Coin360 Daily Dispatch | Crypto Market Updates & Highlights | August 26, 2023

Crypto Market Update

Written by Van

Table of Contents

Market Trends and Insights

• Bitcoin Seller Exhaustion Skyrockets in 2023
• Top 10 Ethereum Wallets Hoard More ETH
• PEPE Tokens Heist: Multi-Million Dollar Scandal
• Num Finance Unveils nCOP Stablecoin

Legal and Regulatory Developments

• FTX Ex-CEO's Legal Battle Heats Up
• Binance Halts Ruble Transfers Amid Regulatory Heat
• Tornado Cash Co-Founder Released on Bail
• Worldcoin Faces Serious Regulatory Challenges
• JP Morgan Predicts Crypto Market Stabilization

Crypto Exchanges and Platforms

• Coinbase and Optimism Ink Revenue Share Deal
• PayPal's PYUSD Struggles to Attract Users
• Massive XRP Withdrawal Shakes the Market

Investments and Token Ownership

• DWF Labs Makes Big Splash in Fetch.ai Market
• MKR and UNI Holders Defy Bearish Trends

Miscellaneous Updates

• Dropbox Revises Storage Policy Over Crypto Misuse
• DeFi Experiences Major Value Outflows
• Bounce Finance Introduces Mutant English Auctions

Bitcoin Seller Exhaustion Skyrockets in 2023

In 2023, the Bitcoin market has shown a notable increase in seller exhaustion. This occurrence, which has happened only about 15 times in Bitcoin's history, with four instances happening in 2023 alone, is detected through the combination of Percentage Supply in Profit and 30-day price volatility.

These periods indicate low-risk bottoms, with low volatility and a high proportion of sellers experiencing losses. The heightened frequency in 2023 provides valuable insights into the current state of the Bitcoin market. 

Top 10 Ethereum Wallets Hoard More ETH

A recent Santiment report highlights a significant shift in the Ethereum market cap, as the 10 largest Ethereum wallets now account for 35% of the total supply. Smaller investors have been selling their ETH, leading to a decrease in price.

Additionally, the number of ETH-holding wallets has seen a surge in activity, with transactions worth over $100,000 increasing. Analyst Benjamin Cowen suggests that crypto price trends, particularly for ETH, will likely see a dip this summer based on historical patterns.

PEPE Tokens Heist: Multi-Million Dollar Scandal

Trillions of PEPE tokens worth $16 million were swiped from the PEPE multisig CEX Wallet, causing a major shakeup in crypto coin prices as they were dumped on various exchanges. The remaining tokens and their associated X account are secure, and the PEPE team will communicate through their X account.

Three ex-team members stole 16 trillion tokens, representing 60% of the team's total tokens, and sold them on exchanges. The team will create new official Telegram groups.

Num Finance Unveils nCOP Stablecoin

Argentine fintech company Num Finance has launched nCOP, a stablecoin built on the Polygon network and pegged to the Colombian Peso. The stablecoin offers yields of 8% to companies that choose it for remittance purposes.

Num Finance is also exploring stablecoins linked to the Mexican peso, Brazilian real, and Bahraini dinar.

FTX Ex-CEO's Legal Battle Heats Up

Former FTX CEO Sam Bankman-Fried's lawyers have objected to the US government's delivery of an additional four million pages of discovery documents less than six weeks before his trial. The lawyers argued that Bankman-Fried is being overwhelmed and unable to prepare his case adequately.

They also complained that the government has no plan to deliver the discovery documents to their client at the Metropolitan Detention Center, Brooklyn (MDC), despite his rapidly approaching trial date.

Binance Halts Ruble Transfers Amid Regulatory Heat

Binance, the largest cryptocurrency exchange, has stopped offering its clients the ability to transfer rubles through sanctioned Russian banks on its peer-to-peer service, following scrutiny from regulators. The move comes as the US Justice Department investigates whether Binance facilitated the evasion of US sanctions by Russians.

Binance has also faced lawsuits from the Commodity Futures Trading Commission and the Securities and Exchange Commission.

Tornado Cash Co-Founder Released on Bail

Roman Storm, co-founder of Tornado Cash, has been arrested for alleged money laundering. He has since been released on bail. US attorney Brian Klein expressed disappointment at the charges, arguing that Storm had merely helped develop the software.

Storm and co-founder Roman Semenov were indicted for fraud, violating sanctions and conspiracy to operate an unlicensed money-transmitting enterprise. Prosecutors claim Tornado Cash facilitated money laundering transactions in excess of $1bn and was used by North Korean cybercrime group Lazarus.

Worldcoin Faces Serious Regulatory Challenges

A self-proclaimed ex-employee of Worldcoin alleges the project's involvement in illicit activities and is reportedly in touch with authorities. These claims are unverified. Worldcoin has been scrutinized for data privacy issues and faces ongoing investigations. The WLD token's value has plunged over 50%, now at $1.26, amid regulatory worries. While some traders profit, most token holders are at a loss. 

JP Morgan Predicts Crypto Market Stabilization

Global investment bank JP Morgan has predicted that the recent sell-off in cryptocurrency markets may be nearing an end. The bank believes there is limited downside for the market in the near term due to a decrease in open interest in Bitcoin futures contracts.

However, the bank also notes potential legal uncertainty for the crypto market, particularly in relation to the SEC's appeal in the Ripple case and the status of approvals for spot Bitcoin ETFs. Crypto community reaction to the report has been positive.

Coinbase and Optimism Ink Revenue Share Deal

Coinbase-backed Layer 2 chain Base and the Optimism network's governance body, The Optimism Collection, have agreed to a revenue and governance sharing arrangement.

Under the agreement, Base will contribute a portion of its revenue or net profits to the Optimism Collective and will receive 118 million OP tokens over six years. Both projects aim to have compatible, interoperable chains within the Superchain ecosystem.

Base is also planning to decentralize its network and improve security and uptime.

PayPal's PYUSD Struggles to Attract Users

PayPal's new stablecoin, PYUSD, is reportedly experiencing slow demand from crypto users, according to data firm Nansen. The low usage may be due to the availability of other alternatives and the high transaction fees associated with using the Ethereum blockchain on which the stablecoin is issued.

Currently, more than 90% of the PYUSD supply is held in custody by Paxos, with only a small number of holders outside of exchanges and contracts.

Massive XRP Withdrawal Shakes the Market

An anonymous whale has withdrawn nearly half a billion XRP tokens, worth $220 million, from Bitvavo crypto exchange and transferred them to a cold wallet for long-term storage. This is the largest XRP transfer of its kind in recent weeks. Meanwhile, the price of XRP has been attempting to recover after a 15% drop on August 17.

DWF Labs Makes Big Splash in Fetch.ai Market

DWF Labs, a blockchain research and development company, has purchased 10 million Fetch.ai (FET) tokens for $2.01 million, making it the 21st largest owner of FET tokens. With a 19.341% share in its portfolio, DWF Labs also holds CRV, USDT, CYBER, and METIS tokens, among others.  

MKR and UNI Holders Defy Bearish Trends

According to a report by IntoTheBlock, only 52.3% of MakerDAO (MKR) holders and about 72% of Uniswap (UNI) holders are currently holding at a loss. This sets MKR and UNI apart from other DeFi tokens, which have a higher percentage of holders incurring losses.

However, both MKR and UNI are displaying bearish signals on their Relative Strength Index (RSI) and have seen declines in their Total Value Locked (TVL) figures.

Dropbox Revises Storage Policy Over Crypto Misuse

Dropbox is discontinuing its "unlimited" storage policy under its Dropbox Advanced plan due to high usage patterns, including unauthorised use for crypto mining.

The company will replace the policy with a metered model, with customers purchasing a Dropbox Advanced plan with three active licenses receiving 15TB of storage space shared by the team. The new policy will be introduced gradually from November 1.

DeFi Experiences Major Value Outflows

Data from DefiLlama shows that decentralized finance (DeFi) has experienced consistent outflows despite numerous failures of centralized crypto exchanges and services.

For those keeping an eye on cryptocurrency charts, you'll notice that the total value locked (TVL) in DeFi has plummeted from $178 billion to less than $38 billion, a significant slide that's worth your attention.

This figure is even lower than the TVL shortly after the collapse of centralized exchange FTX in November 2022. Liquid staking protocols and Coinbase's staking service have accumulated an additional $20.2 billion in assets, offering attractive alternatives to lending protocols like Aave.

Aave's TVL has fallen 21% to $4.5 billion, and Curve Finance has dropped 26% to $2.3 billion. The Federal Reserve's hawkish monetary policy has also made short-term government debt more appealing to investors than stablecoin yields.

Top Altcoin Gainers and Losers

Gainers:

Rollbit Coin RLB (+21.56%)

Monero XMR (+3.43%)

Quant QNT (+3.32%)

Losers:

THORChain RUNE (-7.18%)

Frax Share FXS (-4.66%)

Kaspa KAS (-3.75%)

NFT Market Map

Bounce Finance Introduces Mutant English Auctions

Bounce Finance has debuted its proof of concept for a "mutant English auction" format, offering a "Diamond Hand" necklace paired with two NFTs. The auction mechanics reward early bidders and include small bonuses for subsequent bids. Bounce plans to apply its auction research to various DeFi use cases.

This article has been refined and enhanced by ChatGPT.