🟣 Indecision to close out the week
Arbor Day; don't forget to touch grass
Macauley Peterson
April 26, 2024
Welcome back to 0xResearch – quick hitting alpha for the crypto degens. Here's what we got for you today:
Market sentiment check
Renzo depeg
Avail preps for launch
IBIT treading water
Markets today are mixed, with BTC looking droopy (down -1.5%) while US equities rally (1.5% up on the Nasdaq) — not the inverse correlation that crypto connoisseurs want to see!
Among the bitcoin ETFs, BlackRock’s IBIT registered zero inflows for the second day in a row, combined with Fidelity's offering showing its first ever outflows, shedding -$23 million.
Sentiment on Crypto Twitter has soured notably, with fresh threads deriding mercenary VCs and expressing chagrin at the reset of many lower-cap tokens to their yearly open prices.
That’s encouraging! In contrast to what I wrote last week about sentiment, we could use a little misery to help find a local bottom.
Speaking of pain…
Renzo’s ezETH LRT is slowly healing. Following the rout Wednesday and Thursday, the token’s value is gradually returning to parity with ETH, with less volatility in the short-term swings as well.
Yesterday the Renzo team backpedaled on some of the more controversial aspects of their planned REZ community airdrop, proposing changes to the claim timeline, tokenomics and eligibility requirements.
Addressing the apparent favoritism towards Binance Launchpad participants, the public claim date is moving up to Tuesday April 30 so recipients are not front-run by Binance farmers.
Renzo is also increasing the total community allocation by 2% with the additional tokens going to disillusioned "Season 1" claimants.
That may help smooth ruffled feathers, but it doesn’t address demand for ezETH in "Season 2," for which the allocation remains unchanged.
The consensus cause of the depeg was too many ezETH holders opting to swap into ETH to farm other LRT/protocols at the same time, which would hold only if the perception is that Renzo’s Season 2 incentives are not generous enough compared to alternatives.
And of course, the lack of a withdrawal process left these eager dumpers with no other exit valve than onchain liquidity pools.
Avail outreach
Top layer-2 providers Arbitrum, Optimism, Polygon, StarkWare and zkSync are all expected to offer an Avail for data availability, according to the Avail team.
These rollup builders will support Avail within their chain stacks once its mainnet rolls around.
Earlier this week, Avail announced its upcoming airdrop, dubbed a "unification drop" alongside a claim page, although tokens will not actually be distributed until a future date TBD.
The network’s final testnet — Turing — went live on Wednesday.
Thousands of rollups will continue to launch. With that, rollup interoperability presents a major challenge. Our latest unlocked report here unpacks how Avail presents a potential solution to rollup fragmentation through its three products: Avail DA, Nexus, and Fusion. Avail, the unification layer for web3, may prove to be the logical end game for DA layers, so if you’re interested in what that means, check the report out!
IBIT buyers breaking even:
Source: fewseethis
If you look at a volume weighted average price for all buyers of the BlackRock spot bitcoin ETF, they are now hovering around the break-even point.
One assumes that at least some of that capital is of the patient institutional type, but of course retail traders are also in the mix, so it will be interesting to see how the flows respond to continued sideways chops or further downside moves.
Are IBIT hodlers’ hands more paper or diamond?
Perpetual futures stand out as one of the most dynamic segments within DeFi, characterized by constant innovation, whether that be through pre-market futures or access to community trading vaults. Despite this, perp DEXs currently constitute less than 2% of the total crypto perp volume.
Data publishing costs have historically been a bottleneck for rollups, and as more rollups launch, interoperability will continue to be a major challenge. Avail presents a potential solution to rollup fragmentation through its three products: Avail DA, Nexus, and Fusion, which together aim to unify the web3 experience.
Cryptocurrencies look like they are closing out a volatile week relatively flat
Consensys filed a lawsuit against the SEC in a Texas court on Thursday
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The insights, views and outlooks presented in the report are not to be taken as financial advice. Blockworks Research analysts are not registered broker/dealers or financial advisors. Blockworks Research analysts may hold assets mentioned in this report, further outlined in the Firm’s Financial Disclosures.
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On May 4, 2024, Polygon developers met for the Polygon Protocol Governance Call (PPGC) #19 to discuss and finalize inclusions for the upcoming hard fork. The main focus was on PIP 22, PIP 36, PIP 30, and increasing the minimum gas price. With the inclusion list finalized, Polygon will target shipping these changes at the end of May or early June depending on testnet deployment timelines. The next PPGC meeting is tentatively scheduled for May 30 but may shift a week or two to align with the rollout.
by Boccaccio
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