RESEARCH
BEQUANT Crypto&Coffee
Dip buyers came out in masses and sent Bitcoin, together with Ethereum back towards to weekend highs, although yet again there was not enough momentum to make a break just yet. Nonetheless, the open interest remained within a touching distance of the recent record levels, underpinning the high degree of risk appetite for putting capital to work across the digital asset ecosystem. Granted, discretionary and long-only plays are still dwarfed by the more sophisticated quant and arb based funds, but there is more to digital assets than just Bitcoin. On that note, the amount of Bitcoin locked on Ethereum has continued its relentless trend higher and at the time of writing, just over 174k Btc were locked on the Ethereum network. Thus confirming the view that the hunt for yield play is the ultimate path for the aforementioned risk seekers. This was particularly evident when looking at the price action by Sushi, which only recent had its proposal to add xSushi to Aave successfully passed and integrated. In turn, this is expected to result in another wave of Sushiswap price surge, especially given the raft of upcoming planned updates. Ethereum gas fees are often talked about as being the burden of active traders and this is particularly so for DEX based market participants. On that note, The Block reported that ZKSwap, a decentralized exchange (DEX) built on ZK-Rollup technology, has launched its mainnet as a layer-2 protocol on the Ethereum network. L2Lab, the team behind the DEX, went live on Sunday, a move that came months after introducing a testnet in November. The firm raised an angel investment round of $1.7 million at the time backed by Bixin, SNZ, FBG and Longling Capital. L2Lab said the goal is to use zero-proof knowledge as a scaling solution for the DEX to increase transaction output and lower gas fees that have become a bottleneck for decentralized finance applications on Ethereum. Sticking with the DeFi theme and Uniswap's decentralized exchange reached a major milestone on Monday as cumulative trade volumes surpassed $100 billion in the wake of the decentralized finance boom. Hayden Adams, Uniswap's CEO, tweeted Monday that the platform became the first decentralized exchange to process over $100 billion in transactions. Using data from Dune Analytics, Adams showed cumulative volumes of $101.5 billion as of Monday. The chart highlights Uniswap's dramatic growth since mid-2020 when the first DeFi bull market began.
