OTC Weekly Trading Insights (03/27/2024)

Polymesh ($POLYX), an institutional-grade permissioned blockchain designed specifically for regulated assets, has gained market traction following BlackRock's exploration into the Real World Asset (RWA) tokenization space. Its prominence reflects the growing interest in blockchain-based financial solutions, establishing it as a market leader in this evolving sector. The 190% gain in seven days demonstrates the high demand for this token and the market's interest in the project. Badger ($BADGER) is a DAO that aims to bring Bitcoin as a collateral asset for DeFi applications. Badger DAO introduced a synthetic BTC token (eBTC), a feature with great potential for use in DeFi lending. The stablecoin, which references the Bitcoin rate and runs on the Ethereum network, uses Lido's staked ether (stETH) as a bond. This goal can be accomplished by implementing a strategy that aims to increase decentralization and capital efficiency throughout the DeFi domain. Terra ($LUNA) increased 44.6% in the last seven days following Do Kwon's official release from Montenegro prison. The strong rally also increased the hot debut on social media platforms, pushing the price higher. Overall Market The above chart shows the BTC price movement in the last 30 days. As previously discussed, we expected last week's BTC selloff from its all-time high to find support at the $60k level, as shown above in the upper red box. The strong demand for bitcoin around the $60k level, combined with Fed Chairman Powell's dovish comments, pushed the bitcoin price back into the $68k resistance zone.  Fed Chairman Powell made some dovish comments after the Federal Reserve kept interest rates at 5.50%, with an updated dot plot indicating three rate cuts in 2024. He also mentioned that the Fed was planning to reduce its Quantitative Tightening (QT) program soon. Powell's comments, as well as the dot plot's expected path of interest rate cuts, boosted market sentiment and sent risk assets higher. BTC bulls capitalised on this sentiment and forced bears to close their short positions. As a result of Powell's press conference, the Bitcoin price returned to $68k within four hours. However, our desk noticed a short-term downward trend in BTC price over the last two days. The $69k key level now serves as support. If the Bitcoin price falls below $69k, the lower bound of the upward channel will be tested. Options Market The above table shows the 25-delta skewness for BTC and ETH options.  As a result of the improved market sentiment that followed the FOMC meeting, the prices of Bitcoin and Ethereum rose from their lows of the previous week and are currently trading sideways. The 25-delta skews on BTC options return to positive territory for all tenors. It demonstrates that market sentiment on BTC leans towards a bullish view. The skewness in front-end options is close to zero, indicating that market sentiment is more or less balanced and that there is no clear direction for BTC price in the short term, according to data. On the other hand, the 25-delta skews in ETH options do not indicate such a bullish sentiment. In the short to medium term, the skews on ETH options remain negative. Although the skews in the short-term options are less negative than last week's data, it indicates that investors and traders are less willing to hold positive delta positions on Ethereum, and the market is betting on Bitcoin's short to medium-term performance rather than Ethereum's. Macro at a glance  Last Wednesday (24-03-20) The Federal Reserve announced that its interest rate would remain at 5.50%, unchanged. Fed Chairman Powell's dovish comments boosted gold, equities, and cryptocurrency markets following the press conference. The dot plot indicates that the Federal Reserve will make three quarter-percentage point cuts in 2024. The market expects the Fed's first rate cut in June. Last Thursday (24-03-21) The Bank of England maintained its interest rate at 5.25%, unchanged. The Bank's governor, Andrew Bailey, stated that the rate cut decision would be data-driven, and the data indicated that it was in the right direction. Last week, initial jobless claims in the United States totalled 210k, which was in line with the forecast of 212k. As Powell stated in the press following the FOMC meeting on Wednesday, the strong labour market would not cause the Fed to be concerned about rising inflation. On Tuesday (24-03-26) In February, US durable goods orders rose by 1.4% month on month, exceeding the expected 1.2% increase. Durable goods orders have begun to recover from January's 6.9% drop. In March, US Conference Board (CB) consumer confidence was 104.7, lower than expected at 106.9. The lower-than-expected consumer confidence data suggested that consumer demand had eased, which would help to reduce inflation over time. This Friday, the PCE price index data will be released, which could provide more clarity to the market if the US inflation rate moves in the direction expected by the Federal Reserve. It will also provide insight into the Fed's rate cuts this year. Convert Portal Volume Change The above table shows the volume change on our Convert Portal by zone.  This week, our desk noticed that trading volume increased significantly in the Launchpool while remaining low in other zones.  Over the last seven days, the Launchpool Zone has seen the greatest percentage increase in volume. Trading volume increased by 80.7%, primarily due to increased trade demand for Shentu ($CTK). The Monitoring zone saw a 14.9% decrease in trading volume on Convert. Among all the tokens in the Monitoring zone, trading demand for Enzyme ($MLN) increased the most, while demand for JasmyCoin ($JASMY) decreased the most. The Layer1/Layer2 zone also saw a 49.9% volume decrease as the market traded sideways. Large market capitalization Layer1 and Layer2 tokens are weighted in this volume drop. 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.  Email: trading@binance.com for more information. Join our Telegram (https://t.me/BinanceOTC) to stay up to date with the markets!

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