Credit/Macro/Crypto Analyst, Former Credit/MA PM

Rose Choy

Crypto

<ul>
<li>Recent concerns on Genesis’ solvency arose after the broker/dealer halted redemptions on its lending unit and was reportedly looking to raise $1 billion of loans from investors.</li>
<li>Contagion fears have extended to Genesis’ parent company, DCG, and its wholly owned Grayscale subsidiary, which has a steady fee generating business via its Bitcoin and ETH trust products.</li>
<li>We analyze the potential arbitrage opportunity for the controversial GBTC convergence trade with its 42.7% discount to NAV.</li>
</ul>


Recent concerns on Genesis’ solvency arose after the broker/dealer halted redemptions on its lending unit and was reportedly looking to raise $1 billion of loans from investors.
Contagion fears have extended to Genesis’ parent company, DCG, and its wholly owned Grayscale subsidiary, which has a steady fee generating business via its Bitcoin and ETH trust products.
We analyze the potential arbitrage opportunity for the controversial GBTC convergence trade with its 42.7% discount to NAV.


An Arbitrage Opportunity? Evaluating the GBTC Convergence Trade

Data-Driven Analysis of Cryptocurrency Markets, Kaiko

Kaiko

Data-Driven Analysis of Cryptocurrency Markets

Kaiko is the leading cryptocurrency market data provider for institutional investors and enterprises. We empower market participants with accurate, transparent, and actionable financial data to be leveraged for a range of market activities. Kaiko’s mission is to be the foundation of the new digital finance economy by serving as a single source for market information. Our mission is premised on the idea that high-quality data drives market efficiency and greater transparency throughout the industry. For each of our enterprise clients, we build custom data plans designed for a range of use cases.

<ul><li>The FTX saga keeps entering new levels of strange.</li><li>On Friday, both FTX and FTX US filed for bankruptcy, along with 134 related entities, highlighting just how tangled the exchange’s corporate web had become.</li><li>Just a few hours later, the exchange suffered what now appears to be a massive hack, with more than $600mn siphoned from both FTX and FTX US wallets, instantly triggering rumors of an inside job. </li></ul>

The FTX saga keeps entering new levels of strange.On Friday, both FTX and FTX US filed for bankruptcy, along with 134 related entities, highlighting just how tangled the exchange’s corporate web had become.Just a few hours later, the exchange suffered what now appears to be a massive hack, with more than $600mn siphoned from both FTX and FTX US wallets, instantly triggering rumors of an inside job. 

<ul><li>First came the Terra collapse. Then the bankruptcies of the centralized lenders.</li><li>And now the (almost certain) insolvency of FTX, one of the largest cryptocurrency exchanges in the world. </li><li>FTX’s collapse has shaken the industry to its core, in part because it is a fundamentally different type of business than a crypto lender like Celsius.</li></ul>

First came the Terra collapse. Then the bankruptcies of the centralized lenders.And now the (almost certain) insolvency of FTX, one of the largest cryptocurrency exchanges in the world. FTX’s collapse has shaken the industry to its core, in part because it is a fundamentally different type of business than a crypto lender like Celsius.

<ul><li>Price Movements: For the first time since April, Lido staked ether (stETH) now trades at parity with ETH.</li><li>Market Liquidity: Coinbase reported lower than expected earnings due to a continued rout in trade volume.</li><li>Derivatives: ETH perpetual futures volume is now higher than BTC volumes as traders pounce at renewed volatility.</li></ul>

Price Movements: For the first time since April, Lido staked ether (stETH) now trades at parity with ETH.Market Liquidity: Coinbase reported lower than expected earnings due to a continued rout in trade volume.Derivatives: ETH perpetual futures volume is now higher than BTC volumes as traders pounce at renewed volatility.

Fintech & EM-focused Analyst, KT Capital Group

Alec Tseung

Fintech & EM-focused Analyst

KT Capital Group

Principal investments and advisory firm that focuses on connecting the CIS countries with East Asia.

Principal investments and advisory firm

<ul>
<li>DeFi options protocols' TVL did not change much in the past three months despite the bear market we are now in.</li>
<li>Many (TradFi) institutions and institutional investors we spoke to believed the next bull market/major innovations in DeFi might be coming from protocols that offer yields from real-world assets. </li>
<li>To drive the next phase of growth, options protocols should leverage their composability to tap into it by offering those protocols additional use cases related to options. </li>
</ul>


DeFi options protocols' TVL did not change much in the past three months despite the bear market we are now in.
Many (TradFi) institutions and institutional investors we spoke to believed the next bull market/major innovations in DeFi might be coming from protocols that offer yields from real-world assets. 
To drive the next phase of growth, options protocols should leverage their composability to tap into it by offering those protocols additional use cases related to options. 


DeFi Options Protocols Series (#3): Where Can the Next Phase of Growth Come From?

United States

Ethereum is an open-source, public, blockchain-based distributed computing platform featuring smart contract (scripting) functionality. It provides a decentralized Turing-complete virtual machine, the Ethereum Virtual Machine (EVM), which can execute scripts using an international network of public nodes. Ethereum also provides a cryptocurrency token called "ether", which can be transferred between accounts and used to compensate participant nodes for computations performed. "Gas", an internal transaction pricing mechanism, is used to mitigate spam and allocate resources on the network.

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An Arbitrage Opportunity? Evaluating the GBTC Convergence Trade

Contagion fears have extended to Genesis and its parent DCG and subsidiary Grayscale recently. We examine the arbitrage opportunity for the GBTC...

Rose Choy

Crypto Liquidity in a Post-Alameda World

On Friday, both FTX and FTX US filed for bankruptcy, along with 134 related entities, highlighting just how tangled the exchange’s corporate web...

Kaiko

The FTX Collapse: A Market Analysis

FTX’s collapse has shaken the industry to its core, in part because it is a fundamentally different type of business than a crypto lender like...

Kaiko

FTT Liquidity Faces Key Test

Price Movements: For the first time since April, Lido staked ether (stETH) now trades at parity with ETH. Market Liquidity: Coinbase reported...

Kaiko

DeFi Options Protocols Series (#3): Where Can the Next Phase of Growth Come From?

In the third piece, we continued providing updates on Opyn, Ribbon, Dopex and shared how some (TradFi) institutions we spoke to viewed the whole...

Alec Tseung

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