Hong Kong’s First Crypto ETF, zkEVM Uprising, and More!

Markets have crumbled over the past week, which can in part be attributed to skepticism around the proof of reserves of main industry stakeholders that led two auditors, including Mazars, to bid crypto farewell. Bitcoin and Ethereum are down by 7.6% and 11.5%, respectively. The biggest losers of last week’s rally were Cardano (-19%) among the major Layer 1s, Optimism (-21.6%) among the major Layer 2s, and Curve (-21%) among major DeFi players.

Figure 1: Weekly TVL and Price Performance of Major Crypto Categories

Source: Coingecko, DeFi Llama. Data as of Dec 13 to 19.

Key takeaways

• Sam Bankman-Fried to be extradited to the US; charges could sentence him to 100+ years

• Polygon is auditing its zkEVM, while Consensys announces its own public beta testnet of the scalability solution

• Crypto auditors Mazars and Armanino quit the industry to mitigate reputation risk.

• Chainlink released NFT floor pricing feeds on Ethereum.

Spot and Derivatives Markets

Figure 2: BTC Futures Long/Short Ratio

Source: Coinglass

The chart above can depict the current market sentiment, which has been volatile over the past week, reaching the lowest levels month over month. However, investors’ appetite picked up today, leaning towards longing Bitcoin by almost 53%.

On-chain Indicators

Figure 3: Binance Asset Flow y/y

Source: Glassnode

There has been a multitude of outflows on Binance in the week of December 12, as shown in Figure 2. Almost $14B worth of outflows from the world’s largest crypto exchange over the past week, and almost $11B of inflows. Our team delved into that last week in our last Analyst Call of the year; watch it here.

Next Week’s Calendar

Read our full report here

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

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