CMC Market Pulse delivers actionable market insights, giving you all the key narratives and developments you need in under 5 minutes.
Market Overview 📉
The crypto markets kicked off this week with a large drawdown on July 8, as Bitcoin (BTC) and Ethereum (ETH) hit lows of 53,485 and 2,810 respectively, prices which have not been seen since February this year. The drawdown followed the 4th of July selloff, sending BTC and ETH down 6.2% and 8.14% respectively.
CPI figures came in on July 11, showing a fall in US inflation by 0.1% in June, the first monthly decrease in four years. CPI in the 12 months through June came in at 3.0%, below economists forecast of 3.1%. It also marks the lowest in more than three years. Core consumer price index, excluding food and energy, rose by only 0.1% from May 2024, the smallest increase since August 2021.
The markets subsequently bounced 10% from the lows by the end of the week. BTC and ETH both ended the week slightly higher, with BTC up 0.54% and ETH gaining 1.23%. Funding rates crawled up during the week, perhaps indicating a slow shift towards a risk-on attitude in the markets again.
📌 All eyes continue to watch the wallets controlled by the German Government, which has transferred out 90% of their initial balance of 50,000 BTC to a current balance of 4925 BTC (roughly $282M) — Link
📌 CBOE files 19b-4s for Solana ETFs by 21Shares and VanEck, with analysts expecting the final deadline for the decision on these filings to be in mid March 2025 — Link
📌 Presidential candidate, Donald Trump will be speaking at the upcoming Bitcoin Conference taking place in Nashville in end-July — Link
Why does it matter?
The overhang from Mt. Gox and the German Government continue to impact the markets negatively this week, resulting in several large selloffs in the week. However, as the BTC balance controlled by the German Government continues to dwindle, transfers no longer spook the markets as they used to, with market participants shrugging off the BTC transfers.
Meanwhile, positive CPI data for June shows inflation cooling off, with traders pricing in September and December rate cuts. However, Fed Chair Jerome Powell said that while they are pleased with the slowdown in inflation so far this year, greater signs of confidence that inflation will hit the Fed’s 2% target is needed before it cuts rates. Following the release of inflation data, BTC surged over 2%. However, it failed to hold the $59,000 level and traded back down to $56,900, losing 1.4% in the past 24 hours.
As the market rebounded after the brutal prior week, altcoins also showed some semblance of positive price action, with TOTAL3/BTC rising 2.21% this week. Across the board, there were no clear outperforming sectors but individually, certain tokens such as TIA, NOT and MOG outperformed their peers, rising between 25-38% in the past 7 days alone.
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Narrative of the Week 📰
Perpetual-focused decentralized exchange Hyperliquid seized the narrative this week, with several traders and influencers alike once again discussing the spot launches thus far on the platform, their performance and Hyperliquid’s success in the perpetuals DEX arena thus far.
📌 Of the 36 spot token launches on Hyperliquid thus far, 21 of them are in profit from their launch, with only 3 of the launches completely dead (-90% or more) — Link
📌 Perpetuals DEX aggregator, Rage Trade, announces their upcoming token launch on 7th August, with the RAGE token to be launched on the Hyperliquid spot market — Link
📌 Hyperliquid flips Uniswap in mindshare this week as well, taking the place of the most discussed DEX in the space, according to data platform, Kaito — Link
Why does it matter?
Ever since its launch, Hyperliquid has been widely used and favored by on-chain perpetuals traders for their sleek UI and excellent user experience. The platform took it one step further, with the launch of their own memecoin, PURR, and a permissionless spot market on the platform as well as plans to develop their own EVM-compatible layer. With the announcement of its high TPS, EVM-compatible layer 1, Hyperliquid has been compared with other upcoming L1s including Monad, Berachain and Movement Labs.
However, despite its success, there have also been criticisms of the decentralization of the platform, with some describing it as no better than a centralized exchange due the lack of transparency on their node software and lack of validity proofs on their bridge. However, other users have come to its defense, arguing that most users prefer a centralized product with better UX that gradually decentralizes over time.
Major Project Updates 🗓️
📌 Tron founder Justin Sun teases the development of gasless stablecoin transfers, with the feature expected to launch in Q4 this year on the Tron blockchain before a gradual rollout to other EVM chains — Link
📌 StarkNet wallet, Argent, releases the Argent Card, allowing users to pay for real-world purchases in USDC directly from their Argent wallet, while maintaining self-custody and privacy — Link
📌 Modular execution layer, Fuel Network, kicks off the Fuel Points Program, designed to incentivize deposits on the layer leading up their mainnet launch — Link
📌 TON Applications Chain (TAC) is collaborating with Polygon to deploy an EVM-compatible L2 on the TON blockchain, to increase accessibility to DeFi, gaming and more on the TON blockchain — Link
📌 Story Protocol introduces Story Network, a blockchain built around intellectual property, enabling the monetization, trade and programmability of intellectual property — Link
📌 Zero-knowledge rollup, StarkNet, announces the upcoming launch of STRK staking, which is expected in Q4 2024, which will aid in the gradual decentralization of the chain — Link
Why does it matter?
With the focus on mass adoption for this cycle, projects and decentralized applications have increasingly taken a focus on consumer-facing applications and use cases. Gas fees and off-ramping remain one of the struggles in the crypto user journey. With the move to gasless transfers of stablecoins, which remains one of crypto’s largest use cases, the move by Tron is a step in the right direction in incentivizing mass adoption of the technology. Additionally, the Argent Card joins many other cards which allow the easy spending of on-chain stablecoins and assets such as Solana Pay, EtherFi’s Liquid and more.
DeFi Brief 🏦
📌 Optimism kicks off SuperFest, a DeFi-focused series of events across the OP Superchain, with 1.5M OP tokens allocated as rewards for participants in the on-chain activities. The campaign spans 4 chains and more than 40 decentralized applications — Link
📌 DeFiLlama co-founder, 0xngmi, releases the new aggregated borrowing and earn feature on DeFillama’s services, adding to their DEX aggregation service, LlamaSwap — Link
📌 DEX aggregator, ParaSwap, introduces, ParaSwap Delta, a new addition to the ParaSwap product suite, to unlock gas-free trading, protection from MEV and improved price competition on the platform — Link
📌 Ampleforth-backed project, Spot Protocol, releases the SPOT flatcoin, an inflation-resistant, decentralized currency that maintains stability for everyday use through the separation of AMPL tokens into SPOT and stAMPL — Link
📌 Several DeFi apps’ frontend have been compromised following a hijacking of DNS by projects hosted on SquareSpace. Compound Finance and Celer Network have been affected — Link
Why does it matter?
ETH L2 tokens have been underperforming over the last couple of months, with the arguably over-supply of L2s available on the market and the lack of innovation that many of them bring to table. Additionally, the poor performance of L2 governance tokens as a sector does not help their case.
The launch of the Optimism SuperFest seeks to reinvigorate the DeFi ecosystem of chains in the Optimism Superchain across Optimism, Base, Mode and Frax Finance’s L2, Fraxtal. Additionally, the festival also helps to bring attention to newer projects such as Split Finance, Spectra and Ra Exchange.
Meme Coins 🚀
📌 Base meme coin MAMBA and market making service Gotbit got into a public feud. The Mamba team accused Gotbit of dumping their token, while Gotbit accused the Mamba team of selling on them, resulting in them taking more than 500K in losses — Link
📌 Martin Shkreli releases a screen recording of his DMs on X, allegedly showing a message from legendary crypto trader GCR, who admits that he was wrong regarding the origin of the DJT memecoin — Link
📌 099.eth dives into his strategies in the SOL memecoin arena over the past month, burning “multiple six figures'' in his experiment to find a winning strategy — Link
Chart of the Week 📊
Fundraises 💰
📌 On-chain credit platform, Idle Finance, raises $1.1M in a strategic funding round led by RockawayX, with participation from Fasanara Digital, bringing the project’s total funding to $2.4M — Link
📌 Bitcoin L2, BOB, completes a $1.6M strategic raise from Ledger Cathay Fund, with support from angel investors from BlackRock, Mechanism Capital, Aave, Curve Finance, Injective and more — Link
📌 Algorithmic trading platform, Tread.Fi, closes a $3.5M pre-seed investment round led by New Form Capital, with other investors including Thanefield Capital, Aquanow, and GBV Capital, among others — Link
📌 Term Finance raises $5.5M in a strategic round led by Electric Capital, with support from Maelstrom, Arete Capital, Daemon Ventures and more — Link
📌 Rome Protocol raises $9M in funding with investors including HackVC, Portal Ventures, HashKey, Polygon Ventures and angels including Solana co-founder, Anatoly Yakovenko — Link
Airdrops Abound 🎁
📌 On-chain portfolio tracker service, Debank, announces claims for the initial Debank XP airdrop, allowing users to claim XP based on on-chain assets held and on-chain activities — Link
📌 Solana liquid staking platform, Sanctum, announces the 18th July as the date for the upcoming CLOUD airdrop — Link
📌 ETH liquid restaking platform, EtherFi, releases the checker for the ETHFI Season 2 airdrop, with 53M tokens allocated for the airdrop — Link
📌 Decentralized RPC layer, Lava Network, announces their airdrop for the LAVA token, distributing 6% of the token supply to early users, technical contributors, node runners and more — Link
📌 On-chain quest platform, Layer3, announces their updated tokenomics, leading up to their L3 token airdrop, with 7.5% of the total token supply to be allocated to the initial airdrop — Link
Tweet of the Week 📝
Source: Cobie
Feds among us? Who would’ve thought?
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