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Bitcoin Survives Bear Trap
Publicerad
3 månader sedanden
Bitcoin has witnessed some heavy price turbulence after breaking the $71K mark in early June. Since then, it lost almost 21% in value scraping the key level of $55K in the first week of July.
Figure 1 – Bitcoin Price
Source: Glassnode
However, since last Friday, Bitcoin has gained $7K and is now trading around the $64K mark. But why has it been such a turbulent time for Bitcoin?
Factors Contributing to the Selling Pressure
• Bitcoin Miner Activity
• German Government Sell-Offs
• Mt. Gox Repayment Program & Bitcoin Exchange Liquidity
Bitcoin Miner Activity
The BTC selling pressure was earmarked by miner activity, after selling 30K BTC in June. This sell-off marked miners’ BTC reserves at the lowest in a decade, just over 1.8K BTC.
Figure 2 – Bitcoin Miner Balance’
Source: Glassnode
Miners have however reduced their activity on-exchange, which should calm fears further. In June, miners were moving an average of around 50 BTC or just under $3M per day to exchanges, which has now slowed down, as shown below.
Figure 3 – Bitcoin Transfer Volume from Miners to Exchanges
Source: Glassnode
On top of that, on-chain data shows the 30-day moving average of Bitcoin’s hash rate is starting to close the gap with the 60-day moving average, for the first time since May. This indicates miners are experiencing lower income stress, which typically signals a market bottom.
Figure 4 – Bitcoin’s Hash Ribbon Indicator
Source: Glassnode
As a result, miner reserves have slowly started to pick back up, as shown in the first figure. This could indicate that the miner sell-offs post-halving, due to reduced profitability, have tapered off which is another reason to be cautiously positive.
German Government Sell-Offs
The German Goverment had been in the process of completing the sale of 50K BTC seized from a pirating website, Movie2k, which was worth approximately $3B when the sell-offs started.
Figure 5 – German Government Holdings
Source: @obchakevich on Dune Analytics
Bitcoin had a shaky June and July. However, in the week Germany sold almost 80% of their holdings, 40K BTC or $2.2B worth, Bitcoin’s price remained fairly resilient, a testament to its strength in adverse market conditions. That being said, according to data from Arkham Intelligence, the German Government engaged via OTC trades, to minimize potential slippage and market impact.
Figure 6 – Bitcoin Price (7 July – 14 July)
Source: Glassnode
Nevertheless, the conclusion of these sell-offs is positive for Bitcoin, as it removes a significant dark cloud from the market, and demonstrates the asset’s resilience.
Mt. Gox Repayment Program
However, Bitcoin faces selling pressure due to the upcoming Mt. Gox repayment program. Starting in July 2024, Mt. Gox began repaying approximately $9B worth of assets to its creditors, who have been waiting for over a decade since the exchange’s collapse in 2014.
Figure 7 – Mt. Gox Holdings
Source: @21co on Dune Analytics
Of the approximate 142K BTC held by Mt. Gox, 139K BTC is left to be reimbursed, equating to approximately 2% being paid back as of today, indicating a slow sale rate. However, yesterday Mt. Gox shuffled almost 96K BTC between their wallets, which contributed to the renewed FUD, as they prepare to distribute the reimbursements. While the repayment sum is very large, it is unlikely that these creditors will sell off their BTC immediately, given their long-term belief in the crypto industry given their involvement a decade ago, and the potential capital gains tax implications associated with the asset. The selling pressure is further diluted by the fact that reimbursements will likely occur on different days across different exchanges.
Bitcoin Exchange Liquidity
Despite, Bitcoin’s apparent survival. Let’s take a closer look at how the remaining BTC could affect the market. 139K BTC or $8.93B worth remains for Mt. Gox to restore to creditors, who may end up selling their assets. To gauge the market impact of this, it may help to look at Bitcoin’s liquidity on exchange. Presuming they aim to sell their BTC, the sell-offs will likely occur by trading with a fiat pair (BTC/USD) or a stablecoin pair (BTC/USDT or BTC/USDC). The top 5 most liquid exchanges are listed below, with their respective liquidity depths in dollar and BTC terms (assuming July’s average price of $59K).
Figure 8 – Centralized Exchange % Depth
Source: Coingecko
As to not mitigate the market impact, the sell-offs are likely to occur across several exchanges. The five most liquid exchanges need around $72M outflows, on a given day to have a 2% downward price swing. The potential sell-offs are contingent on creditors finally receiving their assets from Mt. Gox, which is happening very slowly. Furthermore, it is doubtful that once received, they will sell all their BTC immediately, and as such any price action is largely resulting from the negative market sentiment associated with this event.
On-Chain Metrics
Despite the negativity surrounding the market, looking on-chain could help uncover dynamics that might make investors feel positive, and we propose 3 different indicators to look at.
The Market Value to Realized Value Ratio (MVRV) is a metric that assesses Bitcoin’s market valuation relative to its realized value, helping identify market tops and bottoms.
A high MVRV indicates overvaluation and a potential market top, while a low score indicates undervaluation and a potential market bottom.
Figure 9 – Bitcoin MVRV Score
Source: Glassnode
The current MVRV is around levels seen at the end of December 2020, just before Bitcoin rallied from $11K to around the $60K mark. This is also similar to the levels seen towards the end of last year, before the ETF craze which drove Bitcoin to a new all-time high of $75K in early March. Given these historical precedents, this MVRV level suggests a potential for significant upside, making it an opportune time for investors to consider entering the market.
Net Unrealized Profit/Loss (NUPL) indicates the difference between investors’ unrealized profits and losses to assess market sentiment, with positive values suggesting profit-dominant sentiment and negative values indicating loss-dominant sentiment.
This metric is another reason for positivity. Currently, Bitcoin’s NUPL is in the optimism/denial phase, indicating moderate unrealized profits among investors. This suggests that market sentiment is cautiously optimistic, after recent price stagnations led NUPL to drop, and belief to be wiped away. That being said, this is a healthy consolidation for the asset and potentially allows it to spur on.
Figure 10 – Bitcoin Net Unrealized Profit/Loss
Source: Glassnode
- Fear and Greed Index measures market sentiment, with values ranging from 0 (extreme fear) to 100 (extreme greed). It helps investors gauge whether the market is overly bearish or bullish, indicating potential buying or selling opportunities.
Figure 11 – Bitcoin Fear and Greed Index
Source: Glassnode
The Bitcoin Fear and Greed Index was often in the ‘Fear’ region during June and early July. However, this was a positive sign, as it was near levels we had not seen since September 2023, when the asset was trading at $26K, which preceded a historical price rally. Over the weekend, the Fear and Greed Index sprung to Greed levels, suggesting we might be on track for another parabolic run.
Conclusions
• Bitcoin’s turbulence has stemmed from significant selling pressures, particularly the Mt. Gox repayment program.
o The impact of these sell-offs is moderated by Bitcoin’s strong exchange liquidity and potential ETF inflows.
• The dark cloud of the German Government sell-offs is out of the way.
• On-chain metrics suggest the potential for a bullish reversal, indicating now might be an opportune time for investors to consider entering the market.
For investors looking to invest in Bitcoin via a regulated investment vehicle, the following ETPs are available on the European market:
Figure 12 – Top 10 European Bitcoin Products by Assets Under Management Product Ticker
Source: Bloomberg, Data as of July 16th, 2024.
Avg. Daily Spread 20D (bps): refers to the best daily average bid/ask spread over the last 20 days across European exchanges.
This Week’s Calendar
Source: Forex Factory, 21Shares
Research Newsletter
Each week the 21Shares Research team will publish our data-driven insights into the crypto asset world through this newsletter. Please direct any comments, questions, and words of feedback to research@21shares.com
Disclaimer
The information provided does not constitute a prospectus or other offering material and does not contain or constitute an offer to sell or a solicitation of any offer to buy securities in any jurisdiction. Some of the information published herein may contain forward-looking statements. Readers are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties and that actual results may differ materially from those in the forward-looking statements as a result of various factors. The information contained herein may not be considered as economic, legal, tax or other advice and users are cautioned to base investment decisions or other decisions solely on the content hereof.
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Det finns många skäl att sätta börshandlade fonder i hjärtat av din investeringsstrategi när du jämför deras styrkor med alternativen. Vi tittar på fördelarna med ETF-investeringar.
ETFer har samlat flera biljoner i tillgångar under förvaltning sedan deras fördelar först kom till kunniga investerares kännedom i början av noughties. Deras popularitet och trovärdighet har bara ökat sedan dess. Vi förklarar varför både institutionella aktörer och gör-det-själv-investerare köper in sig på ETFer.
14 skäl till att köpa ETFer
- Enkelt: ETFer kan köpas och säljas på börsen som vilken annan aktie som helst.
- Kostnadseffektivt: Avgifterna är låga jämfört med aktiva fonder. Aktiva fonder som grupp misslyckas med att slå marknaden på lång sikt efter kostnader som avgifter och skatter. Medan ETFer strävar efter att matcha marknadsavkastningen minus kostnader. Den negativa sammansättningseffekten av aktiva pengars högre kostnader innebär att motsvarande ETFer vanligtvis vinner över tid.
- Diversifiering och tidshantering: Att äga en ETF ger dig exponering mot dussintals, hundratals eller till och med tusentals värdepapper som täcker alla värdefulla tillgångsklasser. Det är en omedelbar lösning på problemet med att ständigt försöka välja vinnare och förlorare. Istället för att försöka förutsäga marknaden äger du helt enkelt marknaden.
- Transparent: Du vet alltid vad en ETF gör. Det är utformat för att replikera avkastningen från dess angivna marknadsindex – så din avkastning bör matcha det indexets prestanda efter kostnader och tracking error. Du kan kontrollera ditt indexs innehav och exponeringar när som helst på dess webbsida.
- Val och kontroll: Det finns över 1 600 ETFer noterade på London Stock Exchange. Tillsammans gör de att du kan investera i alla länder, regioner, sektorer och tillgångsklasser som du behöver. Från etiska investeringar till AI, från ädelmetaller till genomik – ETFer gör att du kan investera i hela världens framtid.
- Säkert: ETFer tillhandahålls av stora och välkapitaliserade finansiella institutioner som BlackRock, Vanguard, HSBC och State Street. I den osannolika händelsen att något av dessa företag går i konkurs, finns det europeiska regler och kompensationssystem för att skydda dina tillgångar.
- Likvida: ETFer kan handlas när du vill under normala börstider. Jämför det med traditionella fonder som bara kan handlas en gång om dagen.
- Ultralåga handelsavgifter: Vissa mäklare erbjuder handel utan provision medan andra erbjuder mycket billiga vanliga investeringsplaner.
- Prisvärt: Bråkhandel innebär att du kan köpa en ETF från så lite som 1€ eller 1 pund eller till och med en krona hos vissa mäklare. Andra mäklare begär ett minimibidrag från 25€ / £25 eller 50€ / £50 per affär.
- Enkelt att förstå: Att investera i aktier är bäst att överlåta till proffsen, men även aktiva fonder kräver mycket forskning – och du är fortfarande aldrig säker på hur förvaltaren sköter dina pengar. Samtidigt är ETFer extremt enkla även för oerfarna investerare. Allt du behöver veta om en ETF publiceras på dess webbsida.
- Inkomstinvesteringar: Du kan leva på naturlig avkastning med en portfölj av ETFer med hög utdelning. Lägre kostnader innebär mer inkomster till dig.
- Vad du ser är vad du får: Priset på ETFer håller sig vanligtvis nära det faktiska värdet på deras tillgångar. Till skillnad från Investment Trusts, lider ETFer inte av den extra risken att handla till en premie eller rabatt på sina underliggande innehav.
- Lätt att jämföra: ETF-branschen har många marknadsaktörer som konkurrerar om att minska produktkostnaderna och lansera innovativa nya erbjudanden. Det finns gott om val och därför har vi fokuserat på att göra jämförelser snabbt och enkelt.
- Skattevänliga: De allra flesta ETFer kan ägas genom Investeringssparkonton eller kapitalförsäkringar, så dina vinster kan ackumuleras skattefritt.
Är ETFer alltid rätt val?
- Kontanter: Om du vill ha kontanter är det vanligtvis bättre att använda ett sparkonto snarare än en penningmarknads-ETF. Ett konkurrenskraftigt inlåningskonto bör tjäna en högre ränta, det kommer inte att tillkomma några handelsavgifter och den maximala ersättningsnivån är högre för kontanter på banken jämfört med en ETF-leverantör.
- Frestelse att överhandla: Många handlare (inklusive hedgefonder) använder ETFer. Men överdriven handel kan öka kostnaderna och potentiellt minska avkastningen. Vissa tycker att det är lättare att köpa och hålla med en mindre flexibel indexfond. Om det är du, kan en gammal skolans fond vara en bättre psykologisk passform.
- Inte alltid billigare: Ibland är den lägsta kostnadsindexfonden en smula billigare än sin ETF-motsvarighet. Detta är något att hålla utkik efter på välbetjänade marknader som FTSE 100 trackers.
- Högriskprodukter: Hävstångsbaserade och korta ETFer är högt specialiserade investeringar som huvudsakligen är avsedda för kortsiktig användning av institutionella aktörer. Investera bara i nischprodukter om du är helt säker på att du förstår riskerna.
- Illikviditet: Även om de flesta ETFer är mycket likvida, kan vissa små och nischade ETFer handlas sällan. Låga handelsvolymer kan innebära en kostsam spread. En lämplig fond kan vara ett bättre alternativ.
- Ingen överavkastning: En ETF strävar efter att matcha avkastningen från sitt index. Att investera dina pengar med en aktiv fondförvaltare kan fungera bättre med jämna mellanrum, speciellt om du har tur. Mot denna förhoppning står de fasta bevisen från ett flertal studier på att aktiva fonder misslyckas med att slå indexföljande produkter sammantaget.
Den avgörande fördelen
Ökningen i popularitet för ETFer är ingen tillfällighet. De flesta investerare tycker att en ETF-portfölj gör det möjligt för dem att enkelt genomföra sin investeringsstrategi – oavsett om de vill bygga upp välstånd eller leva på inkomster. Naturligtvis är det alltid bäst att göra din analys först. ETFmarknaden.se är ett bra sätt att börja sin resa på.
Nyheter
CEBX ETF köper dollardenominerade fastränteobligationer
Publicerad
11 timmar sedanden
17 oktober, 2024iShares US Aggregate Bond UCITS ETF EUR Hedged (Dist) (CEBX ETF) med ISIN IE00093SKUY4 mförsöker följa Bloomberg US Aggregate Bond (EUR Hedged)-index. Bloomberg US Aggregate Bond (EUR Hedged)-index följer obligationer med fast ränta i USD, inklusive statsobligationer, statsrelaterade, värdepapperiserade och företagsrelaterade värdepapper. Valutasäkrad till euro (EUR). Betyg: Investment Grade.
Den börshandlade fondens TER (total cost ratio) uppgår till 0,30 % p.a. iShares US Aggregate Bond UCITS ETF EUR Hedged (Dist) är den billigaste ETF som följer Bloomberg US Aggregate Bond (EUR Hedged) index. Denna ETF replikerar resultatet för det underliggande indexet genom samplingsteknik (köper ett urval av de mest relevanta indexbeståndsdelarna). Ränteintäkterna (kuponger) i ETFn delas ut till investerarna (halvårsvis).
iShares US Aggregate Bond UCITS ETF EUR Hedged (Dist) är en mycket liten ETF med tillgångar på 0 miljoner euro under förvaltning. Denna ETF lanserades den 21 februari 2024 och har sin hemvist i Irland.
Varför CEBX?
Diversifierad exponering mot den breda US-dollardenominerade obligationsmarknaden med investeringsgrad
Direktinvesteringar i stats-, statsrelaterade, företags- och värdepapperiserade obligationer
Obligationsexponering med investeringsgrad
Investeringsmål
Andelsklassen strävar efter att spåra utvecklingen av ett index som består av amerikanska dollar denominerade statsobligationer, statsrelaterade, företagsobligationer och värdepapperiserade obligationer.
Handla CEBX ETF
iShares US Aggregate Bond UCITS ETF EUR Hedged (Dist) (CEBX ETF) är en europeisk börshandlad fond. Denna fond handlas på flera olika börser, till exempel Deutsche Boerse Xetra.
Det betyder att det går att handla andelar i denna ETF genom de flesta svenska banker och Internetmäklare, till exempel DEGIRO, Nordnet, Aktieinvest och Avanza.
Börsnoteringar
Börs | Valuta | Kortnamn |
XETRA | EUR | CEBX |
Största innehav
Emittent | Vikt (%) |
UNITED STATES TREASURY | 44.49 |
FEDERAL NATIONAL MORTGAGE ASSOCIATION | 11.71 |
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION II | 5.71 |
FEDERAL HOME LOAN MORTGAGE CORPORATION | 5.08 |
UNIFORM MBS | 2.85 |
BANK OF AMERICA CORP | 0.59 |
JPMORGAN CHASE & CO | 0.56 |
MORGAN STANLEY | 0.43 |
INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT | 0.38 |
WELLS FARGO & COMPANY | 0.37 |
Innehav kan komma att förändras
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Transforming DeFi: The Strategic Leap of Unichain
Publicerad
1 dag sedanden
16 oktober, 2024• Uniswap Labs announced Unichain, whose testnet launched on October 10 and mainnet is launching in November, relying on the tech infrastructure from Ethereum layer-2 Optimism’s OP Stack, and block builder Flashbots.
• Unichain is a DeFi-specific scalability solution aiming to offer a universal liquidity hub, with an emphasis on transaction speed and superior security.
• Uniswap’s token UNI will be used, or staked, to validate Unichain transactions and earn part of the network’s sequencer fees – of which the stack will be decentralized using what’s known as the Unichain Validation Network.
• This is a key development, as it will transform UNI from a governance token into a utility token, thereby completely changing its investment case.
Uniswap is the crypto market’s largest decentralized exchange (DEX) and the pioneer of the crypto-native automated market maker (AMM), which later became an industry standard for most DEXs. While Uniswap has maintained over 46% of the market share, its dominance has been eaten away by emerging DEXs, as shown below in Figure 1, that offer revenue sharing with token holders rather than just for liquidity providers.
Figure 1 – Decentralized Exchanges Volume
Source: Dune
Driven by this increasing competition, Uniswap Labs revealed Unichain, a Layer 2 (L2) Superchain, built using OP Stack, which is a modular, open-source software stack developed by Optimism, one of Ethereum’s leading scalability solutions. The primary goal of the OP Stack is to create scalable, secure, and interoperable blockchains, with Unichain being a prime example.
What is Unichain?
In essence, it’s a DeFi-centric Ethereum scaling solution designed to cater to users’ financial activities. By integrating advanced cross-chain functionality through technologies like cross-chain intents (ERC-7683), which we’ll delve into later, and the LayerZero bridge, Unichain addresses key challenges in the DeFi ecosystem:
- Transaction Speed: Block times are reduced to one second, with plans for 250ms sub-blocks – faster than many other L2s.
- Cost Efficiency: Transaction costs are projected to decrease by approximately 95% compared to Ethereum’s Layer 1, as can be observed below in Figure 2.
- Cross-Chain Liquidity: Unichain aims to create a unified ecosystem for seamless multi-chain asset trading, all whilst abstracting the technology’s complexity away from the user. Otherwise, users are required to utilize third-party bridging solutions and asset wrappers, which exposes them to heightened smart-contract risk.
- Incentive Structure: A robust reward system that compensates both token holders and liquidity providers for their liquidity and security contributions.
While Unichain aims to tackle liquidity fragmentation across networks, this gradual process will stretch beyond the initial mainnet launch. The protocol will need to incentivize users and liquidity providers to migrate their liquidity to Unichain as the premier network over time. Thus, liquidity fragmentation could worsen in the short term as this reorganization takes place.
Figure 2 – Average transaction speed vs. Fees of Ethereum’s Layer 2s
Source: Dune
What makes Unichain stand out?
- Interoperable and a Multi-Chain Cohesive Ecosystem:
The quest of lowering transaction costs came at the expense of fragmented liquidity, complicating the user experience. Unichain is designed to simplify swapping across different chains. They worked with OP Labs, the builders behind Optimism (Ethereum’s third largest L2 by TVL of $680M), to make it easy to send messages between L2s in the Optimism Superchain using the network’s stack native interoperability technology. For other chains, Uniswap Labs is improving cross-chain compatibility through initiatives like the Cross-Chain Intents standard, known as ERC-7683.
In this view, Unichain’s Total Addressable Market can have a target of $4.9B, illustrated below in Figure 3.
Figure 3 – UNI’s TVL Across Chains
Source: DeFiLlama
What is ERC-7683, and what is its impact?
Introduced in April 2024, the Cross-Chain Intents standard enhances blockchain interoperability by standardizing off-chain messages and on-chain settlement. This framework simplifies cross-network transactions for users, allowing them to submit a general request—such as swapping Token X on Ethereum for Token Y on Arbitrum—without needing to choose specific bridges, DEXs or solutions. Once a request is made, specialized agents called ”fillers” compete to execute the transaction efficiently. This approach streamlines the process, making it easier for users to trade across several networks like they would in a traditional fintech application that has multiple currency accounts, all whilst fostering competition among service providers across the crypto ecosystem. This will ultimately improve the user experience, which is one of the most important factors in driving mainstream adoption.
- Vertical Integration:
Unichain represents a strategic shift in Uniswap’s operational model, enhancing its control over revenue streams and transaction processing. By evolving into an execution network similar to Base and Arbitrum, Unichain now captures additional value through:
o Transaction / Gas Fees – previously allocated to the networks Uniswap lives on. As shown below in Figure 4, Uniswap will be able to preserve about close to $374M in fees, once they’re able to settle these transitions on its own network.
Figure 4 – Uniswap Economics by Blockchain
Source: TheDeFiReport, TokenTerminal
o Swap fees: allocated to liquidity providers (LPs), which had previously been managed and distributed to contributors.
o Front-end fees: the protocol’s only source of revenue that it retains. It has already been in place and managed by the exchange’s front-end interface, as shown below in Figure 5. Uniswap has generated close to $50M in front-end fees since inception.
o Maximal Extractable Value (MEV): previously absorbed by the networks Uniswap was deployed on. Unichain could retain a significant portion of the $83B paid on Ethereum if they had internalized MEV from the offset, as seen below in Figure 5.
Figure 5 – Total Volume of Sandwich attacks on Ethereum, via Uniswap
Source: Dune
This transformation allows Uniswap to optimize its revenue structure and maintain greater oversight of the entire transaction lifecycle, from execution to settlement. The new model not only improves Uniswap’s economic efficiency but also positions it to offer enhanced services and potentially lower costs for users, all while retaining more value within its ecosystem. Uniswap’s substantial DEX volume across multiple networks, as illustrated in Figure 6, positions the new network for significant growth. By consolidating this activity within its ecosystem, Unichain stands to benefit from a powerful network effects.
Figure 6 – Uniswap Volume Across Different Chains
Source: Dune
Unichain’s architecture also enhances the platform’s capabilities with features like fair transaction ordering, which helps prevent market manipulation strategies such as front-running and back-running. Additionally, by utilizing a dedicated validator set on Ethereum, Unichain can effectively mitigate toxic flows, thereby reducing Maximal Extractable Value (MEV) losses, which we talk about next, helping to foster a fairer trading environment.
- Lower MEV Loss: Unichain’s collaboration with Flashbots introduces an advanced block production system that enhances market efficiency and mitigates MEV concerns. By utilizing Trusted Execution Environments (TEEs), this system achieves faster block times, improved transaction ordering transparency, and reduced failed transactions. While TEEs do not replace decentralized consensus, they provide enhanced trust and security compared to traditional block builders. This approach effectively limits validators’ ability to manipulate transaction order for profit, creating a more equitable environment.
- Unichain Validation Network: UNI stakers will form a decentralized network of full nodes that replace the actions of the centralized sequencer. Overall, they will provide several key benefits, including:
o Enhanced Decentralization: An additional layer of security that allows independent nodes of operators (token stakers) to verify the state of the blockchain – helping to reduce the risks associated with single sequencer architecture commonly found in other L2 solutions.
o Faster Finality: Quicker settlement of cross-chain transactions, driven by the flashblock technology.
o Increased Token Utility: Instead of simply serving as a governance token, UNI will now play a critical part in the ecosystem. Validators will have to stake the token to participate in the network validation – allowing token holders and not just liquidity providers to earn rewards.
So, what does that mean for Uniswap, Ethereum and the other L2s Uniswap was deployed on?
Unichain’s launch will introduce seamless cross-chain swaps directly through the Uniswap Interface and Wallet, significantly enhancing accessibility to cross-chain markets and their liquidity.
The platform will utilize UNI tokens for network security, with staking occurring on the Ethereum mainnet. This integration increases UNI’s utility and potential demand. However, it’s important to note that the staking yield from transaction fees is distinct from the pending fee switch affecting the broader Uniswap community. Both mechanisms serve to incentivize token holders.
Unichain’s introduction may signal a shift towards app-specific chains retaining substantial user activity. This could create a network effect, attracting more users and liquidity and potentially drawing in other DeFi protocols focused on multi-network presence rather than developing proprietary chains. As seen below, Uniswap has about 14M cumulative users spread across the multiple networks it is deployed on, depicted below in Figure 7. Thus, consolidating this user base could create an unmatched DeFi hub.
Figure 7 – Uniswap Users and New Users
Source: Dune
For Ethereum, Unichain’s launch may lead to a reduction in revenue, as Uniswap has been a significant contributor to transaction fees on the mainnet. Consequently, this could further decrease Ethereum’s deflationary activity. However, if an explosion of activity occurs, we can expect a surge in the amount of ETH used by L2s to settle their activity on the mainnet.
To recap, Uniswap’s evolution into Unichain represents a pivotal shift for the UNI token, transforming it from a governance-focused asset into a multifaceted, value-generating instrument. This transition elevates UNI’s status in the crypto ecosystem, positioning it competitively alongside established proof-of-stake tokens like ETH.
What’s happening this week?
Source: Forex Factory, 21Shares
Research Newsletter
Each week the 21Shares Research team will publish our data-driven insights into the crypto asset world through this newsletter. Please direct any comments, questions, and words of feedback to research@21shares.com
Disclaimer
The information provided does not constitute a prospectus or other offering material and does not contain or constitute an offer to sell or a solicitation of any offer to buy securities in any jurisdiction. Some of the information published herein may contain forward-looking statements. Readers are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties and that actual results may differ materially from those in the forward-looking statements as a result of various factors. The information contained herein may not be considered as economic, legal, tax or other advice and users are cautioned to base investment decisions or other decisions solely on the content hereof.
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Samsung’s new crypto payment option, USDA leverages blockchains, and half of hedge funds invest in crypto
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