Autor Cointelegraph By Kyle White

Bitcoin capitulations abound — Data shows realized and unrealized losses at record-highs

Bitcoin capitulations abound — Data shows realized and unrealized losses at record-highs

Uverejnil používateľ | nov 28, 2022 |

Being three weeks removed from the FTX collapse, Bitcoin (BTC) analysts are combing through data to decipher whether more selling will continue or if a bear market floor has been reached. One thing miners, short-term and long-term holders have in common is they are losing in the Bitcoin market right now. According to on-chain analysis from Glassnode, the scale of both realized and unrealized losses amongst Bitcoin holders is one of the heaviest capitulation events in BTC’s history. Capitulation is hindering all groups from the increasing number of bankruptcies and dwindling miner revenue. Bitcoin’s realized losses fourth largest on record while unrealized losses increaseNovember recorded $10.8 billion in 7-day realized losses for Bitcoin. The largest recorded realized loss in Bitcoin’s history is June 2022 when $19.8 billion was recorded. Such losses show that a large volume of Bitcoin has changed hands at discounted prices.Bitcoin realized 7-day losses. Source: GlassnodeA popular crypto investing saying is “you cannot lose if you do not sell.” Unrealized losses track the entire Bitcoin market versus total market capitalization. The November 2022 56% unrealized loss is the largest in the current bear market. In 2014-2015, unrealized losses hit an all-time high for Bitcoin holders at 86%. The current unrealized losses are the fourth largest in Bitcoin’s history.According to Glassnode analysts: “This metric has recently peaked at 56%, which is the highest for this cycle, and comparable to prior bear market floors.”Bitcoin unrealized losses 7-day moving average. Source: GlassnodeBlock times slow down as Bitcoin miners struggle Bitcoin investors are not the only group capitulating in the current market. Bitcoin miners are struggling to remain profitable with the depressed prices.There it is. Hash Ribbon miner capitulation confirmed. Triggered by the $10B FTX fraud and subsequent collapse, Bitcoin miners are now going bust and Hash Rate is trending down. pic.twitter.com/TorX7PzrNu— Charles Edwards (@caprioleio) November 28, 2022Since Bitcoin miners are under pressure to remain financially viable, this affects the BTC mining hash rate. A reduction in Bitcoin’s hash rate slows down BTC transactions. According to HashRate Index, block times reached over 11 minutes. Bitcoin’s hashrate is dropping like a rock↘️Bitcoin’s 7-day average hashrate is currently 236 EH/s, a 14% decrease from its 274 EH/s ATHBlock times are sluggish as a result: 11 minutes and 12 seconds on average this epochhttps://t.co/JN7OmpJ8X0 pic.twitter.com/ckxqEqOGqX— Hashrate Index (@hashrateindex) November 28, 2022

Despite the current challenges, analysts believe that capitulation is healthy for starting the next bull run. Glassnode notes:“One consistent event which motivates the transition from a bear back towards a bull market is the dramatic realization of losses, as investors give up and capitulate at scale.”With so many groups currently at a loss at this stage of the bear market post-FTX collapse, Bitcoin and overall market sentiment will need to improve to spur new money to drive a bull run. Without improved sentiment, the capitulation may not match previous Bitcoin cycles. The views, thoughts and opinions expressed here are the authors’ alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

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Lido fundamentals shine even as the wider crypto market struggles to regain traction

Lido fundamentals shine even as the wider crypto market struggles to regain traction

Uverejnil používateľ | nov 21, 2022 |

The crypto market has witnessed a turbulent few weeks after the FTX collapse but Lido Finance, a liquid staking protocol, has been a bright spot amidst the chaos. According to Data from DeFiLlama, Lido protocol has earned $1 million or more in fees daily since October 26. Lido fees and revenue over time. Lido has collected over $1M in fees every day since October 26th pic.twitter.com/GHkzSzYIOo— DefiLlama.com (@DefiLlama) November 18, 2022Let’s analyze the on-chain fundamentals to see why this trend has continued. What’s behind Lido Finance’s growth?Lido’s growth started in May 2021, pre-FTX collapse. The fees reached an all-time high on Nov. 10 as fee revenue nearly topped $2.6 million. The protocol earns 10% of the total Ethereum (ETH) staking rewards generated from user deposits. Data also shows a steady increase in deposits to Ethereum’s PoS consensus translates to an uptick in Lido’s fee capture.Lido total deposits. Source: Dune AnalyticsLido’s fee revenue moves in tandem with Ethereum Proof-of-stake (PoS) earnings since Lido sends received Ether to the staking protocol. After the FTX collapse, Ethereum activity has grown thanks to an uptick in decentralized exchange (DEX) activity. Ethereum fees and revenue also reached a 30-day peak on Nov. 8, posting $9.1 million in fees and $7.3 million in revenue. Ethereum fees and revenue. Source: Token TerminalNew and daily active users keep increasingUnique depositors into the Lido protocol have reached 150,000, demonstrating that Lido is continuing to attract new users. The increase in unique deposits comes after centralized “earn” programs have shown weaknesses due to exposure to their exposure to FTX, Genesis, BlockFi and others. Lido unique deposits. Source: Dune AnalyticsDaily active users and Lido (LDO) token holders are also increasing on Lido. According to data from Token Terminal, daily active users hit a 90-day high of 837 on Nov. 17 further bolstering the platform’s positive momentum. Lido tokenholders and daily active users. Source: Token TerminalRelated: DeFi platforms see profits amid FTX collapse and CEX exodusLido’s market capitalization does not match its on-chain fundamentals While fees, deposits and revenue continue to increase for Lido, the market cap of LDO tokens is not keeping pace. As mentioned above, Lido hit a record amount of fees on Nov. 10, at the same time the market cap decreased from $1.2 billion to $663.7 million. According to Coingecko, during this same period, the price of LDO tokens dropped from $1.80 to a low of $0.90. Lido’s circulating market cap and fees. Source: Token TerminalDespite the market-wide downturn, Lido is showing strong fundamentals on multiple fronts. The steady uptick in DAUs, revenue and new unique participants are all key components for assessing growth and sustainability within a DeFi platform. The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

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DeFi platforms see profits amid FTX collapse and CEX exodus

DeFi platforms see profits amid FTX collapse and CEX exodus

Uverejnil používateľ | nov 16, 2022 |

A week after the fallout from the FTX and Alameda chaos, some on-chain data points are interesting to observe. Although record amounts of Bitcoin (BTC) and Ether (ETH) are leaving the exchanges, not all decentralized applications (DApps) and protocols have shown growth, mainly due to reliance on FTX and Alameda. DeFi earnings highlight positive revenue for some protocolsAccording to Token Terminal’s earnings leaderboard, in the last seven days, three protocols had revenue above $1 million. Ethereum led the on-chain earnings with over $8.5 million total, a sign of strong post-Merge fundamentals. OpenSea was a distant second place to Ethereum, earning $1.5 million, while nine protocols and DeFi platforms earned more than $100,000. Earnings leaderboard. Source: Token TerminalDecentralized perpetual exchanges see increased trading volumeCombined with the migration away from centralized exchanges (CEXs), the volatile crypto market has users trading in record numbers. According to data from Token Terminal, the daily trading volume of perpetual exchanges reached $5 billion, which is the highest daily trading volume since the LUNA and TerraUSD (UST) meltdown in May 2022.Perpetual exchange volume. Source: Token TerminalWhile trading volume increased, the total value locked in DeFi lags Only seven protocols saw a net increase in their total value locked (TVL) over a seven-day period. Gains Network, a perpetual exchange on Polygon, saw the largest seven-day increase at 17.3%TVL sorted descending from 7-day. Source: Token TerminalOne interchain operability protocol, Ren, witnessed a TVL drop of 50% in the last week. As reported by Cointelegraph, Ren partnered closely with Alameda, receiving quarterly funding and keeping its treasury directly on FTX. The protocol itself benefited from Alameda’s locked liquidity in an attempt to improve interoperability. Ren TVL. Source: Token TerminalData also shows that blockchain revenues are rising amid a constant rate of daily active users. Major blockchains saw an increase of over 300% in daily revenue when compared to previous weeks. At the same time, daily active users remained steady at 1 million. The dichotomy between these data points suggests that transactions are happening at a more frequent pace among existing users.Blockchain revenue and daily active users. Source: Token TerminalRelated: FTX collapse followed by an uptick in stablecoin inflows and DEX activityBlockchain revenues do not necessarily equal earningsWhile blockchains saw an increase in revenue,s which is likely primarily due to token emissions, only Ethereum saw positive earnings. Proof-of-stake (PoS) blockchains like Polygon, BNB Smart Chain and Optimism all recorded negative earnings. When PoS blockchains have negative earnings, holders of the tokens are hit with inflationary losses. Blockchain earnings. Source: Token TerminalOn-chain data continues to exhibit strong points with increased activity on decentralized perpetual trading platforms and positive revenue for DeFi protocols. Even though CEX outflows were historic, daily active DeFi users did not increase, but the fact that they remained consistent is notable. The same data also highlighted lagging blockchain earnings (except for Ethereum) and a decrease in TVL. The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

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FTX collapse followed by an uptick in stablecoin inflows and DEX activity

FTX collapse followed by an uptick in stablecoin inflows and DEX activity

Uverejnil používateľ | nov 14, 2022 |

On-chain data from Glassnode show Bitcoin’s (BTC) movements hit a new record for the largest net decline in aggregate BTC balances on exchanges, reducing by 72,900 BTC in one week. A similar movement occurred in April 2020, November 2020 and June 2022 with the current outflow leaving around 2.25 million BTC on exchanges. Bitcoin exchange balances with net position change line. Source: GlassnodeExchange exodus for Ether, but not stablecoinsWhile Ether (ETH) did not see an all-time high outflow from exchanges, 1.1 million Ether were withdrawn from exchanges over the last week. According to Glassnode, this marks the largest 30-day exchange balance decline since September 2020 during the DeFi summer in the same year. Ether exchange net position change. Source: GlassnodeRelated: Exchange outflows hit historic highs as Bitcoin investors self-custodyContrary to Bitcoin and Ether’s declining balances on exchanges, stablecoins balances remain net positive on exchanges, meaning their balances are growing. Over $1.04 billion in USDT, USDC, BUSD and DAI moved to exchanges on Nov. 10. This marks Nov. 10 as the seventh largest stablecoin inflow to exchanges. Stablecoins exchange net volume. Source: GlassnodeAccording to Glassnode, with the major influx of stablecoins to exchanges, the current $41.186 billion total is an all-time high. Stablecoins on exchanges. Source: GlassnodeBitcoin miners continue to sell Bitcoin miners continue to remain under extreme pressure and data highlights that hash prices are at all-time lows. The record-low hash prices led to miners selling around 9.5% of their treasuries which is around 7.76 million BTC. This sell-off marks the sharpest monthly decline for miner balances since September 2018. Bitcoin miner balances. Source: GlassnodeDecentralized and centralized altcoin performanceUtilizing asset basked to analyze performance between decentralized exchange (DEX) and centralized exchange (CEX) tokens, Delphi digital found that when comparing the basket prices to BTC, the DEX basket had gained 24% whereas the CEX basket is down 2%. CEX and DEX basket performance. Source: Delphi DigitalGenerally, the on-chain activity correlates to overall Bitcoin, Ether and altcoin market sentiment with the current FTX chaos catalyzing historic exchange outflows and CEX tokens’ underperformance. A likely trend to emerge from the current chaos is a steady uptick in self-custodied cryptocurrencies and an increase in DEX use. The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

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Arbitrum sees steady growth as airdrop speculation leads to increased earnings

Arbitrum sees steady growth as airdrop speculation leads to increased earnings

Uverejnil používateľ | nov 14, 2022 |

Post Ethereum (ETH) merge, layer-2 blockchains have been catching the eyes of users and investors alike. Research firm Delphi Digital has been tracking Arbitrum since August and recently shared its analysis in a monthly market report. According to data, user behavior and historical analysis show multiple trends of rapid growth in transactions, total value locked (TVL) and daily active users at Arbitrum-based platforms. Arbitrum reaches the top-10 in monthly earningsWhen projects give away more token incentives than the revenue they incur, they have negative earnings. Token incentives that are higher than fees a protocol receives are typically a sign that the growth is not sustainable and more than likely wash trading. Over the last 30 days, Arbitrum has earned $1 million in fees, a 134.41% increase. The increase in fees also increased the 30-day revenue for the Arbitrum protocol by 46.91%. Such growth puts Arbitrum as eighth among all DeFi protocols with $240,000 in earnings. Earnings leaderboard sorted by earnings. Source: Token TerminalUser growth hits 70,000 daily active users as Optimism investors move to ArbitrumIn order for a protocol to receive revenue and earnings, they need daily active users. The daily active users transacting and interacting with Arbitrum is how fees increase. Over the past 30 days, Arbitrum witnessed user growth double to more than 70,000 but more recently user count is back to under 30,000. Arbitrum 30-day fees and daily active users. Source: Token TerminalOptimism is another blockchain protocol that is similar to Arbitrum but doesn’t have a token. When Optimism released the OP token, users that were active on the blockchain received airdrops. Due to the similar launch structure of Optimism, some investors are speculating that Arbitrum will also do an airdrop. This speculation might be why users are trading so frequently on the Arbitrum blockchain. Overwhelming, new Arbitrum users are bridging from Optimism. Optimism to Arbitrum accounts for 66.9% of all transfers with Ethereum and Binance (BNB) only equaling 32% combined. ETH transferred to Arbitrum. Source: Dune AnalyticsDespite the majority of transfers coming from Optimism, the blockchains have a similar number of daily active users. On Nov. 13, Optimism had more daily active users with 31,117, while Arbitrum had 27,714. Arbitrum and Optimism daily active users. Source Token TerminalUser and builder behavior on ArbitrumWhen new blockchains launch, users need decentralized applications (DApps) in order to engage with the protocol in a meaningful way. Popular DApps can also increase fees and revenue for the blockchain. On the Arbitrum blockchain, so far perpetual exchanges are proving to be popular. Five of the seven top Arbitrum contracts belong to perpetual exchanges. In addition to the popularity of perpetual exchanges, seven of the 15 most gas-consuming contracts on Arbitrum in the past 30 days were originally built on Arbitrum.Arbitrum gas-consuming contracts broken down by DApp. Source: Token TerminalArbitrum is a growing blockchain when analyzing fees, earnings and revenue but the daily active user growth is starting to contract, even ceding ground to Optimism. Users will want to look at the scaling issue Optimism faced when speculating on the Arbitrum airdrop. The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

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