Market Observation and Analysis

Macroeconomic Environment

Current macro liquidity is showing signs of deterioration. The US dollar index is approaching a new high for the year, putting significant pressure on risk assets. The strength of the dollar is not only due to the stickiness of US inflation and the potential delay in interest rate cuts but also reflects a reassessment of geopolitical risks by the market. It is worth noting that in this election year, the performance of the US stock market remains quite impressive. In contrast, the performance of the cryptocurrency market appears relatively weak.

Overall Market Trends

This week, Bitcoin fell below the weekly support level, and there was significant selling pressure on multiple major trading platforms. The exchange rate of Ethereum against Bitcoin strengthened, leading to a rebound in altcoins. The main line of the market rebound revolves around the Ethereum ecosystem.

Several projects worth noting include:

1. BLAST: As an Ethereum-based L2 project, it recently launched a points airdrop model.

2. KAS: A POW public chain project, its KRC-20 meme plan is about to go live on the mainnet, attracting the attention of some large miners.

3. LISTA: A decentralized algorithmic stablecoin project on the BSC chain has recently launched new mining activities.

Bitcoin Analysis

on-chain data

The market has entered a phase of exhaustion. Since June, the price of Bitcoin has fallen below the 3-month average holding cost. If this trapped structure continues, it may lead to further deterioration of investor confidence, making the adjustment deeper and longer in duration. Historically, similar major adjustments have occurred an average of five times during bull markets.

The growth of stablecoin market capitalization supply has slowed, indicating a lack of new capital inflow in the market. Institutional funds have shown a net outflow for two consecutive weeks, but there are signs of increased capital inflow into altcoins.

The long-term trend indicator MVRV-Z Score is currently at 1.8, entering the mid-stage. This indicator reflects the overall profit status of the market, and the current level indicates that holders are generally in a slight loss position.

futures market

The funding rate for futures has slightly decreased this week. The current rate level indicates that there is still a lot of long leverage, which may suggest a short-term market top. The futures open interest continues to decline, while the long-short ratio for futures is 2.4, reflecting a high retail investor sentiment for bottom fishing, suggesting that the market may not have fully bottomed out yet.

spot market

Since Bitcoin reached its historical high of $73,000 in March, it has been in a consolidation phase. The overall trading volume of centralized exchanges has decreased to levels seen at the end of 2023, while the on-chain trading volume of decentralized exchanges remains stable. The exchange rate of Ethereum against Bitcoin continues to strengthen, and future investment opportunities may revolve around the Ethereum ecosystem.

Public Chain and DeFi Data

The total locked value this week is ( TVL ) at 95.3 billion USD, a decrease of 5.6 billion USD compared to last week, a decline of 5.6%. The TVL of major public chains generally fell, with the Ethereum chain down 8%, TRON chain down 6%, BSC chain down 5%, Arbitrum chain down 9%, Base chain down 4%, BLAST chain significantly down 27%, Polygon chain down 5%, and Optimism chain down 8%. Notably, the TON chain has risen 107% against the trend this month.

Overview of the NFT Market

This week, the floor prices of blue-chip projects in the NFT market have significantly declined, and the overall market continues to drop. Major projects such as CryptoPunks fell by 13%, BAYC dropped by 17%, Pudgy Penguins decreased by 28%, and Azuki fell by 23%. The only project that rose against the trend was Milady, which increased by 4%.

The overall trading volume of the NFT market has slightly declined, with blue-chip project trading volumes generally decreasing by about 20%. The number of first-time and repeat buyers is also gradually decreasing. Overall, the atmosphere of the NFT market remains quite sluggish and faces severe challenges.