👀 What’s to Come in Volume 38

🔑 Key News: Honda Accepts $BTC $ETH, Celsius Wants Restart, Stars Arena Exploited, $LVL $OATH $FRAX Updates & more from CJ

⛓ On-Chain Sleuthing: $GMX Newest Omega Whale from Cl

🔥 Hot Narratives Intent-Based Narrative & $ARB STIP Voting Phase from unexployed

📈 Macro Outlook Big Update Related to Ongoing Conflict in Middle-East from Hansolar

📉 HTF Price Action Scenarios To Trade or Not to Trade? from Vlad

⚔️ A Call to Arms

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🔑 Key News

Major Headlines

• Slow start for ETH ETFs

• Honda Accepting Bitcoin and Ethereum in a Revolutionary Partnership

• SEC's motion to appeal loss in @Ripple case denied

• Celcius seeks approval to repay customers by year-end and potentially restart as NewCo

• Ripple receives full license to provide digital payment token services in Singapore

• FTX hacker swapping ETH to BTC on Thorchain which prompted Thorswap to take down their frontend

• Binance launches copy trading feature

• Vita Dao launches biotech company MatrixBio

Exploits/Updates that Happened this Week

• Bigwhaleio hacked for 7280 BNB

• Orbiter Finance network issue and the team’s response

• Stars Arena first exploit, followed by a $3M exploit

• Hypercycle OTC scammed for almost $1M

• Galxe frontend exploited

• HTX Global exploiter returned funds

• Goldfinch loses $7M due to default but covers the losses themselves

• Gitcoin made a mistake that cost them $500k

• MantaSwap rugged/exploited for $100k

Useful DeFi Updates

• Opensea Pro introduces Private Sales

• TProtocol introduces USTP

• StarkWare delays first token unlocks to April 2024

• Rollbit buyback and burns are now on-chain

• Oath Foundation introduces Aurelius which will deploy on Mantle

• Celestia introduces the Celestia Improvement Proposal Process

• MEVdotio goes live

• FriendTech added the ability to change login method

• Sui Foundation reallocates 117M Sui from market makers

• Level Finance hints at building their own chain

• Xion launches testnet using USDC as gas

• Frax Finance releases v3 docs

• BackedFi issues tokenized short-term US treasury bond ETF on Base

• Arbitrum STIPs live and here’s a Dashboard by @inspexco

• Metis reverting to Optimistic rollup

• FanTech giving out MNT to incentivize users

Interesting New Projects

• ProtoKit: Protocol development framework for privacy-enabled application chains

• Phaver: Raised $7M, web3 social application built on Lens and CyberConnect

• Kamino Finance: Automated liquidity & yield venue on Solana

• Sujiko: NFT perpetual futures DEX which recently went live

• Swissknife: EVM tooling aggregator

• Layer Akira: Hybrid on-chain / off-chain CLOB dex built on Starknet

• Hub3: FT fork on Solana

Courtesy of CJ - check out his telegram channel for daily news, projects updates and new releases

⛓ On-Chain Sleuthing

Our dear friend CL is currently traveling, hence the small update. He will be back soon.

Amber Group now Biggest $GMX Whale

We want to congratulate Amber Group for becoming the biggest, known, $GMX whale.

Our sleuth team noticed that various addresses associated with Amber Group had been accumulating tons of $GMX.

Research and analysis by Cl

🔥 Hot Narratives

RFQ Trend: IntentX Tokenomics

Over the last few months the word ‘intent’ and ‘intent'-based’ have been used more frequently. They are a pivotal concept within crypto as they promise to shift the way transactions are conducted and trade is facilitated.

First, a small refresher on intents: An intent is like a simple message that tells someone what you want to happen WITHOUT explaining all the details.

Imagine ordering a pizza online. Instead of listing all the pizza ingredients and how it should be cooked, you just select a “pepperoni pizza” from a menu. That choice is your intent - it tells the pizza place exactly what you want.

Intents make things easier because you don’t have to explain everything step by step; you just express your wish or what you want to do in a shorter, more straightforward way. It’s like giving a quick instruction to get what you want.

Now in crypto, the concept of intents is like a smart way of telling the underlying protocol what you want to do with your assets. Normally, users would need to construct their transactions in a certain way to perform a swap.

Intents make it easier to give specific instructions. For example, if you want to trade 2000 USDC for 1 ETH, you can create an intent that says, “I authorize any future state where I have 1 more ETH and 2000 USDC, and I don’t really care how that may happen.

This sounds very similar to posting a limit order, however, there are more benefits to intents. More specifically, the capital efficiencies improved through the use of just-in-time (JIT) liquidity. This is especially true for perp DEXs using intents.

As quotes get streamed to market makers, traders are able to get the best quotes. The Open Interest is able to scale as market makers are delta neutral because their hedging off-chain by reverse-mirroring traders’ positions.

Here is a wonderful insight published by SYMMIO, the team that is creating a lot of the back-end behind intent solutions:

This + being non-custodial, makes intents truly a game-changer within crypto, and as the combination of on-chain execution and off-chain computing is being implemented much more seamlessly. You can expect a lot of innovation on the “intent” side of crypto.

Projects that are working on this:

• SYMMIO

• Thena

• Based Markets

• IntentX

• Anoma

Go follow fellow Castle member Squigs who is deeply involved in the intent space and is preparing a deep dive into this topic.

Arbitrum Projects Getting Approved

Last week, we posted our Arbitrum STIP Codex, which provided a high-level analysis of all the posted proposals by projects including data on their intent with the grant.

This was in preparation for the voting rounds that followed the proposal phase which is occurring right now. There are only 2 days left for votes to be submitted and some of the proposals already reached the mandated quorum.

The good lads over at Inspex have created wonderful public sheets that track all the voting standings.

Another, more extensive public resource has been created by Ouroboros Research which can be found here. It includes pleasant visuals, but also a tab ‘Grants Ranked’ ranking all the proposals that have been passed in chronological order.

Use these sources of information to your advantage to spot, where the money will flow to. So far, people are underestimating the size of this program and the amounts some of these projects are receiving.

You could either choose to speculate on the underlying tokens or prepare yourself to farm some of the incentives in the most lucrative places.

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/.

BTC, ETH, and Macro

Upcoming Events

• Wed, Oct 11th : PPI, FOMC minutes

• Thurs, Oct 12th: Inflation Rate, Jobless Claims

• Fri, Oct 13th : Grayscale Appeal

  • Base-case is an appeal from SEC. Otherwise, implicit spot ETF approval?

BTC, ETH, and Macro

• There have been some rather strong macro headwinds affecting crypto lately;

  • First, the US10Y yields making aggressive moves upwards after the FOMC causing SPX and GLD to drop sharply over the past weeks.

  • However, the heightening geo-political conflict between Hamas and Israel seems to have caused bond markets to re-adjust long-term rates due to the conflict potentially increasing fiscal spending(a form of monetary easing).

• Bitcoin displayed a low correlation to both the fall in the SPX & GLD as well as the bounce. If anything, it looks like BTC has been holding up well relative to tradfi markets. However, there are clear signs that markets are very illiquid and can be influenced by a few participants.

Option Markets

• BTC IV and Skews: IV hanging around the high 30s, currently at 38. 7day atm IVs are also at similar levels to the 30day IVs indicating that dealers maybe expect some volatility in the short term.

• Considering BTC gamma charts, dealers are negatively positioned from 28.5k to 32k indicating that there may be some re-enforcing flows if we break past 28.5k.

• ETH IV and Skews: ETH IVs are markedly lower than BTC’s and after having a lackluster debut on the ETF scene the aggressive large-vol seller returned dropping ETH vols towards the low to mid 30 handle. Skews are all looking bearish as puts are being favored on all expiries except the 6-month expiries.

Courtesy of Hansolar - check out his telegram chat for all things options, crypto and DeFi

📈 HTF Price Action Scenarios

Gm frens!

Once again the upside momentum couldn’t quite sustain itself. This is a very usual occurrence in sideways markets. I call this “range shenanigans”, as it’s really easy for the market manipulators to take prices from one extreme to another. And by doing that they fool you to jump on the train, only to liquidate you later to accumulate/distribute their own shares.

• Range high liquidated

• Daily demand tapped

• Re-accumulation playing out

• Waiting for bullishness to prove itself

I’ll once again repeat myself like a broken record - this is a hostile market environment without any good directional clues and you can outperform others by staying out.

Trade (or don’t trade) responsibly and I’ll see y’all next week!

Courtesy of Vlad - trend-based trader and MentFX student

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