Amberdata Digital Asset Snapshot: Brazil Approved Solana ETF & Spot Trading Volumes Soar

Brazil leads the way. After the launch of Ethereum ETFs in the United States last month, the first approved Solana ETF came from the Brazilian Securities and Exchange Commission (CVM). The new ETF is expected to be traded on the Brazilian Stock Exchange B3 within the next 90 days. Brazil adds the Solana ETF to the earlier launch of Bitcoin and Ethereum ETFs.

Wrapped Bitcoin WBTC undergoes changes. The largest and most popular wrapped Bitcoin token on Ethereum – is undergoing some major changes. Issuer BitGo announced plans to transfer ownership to BiT Global creating a joint venture with BitGo and Justin Sun (founder of Tron) who has a controlling interest. The transfer would involve 2 of 3 multi-sig keys being transferred to the new joint venture, while the remaining key would stay with BitGo. During a live stream this week, BitGo also confirmed that the multisig only requires 2 of 3 signatures. Today, a post by BitGo proposes a new model with a third entity (BitGo Singapore) holding 1 key with the other two held by BitGo (in the United States) and the joint venture BiT Global (Hong Kong).

In response to the announcement, a proposal on MakerDAO’s governance forum by security firm BA Labs requested that the dApp close all new WBTC debts and prevent new borrowing against WBTC capital. In addition, Coinbase announced plans to launch their own wrapped Bitcoin product cbBTC, providing an alternative and likely elevating the token’s status on their Ethereum L2 network Base.

Spot Market - Explosive Trading Volumes

Spot trade volume by exchange

The most notable event in the spot market world would definitely be August 5th, where CEXs saw an explosive jump in trading volume. Unfortunately, this was not due to good news, but rather reactionary trading due to bad macroeconomic conditions. From an unfavorable jobs report to Japan raising interest rates for the first time in a decade, traders violently reacted to this bad news to quickly sell off crypto assets. BTC and ETH saw huge slides in price, with BTC currently sitting below 60k and ETH below 3k, both significantly lower than the price highs we saw earlier this year. Of course we could be much worse off, as markets recovered most of their progress over the following two weeks to present day. Many people like to think of BTC as a store of value like gold, but it is not sheltered from macroeconomic conditions, and is very often subject to the violent economic stormwinds. 

Exchange volume market share across all CEXs

Of course, CEXs are always interested in price volatility, as it brings huge volume to their exchanges. And volume results in revenue via trading fees. What’s interesting about the August 5th sell off is that we don’t see any particular winner among CEXs in terms of exchange volume market share. This means that trades proportionally raised exchange volume across all exchanges, showing that no single CEX has market dominance. In fact, if you look at the market share graph above, you wouldn’t even know there was a sizable market event on August 5th. This is healthy for the digital assets market, as strong competition across exchanges encourages price stability and reduces volatility.

DeFi DEXs - Uniswap V3 Volumes Hit Monthly High

Decentralized Exchange (DEX) protocol from weeks 8/6/2024 and 8/13/2024

Uniswap V3 Trading volume over past month

DEXs saw a monthly high in trading volume on August 5th, as expected. Leading the charge was WETH_USDC, WBTC_WETH, and WETH_USDT, comprising almost 90% of the volume on that day. With strong price action came large trading volumes, as users took advantage of the price imbalance between CEXs and DEXs for arbitrage opportunities. Pictured above is Uniswap V3’s trading volume, which shouldered most of the volume on August 5th. Shortly following this monthly high, Uniswap V3 saw a monthly low in trading volume, as prices settled to their new zone.

DeFi Borrow/Lend - Liquidations in Full Force

DeFi Lending protocol comparisons from weeks 8/6/2024 and 8/13/2024

DeFi Lending liquidation volume and count over past three months

Of course, with such strong price action, we should expect to see a large amount of liquidations as loan factors become unhealthy. We can see traders liquidated in full force on August 5th, with about 900 liquidations and a total liquidation value of 29.6 million. Interestingly, we saw a much larger wave of liquidations exactly one month earlier on July 5th, with roughly 1300 liquidations and around 54.2 million in liquidation volume. Given that the August 5th slide was much more severe than the July 5th slide, it implies that the number of loans across all lending platforms is much lower, leading to less loans to liquidate. Few traders are willing to take loans when price is very volatile, in order to avoid getting liquidated. 

Networks - Anxious Times for BTC, ETH Recovering

Network comparisons from weeks 8/6/2024 and 8/13/2024

Bitcoin Net Unrealized Profit / Loss (NUPL)

With the current state of the market, it can be hard to determine the sentiment for BTC holders. We turn to Bitcoin NUPL, which suggests the current state of mind for BTC holders. With the huge price drop we’ve seen over the past two weeks, it’s no surprise to see the BTC NUPL score drop below 0.5, indicating that BTC users are feeling anxiety. Anxiousness definitely characterizes the sentiment well, as BTC users worry about the price slipping further, with no clear sign of recovery to earlier ATHs. Market sentiment is a very important feature to consider when analyzing your trading strategy, as the direction of the market is only clear in retrospect, and so we must rely on metrics such as NUPL to help us understand how traders are feeling at a given point in time.

ETH Realized Cap and Market Cap

On the ETH side, we saw an important signal occur: ETH realized cap and market cap have crossed. The asset has quickly bounced back since touching the market cap, but nonetheless seeing the buy signal reached is an uncommon occurrence for this metric. We should expect ETH to recover to new ATHs, if the past repeats itself. Unlike BTC, ETH’s realized cap seems to hang below market cap for a while, so we may not see these ATHs for some time. For example, from mid 2022 through the end of 2023, ETH’s realized cap stayed below its market cap for a significant period. It’s possible we’ll see similar events unfold over the next few months before we see ETH find its new ATH. 

Links

AmberLens:  intelligence.amberdata.com 

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Spot Market

Spot market charts were built using the following endpoints:

• https://docs.amberdata.io/reference/market-metrics-exchanges-volumes-historical
• https://docs.amberdata.io/reference/market-metrics-exchanges-assets-volumes-historical
• https://docs.amberdata.io/reference/get-market-pairs
• https://docs.amberdata.io/reference/get-historical-ohlc

Futures

Futures/Swaps charts were built using the following endpoints:

• https://docs.amberdata.io/reference/futures-exchanges-pairs
• https://docs.amberdata.io/reference/futures-ohlcv-historical
• https://docs.amberdata.io/reference/futures-funding-rates-historical
• https://docs.amberdata.io/reference/futures-long-short-ratio-historical
• https://docs.amberdata.io/reference/swaps-exchanges-reference
• https://docs.amberdata.io/reference/swaps-ohlcv-historical
• https://docs.amberdata.io/reference/swaps-funding-rates-historical

DeFi DEXs

DeFi DEX charts were built using the following endpoints:

• https://docs.amberdata.io/reference/defi-dex-liquidity
• https://docs.amberdata.io/reference/defi-dex-metrics
• https://docs.amberdata.io/reference/defi-impermanent-loss 

DeFi Borrow/Lend

DeFi lending charts were built using the following endpoints:

• https://docs.amberdata.io/reference/defi-lending-protocol-lens
• https://docs.amberdata.io/reference/defi-lending-asset-lens

Networks

Network charts were built using the following endpoints:

• https://docs.amberdata.io/reference/blockchains-metrics-latest
• https://docs.amberdata.io/reference/transactions-metrics-historical
• https://docs.amberdata.io/reference/get-historical-transaction-volume

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