Weekly Market Insight: September Week 1

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Market Updates

03 Sep 2024

Headline News

- Last week, Bitcoin's price dropped by 10.8%, following a decline in market optimism after Fed Chair Jerome Powell's speech at the Jackson Hole Symposium. Bitcoin ETFs saw a net outflow of $277.12 million, while Ethereum ETFs experienced a $12.6 million outflow, with Ethereum ETF trading volume hitting a new weekly low.
- September has been the weakest month for Bitcoin prices, with only three years closing in positive territory since 2013. While this observation does not have predictive capability, it serves as a reference worth noting. Despite this seasonal downturn, it often sets the stage for bullish momentum in the following months. This September, however, is marked by significant events after a relatively quiet August, including Korea Blockchain Week, Token2049, Solana Breakpoint, and Mainnet.

Macro-Outlook

- The data released last week showed a resilient U.S. economy, durable goods orders increased by 9.9% in July, compared to the 5% estimation and Q2 GDP upwardly revised from 2.8% in advanced estimation to 3%. Meanwhile, core PCE price index increased by 0.2% in July, in line with market expectations and consistent with the 0.2% increase in June.
- The U.S. personal income increased by 0.3% in July, higher than expectation of 0.2%. The U.S. personal spending increased by 0.5%, matched with market expectations.
- The market still expects a 31% probability that the Fed will cut 50bps in the upcoming FOMC meeting. This probability is expected to have significant impact depending on the upcoming jobs report this Friday.

Upcoming Economic Calendar including,

- Tuesday, September 3rd 10:00pm: The U.S. ISM Manufacturing PMI in August
- Wednesday, September 4th 10:00pm: JOLTs Job Openings in August
- Thursday, September 5th 10:00pm: The U.S. ISM Services PMI in August
- Friday, September 6th 8:30pm: The U.S. Non-Farm Payrolls and Unemployment Rate in August

Weekly-Cryptos-Overview

- Opensea received Wells Notice from SEC, accusing NFTs on the platform are securities.
- Telegram founder Pavel Durov is under formal investigation and on $5.56 million bail.
- Robinhood Wallet has added support for Solana network.

Layer 1 and Layer 2s

- Starknet launched the Bolt upgrade on the mainnet, featuring parallel execution and block packing. The upgrade reduces the confirmation time to 2 seconds and block times to between 20 to 60 seconds.
- Soneium launched the Minato Testnet and Spark Incubation program. Visionary developers are entitled for up to $100,000 investment per team.
- Kakao and LINE launched Kaia mainnet, a Layer-1 blockchain that serves as the web3 integration for both messaging apps.
- TON blockchain resumed activity after a nearly six-hour outage caused by a surge in network traffic as the result of DOGS airdrop.
- Abstract Chain introduced Abstract Global Wallet, featuring seedless web2 sign-in and gas abstraction.
- Optimism launched a Bridged USDC Standard, allowing OP Chains to easily deploy USDC using the canonical OP Stack bridge.

Dapps

- MakerDAO rebranded to Sky and introduced the new USDS (new DAI) and SKY (new MKR) tokens.
- Binance, Bybit and Bitget announced the launch of their SOL LSTs with Sanctum.
- Arweave launched ArFleet, a temporary storage solution built on Arweave and AO, providing cost-effective short-term data storage and content retrieval services.
- Frax launched Frax Name Service (FNS), a fork from Ethereum Name Service.
- Dinero announced to build the first native ETH LST, moveETH, on Movement L2.
- Centrifuge partnered with Morpho and Coinbase to launch permissioned lending and borrowing of its tokenized Treasury-backed tokens via Morpho's vaults and Coinbase Verifications.
- Balancer announced its vision to expand into the Superchain with partnerships such as Fraxtal, Mode and Aura on Base.

Upcoming Alpha and Governance

- Korean Blockchain Week is held from September 1st to September 7th in Seoul, Korea.
- MATIC to POL migration will be live on September 4th with no deadline. MATIC holders in Ethereum are required to migrate manually. Stakers and MATIC holders in Polygon will have their token upgraded automatically.
- AO has opened DAI deposits for its AO token minting, with rewards starting September 4th.
- Thorchain is expected to undergo a hard fork upgrade on September 4th, upgrading Cosmos SDK version, trimming node state, adding support for Bitcoin Taproot addresses and more.
- Wormhole teased Wormhole Sigma with more detail on September 4th and October 14th.
- Sonic testnet is expected to be launched this week.
- Stacks began its Nakamoto Upgrade activation window. Operators have the entirety of Stacking cycle 92 to implement the upgrade, which takes roughly two weeks. sBTC is expected to be released four weeks after Nakamoto is fully activated.
- Aave proposed to deploy GHO Stability Module (GSM) to support reserve allocation and management, integrating into BlackRock BUIDL.
- Maple Finance proposed the launch of SYRUP and MPL to SYRUP conversion of 1:100. Staking rewards will be reintroduced, protocol revenues will be used to buyback SYRUP to redistribute to stakers.
- Threshold proposed merging tBTC with WBTC, giving Threshold to become the sole merchant to mint or redeem WBTC. BitGo will receive newly minted T accounting 15% of the total supply. If the proposal is declined, the minted tokens will be repurposed to subsidize users for the costs of offboarding WBTC.
- Lyra, option protocol L2, rebranded to Derive, aiming to introduce more programmable structured products. The team will announce an update on its new DRV token on September 4th.
- Gnosis proposed to change its gas token from xDAI to alternative tokens, as the result of raising concern on the freeze ability on new USDS.
- Yuga Labs formed The Workshop, a team of 13 engineers that focus on delivering the first set of products on ApeChain.
- SafeDAO proposed to switch on revenue stream from swaps feature within the Safe Wallet. The revenue is forecasted to be approximately $2.5 million from licensing fees powered by CoW Protocol.

Token Unlock

- TAIKO token unlocked on September 5th, amount representing 19.02% of the token supply.
- IMX token unlocked on September 6th, amount representing 2.07% of the token supply.
- MODE token unlocked on September 6th, amount representing 38.46% of the token supply.
- APTOS token unlocked on September 12th, amount representing 2.33% of the token supply.

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