This week has been monumental for Cryptocurrencies. Bitcoin reached at All Time Highs again! Institutions keep buying more Bitcoin. Ethereum is on its final stand against the BTC pair. Various alt-coins are sitting on support. Ripple was slammed with a colossal lawsuit by the SEC. 1Inch airdropped its users their governance token for Christmas.

Talking Points

  • Bitcoin All Time Highs

Bitcoin All Time Highs

Bitcoin is in price discovery and slammed all time highs again! At this point it feels surreal that we are sitting around $28,400 Dollars. Institutions are adding to their balance sheets at a high rate and retail is completely euphoric at this point. It seems crazy to say but the bull run is really just starting.

Bitcoin 1-Hour Chart

Funding

In Volume 2 I spoke about waiting for funding to reset before entering any new longs. As we can see from the chart below, Funding reset to .01 on the dip to $21,800. The opportunity wasn’t available for long, but if you were able to move quickly that was the perfect opportunity to buy.

Open Interest

Open Interest has continued to grow with price. This is showing that we are still in a healthy uptrend. As long as we continue to see open interest rise across all futures exchanges, I’ll continue to look for opportunities to buy.

Source: bybt.com

I mentioned the $36,000 strike in Volume 2 . It has continued to grow and is now has an open interest of 20,000 Bitcoins equaling notional value of $520 Million. That’s incredible given that we have almost doubled from a $378 million dollar notional value we saw 7 days ago.

Source: Bybt.com

Same story here from last week. January 29th strike has the highest open interest. There is something to take note of here. Despite there being a massive amount of money on the line for January 29th, every contract before January 29th has a Call/Put ratio of less then 1. I don’t really see this being a bearish factor long term. But in the short term this may yeild another opportunity to load up on more Bitcoin.

Source: bybt.com

Bitcoin has a bullish options flow with a call/put ratio is of 2.01 and over double the amount of volume being traded on calls then puts with $120 Million in Open interest for calls.

Smart Money

Institutions are adding more and more Bitcoin to their balance sheets. Micro Strategy has added $650 million more Bitcoin at $21,925.

GrayScale has added another $300 Million to their balance sheet. Looking at the chart below we can see that GrayScale has been accumulating Bitcoin since the 8th of June and started to make more aggressive buys as time goes on.

Key Takeaway’s on Bitcoin

  • Broke All Time Highs again

Whats going on with Ethereum?

As we can see from the ETH/BTC chart, Bitcoin has run over Ethereum in terms of price performance. Ethereum is on its last leg verse the BTC pair and if this support is lost it could get ugly for Ethereum in the short term.

Source: TradingView ETH/BTC

The key takeaway from the chart above is the better investment at the moment is bitcoin. When Ethereum has its turn we should see a rise in the ETH/BTC chart. When that happens our attention should be turned to Ethereum. If Support holds this could yield a great opportunity to start accumulating Ethereum as a long term investment.

Open Interest

Ethereum has a bullish options flow. The Call/Put ratio is not as bullish as Bitcoins, but 1.5 is nothing to ignore. People still seem to be putting their money on Ethereum’s going up in value.

CME Adding Ethereum Futures

CME is looking to add Ethereum futures to their exchange. This is big news for Ethereum as this will bring a massive amount of volume to the network.

CME is the second largest derivative exchange for bitcoin right under Binance and this should bring alot more volume to Ethereum once trading takes place.

Key Takeaway’s from Ethereum

  • Bitcoin Continues to out perform Ethereum

Ripple Lawsuit

Ripple was faced with a massive Lawsuit for selling unregistered securities worth $1.3 billion. They failed to register Ripple as a security and they didn't qualify for exemption from Security Classification like Ethereum did back in 2018.

Page 10 of the lawsuit against Ripple

It states in the lawsuit that Ripple’s Co-Owners Garlinghouse and Larsen were advised in 2013 that Ripple could be classified as a “Investment contract”. I cant imagine that news pleased the SEC. From the way it seems the executives of Ripple completely ignored US regulations despite working in the US.

Exchange De-listings

Bitstamp is the first exchange to halt trading and deposits for U.S customers.

This lawsuit puts their privilege to be listed on US exchanges. This will be a massive blow for their market share. Ripple is treading in dangerous water as we see more and more exchanges will look to halt trading.

Is there a Future for Ripple?

With pressure from the SEC and major exchanges looking to halt trading, its not looking good for ripple. The CEO of Ripple, Brad Garlinghouse has stated in the past that he would be open to moving the Ripple Headquarters to a different country if they face regulatory trouble.

I don’t think running from regulation will save them. The lawsuit was heavy and exposed the and nefarious and greedy activities they have facilitated since 2013. Despite losing all traction from US Investors, Foreign retail investors will be extremely cautious playing ripple after they have been exposed for taking advantage of retail to drive profits for themselves.

Key Takeaway’s on Ripple

  • They are in big regulatory trouble

1Inch Air Drop

Christmas was kind to 1Inch and Mooniswap users. The independent board of the 1Inch released their governance token and airdropped it to all wallets who interacted with the exchange until December 24th as long as they met the following conditions:

  • at least one trade before September, 15th

Around 6% of the 1.5 billion token supply was distributed to 50,000 wallets who interacted with the platform. FTX and Binance quickly listed spot and future markets for 1Inch with a listing price of $2.30. 1Inch announced their liquidity mining program that will launch December 26th for users who wish to be Liquidity providers.

Mooniswap has re branded to 1Inch Liquidity Protocol, so the team can consolidate all affiliates under one brand. The idea is to drive attention to the 1Inch protocol just like Uniswap did back in September with their airdrop.

1Inch is a governance token that allows users to cast votes on the settings of the Spread-Surplus pools, which accumulate “leftovers” from swap transactions of tokens whose price changed during the time of the transaction. The Idea is that these “leftovers” will be accumulated in a pool, exchanged for 1Inch and a vote will be cast for the proceeds to either be claimed by Governance Participants or distributed to referrers.

This may pave a way for other DeFi applications to host airdrops or some sort of incentive program for early adopters. These last two air drops from 1Inch and UniSwap have shown that airdrops can be worth thousands of dollars and missing out on them is a big hit for any active market participant.

Key Takeaway’s on 1Inch

  • 1Inch airdropped their governance token

I am an Under Graduate finance student. I have been studying Crypto Currencies since 2016 and my trading is based off of On-Chain analysis and Order Flow.