The latest moves in crypto markets, in context By Lyllah Ledesma, CoinDesk reporter Was this newsletter forwarded to you? Sign up here. |
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Welcome to Wednesday. Here’s what you need to know about crypto today: |
- Hedge fund Fir Tree sues Grayscale to get details about GBTC.
- Sam Bankman-Fried hires celebrity defense lawyer Mark Cohen.
- Binance's CEO discloses how much the exchange makes in fees.
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CoinDesk Market Index (CMI): 850 −1.5%
Bitcoin (BTC): $16,794 −1.2%
Ether (ETC): $1,225 −2.7%
S&P 500 futures: 3,917.50 −0.7%
FTSE 100: 7,518.67 −0.0%
Treasury Yield 10 Years: 3.51% −0.1
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Fir Tree Partners is suing Grayscale Investments to obtain details about the Grayscale Bitcoin Trust (GBTC) in order to investigate potential mismanagement and conflicts of interest. The hedge fund said it wants Grayscale to resume redemptions and cut its 2% fees for the trust, which is the largest publicly traded crypto fund in the world. GBTC is trading at a 43% discount to the price of the underlying bitcoin. (Grayscale and CoinDesk are both owned by Digital Currency Group.) |
Grayscale Investments CEO Michael Sonnenshein (CoinDesk) |
FTX founder Sam Bankman-Fried has hired high-profile defense attorney Mark Cohen, a former federal prosecutor who represented socialite Ghislaine Maxwell in her sex-trafficking trial. Although Bankman-Fried hasn't been formally charged with any wrongdoing, he is reportedly being probed by both U.S. federal prosecutors and the Securities and Exchange Commission for his actions at failed crypto exchange FTX and Alameda Research, FTX’s affiliated trading arm that he also owned. Crypto exchange Binance generates 90% of its revenue from transaction fees, CEO Changpeng Zhao said in an interview with TechCrunch. Zhao added that Binance had removed all ads from data site CoinMarketCap, which it acquired in 2020, to make for a cleaner experience. "We can turn that back on, that’ll give us $40 million a year. But we don’t need to today," Zhao said. It is estimated that Binance had about $20 billion in revenue in 2021, according to a Bloomberg analysis. |
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Market Insight: AXS Rally May Be 'Short' |
Open interest in AXS futures and perpetual futures has jumped to the highest since early September. (Coinglass) |
AXS, the native token of blockchain-based play-to-earn game Axie Infinity, has come out of oblivion with a double-digit price rally. Leverage traders, however, appear to be skeptical if AXS' turnaround from 17-month lows will be long-lasting. That's because while open interest or the dollar value locked in the number of active standard futures and perpetual futures contracts tied to AXS has increased to a three-month high of $129.7 million, funding rates remain negative, according to data source Coinglass. The combination of rising open interest and negative funding rates suggests an influx of new money on the bearish side, a sign of traders shorting the rally. |
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Source: Arcane Research/ProShares |
- The chart shows ProShares Short Bitcoin Strategy (BITI) exchange-traded fund has had outflows since late November.
- Yet, the net short exposure remains elevated at equivalent of 6,230 BTC – well above the summer highs.
- According to Arcane Research, the net short exposure in BITI peaks at market depths.
- "Countertrading extreme BITI inflows could be a promising trading strategy," Arcane Research said in the weekly note.
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Disclaimer: The information presented in this message is intended as a news item that provides a brief summary of various events and developments that affect, or that might in the future affect, the value of one or more of the cryptocurrencies described above. The information contained in this message, and any information liked through the items contained herein, is not intended to provide sufficient information to form the basis for an investment decision. The information presented herein is accurate only as of its date, and it was not prepared by a research analyst or other investment professional. You should seek additional information regarding the merits and risks of investing in any cryptocurrency before deciding to purchase or sell any such instruments. |
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