RESEARCH
BEQUANT Crypto&Coffee
Bitcoin call options selling and call buying was the name of the game today, with Jan29 52k and 32k call strikes particularly active. Remember that earlier in the week, the infamous $36k call buyer took profits and repositioned to higher levels, the largest OI for Jan29 switched from 36k to 52k, also switching noted to 56k, 64k and 72k strikes. Jan15 weekly expiry will bring further swings to the market and gamma effects only to prove meaningful if spot breaks out higher, otherwise impact will diminish heading into month-end. Yearn.Finance (YFI) rallied aggressively and with it so did its related ecosystem counterparts after a proposal was launched dubbed “Buyback and Build”. Specifically, it was suggested to use YFI staking rewards to buy back YFI on the open market. Use bought back YFI for contributor rewards and other Yearn initiatives. Retire the YFI governance vault as it no longer has a use, opening up for it to be replaced in the future with a regular vault. Make it possible to participate in Governance even if one’s YFI is being used elsewhere. One of the core players of Yearn ecosystem, Sushiswap, also posted another day of solid gains, rallying over 30% and through the key $5 level. Despite the recent upside, the token continues to trade cheap relative to Uniswap based on price/sales comparables. At the time of writing, SUSHI was trading 4.5x and UNI at 10.5x. Houbi token (HT) has had a poor start to the year, down 6% year-to-date, but an interesting trend is emerging and that is locking of Bitcoin on HBTC (Huobi Bitcoin), which was deployed onto the Ethereum last year to help facilitate DEX trading growth. In terms of news flow, The Block reported that Anchorage has won the race to become the first federally chartered digital asset bank by obtaining a national bank charter from the Office of the Comptroller of the Currency (OCC). The institutional crypto custodian is now on even firmer footing with its designation as a "Qualified Custodian" under the Securities and Exchange Commission's (SEC) requirements. Investment advisers have to keep client funds and securities with those that meet the qualified custodian standard, usually banks or registered broker-dealers. Also of note, the in-focus XRP traded higher, inline with broader market after Japan's Financial Services Agency (FSA), the country's securities regulator, has confirmed that it views XRP as a cryptocurrency and not as a security. This was reported by The Block and the question has become relevant recently in light of the U.S. Securities and Exchange Commission's allegation that by selling XRP the firm engaged in sales of unregistered securities — and because just about one month ago Ripple CEO Brad Garlinghouse said that the firm might leave the U.S. in search of a more friendly regulatory environment. In related news, Grayscale Investments, the world’s largest digital currency asset manager, announced it has begun dissolution of its Grayscale XRP Trust following the U.S. Securities and Exchange Commission’s lawsuit against Ripple Labs alleging the XRP token is a security under federal securities law.
