28 June

Grayscale Investments said Monday it would work with market-making heavyweights Jane Street and Virtu Financial as authorized participants should its Grayscale Bitcoin Trust (GBTC) garner SEC approval to be converted into an ETF. “Authorized participants” are specialized traders that can create and redeem shares of an ETF.

A decision on Grayscale’s ETF application is due on or before July 6, and the heavy betting is that the SEC will deny the proposal. Nevertheless, CEO Michael Sonnenshein this morning reiterated his company’s “unequivocal” commitment to converting GBTC from a trust to a spot ETF.

Additionally, Grayscale earlier this month hired high-powered attorney and former Obama administration official Donald B. Verrilli to assist in those efforts, and has made little secret of its intent to take the SEC to court should the agency deny the ETF application.”

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“The first and most obvious indication of a bear market is when the spot price of Bitcoin (BTC) falls below the 200-day MA and an even more extreme scenario, the 200-week MA. Glassnode also demonstrated that falling below 0.5 the Mayer Multiple (MM) is an exceedingly rare occasion that hasn’t happened since 2015.

Only 84 out of 4160 trading days (2%) have recorded a closing MM value below 0.5. For the first time in history, the 2021-22 cycle has recorded a lower MM value (0.487) than the previous cycle’s low (0.511).

[Further], Glassnode said instances when spot prices trade below the realized price are uncommon, noting that this is only the third time this has happened in the last six years and the fifth time it’s happened since Bitcoin’s launch in 2009.

Spot prices are currently trading at an 11.3% discount to the realized price, signifying that the average market participant is now underwater on their position.

In the midst of this, Bitcoin and Ethereum have both traded below their previous cycle ATHs which is a first in history.

Factoring in all the negative metrics, Glassnode assesses that the market is in the midst of a capitulation event. Miners have started selling their stacks, which is another indicator that capitulation has taken place. Such events often signify the bottom price range of a cycle.

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Voyager Digital has issued a notice of default to Three Arrows Capital (3AC) after the beleaguered hedge fund failed to make the required payments on its loans of 15,250 bitcoins and $350 million in USDC, worth about $670 million at current prices.

Voyager also announced it has drawn down $75 million of the emergency $200 million cash and USDC credit line provided by Alameda Ventures. As of Monday morning, the company has $137 million of cash and crypto assets on hand.”

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“Arbitrum and Optimism sit 4th and 5th when it comes to fees earned by all Layer 1 and 2 networks — behind only Ethereum, BSC, and Bitcoin. [A significant] source of revenue for rollups is MEV. Increasingly a key differentiator between L2s, each rollup platform’s approach to MEV has significant implications for the future value accrual of its native token.

Optimism is taking what’s known as an “offensive” approach to MEV. Rooted in the belief that MEV is fundamental to blockchain and attempts to remove it are futile, Optimism will eventually incorporate what is known as MEV auctions (MEVA).

MEVA seeks to isolate and redirect the revenue generated by MEV by auctioning off the right to extract it to the highest bidder. Optimism plans to allocate the revenue it earns via MEVA to funding public goods via retroactive public goods funding. In doing so, the L2 believes it will be able to create a self-sustaining ecosystem that, in the long run, will provide more value to all its stakeholders.

Arbitrum on the other hand, is taking a “defensive” approach to MEV, which is grounded in the idea that MEV is a tax on users. Rather than seeking to capture and re-allocate it, Arbitrum focuses on minimizing MEV within its system.

To do this, the Arbitrum network will implement what is known as Fair Ordering or Fair Sequencing, wherein all transactions in a batch are processed based on the order in which they are received. In doing so, Arbitrum intends to reduce the amount of MEV extracted, thereby making the rollup less expensive and more attractive to users and builders.

Offensive MEV provides an L2 with a stream of revenue that can be used to directly accrue value to its native token. While Optimism’s MEV revenue will at first be used entirely to fund public goods, a portion — or even all — can eventually be allocated to tokenholders through either a traditional single-sided staking pool, or through the decentralization of the sequencer (more on that later). In being used to fund public goods, MEV may help an L2 token indirectly accrue more value through improving the overall health and long-term sustainability of its ecosystem.

While defensive MEV deprives a rollup of a source of revenue that can be used to directly accrue value to its native token or bolster its ecosystem, it may indirectly improve the value of an L2 token. Users may be more inclined to transact on a network in which MEV does not run as rampant, bolstering its adoption and network effects.

Although it is very unlikely L2 tokens will be net-deflationary — or have the same monetary premium as ETH — they may still trade with an “index premium,” as they represent the broadest way to gain exposure to their respective ecosystems.”

“While blockchain primarily deals with things like data integrity and immutability — making sure that information data that sits on a blockchain is of high quality — AI uses data that is stored efficiently to provide meaningful and timely insights that researchers, analysts and developers can act on. People are only now beginning to realize the need for high-quality data to train an engine.

AI can help us to not just make the right decisions through a specific situation, but it can also provide predictive heads-up as it gets more trained and intelligent. However, blockchain as a framework is quite capable of being an information highway.”

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“Ripps first began minting his RR/BAYC NFTs on May 13 on Foundation, and after Yuga sent him an initial DMCA takedown claim, it quickly rescinded the claim when Ripps fought it. OpenSea, the largest NFT marketplace, has since removed Ripps’s collection because of “a claim of intellectual property infringement,” but not before it saw nearly $3.5 million in total volume traded.

This is no mere monkey business… These actions are calculated, intentional, and willful with the stated purpose of causing actual and monetary harm to Yuga Labs and to the holders of authentic Bored Ape Yacht Club NFTs.”

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