Whale Accumulates About $187,000,000 Worth of Bitcoin and Altcoins From Binance in Just Three Days: Lookonchain

December 2, 2023 The Daily Hodl

Over $102,000,000 in Bitcoin, Ethereum, BNB and Other Assets Liquidated As Binance and Ex-CEO Plead Guilty in US

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$2,907,170,360 in Ethereum Accumulated by 200 Largest ETH Whales in One Year, Says Analytics Firm Santiment

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Binance Experiences Withdrawals, but ‘No Mass Exodus’ of Funds Despite $4,000,000,000 Settlement: Nansen

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Why is Solana (SOL) price down today?

November 13, 2023 Coin Telegraph

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Despite an 11.3% correction in just two days, SOL maintains a robust position with healthy derivatives markets and on-chain metrics.

Solana’s native token, SOL (SOL), experienced a remarkable 58.6% surge in just five days, reaching a $64 high on Nov. 11. However, the subsequent two-day retracement of 11.3% to $54 has prompted investors to question whether this signals a fading bullish momentum or merely a temporary price adjustment.

To put SOL’s performance into context, it can be compared with other leading altcoins. Since its peak on Nov. 11, Avalanche’s AVAX (AVAX) has rallied by 17%, Ether (ETH) gained 1%, and BNB (BNB) traded down 2%. This comparison underscores that SOL has underperformed in the broader altcoin market. Therefore, the 5.5% daily decline on Nov. 13 is unlikely to be tied to macroeconomic or sector drivers, such as the potential approval of a spot BTC exchange-traded fund.

Solana remains a top contender in terms of performance and on-chain activity

Despite the recent decline in SOL’s price, a seven-day gain of 35% suggests that investors should not hastily adopt a bearish outlook, as this could merely be a natural correction following Solana’s significant outperformance. However, it’s essential not to disregard Solana network’s fundamentals, which include on-chain metrics and SOL’s derivatives markets. Excessive leverage use by traders could potentially lead to forced liquidations, especially in perpetual contracts or inverse swaps, where funding rates play a crucial role.

Perpetual contracts, also known as inverse swaps, carry an embedded rate that is typically charged every eight hours. A positive funding rate indicates that longs (buyers) are seeking more leverage, while the opposite situation arises when shorts (sellers) require additional leverage, leading to a negative funding rate.

*7-day funding rates at top exchanges. Source: CoinGlass*

The seven-day funding rate for SOL aligns with that of Bitcoin (BTC) and ETH, pointing to a slightly higher demand for leverage longs. The 0.4% weekly cost is standard, considering that cryptocurrency’s market capitalization has grown by 10.5% over the past two weeks, reaching $1.4 trillion, its highest level since May 2022.

Analyzing on-chain data from semi-centralized networks with very low transaction fees carries inherent risks, as inflating these metrics is relatively easy, particularly those related to decentralized finance. A case in point is the revelation in August 2022 by a former developer from Saber, a previously esteemed decentralized exchange on Solana, who disclosed that a significant portion of the application's total value locked (TVL) was manipulated through double-counting.

Data providers have since improved their services to prevent such obvious inflation of metrics. Currently, Solana's TVL stands at $535 million, which, while a substantial figure, is relatively modest compared with its close competitors.

*Blockchains TVL ranking in USD. Source: DefiLlama*

It’s noteworthy that Solana’s TVL lags behind Avalanche’s $614 million, despite Solana’s impressive $22.7 billion market capitalization. Similarly, Polygon’s TVL is $840 million, while MATIC’s (MATIC) market value stands at $8.2 billion, underscoring the disparity.

Moreover, the accumulation of seen-day fees for Solana, totaling $660,000, does not seem to justify significant future demand for SOL. Even if this number were to increase significantly, it would still fall short of the token supply increase, which has risen by 3.7% in the past 90 days, equivalent to $65 million per week.

In addition to the regular issuance of SOL, there’s the vesting schedule related to the failed FTX exchange and Alameda Research. The bankruptcy estate has been permitted to sell up to $100 million in digital assets per week, including 55.75 million SOL in September 2023.

NFT data shows Solana is a top contender

Solana’s emergence as a strong player in the nonfungible token (NFT) market was one of its notable selling points, given the high costs associated with issuing and maintaining collections on Ethereum, the leading blockchain. However, this advantage has not been sufficient to attract the highest-value items and whales to Solana’s NFT markets.

*Blockchains by NFT sales volumes in USD, 7-day. Source: CryptoSlam*

Despite the seven-day average transaction fee on the Ethereum network increasing to the current $7.6, its total weekly NFT volume continues to outpace Solana’s by more than seven times. This data underscores that investors and creators consider factors beyond transaction costs. Nevertheless, Solana maintains a significant position in the market, alongside the leaders, Bitcoin and Ethereum.

Even though SOL price corrected by 5.5% on Nov. 13, it does not necessarily reflect a decline in network activity or reduced demand for leverage longs using futures contracts. However, it does indicate that investors have taken notice of SOL’s seemingly excessive market capitalization compared to its peers. The extent of this correction remains uncertain.

This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Bitcoin price chases after $35K as BTC derivatives data signals fresh inflow

October 25, 2023 Coin Telegraph

Bitcoin price chases after K as BTC derivatives data signals fresh inflow

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Bitcoin options and futures data suggests the current BTC price movement could have longevity.

Bitcoin’s (BTC) price action is the talk of the town this week and based on the current sentiment expressed by market participants on social media, one could almost assume that the long-awaited bull market has started.

As Bitcoin's price rallied by 16.1% between Oct. 22 and Oct. 24, bearish traders using futures contracts found themselves liquidated to the tune of $230 million. One data point that stands out is the change in Bitcoin's open interest, a metric reflecting the total number of futures contracts in play.

The evidence suggests that Bitcoin shorts were taken by surprise on Oct. 22 but they were not employing excessive leverage.

*Bitcoin futures aggregate open interest, USD. Source: Coinglass*

During the rally, BTC futures open interest increased from $13.1 billion to $14 billion. This differs from August 17, when Bitcoin's price dropped by 9.2% in just 36 hours. That sudden movement caused $416 million in long liquidations, despite the lower percentage-size price move. At the time, Bitcoin's futures open interest decreased from $12 billion to $11.3 billion.

Data seems to corroborate the gamma squeeze theory that is circulating, which implies that market makers had their stop losses "chased."

The $BTC "god candle" lines up with where dealers got blown out of short positioning ($32k-$33k).

This was a gamma squeeze, not organic. pic.twitter.com/NXM8z8mNDa
— Not Tiger Global (@NotChaseColeman) October 24, 2023

Bitcoin personality NotChaseColeman explained on X social network (formerly Twitter), that arbitrage desks were likely forced to hedge short positions after Bitcoin broke above $32,000, triggering the rally to $35,195.

The most significant issue with the short squeeze theory is the increase in BTC futures open interest. This indicates that even if there were relevant liquidations, the demand for new leveraged positions outpaced the forced closures.

Did Changpeng Zhao and BNB play a role in Bitcoin's price action?

Another interesting theory from user M4573RCH on X social network claims that Changpeng "CZ" Zhao used BNB as collateral for margin on Venus Protocol, a decentralized finance (DeFi) application after being forced to sell Bitcoin to "shore up" the price of BNB token.

maybe im nuts but what we just saw is

cz has BNB collateral on Venus

bnb dumping

cz sells btc to shore up bnb

cz unwinds loans and pays back debt on Venus

bnb on venus no longet vulnerable to liquidation

cz buys back btc with bnb to rebalance his btc position@cz_binance… pic.twitter.com/NHulDnacB3
— ⚡️ (@M4573RCH) October 25, 2023

According to M4573RCH's theory, after a successful intervention, CZ would have paid back the interest on Venus Protocol and bought back Bitcoin using BNB to "rebalance" the position.

Notably, the BNB supply on the platform exceeds 1.2 million tokens, worth $278 million. Thus, assuming that 50% of the position is controlled by a single entity, that's enough to create a $695 million long position using 5x leverage on Bitcoin futures.

Of course, one will never be able to confirm or dismiss speculations such as the Venus-BNB manipulation or the "gamma squeeze" in Bitcoin derivatives. Both theories make sense, but it is impossible to assert the entities involved or the rationale behind the timing.

The increase in BTC futures open interest indicates that new leveraged positions have entered the space. The movement could have been driven by news that BlackRock's spot Bitcoin ETF request was listed on the Depository Trust & Clearing Corporation (DTCC), even though this event does not increase the odds of approval by the U.S. Securities and Exchange Commission.

Bitcoin derivatives point to a healthy bull run and room for further gains

To understand how professional traders are positioned after the surprise rally, one should analyze the BTC derivatives metrics. Normally, Bitcoin monthly futures trade at a 5% to 10% annualized premium compared to spot markets, indicating that sellers demand additional money to postpone settlement.

*Bitcoin 1-month futures premium. Source: Laevitas.ch*

The Bitcoin futures premium reached 9.5% on Oct. 24, marking the highest level in over a year. More notably, it broke above the 5% neutral threshold on Oct. 23, putting an end to a 9-week period dominated by bearish sentiment and low demand for leveraged long positions.

To assess whether the break above $34,000 has led to excessive optimism, traders should examine the Bitcoin options markets. When traders anticipate a drop in Bitcoin's price, the delta 25% skew tends to rise above 7%, while periods of excitement typically see it dip below negative 7%.

*Bitcoin 30-day options 25% delta skew. Source: Laevitas.ch*

The Bitcoin options' 25% delta skew shifted from neutral to bullish on Oct. 19 and continued in this direction until it reached -18% on Oct. 22. This signaled extreme optimism, with put (sell) options trading at a discount. The current -7% level suggests a somewhat balanced demand between call (buy) and put options.

Whatever triggered the surprise price rally prompted professional traders to move away from a period characterized by pessimism. However, it wasn't enough to justify excessive pricing for call options, which is a positive sign. Furthermore, there is no indication of excessive leverage from buyers, as the futures premium remains at a modest 8%.

Despite the ongoing speculation regarding the approval of a spot Bitcoin ETF, there is enough evidence to support a healthy influx of funds, justifying a rally beyond the $35,000 mark.

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