Market Status
Although a downturn week in the end of Feb, BTC reached as high as $58000. At the last week, stock market also sold off. BTC price has stronger correlation with S&P 500. The correlation between the two shot up after the March 2020 crash but has been dropping since November 2020 with BTC’s rise. Now it is back again. The trend strength the cognation of taking BTC as risk asset and store of value.
With this huge volatility, lots of funds were liquidated. Especially as BTC dropped below $50K a large amount of long contracts were liquidated in the $47–49K range. Below graph shows the value of liquidated BTC perpetual future contracts. The large amount of long-liquidations compared to short-liquidations shows that a disproportionate amount of contracts were going long, a sign of the market’s bullishness.
Stablecoins had a big month amidst the market volatility. USDC led the way, with market cap increasing by about $1B on the week. USDC transfers also surged, increasing by 13.5% week-over-week for an average of about 60.4K a day. Total USDC supply passed 9 billion on February 28th after passing 8 billion just six days earlier. USDC supply has more than doubled since the start of the year.
As a result of USDC’s rapid rise Tether’s (USDT) supply dominance has dropped to 70%, its lowest level ever.
Stablecoin active addresses have also surged along with supply, signaling high activity. Throughout most of February stablecoins have averaged over 300K unique active addresses per day. On February 18th stablecoin total active addresses topped 400K, a new all-time high.
This week $1.04 Billion in liquidity was withdrawn from Uniswap which appears to be spread across an variety of assets. Uniswap transaction counts fell significantly from ~186k to 85k tx/day on 18-Feb, approximately signalling the local top in ETH/USD price. Uniswap transaction volume then surged to $1.76 Billion on 23-Feb before dropping 45% to $0.97 Billion by weeks end. We think it related with high transaction fee on Ethereum. As we can see the growth on Binance Smart Chain, and some other public blockchains.
It must be noted that most Uniswap liquidity and volume values are coming off near all-time-highs so it remains to be seen if these are simply a response to the price correction, or the start of a trend or asset rotation.
Another interesting hot topic is NFT. A 21,069 x 21,069 pixels jpg file attached to an Ethereum token sold today for $69M in ETH at Christie’s, the world’s oldest fine art auctioneer. Of course, that’s Beeple’s “Everydays: The First 5,000 Days.”
Could NFT be the trend of market continuously? CNBC reports this week that NFTs are fetching huge prices — in the millions of dollars — when they are being tied to digital collectibles, and when they pass back and forth among buyers and sellers. Also, high art meets high tech meets high prices. At least for now, the novelty of the digital conduits may enough to sustain the frenzy (what else can we make into an NFT?) … but then again, what’s left beyond the new bells and whistles?
TitanSwap Delivery
Titanswap works hardly on an important update, layer 2 migration. There are already multiple products released Layer2 testnet solution, like Curve, ZkSwap, ArbiSwap, etc. The user experience is not perfect yet, there are still lots of loading time, multiple deposit or withdraw steps. Another consideration is about the shared liquidity. As you know, we share liquidity from Uniswap and Sushi, it is important to keep our L2 solution interconnecting with them. This obstacle adds additional works on the teams, but we believe the final solution will the biggest update since our launch. Keep an eye on it~
