If you haven’t read it yet, we published our extensive research piece into the Arbitrum DAO airdrop. We cover most movements of DAOs and included our thoughts on what happened. You can find it through this link.

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This validates our work. We are currently in the process of making another research piece on GMX v2 and one covering the Optimism airdrop, so subscribe if you don’t want to miss that.

Now onto business as usual 👇

 👀 What’s to Come in Volume 23

⛓ On-Chain Sleuthing: Kang losing BIG on Azuki’s, CHIBI rugging, and Smart Money’s favorite farms feature along with Smart Money Moves from Cl & Amir Ormu

🔑 Key News: Moar tardfi ETF filings, $TUSD turmoil, some DeFi exploits, and many, many DeFi updates from CJ

🔥 Hot Narratives: Narratives are dire, zkSync analytics, and BTRFLY update by unexployed

📉 HTF Price Action Scenarios: Covering potential ETH/USDT scenarios from Vlad

📈 Macro Outlook: FED & Rate Hikes, Macro is looking bullish? & Crypto Options from Hansolar

⚔️ A Call to Arms

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⛓ On-Chain Sleuthing

Top 10 $GMX holder unstaked his position prepping for v2?

A big, unknown $GMX whale recently unstaked 9k GMX ($480k) from the platform and proceeded to sell 2k $GMX twice over the past three days.

It looks like he decided to scale out of his mega position, maybe he is betting on a sell-the-news event for $GMX v2. The whale still holds over $4mln $GMX.

The Castle sleuths identified a second address of his that was an early buyer in $DICE and $ROUL. This address also holds 72 GBC. To this day we are puzzled by the identity of this address… Nevertheless, one that you could keep your eye on.

His $GMX wallet address.

DeFi Mochi caught slipping

Mochi is a big “influencer” on Twitter and known for his Dune dashboards. He has amassed over 57k followers through writing threads on all kinds of projects and topics.

In the past Mochi has been caught slipping up and accepting payments from projects that ended up rugging. He rightfully received a lot of criticism for not doing any due diligence into these projects and simply accepting the easy cash. Many of his followers have lost money on those projects.

You would think after receiving so many backlash, he would change, but this week showed that nothing is far from the truth as he advertised another rug. This time a microcap (!?) project with a market capitalization of $20k.

Our Amir immediately went to work and found his wallet address with ease. See his thread for more information.

One big wallet caught in this drama has been Crypto Royalty. He said he lost about $35k although on-chain evidence points to a much larger loss.

His statement on the matter.

His alleged wallet.

Andrew Kang rekt on Azuki’s?

Andrew Kang posted a thread on the 23rd of June, just before the Azuki Las Vegas event, in which he stated how much he was bullish on the NFT collection.

After a careful analysis of the PFP posted in this thread, the team succeed in identifying the main NFT wallet of Andrew Kang.

His wallet in question.

We even noticed that Kang is the second single biggest holder of Azuki.

Unfortunately for Kang, the team behind Azuki didn't have much of their holder interest at heart. The big announcement from the Las Vegas event finally turned out to be a massive dilution of the existing collection and was detrimental to the price.

The price tanked from 15 ETH to ~8.5 ETH in less than a week and resulted in the loss of top 5 collection position.

Kang minted 580 Azuki Elementals (the new copy pasta collection)….

Smart Money Moves & Farms

• Seeing smart money whitelist buys $Malt, as they have interacted with Malt's previous versions they have WL for buying it now.

• The Granary is still popular among smart farmers, especially farming $ARB via looping it.

• Volatile Pools on Hermes Protocol, Ramses, The Ennead, Velodrome and Chronos are still popular among smart farmers.

• Farming R+DAI on Aura Finance is still a favored option among smart farmers.(Also you don't need to claim the rewards daily and sell them, as the APR is being paid in real yield (LDO, BAL and Aura), so you can hold them without expecting dilution for them)

• Farming WETH-ARB on Pendle V2 is favored by smart farmers as well.

• Lybra Finance is still popular among smart farmers too.

Research and analysis by Cl & Amir Ormu

🔑 Key News

Major Crypto News

• Invesco, WisdomTree, Valkyrie and possibly Fidelity filing for Bitcoin ETF

• 3AC Ventures surfaces while their exchange releases oUSD and Raiser

• Ripple Gains In-Principle Payments License in Singapore

• Circle Restarts U.S. Treasury Purchases in BlackRock-Managed USDC Reserve Fund

• Bitgo terminating acquisition of Prime Trust while TUSD has some concerning issues emailed to users

• Today there was a brief TUSD depeg

• SEC allowed launch of first leveraged Bitcoin futures ETF

• Celsius creditors alleges Wintermute facilitated ‘wash trading’ in new class action lawsuit against Celsius

• Hong Kong’s largest bank, HSBC, to offer Bitcoin & Ethereum ETFs to customers

• Resurfacing rumors from back in April that FTX debtors recovered $7 billion in liquid assets

Exploits/Updates

• Gplx dev rugged

• ShidoGlobal exploited for $240k

• EDE Finance exploited again

• Chibi Finance rugged for $1M

DeFi Weekly Updates

• Polygon Labs to upgrade Polygon PoS to zkEVM validium

• Reserve Protocol investing $20M into CRV CVX and SDT

• y2k introduces new product "WILDFIRE”

• MakerDao's sDAI is live while a proposal to allocate excess DAI to other strategies is up

• Level Finance $20M injection proposal passed and a new proposal to burn 180k LVL is up

• Radiant x Magpie partnership to unveil Radpie while Radiant also proposing to deploy on Eth

• Bybit announces official conversion date from BIT to MNT

• Protocol_fx revised whitepaper

• Offchain Labs releases tooling to build Orbit DevNet chains while zkSync releases zkCredo and zkStack

• OSMO 2.0 unveiled

• Vela Hyper VLP 2.0 and platform relaunches

• BadgerDAO discontinuing auraBAL cvxCRV CVX/beCVX

• Azuki introduces Azuki Elementals

• JPEG proposal update includes slash/burn, burning $JPEG and tokenomics revision

• Neon EVM releases their whitepaper and launches closed beta on Solana

• Maverick protocol releases ecosystem incentive program

• Panoptic litepaper revealed

• Gearbox vote to add @curvefinance v2 pools passed

• Diva Protocol launches mainnet

• Tezos Set to Become 8 Times Faster After 'Nairobi' Upgrade

• PlutusDAO v2 tokenomics upgrade soon

Interesting projects

• Stella: Ex Alpha Homora team’s leverage farming project

• Zora Network: Just launched on mainnet, a place for more onchain expression + experimentation

• Stake Stone: Yield-Bearing ETH to Connect Staking Liquidity

• Radpie: Radiant x Magpie collaboration project

• Party DAO: Party lets groups of any size use Ethereum together

• U Protocol: Immutable and omnichain stable asset solely backed by $wstETH

• Kekotron: Advanced MEV tool built by the Nchart team

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

🔥 Hot Narratives

The current market is so dry, there are barely any narratives to be played. The ones that do get played last for a couple of days at most. Sometimes, there's a game of hot-potato with certain memecoins, but most people are better off watching from the sidelines.

Yet, there are two things I want to mention and they have been mentioned before: zksync and Redacted prepping to enter LSDfi.

zkSync Analytics tool & insights

By now I hope that most of you at least tried zkSync Era and did a few transactions on that chain. In my eyes, Era is one of the leading, live zk-rollups and is in a similar phase Arbitrum was in last year: sporadic high gas fees and lots of scammy projects.

We think it is best to wait until established projects decide to move over before calling a true zkSync szn. Nevertheless, it remains likely beneficial to keep doing transactions on the chain as it may have similar airdrop requirements as Arbitrum.

There is this beautiful tracker dashboard made that tracks your volume on different zk protocols. This gives an insight into how much you have already done.

Redacted, pxETH, and Dinero

Redacted’s plans to launch a stablecoin called $DINERO are publicly known for quite a while now. 2 months ago the litepaper dropped, describing Dinero as a stablecoin backed by blockspace. The full product contains a permissionless RPC endpoint, a stablecoin ($DINERO), and an ETH liquid staking token ($pxETH).

Quite a lot of interesting nuggets in that paper, especially the Redacted Layer with its RPC endpoint which would allow for gas payments in $DINERO.

6 days ago on June 22th, a proposal was posted with a plan to grow pxETH. This indicates that Redacted is putting the pieces in place to properly launch DINERO.

The proposal really aims to acquire more market share of staked ETH using the treasury and at max 5% of BTRFLY emissions (only if necessary). To grow pxETH, DEX platforms with high bribe efficiency will be targeted, most likely referring to Curve here.

Redacted remains a big DeFi player with many fingers in many pies.

📈 HTF Price Action Scenarios

Gm frens

Last week I wanted to see a bullish daily close confirming a breakout.

• Re-accumulation playing out

• Momentum to the topside

• Ideally would have broken out higher above 1930ish

• Follow LTF uptrend or wait for pullback into demand zone (green)

• LTF structure re-accumulation playing out

• Longs are favorable

Overall price is delivering bullish and it makes sense to expect continuation. Trade responsibly and I’ll see you here again next week!

Courtesy of Vlad - trend-based trader and MentFX student

💹 Macro Outlook

Previous Macro Events

• 3/17 BTFP Starts 👉 SPX, Gold, Crypto rally

• 3/22 08:00 FOMC: 0.25% 👉 SPX & crypto fell, but gold rose and bond yields fell

• 3/31 12:30 PCE Inflation: A 0.3% F 0.4% P 0.5% 👉 SPX & crypto rally on softer print

• 4/12 18:00 FOMC Minutes: Admission of light recession towards eoy

• 4/13 PPI: A -0.5% F 0.1% P 0.0% 👉 Large fall leads to risk-on rally

• 4/20 UK 👉 10.1% inflation numbers sparks sell off

• 5/4 03:00 FOMC: A 5.25% F 5.25% P 5% 👉 SPX sell off BTC and GOLD up

• 5/5 12:30 Nonfarm payrolls A 253k F 180k P 165k | Unemployment Rate: A 3.4% F 3.6% P 3.5% 👉 SPX up Gold and BTC down

• 5/25 NVDIA breaks ATHs

• 5/28 Debt Ceiling resolution 👉 BTC +4.5% ETH +4.3%

• 6/13 12:30 CPI A 4% P 4.1% | Core A 5.3% F 5.3% 👉 No large reaction

• 6/14 FOMC A 5.25% P 5.25% 👉 No large response

• 6/15 Retail Sales MoM A 0.3 F -0.1% P 0.4%

Upcoming Macro Events

• 6/28 & 6/29 Powell Testimony

• 6/30 Core PCE Price Index

• 6/30 Personal Income / Personal Spending

• 7/3 ISM Manufacturing PMI

• 7/6 FOMC minutes

• 7/7 Non Farm Payrolls / Unemployment Rate

• 7/12 Core Inflation / Inflation Rate

BTC, ETH, and Macro

• As SPX peaked and has started to roll over, the momentum shifted towards crypto markets as multiple tradfi institutions announce their entries into the industry.

• The FED’s preferred inflation metric, core PCE comes out on Friday. It has been sticky at around 5% and expectations are still high. Undershooting expectations could become a bullish catalyst for markets.

• 25bps rate hike probabilities for July have stayed stable indicating low monetary policy uncertainty.

• US stock P/E levels seem to have gone through a capitulation cycle and have now seemed to have bottomed.

• China looks like it is trying to stimulate the slowing economy 👉 +ve for crypto.

• TGA refill status: 340b has been refilled, 50% from RRP(neutral to net liquidity). The rate of increase slows from July to Sept, so should become less of an issue.

Crypto Options Markets

• Large Opex this Friday with considerable negative gamma around the 30k strike. This means many players are currently holding short 30k calls. If the price continues up beyond 30k towards Friday, it could lead to further bullish flows as they hedge their positions(aka a slingshot effect).

• Beyond this expiry, there are more pockets of negative gamma around the 31k strike. We could see another swift move up if spot markets find a bullish catalyst.

💡 Reminder that options flows are still small relative to the size of the market. Analyzing flow from options dealers may have a limited effect on crypto markets.

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

Thanks for reading, please give us a follow at Castle Capital and subscribe to The Castle Chronicle for an update each week!

Virtually yours,

Atomist & The Castle