rewards is bumped up to around 29% based on the following assumptions.
Weekly Yield in USD:
$16,940 = 15,400 * $1.10
$879,689 = $16,940 × 52
Total Known Yield Percentage = ((Additional Annualized Yield + Known Yield) / Pool Value) * 100
Total Known Yield Percentage = ((879,680 + 2.74% $3,355,176) / $3,355,176) 100
Total Known Yield Percentage = (971,552.78 / $3,355,176) * 100
Total Known Yield Percentage ≈ 0.2901 * 100 ≈ 29.01%
These yields are NOT reflected on the front end. Mind the mint fee that is charged on WLP that varies between 0.25-0.75%.
Arbitrum STIP: Camelot
Last, but not least, yesterday, Camelot started their incentive system on a lot of their pools:
$ARB incentives go live 5pm UTC 14th Nov 🏆
Over 45 partners.
Read all of the details below 👇🧵/1
— Camelot (@CamelotDEX)
Nov 14, 2023
Take care of the different pools (V2 vs V3 vs Gamma Vaults), they are all incentivized differently. Yields look as follows, but up to change:
Courtesy of unexployed
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💹 Macro Outlook
Please note that if certain technical jargon or concepts mentioned in this text are unclear, you can refer to investopedia.com for detailed explanations and definitions. Additionally, for a comprehensive overview of macroeconomic events, you can explore the event calendar on investing.com/economic-calendar/.
Tues Nov 14th : CPI
Wed Nov 15th: PPI, Retail Sales
Thurs Nov 16th: Initial Jobless Claims
Fri Nov 17th: Spot ETF window end
BTC, ETH, and Macro
Markets have gotten very trigger-happy as BTC continues its no-pullback climb up. Last Friday we popped up on the ETF duo’s statement on how we were entering a period(Nov 9th to the 17th) where all ETFs could be approved together. This followed by Blackrock filing an ETH spot ETF further heated things up as the lagging 2nd largest crypto asset Ethereum finally made a newsworthy move.
Interestingly, IVs have leveled off for BTC around the 58 mark indicating that dealers in the option markets are no longer under pressure of a squeeze. ETH however which saw even more extreme levels of volatility suppression continues to see an increase in IVs after having flipped BTC’s vols. If spot flows continue aggressively, we may see additional buying flows from squeezed players from the options market.
A short-term play for both BTC and ETH could be buying the dip this Friday if there is no news on the spot ETF. Currently, insiders are putting a 20% chance of an early approval for the ETF, which is likely largely divergent from the expectations of the average trader.
📈 HTF Price Action Scenarios
Last week offered quite a few nice long opportunities. The plan remains the same - look to this trend for as long as it lasts. Therefore looking to get involved after re-accumulation is the play.
Accumulation inside the daily demand zone
Expansion out of consolidation
New highs breached
At some point, this push will lose steam and we will enter a correction phase. Once that happens it’s going to once again be a game of waiting for big money to re-enter the market and show its cards.
Overall this is now a bullish market and longs are favorable!
Trade responsibly and I’ll see y’all next week!
Courtesy of Vlad - trend-based trader and MentFX student
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In our newsletter, we may discuss projects or tokens in which we hold positions. While we aim to provide informative content, our views are not financial advice. Please conduct your research and consult professionals before making investment decisions. Crypto markets are volatile, and past performance doesn't guarantee future results. Invest responsibly, and be aware of the risks. Your capital is at risk, and we do not accept liability for any losses.