July 15, 2022

The latest moves in crypto markets, in context

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Good morning, and welcome to First Mover. I'm Lyllah Ledesma, here to take you through the latest in crypto markets, news and insights.

Price Point: BTC holds the $20,500 level and DeFi tokens continue to surge. A new court filing showed that Celsius acknowledged a $1.2 billion hole in its balance sheet.
Market Moves: Omkar Godbole looks into why DeFi tokens are rallying and whether traders think it will be a short-lived rally or not.

This newsletter was produced by Parikshit Mishra. Let us know what you think by replying to this email.

Price Point

The crypto market got off to a good start on Friday morning, with bitcoin (BTC) trading up 5% on the day, at $20,800 and all other assets in the green.

Liquidation levels for BTC are currently at 5:2 in favour of short rekts, meaning an upside rally has been favoured over the last 12 hours, according to Hashdex's head of Europe, Laurent Kssis.

"An upside above $21,000 can be tested should the short liquidations continue to be triggered and we could then test the $22,000 mark," said Kssis. He added that a cautionary stance remains as any further negative news will keep BTC under pressure and below $20,000.

AAVE was up 16.5% over the last 24-hours and Solana's SOL was up by 12%. The Quant Network (QNT), which automates trust functions between multiple blockchains, was trading up 20% on the day.

Yesterday UniSwap's UNI was listed on Robinhood's crypto trading platform and has since rallied 11%. The decentralized exchange's ERC-20 token boasts a market capitalization of about $4.7 billion, and had about $394 million in trading volume.

The recent rallies in altcoins and BTC's rise have brought the entire crypto market capitalization up to $928 billion, trying to approach the $1 trillion mark again.

Total Crypto Market Capitalization (CoinMarketCap)

Meanwhile, Celsius acknowledged a $1.2 billion hole in its balance sheet Thursday, according to a new court filing from the company's advisory partner, Kirkland & Ellis. The news came after the ailing crypto lender filed for bankruptcy protection Wednesday.

Some analysts are seeing a bright future for Celsius' CEL token, despite the lender's recent downfall. The token could recover in the future despite the current actions of its management team, some traders are saying. CEL was up 20% on the day.

Bitcoin (BTC)

See the latest price here

Ether (ETH)

See the latest price here

Market Moves

By Omkar Godbole

Cryptocurrency lending platform Aave's native coin AAVE was up 15% at $91. Last week, AAVE proposed a decentralized yield-generating dollar-pegged stablecoin GHO to expand services offered on the platform. GHO is likely to generate additional revenue for the Aave DAO by sending 100% of interest payments on GHO borrowing to the DAO, the proposal said.

Decentralized exchange Uniswap's UNI traded at $7, representing a 13% gain. Bitcoin, the biggest cryptocurrency by market value, changed hands at $20,660, up 3.5%, while Ethereum's ether token was priced at $1,200, up 8%. Other notable gainers were programmable blockchain Solana's SOL cryptocurrency, privacy-focused coin monero, Polygon's MATIC, cosmos and algorand.

DeFi outperformance a flash in the pan

Observers were unsure if the rally in the DeFi majors would be long-lasting, given the fundamentals remained weak.

"Sure, we see some rally in the DeFi coins for now, but fundamentally nothing has changed. The total value locked has been destroyed," crypto financial services firm Amber Group said, while noting the absence of large buying.

"We have seen some institutional mandates scooping up majors and DeFi blue chips, but it's not like massive amounts," Amber's trading desk told CoinDesk.

The total value locked in the DeFi protocols has crashed to $38 billion from $95 billion this year. And there was hardly an uptick as of writing, according to data source Defi Pulse. The total value locked is the amount of user funds deposited in the DeFi protocols and is one of the most commonly used metrics to assess the sector's growth.

Other indicators, such as the volume of bitcoin locked in DeFi and the number of addresses lending and borrowing in DeFi protocols, pointed to a continued slowdown in the activity.

"The volume of wrapped bitcoin participating in DeFi protocols is a clear indicator of the DeFi momentum among more traditional crypto investors," Jesus Rodriguez, CEO of the analytics firm IntoTheBlock, wrote in an DeFi analysis piece published Tuesday. "Recently, that indicator has dropped to a near all-time low, signalling a slowdown in the DeFi activity among Bitcoin holders."

Read the full story here: DeFi Coins Outperform Bitcoin, Ether as Traders Pare Bets on Jumbo Fed Rate Hike

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Crypto Prices

The following are the biggest movers in the CoinDesk 20 digital assets over the past 24 hours:

Biggest Gainers

Asset	Ticker	Returns	DACS Sector
Terra	LUNA	+18.9%	Smart Contract Platform
Ethereum	ETH	+12.1%	Smart Contract Platform
Solana	SOL	+11.7%	Smart Contract Platform

Biggest Losers

There are no losers in CoinDesk 20 today.

Sector classifications are provided via the Digital Asset Classification Standard (DACS), developed by CoinDesk Indices to provide a reliable, comprehensive, and standardized classification system for digital assets. The CoinDesk 20 is a ranking of the largest digital assets by volume on trusted exchanges.

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Latest Headlines

DeFiance Capital Has Been 'Materially Affected' by Three Arrows Liquidation
The firm's CEO has said that he is committed to recovering all assets that may have been affected.
Bitcoin Mining Rig Prices Slump to Near 2-Year Lows Amid Celsius Bankruptcy
Celsius's mining unit is said to have auctioned off some of its newly purchased mining rigs at fire-sale prices back in June, before filing for bankruptcy.
DeFi Coins Outperform Bitcoin, Ether as Traders Pare Bets on Jumbo Fed Rate Hike
The outperformance of the DeFi coins could be fleeting, given the weak fundamentals.
Three Arrows Liquidators Ask Singapore Court to Recognize Company's BVI Bankruptcy: Straits Times
Three Arrows' liquidators are working to get Singapore courts to recognize the British Virgin Islands liquidation order against it, in order to preserve the company's Singapore assets.
Celsius Network 'Could Stick Around' After Bankruptcy, Restructuring Expert Says
Ryan Preston Dahl joined CoinDesk TV's "First Mover" to discuss the crypto lender's filing.
5ire Raises $100M to Fund Expansion of Sustainable Blockchain
The company will use what it calls a Proof-of-Benefit mechanism, saying it is the only sustainability-focused blockchain unicorn in the world.

What to watch:

Check out the CoinDesk TV show "First Mover," hosted by Christine Lee, Emily Parker and Lawrence Lewitinn at 9:00 a.m. U.S. Eastern time.

Avery Akkinenni, president, Vayner3
Robert Le, fintech analyst, Pitchbook
Jason Pagoulatos, markets associate, Delphi Digital

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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.