By Matrixport Research

Summary

BTC Price Trend: Based on the 4 key BTC price indicators and data as of 31 March, BTC price will likely remain range-bound in the short term.

Market Trends:

  • An increasing number of banks are expanding their presence in the cryptocurrencies space with introduction of new products and services. This should bode well for the development of the industry and support the long-term growth of BTC and other cryptocurrencies’ prices.

  • Ripple suffers another setback as its partnership with MoneyGram was terminated, however, the firm quickly found a new partner within Southeast Asia to continue its expansion in the cross-border payment space.

  • DeFi space continues to heat up with Uniswap poised to launch its latest version 3 and NFTs growing in popularity.

Abnormal Activity Tracker: No abnormal activity. 

BTC Price Trend

Based on the 4 key BTC price indicators and data as of 31 March, BTC price will likely remain range-bound in the short term. Overall:

  • NVTS is a short-medium term bull/bear indicator. Current NVTS value is 100.49, on the higher end of the scale, however NVTS value have been hovering around the same value, therefore it is likely prices will continue to be rangebound;

  • MVRV is a short-medium term bull/bear indicator. Current MVRV value is 3.38, on the higher end of the scale, suggesting that BTC reaching its short-term peak；

  • Mayer Multiple is currently 2.02, with the value hovering around 2 for the entire march, therefore there is a lack of signal;

  • Funding rate shown no abnormality across the entire month of March. No short-term price signals are provided.

As discussed per our previous report “Price Indicators Deep Dive and Bitcoin Price Analysis”, there are limitations to the aforementioned indicators, and these indicators should only serve as suggestions and not investment advice.  

Market Trend

JPMorgan Chase is looking to issue debt linked to cryptocurrency-focused companies. J.P. Morgan Cryptocurrency Exposure Basket, the incoming debt instrument, is long on MicroStrategy, Square, Riot Blockchain and NVIDIA with positions in 11 companies in total. The prospectus documents state the notes will pay out based on the basket companies’ performance less a 1.5% fee deduction.

Zurich-based private bank NPB Neue Privat Bank AG is launching its digital asset banking and custody services through a partnership with InCore Bank AG. The bank will provide clients with a simple way to trade major cryptocurrencies on their platform and provide custodian services for their assets.

Goldman Sachs has announced it will be offering crypto to its private wealth management (PWM) clients and has appointed a new global head to manage the segments. The unit will work with advisors to educate clients about the digital assets and blockchain technology. The bank will offer a full spectrum of investments in digital assets, including spot trading, derivatives, and other crypto-related investment vehicles. This news came after Goldman Sachs relaunched its cryptocurrency trading desk after a three-year hiatus.

Commentary: Financial heavyweights are broadening their exposure to the nascent asset class. With more banks, particularly mega banks like JP Morgan and Goldman Sachs, entering the market and expanding their presence, it is likely the cryptocurrency industry will receive a new boost of capital and resources for future innovation. Overall, this is a very positive signs for the market and long-term development.

In the latest announcement, Ripple Labs and MoneyGram have decided to wind down their partnership agreement. Ripple had been paying MoneyGram to use XRP token in international settlement since 2019, with MoneyGram netting $61.5m in market development fee from Ripple. The partnership was put on hold in February 2021 after US SEC investigated Ripple and its practices. Both sides commented that they are “committed” to revisiting their partnership in the future.

Ripple acquires 40% stake in an Asian remittance payments specialist, Tranglo, to meet growing customer demand. Ripple said its investment in Tranglo is a part of its commitment to enhancing the payments ecosystem in Southeast Asia. The move also coincides with Ripple’s office expansion in Southeast Asia as it continues to scale up operations in the region.

Commentary: The ongoing investigations into Ripple and its illegal practices have continued to weigh down on Ripple’s business. The partnership with MoneyGram was the next domino to fall under the pressure. To help alleviate its position within the cross-border payments space, Ripple has embarked on new projects and investment within the Southeast Asia space, particularly in the cross-border payment sector. As the Southeast Asia payment space is highly fragmented, it boasts potential huge rewards, and should Ripple be successful, the new partnership with Tranglo could yield even better returns for the company, as well as its token XRP.

Uniswap, the leading decentralized exchange (DEX), is releasing its third iteration on its mainnet on May 5 and will be integrating Uniswap v3 with its previous edition. The latest version aims to improve Uniswap’s ability as an automated market maker (AMM), providing it with additional flexibility and efficiency. The new key change is focused on the concept of “concentrated liquidity”, where liquidity providers (LP) can set minimum and maximum prices on their portion of liquidity of any given pool, giving them more control over the price ranges in which their capital is used.

Uniswap has licensed the third iteration of its code bank in an apparent move to ward off would-be copycats. To prevent future rival projects such as SushiSwap from copying its creation, Uniswap has appealed for a business source license that would delay any commercial use of their codes for up to two years. With the license, no one can copy Uniswap’s code base wholesale, a departure from the open-source nature of most cryptocurrency project.

With the announcement of Uniswap v3, rivals are starting to speed up their plans to build alternatives or improve their protocols. Integral, a new AMM designed with a baked-in order book, went live in March, as it hopes siphon liquidity away from DEX like Uniswap with its approach to impermanent loss and order book mirroring. Utilizing the concept of vampire attacks, it is taking the idea one step further by “mirroring” liquidity on itself to gain adoption. Integral will mirror snapshots of Binance’s order book onto the AMM to artificially create depth accompanied by Uniswap’s prices from Uniswap’s own price oracles. Other AMMs have also went live in the last month with the aim of getting a slice of the growing pie.

Commentary: Innovation and competition within the DeFi space continues unabated. In the latest bid to fend off rivals such as SushiSwap and PancakeSwap, Uniswap has announced its plans to launch the 3rd iteration of its popular protocol. While the new concept is interesting and appealing to LPs, it remains unknown if Uniswap is able to protect its faltering market share and regain some lost grounds. While Uniswap continues to innovate, other competitors (both upstarts and current ones) have started to launch new products to gain a slice of the growing DEX space.

Jack Dorsey, CEO of Twitter and Square, sold his first tweet for $2.9m. Dorsey had listed the tokenized version of the tweet March 5 on non-fungible token (NFT) platform Valuables, a program for selling authenticated tweets created by startup Cent. The winning bidder will receive a digital certificate of the tweet, signed, and verified using cryptography by its creator. The NFT prompted a bidding war between Estavi (CEO of Bridge Oracle) and Justin Sun (Tron Founder) which Estavi eventually won.

CarbonDrop conducted a three-day auction of NFT artworks, raising a total of $6,662,054 from eight artists. NFT art, which typically uses the Ethereum blockchain to create title deeds to digitally rendered pictures and animation, has exploded in popularity in recent weeks.

Crypto.com launched a NFT platform on March 26 featuring content from the likes of Snoop Dogg, Lionel Ritchie, and Boy George. The exchange claims it will be the world’s largest and most user-friendly NFT platform, featuring collaborations between mainstream and digital artists. The platform will start as an invitation-only channel and may open to the public at a later date.

Blockchain platform Enjin has secured $18.9m fundraise in a bid to migrate its upcoming product Effinity to Polkadot. It plans to transition to Polkadot to save users from the soaring gas fees on the Ethereum network and help to increase scalability for its upcoming NFT platform.

Commentary: After the DeFi summer of 2020, the next craze within the space has emerged. In the recent weeks, NFT have emerged onto the scene and captured the attention of numerous stakeholders. NFTs are growing in popularity as seen from the high interest and bids from numerous auctions. Should the trend continue, NFTs could continue to grow and be an important sector within the space. Numerous NFT-focused blockchains and platforms potentially benefitting from the increased traffic and fees.

Market Statistics

In this section, we will provide the latest update on the market shift. In the first edition, we have included a few key sections for readers to gain an understanding of the market. In the subsequent editions, we’ll only include noteworthy updates and shift in market.

  • The spot market is dominated by the Big 3 (Binance, Huobi and OKEX). Together they control 74% of the total market. While DEX is gaining popularity, it remains a small portion of spot trading volume. Coinbase is the 4th largest exchange, far behind the Big 3 exchanges.

  • The derivatives market is larger than the spot market. Within the derivatives market, futures is the mainstream product, with BTC future products accounting for 80%. Options products are growing but remain a small slice of the booming derivative market.

  • Bitcoin remained the largest cryptocurrency within the ecosystem with over 50% market share. Ethereum, the second largest, is only 10%. Despite the rise of altcoins, Bitcoin’s market position remains relatively stable and dominance remains untouched.

Disclaimer

Matrixport provides this analysis as general information only. Matrixport accepts no responsibility for the accuracy or completeness of any information herein contained and Matrixport shall not be responsible for any loss arising from any investment based on any forecast or other information herein contained. The contents of this materials should not be construed as an express or implied promise, guarantee or implication by Matrixport that the forecast information will eventuate. The cryptocurrency market is highly volatile. Buying, selling, holding, or investing in cryptocurrencies or related product carries various risks and is not suitable for all investors. Please seek expert advice, and always ensure that you fully understand these risks before participating in the cryptocurrency market. Matrixport is not acting as a financial adviser, consultant or fiduciary to you with respect to any information provided. Any information available here is “general” in nature and for informational purposes only.