This week, our desk saw a significant increase in trading demand for DeFi tokens and Layer1/Layer2 tokens.
Raydium ($RAY) is a decentralized exchange deployed on the Solana chain, and BakerySwap ($BAKE) is a decentralized exchange deployed on the Binance Smart Chain. Both projects are automated market makers (AMMs) that provide users with liquidity and yield farming.
NEAR token ($NEAR) is the native token of the NEAR Protocol, a layer-one blockchain. Its market cap more than doubled in eight days, from December 19 to December 26, with the price rising from $2.29 to $4.62. It is currently trading at $3.93.
The NEAR price skyrocketed after the NEAR project revealed its development roadmap for 2024. It includes high-speed transactions that exceed 100,000 transactions per second, improved scalability to eliminate bottlenecks, and the introduction of innovative dApps like Nightshade 2.0, which promise enhanced privacy and security.
Overall Market
The above chart shows the BTC price in 2023.
The blue line mentioned in the previous post served as support, and the BTC price recovered after the Monday touch.
However, as we have stated repeatedly since the beginning of December, we see the BTC price trading sideways below that key level last week.
On January 10, 2024, the SEC will make a decision on a BTC spot ETF approval, which could be a catalyst for the BTC price to break through this resistance level and continue its bull rally.
The above chart shows the ETH price in 2023.
Ethereum gained traction in the final week of 2023, reaching a new yearly high of $2,445.80 today.
Many layer 1 competitors, including Solana ($SOL) and Avalanche ($AVAX), outperformed Ethereum in 2023. Furthermore, layer 2 ETH network solutions such as Arbitrum ($ARB) and Optimism ($OP) have outperformed ETH.
As mentioned in the December 14 commentary, our desk predicted a significant movement in the ETH price while BTC struggled to break the $45k resistance level.
Options Market
The above chart is the at-the-money implied volatility (IV) for BTC and ETH options.
Our desk observed strong momentum in the ETH price after it broke above the $2,400 level today. ETH option implied volatilities have returned to yearly highs.
The IV of ETH options is almost 10% higher than the IV of BTC options in the near-term option with a 7-day expiry, which is the largest spread in 2023. For longer-term options, we see that the IVs of ETH options are all higher than the IVs of BTC options. The positive spreads of IVs of ETH over IVs of BTC were the norm during the bull market in 2021.
As the IV differences between ETH options and BTC options have returned to positive territory, it may indicate that we are entering an altcoin season in which the ETH price will outperform the BTC price in the coming months.
Macro at a glance
Last Wednesday (2023-12-20)
Conference Board (CB) Consumer confidence in the United States was reported at 110.7 in December, much higher than the estimated 103.8 and previous month’s 101.0. It implied that US consumers had been encouraged to increase spending because of the positive outlook for the country's economy. The US economy will benefit from the higher levels of confidence.
Last Thursday (2023-12-21)
The US GDP growth rate in Q3 2023 was 4.9%, slightly lower than the estimated 5.2%. The data show that the Federal Reserve managed to have a "soft landing" with the US economy, with gradually lower inflation and strong GDP growth.
Initial jobless claims in the United States were 205k, similar to last week's 203k, and better than the estimated 214k. This signals that the unemployment rate in the United States remains in the low range.
On the other hand, the UK reported quarterly GDP growth of -0.1% in Q3 2023, which was slightly lower than the expected 0%. Its GDP growth rate is 0.3% year on year, the same as in the previous quarter, falling short of the estimated 0.6% growth rate. The UK economy is growing at a slower pace than the US economy.
Last Friday (2023-12-22)
The US PCE price index, which the Federal Reserve uses to measure inflation, was recorded at 2.6% on a yearly basis in November, down from 2.9% in October. The core PCE price index was 3.2%, down from 3.4% in October. The slowing of inflation increased the likelihood of the Federal Reserve cutting interest rates sooner. The US dollar index (DXY) fell to 101.668, while gold rose to $2,070 before closing at $2,052.
Convert Portal Volume Change
The above table shows the volume change on our Convert Portal by zone.
Our desk has noticed a significant volume change in the above zones in the past seven days.
The Metaverse zone is where the volume change on Convert is most noticeable. The largest contributors to this volume change are BurgerCities ($BURGER) and the Sandbox ($SAND). Both Mataverse projects have trading volume growth at 377% and 128%, respectively.
The main cause of last week's +52.91% increase in the DeFi zone volume was the strong trading demand for Raydium ($RAY).
The primary cause of the Layer1/Layer2 zone volume increase is Optimism ($OP) and Mina Protocol ($MINA). Both tokens experienced a strong rally in the past week, and investors utilized the Convert Portal to lock in the price, disregarding the volatile market change.
Why trade OTC?
Binance offers our clients various ways to access OTC trading, including chat communication channels and the Binance OTC platform (https://www.binance.com/en/otc) for manual price quotations, Algo Orders, or automated price quotations via Binance Convert and Block Trade platform (https://www.binance.com/en/convert) and the Binance Convert OTC API.
To access manual price quotations, you may visit our Binance OTC platform (https://www.binance.com/en/OTC-Trading/spot), where you can RFQ (request-for-quote) and trade directly with our OTC trading team via a live chat.
To utilise our Algo orders features, you may visit our BinanceAlgo Orders platform (https://www.binance.com/en/OTC-Trading/AlgoTrading).
For any other inquiries on OTC trading, please reach out to us via our email at [email protected] for our trading desk to get in touch with you and get started.
OTC trades may also be automatically quoted on Binance Convert and via API, offering users a quick and simple way to execute trades across 60,000+ pairs with one simple click. Binance Convert supports over 350 tokens listed on the exchange including fiat pairs. Begin trading from as little as 1 USD. To start, simply navigate to the Binance Convert & Block Trade platform (https://www.binance.com/en/convert), select the coins you wish to trade, preview and confirm the quote with settlement reflecting almost instantly in your wallet balance. For details and access to Binance Convert OTC API, please refer to our Convert Endpoints (https://binance-docs.github.io/apidocs/spot/en/#convert-endpoints) and reach out to us at [email protected] if you have any questions or require assistance.
Visit Binance OTC (https://www.binance.com/en/otc) for more information on our OTC products and solutions.
Experience the main benefits of Binance Convert and OTC Trading:
Fast & Competitive Pricing
Instant settlement
Widest availability of coins
Bespoke service with unique market insights
Zero fees and slippage
Email: [email protected]
Join our Telegram (https://t.me/BinanceOTC) to stay up to date with the markets!
