Stake Hacked, $UNIBOT vs $BANANA, $METAL, Pintswap & More
The Castle Chronicle: Volume 33
👀 What’s to Come in Volume 33
🔑 Key News: Stake Hacked, ETF Delays AGAIN, Uniswap V4 Update & more from CJ
🔥 Hot Narratives: Trading Bot Wars and $ARB Incentives from unexployed
📈 Macro Outlook: Explaining the Grayscale Retracement Implications & Options Market Analysis 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
Grayscale wins court battle against SEC
X/Twitter acquires license to add (crypto) payments
SEC Delays Spot Bitcoin ETF Decision for All Applicants Including BlackRock, Fidelity
China court declares virtual assets legal properties protected by law
GoGalaGames CEO and co-founder filed lawsuits against each other
South Korea looks to track and freeze crypto used by North Korea in new bill
Exploits that happened this week
StarkWare reenabled upgrades to save user funds
PepesGame admin wallet drained
SharedStakeOrg sgETH exploited for 102 ETH
Symbiosis PSA to revoke approvals if you used them from August 30th to September 1st
GBOT issues in-depth clarification of GBOT OTC incident
Possible grief action on AjnaFi, recommended to remove funds
Stake hacked for $41M
FloorDAO exploited for $65k
NimaCapital broke their agreed terms with Synapse Protocol and dumped their tokens
Useful Weekly DeFi Updates
Ethereum Execution Layer Specification (EELS) reveal
Curve Finance launches on Base
Paraspace and Parallel Fi merging to become ParaX
OthersideMeta announces LoTM open beta next month
RuneKek announces last phase of EndGame is to launch an EndChain on Solana codebase
Uniswap announces v4 launch after Dencun upgrade
Zksync co-founder @gluk64 pitches "L1 Fork as the Court of Final Appeal”
V4 Adoption & DYDX Token Migration to dYdX Chain proposal passed
Raft announces Raft v2
Aave resumes $GHO minting
Developer of PUBG launching Settlus, a Cosmos-based chain
Governance proposal to introduce staked Frax (sFRAX)
Caldera unveils first 3 Arbitrum orbit chains
Ethena launches pre-registration for guarded mainnet launch
Some Interesting Projects to Look Out For
⛓ On-Chain Sleuthing
Digits and Ethersole Increasing $RLB Holdings
Some major addresses that we have covered in the past have been increasing their $RLB exposure.
Digits DAO now holds a $950k position in $RLB:
Digits DAO DeBank Page [only visible for free subs]
Ethersole now holds $460k in $RLB:
Ethersole DeBank Page [only visible for free subs]
Pintswap Trending Upwards
We covered Pintswap a while ago when it just launched its NFT collection for its upcoming OTC order book DEX.
We wanted to congratulate anyone who managed to get in and give an update on the collection. As you can see, the collection is trending upward quite nicely.
An interesting address that we have dubbed the “TRIS Biddooorrr” has buying a lot of the supply. The address acquired 5% over the course of 3-4 days. Clearly, this owner expects something big.
TRIS Biddooorrr Blur Page [only visible for free subs]
Another interesting token that we have been monitoring is $METAL. The project provides interesting tools around on-chain data and trading.
Looking on-chain we have found some bullish indications.
We basically noticed that most of the big holders are extremely bullish and have been adding to their bags.
Top Holder Addresses [only visible for free subs]
Kwenta Wash Trading
We have noticed an address that has been wash trading with massive size on Kwenta. The goal of this user has been farming as much of the $OP rewards as possible as it is rewarded based on volume.
Kwenta Wash Trader [only visible for free subs]
It’s an interesting topic. Will this way of incentivization lead to organic users or not? Is the use of grants a sustainable way of building a perp protocol on Layer 2s?
Smart Money Farms
Smart Farmers have favored BASE chain recently, but Prisma Finance still caught their attention.
Popular stablecoin farms of the week:
USD+/DAI on Aerodrome with 13.8% APR and 22m TVL!
USDbC single sided staking on Based Farm with 178% APR and 1.9m TVL.
• Popular Volatile LPs of the week:
WETH/USDbC on Aerodrome with 11.76% APR and 52.5m TVL.
TAROT/WETH on Aerodrome with 295% APR and 5.8m TVL.
UNIDX/WETH on Aerodrome with 88% APR and 1.35m TVL.
🔥 Hot Narratives
$BANANA vs $UNIBOT
In the case that Maestro never launches a token (which is highly likely), then it could be that we are approaching the endgame of bot tokens now that Banana Gun has announced its token (see Tweet).
Over the summer, the Banana Gun bot has gained significant traction and taken a significant % of the overall market. A huge feud sparked between the communities of Unibot and Banana as both were shitting heavily on each other.
The team announced a presale of 800E for different groups of users (see Tweet). Full details down below:
This token distribution led to some criticism on Twitter. People are saying that the team is being greedy by raising so much AND keeping a large percentage of the supply reserved for the treasury. That being said, the presale is valued at $1.5 million, which, in our eyes, is extremely cheap for a project of this size.
The launch of $BANANA is highly hyped. We expect that many on-chain traders will be bribing and sniping the token, making it extremely hard to get a good entry.
If you like a good dose of PVP, playing the $BANANA launch might be something you want to put on your agenda.
New $ARB Incentive Proposal
A new proposal has been made on the Arbitrum governance forum regarding on-chain $ARB incentives. This time it is done on behalf of the Arbitrum Incentives Working Group which has been hosting community calls and workshops over the past few months.
The initiative proposes to inject up to 75 million $ARB into the network and distribute them across active Arbitrum protocols. Underpinning the proposal are clear eligibility requirements for grantees and a meticulously designed two-cycle voting process, market by community engagement.
The program offers a spark of hope for the Arbitrum community which has been a bit in the gutter lately despite the announcement of Stylus Testnet. One could expect that network metrics such as TVL, trading volumes, and user engagement would be driven up by a grant program of this size.
So far, the community is very open and welcomes this proposal. We are excited to see this go into a voting process.
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/.
Wed: ISM Services PMI (Aug)
Thurs: US Jobless Claims and Unit Labor Costs (Q2), 6 FEDs speak
Fri: US Consumer Credit (Jul)
Next Wed: CPI
BTC, ETH, and Macro
Euphoria from Grayscale’s win against the SEC was short-lived to the disappointment of the crypto space. It looks like the low liquidity is leading to wide swings by a few players in the markets. Coupled with macro headwinds, crypto sentiment is as pessimistic as it was during the FTX blow-up according to options skews.
Also disappointing to those expecting a liquidity injection from the BoC to revamp their economy, Xi released a statement on how he believes austerity is the solution and that “Western-style social support would only encourage laziness”. Quite an ironic statement considering each country’s political history.
With still a month to go until the Bitcoin ETF approval date, it looks like more chop(or drop) for the time being.
IVs staying elevated as we saw some major swings with the Grayscale news. Interestingly realized vols are actually higher than IVs at the moment.
BTC IVs have risen slightly to 39.23(37.26 last week) which implies the options markets expect a 2.05% daily price move.
Short-term skews shot up almost 10 points on the weekend which is quite unusual. In some cases, aggressive options buying in either direction is an indication of insider knowledge. However considering the low liquidity, even small trades can move the markets in current conditions.
BTC gamma charts are displaying some negative gamma below the current price suggesting that if we lose the 25.5k level, we could move to 25k quickly due to option flows covering their short positions.
ETH IVs fell slightly to 38.42(39.13 last week) implying the options markets expect a 2.01% daily price move. Currently, the 30d IV is higher than the historical volatility of 42.2%.
ETH skews are also very positive implying option market participants are very pessimistic. Currently, they are at similar levels to the FTX crash. Either puts are overpriced(relative to calls) or perhaps there really is some bad news brewing under the surface. Only time will tell.
📈 HTF Price Action Scenarios
Last week we had some positive news regarding ETFs and whatnot, causing a spike in price. I started following the 30m chart to see if there is any re-accumulation that I could get involved in, but unfortunately, the entire pump has retraced since then and we are now back at local lows inside the daily demand.
Daily demand tapped
Re-accumulation playing out
Looking to follow bullish momentum
On the HTFs nothing has really changed though. I still expect accumulation inside this daily demand, which means I’ll be looking for new bullish momentum to follow.
Trade responsibly and I’ll see y’all next week!
Courtesy of Vlad - trend-based trader and MentFX student
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