M6 Labs Crypto Market Watch: The Great Bull Market Is Starting

Editor’s note: The following is from cryptocurrency research company M6 Labs (Official recommendation) Weekly market observation column, which covers the summary and interpretation of important information in the Web3 industry, the analysis and judgment of data trends, potential projects worthy of attention in various subdivisions, etc. It does not constitute investment advice, so readers should DYOR.

Welcome to the latest edition of M6 Labs’ Crypto Market Watch. It’s been an eventful week, with cryptocurrencies seemingly reawakening and the greatest bull market of all time kicking off. In this comprehensive analysis, well dive into the key developments, market trends, and promising opportunities currently shaping this momentous event.

• The cryptocurrency space appears to be coming back to life after a long and challenging period. We may witness prices rising to $40,000 and beyond in anticipation of exchange-traded funds (ETFs).

• Non-fungible tokens (NFTs) have seen an uptick in trading activity and prices during the recent market rally. However, their performance still significantly underperforms the overall market.

• The crypto market is currently experiencing significant growth, with major large-scale projects such as Solana, Injective, and Rollbit achieving gains of 76%, 75%, and 65% respectively. This shows that capital is flowing into projects that are considered high risk but have the potential for high returns.

• Spot trading is not the only cryptocurrency trading method that has had recent success. Derivatives, especially Bitcoin options, are also becoming increasingly popular. Total open interest in Bitcoin options across exchanges reached an all-time high of $15.37 billion.

• Stablecoins have halted their downward trend and have not made new lows in more than three months, signaling a possible reversal in market sentiment.

• The DeFi market has rebounded significantly, with total value locked (TVL) reaching a three-month high of $42 billion. This recovery comes after the recent lows in February 2021, when TVL was just $35.8 billion.

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This week’s topic: How will the year end?

The currency of financial markets is probabilities, and the key is how to stack those probabilities on your side and combine them with effective risk management. With that in mind, let’s examine the near-term probabilities. First, let’s focus on the life of the party: the spot Bitcoin ETF, which has seen major developments again recently.

Following Blackrock, Ark, and Van Eck, Valkyrie also recently updated their spot Bitcoin ETF application.

source

Bernstein Research, the research arm of AllianceBernstein, believes that the possibility of the U.S. Securities and Exchange Commission (SEC) approving the first spot Bitcoin ETF before January 10 is very high, as the SEC has been actively participating and responding to edits and comments on ETF applications. Comment.

This expectation was partly influenced by the SEC’s decision not to appeal Grayscale’s decision requiring a re-evaluation of its application to convert the Bitcoin Trust (GBTC) into a spot Bitcoin ETF.

SEC Chairman Gary Gensler revealed that the SEC is evaluating 8 to 10 spot ETF applications, and public records show that including Cathie Wood’s ARK Investment Management, Blackrock, Bitwise, Wisdomtree, Fidelity, Van A total of 12 applications are awaiting approval, including well-known companies such as Vaneck and Invesco.

ETFs are coming, right now. This event has been eagerly awaited for years, and now its finally here. It remains to be seen how investors react to the news following the announcement. Will this lead to a sell the news event, or push prices to new all-time highs? It is highly likely that investors will take positions in the market before this event occurs, causing BTC to reach new near-term highs.

Furthermore, the chart tells us that significant changes are taking place. Bitcoin’s dominance has surged to 54%, indicating a clear preference for Bitcoin over other altcoins in anticipation of ETF approval. Interestingly, the current rise in BTC dominance is reminiscent of the uptrends observed in 2018 and 2019, which foreshadowed a bull run in 2021.

Source: Tradingview

Capital inflows: Investment products linked to digital assets recorded significant inflows, totaling $326 million, representing the largest weekly inflows since July 2022. BTC led the charge, accounting for the lion’s share at $296 million, while the recent rise in Bitcoin’s value also attracted an additional $15 million into investment products that bet against Bitcoin.

Growing optimism within the market further catalyzed significant investment in Solana, with cumulative inflows totaling $24 million. However, this optimism did not extend to Ethereum as it experienced $6 million in outflows, going against the trend of the broader market.

Source: Coinshares

Capital appears to be returning to the crypto space, as evidenced by monitoring of capital inflows. The main focus is on BTC and surprisingly, ETH is underperforming. However, this trend may reverse following the announcement of the ETF. Typically, capital flows from BTC to ETH and then to other altcoins after BTC gains dominance and reaches new relative or all-time highs.

Derivatives and Open Interest: Spot trading is not the only cryptocurrency trading method that has had recent success. Derivatives, especially BTC options, are also becoming popular. Total open interest in Bitcoin options across exchanges reached a record $15.37 billion. OKX, in particular, saw its open interest surge to over $1 billion. A similar pattern emerged on Deribit. Similar to the increase in spot trading volume, the surge in Bitcoin options activity is likely due to increased market participation. Monthly Bitcoin options trading volume on multiple exchanges is also near all-time highs.

Source: The Block

Additionally, the Chicago Mercantile Exchange (CME) quickly rose to become the second largest Bitcoin futures exchange by open interest, with a nominal open interest of $3.54 billion. This significant rise highlights the growing influence of traditional financial institutions in the crypto space and underscores CME’s role as a key player in the crypto derivatives market. CMEs growth in open interest, particularly in cash-settled futures contracts, reflects a surge in institutional interest in Bitcoin futures and has accompanied a 27% rise in Bitcoins price this month.

Source: Coinglass

Source: The Block

Stablecoins: Another positive sign is that stablecoins have halted their downward trend and have not reached new lows in more than three months, signaling a possible reversal in market sentiment.

Source: Nansen

What’s happening with the DeFi market?

The DeFi market has rebounded significantly, with total value locked (TVL) reaching a three-month high of $4.2 billion. This recovery follows recent lows in February 2021, when TVL was just $3.58 billion.

• The recovery of the DeFi market can be attributed to two key factors. First, asset prices rose, including a significant increase in the price of ETH. Over the past two weeks, the price of ETH has increased from $1,590 to approximately $1,873, aiding the market’s recovery. As mentioned earlier, new inflows from players seeking to earn yield through staking and lending also played a role in the market recovery.

• Trading volume within DeFi protocols has reached its highest point since March, with $4.4 billion in volume recorded in October.

• Marinade, the prominent lending protocol on Solana, has experienced significant growth in total value locked (TVL) this month, surging by 120%. This growth is attributed to the launch of Marinade’s native staking product with competitive yields. During the same period, the TVL of a rival protocol, Jito, also increased significantly by 190%, reaching $168 million.

• On the Ethereum network, capital flows into platforms such as Enzyme Finance, Spark, and Stader surged between 37% and 55%. These inflows are growing faster than asset price increases, indicating an increase in the number of people participating in DeFi activity.

To summarize, the recovery in the DeFi market is driven by a combination of rising asset prices, increased trading volumes, and fresh capital inflows, with significant growth observed across different blockchain protocols.

Source: DefiLlama

Summary: After a long and challenging period, the cryptocurrency space appears to be coming back to life. With expectations for the ETF, we may witness price increases to $40,000 and beyond. In addition, the Bitcoin halving event, although its impact is gradually waning, has acquired a mythical importance and will be the next big event that many people pay attention to. Time will ultimately reveal how the market reacts in the medium to long term, but in the short term, conditions look extremely favorable.

Project Spotlight:Marinade Finance

Solana has certainly become one of the standout performers in recent cryptocurrency rallies. With this in mind, let’s explore the options available to SOL holders keen on staking their tokens for attractive yields. Previously, a popular choice among users was Lido. However, with the end of Sol staking on Lido, users now have the opportunity to take advantage of protocols like Marinade Finance. It should be noted that Marinade has restricted access to its service to UK users due to regulatory issues.

Even during a bear market, Marinade Finance has impressively stayed on course and introduced noteworthy upgrades and features, including liquidity staking. As the Solana ecosystem continues to expand and solidify its position as a prominent player in the upcoming bull phase, understanding protocols like Marinade holds the potential for favorable opportunities.

mSOL: Liquidity Staking Token

• Staking: Marinade allows users to stake SOL tokens and in return receive salted SOL tokens (mSOL), which represents their share of staked SOL, and access to the broader DeFi ecosystem.

• Versatility: mSOL is awarded to users as a liquid staking token when they participate in the Marinade protocol. It serves as confirmation of their staked SOL tokens, allowing for conversion back to staked SOL at any time and collection of accumulated rewards. Crucially, these tokens remain fully fungible within the DeFi space while growing in value as SOL staking rewards increase.

• Value Appreciation: The value of mSOL steadily increases with each epoch as a result of rewards earned for staked SOL within the protocol. Holding mSOL for a year can result in approximately 7-8% growth in value, making it an attractive passive income channel.

The benefits of staking SOL with Marinade include:

• The protocol operates as a non-custodial solution, ensuring users maintain full control over their assets and associated accounts.

• The protocol allows users to stake freely and incur no additional fees when unstaking is delayed.

• Marinade’s governance framework prioritizes active community participation and contribution.

Data source: DefiLlama

Marinade currently has approximately $325 million in total value locked (TVL), making it one of the largest protocols in the Solana ecosystem. Although TVL has fallen significantly from its all-time high, it has risen recently as SOL prices have surged.

DeFi、L1、L2

news

• VanEckSolana is predicted to reach $3K.

• ProSharesLaunched the first short ETH futures ETF.

• UnibotUnder attack.

• TahoWallet open beta portal waiting list.

• AvalaunchTermination of partnership with Starsarena.

• FuseLaunching Solana’s first smart wallet.

• SolanaPartnership with Amazon Web Services.

• ArkhamLaunched chat room function.

• Andreessen HorowitzPlans to raise $3.4 billion for its next early-stage fund.

• NeoThere are plans to launch Ethereum-compatible sidechains to enable interoperability with the N3 mainnet.

• SolanaAdd incubators to boost growth and attract founders from competing chains.

• ShufflePlanned airdrop.

• RenzoAnnouncing a re-staking mechanism that allows everyone to re-stake through Eigenlayer.

• Layer N launches Nord, Layer N’s first exchange-optimized convolutional network, will soon launch a testnet.

• FlokiPlans to tap into the trillion-dollar real asset (RWA) market and launch TokenFi to position itself as a serious DeFi player.

• Starknet50 million tokens will be distributed.

• Goldman SachsEthereum’s Dencun upgrade, expected in the first quarter of 2024, is believed to be an important step in transforming the blockchain into a scalable settlement layer.

• PolygonThe POL token upgrade is now online on the Ethereum mainnet.

• Astrid FinanceAttacked and will refund the user.

• SnowtraceService will be discontinued due to Etherscan charges.

• British TreasuryReleased final proposals for crypto asset regulation.

• Stars ArenaCEO steps down.

• Blockchain startup EtherfuseLaunching tokenized bonds in Mexico, targeting retail investors.

• BNBLaunched BNB secure wallet.

• Stelo Labsis gradually closing.

• TimelessLaunching their V2.

• NymThere are plans to launch NymVpn.

• ArgentPriority will be given to the development of Starknet and the development of the zkSync Era will be stopped.

Binance’s market share has dropped significantly: Despite the recent growth in the cryptocurrency market, its market share fell from 74% in December 2022 to 50% this month. Several factors, including executive departures, regulatory challenges, and legal accusations, have contributed to Binance’s decline in market share.

Source: The Block

Cryptocurrency delistings from exchanges rise:More than 3,400 tokens have been delisted this year, marking a record increase in delisting rates. Major exchanges like Coinbase and Binance have been actively delisting coins, with Coinbase delisting 80 trading pairs in October, the highest monthly delisting count since 2021.

Increased activity:Weekly active wallets on L2s continue to hit all-time highs. This shows that most protocols are moving their products from mainnet to L2s, or deploying on L2s, and user activity is also increasing.

Source: Token Terminal

Overview of Blue Chip Stocks in the Crypto Market

The crypto market is currently experiencing significant growth, with major large-scale projects such as Solana, Injective, and Rollbit achieving gains of 76%, 75%, and 65% respectively. This suggests money is flowing into projects that are considered riskier but have the potential to deliver high returns.

Additionally, other coins like CANTO, MINA, and NEAR are also performing very well, while the gains in others like RLB, PEPE, and MANA show that investors are willing to take more risks in search of higher returns.

Going further, the growth of multi-chain real asset (RWA) Hashnote, whose total value locked (TVL) increased by 373.51%, is an example of the potential for new major blue-chip protocols to emerge in the upcoming new bull cycle, Providing stiff competition for established big players like Maker, Compound and Aave.

Source: Tradingview

Review protocol revenue:An important measure of a protocols vitality is the fees it generates, especially if this is its intended revenue model. As expected, Ethereum is in the lead, but it is worth highlighting the presence of Tron and OpenSea in this case.

Source: DefiLlama

ETH/BTC：Ethereum continues to lose value relative to Bitcoin. Unless this trend is reversed, a full-blown altcoin season is unlikely to arrive.

Source: Tradingview

The latest SocialFi news:Friendtech and Starsarena have been two prominent protocols in the SocialFi space over the past few months. However, this narrative and trend appears to be waning, with user activity and transaction volume experiencing a sharp decline.

Friendtech has seen a sharp decline in its number of traders and trading volume over the past month.
Source: Dune.

Degen Corner

Several recently launched currencies, includingAardvark、CAESAR、MOG、BITCOIN、CRESO、MLPandREKT, has accumulated a considerable amount of fallen smart money holdings.

Although established meme coins like Floki and Pepe have witnessed significant price gains recently, their values ​​are still well below their all-time highs. This resurgence signals renewed interest in these highly speculative assets.

Ether.fiNative Ethereum Restaking is being introduced via EigenLayer, in the form of eETH. Users can earn points by staking eETH, participating in the protocol, and completing tasks. EigenLayer will distribute points to native stakers, and eETH stakers can receive 100% of the proceeds without any deductions.

Aevo, a derivatives L2 application chain for options and perpetual contract trading on the OP stack, merged with Ribbon after DAO voting approval. $RBN token holders can convert to $AEVO, which will serve as the governance token. The token generation event is scheduled for January 2024, and staking $AEVO for three months will receive benefits such as discounts, reward multipliers, and early access.

try outSagaThe Pegasus incentivized testnet.

Be sure to mint the latest free NFTs on Scroll to increase your chances of qualifying for future airdrops. Follow thisPostandScrollThe official guide.

HyperliquidThe points program starts on November 1st.

NerbbotA useful feature has been introduced to efficiently track whale activity on any coin.

Real Smurf CatAfter experiencing the inflow and outflow of funds, a large amount of corrupted smart money was positioned in the project.

JOEReaching an all-time high, it is considered a favorite of Degen.

SPXBecame part of a new meme trio, along with JOE and Real Smurf Cat, that attracted Degen purchase and attention.

Banana Gun BotContinued to climb in usage, transaction volume and fees incurred. Many expect this Telegram bot to surpass its competitors in the market. Many people are accumulating tokens in the hope that the price will rise significantly.

Source: Dune

NFTs & Gaming

News

• FrameAnnounced to be powered by Arbiturm’s Nitro Stack

• OpenseaIntroducing Shipyard, a collection of open source Solidity contracts for NFT creators

• Supcomic comes to the store, Bitmap: Fragments of the Machine

• Steve AokiIntroducing digital sneakers for Stepn

• Axie InfinitySky Smash has integrated Axie experience points

• ArcadeDaoAlready started

• Alpha 3.0 game update redefines blockchain RPG with season-based leaderboards and exciting new additions
  

• Async Artbeing phased out

• NFT ParisLaunch of loyalty token

• The upcoming Acolytes is a spin-off of Oxmons

• Animoca Brands acquires Azarus, bringing streaming to Web3 games

• Southern CrossStar exec says blockchain will become standard for gaming in Asia

• Innovative Game NFTGaulThere is a public test this week

• NEOM InvestmentFund proposes $50 million investment in Animoca Brands

• GameShiftThe beta version is online

• Nearcon 23 Taking place from the 7th to the 10th, be sure to join this four-day journey, which will be attended by a number of industry figures

Jonah’s great summary of Web3 game development:

source

NFT

During the recent market rally, NFTs experienced increased trading activity and rising prices. However, their overall market performance still lags significantly. Many projects and companies appear to be re-examining their strategies and long-term goals in anticipation of the next bull market. The concept of traditional NFTs and their practical applications are expected to undergo significant expansion to provide more enhanced benefits to users. One notable emerging trend is the integration of traditional NFTs into the gaming industry.

Traditional NFTs. Source: Coingecko

Gaming Tokens. Source: Coingecko

Volume: Weekly volume for art and collectibles NFTs on Ethereum has been rising since early October, coinciding with the rise in ETH price and indicating some new interest. However, weekly volumes are still not much higher than they were in late August, suggesting that NFTs are primarily benefiting from rising values ​​of the assets they are priced into, rather than experiencing a massive resurgence of activity.

Source: The Block

Minting: Accompanying the recent increase in volume and transaction volume, there has also been an increase in the number of NFTs being minted on Ethereum.

Source: The Block

Some notable sales to watch this month: It’s clear that blue-chip collections continue to hold high value for NFT collectors.

Source: CryptoDiffer

Project Focus:Wreck League

Wreck League introduces a unique concept where players use NFT-minted parts to build mechas and compete in real-time player versus player (PvP) fighting game competitions. Unlike traditional fighting games with predefined characters, each mech is crafted and owned by its creator, allowing for over 1.5 quadrillion possible mecha combinations.

• Players can freely assemble, disassemble and customize the mecha using ten unique NFT parts. This customization gives each mech a unique visual appearance and playstyle, enhancing their performance in various gaming events and tournaments.

• The first season of Wreck League has specifically partnered with Yuga Labs to integrate Bored Ape Yacht Club, Mutant Ape Yacht Club, Bored Ape Kennel Club and Kodas into the game. Holders of these series can receive a Founder Mecha for free.

• Wreck League provides a AAA-level, real-time PvP (player versus player) fighting game experience with cross-platform functionality between mobile devices and PC. Players can use their customized mechs to participate in various events and tournaments, competing for valuable on-chain rewards.

other projects

passmint.funEarn ETH with its referral rewards.

Embed on your own website or platformZoraCasting page and earn casting referral rewards.

ImgnAIis a cryptocurrency-based project that enables users to create AI-generated art, and the project has entered Nvidias Innovation Incubation Program (Inception Program). Following the announcement, the project’s native token $IMGNAI reacted well, surging in value by as much as 34%.

Maison MargielaProvides a free Web3 multiplayer coin minting game where players can enter a code, confirm and then play the game, trying to mint various numbers, with the challenge resetting the counter after each successful minting.

The collectibles market is expected to be worth US$1 trillion by 2033, with stamps accounting for one of the largest segments, accounting for approximately 8%. On Thursday, the German postal service released its first stamp with digital twin features. Go deeper into thistopic, learn how to participate in this trend.

Pre-register to play on Immutable zkEVMMetalcore, a PvPvE shooter.

Farcana is a blockchain-based gaming metaverse where players can earn Bitcoin through a game format called Play to Hash (P 2 H).Register here, experience Farcana Beta.