Table of contents:
1. Data on large token unlocks this week;
2. Overview of the cryptocurrency market, a quick read on the weekly rise and fall of popular coins/fund flows in sectors;
3. Spot ETF capital inflow and outflow situation;
4. Interpretation of contract funding rates;
1. Data on large token unlocks this week;
Tokens such as APT, MOVE, and KAS will see significant unlocks this week, including:
Movement (Move) will unlock approximately 50 million tokens on January 9 at 8:00 PM, accounting for 2.22% of the current circulation, worth about $53 million;
io.net (IO) will unlock approximately 3.22 million tokens on January 11 at 8:00 PM, accounting for 2.50% of the current circulation, worth about $11.8 million;
Kaspa (KAS) will unlock approximately 18.2 million tokens on January 6 at 8:00 AM, accounting for 0.72% of the current circulation, worth about $22.7 million;
Aptos (#APT ) will unlock approximately 11.31 million tokens on January 11 at 9:59 AM, accounting for 2.03% of the current circulation, worth about $110 million;
Ethena (ENA) will unlock approximately 12.86 million tokens on January 8 at 3:00 PM, accounting for 0.42% of the current circulation, worth about $16.2 million.
The above is in UTC+8. This week, focus on the negative effects caused by the unlocking of these tokens, avoiding spot markets and seeking short opportunities in contracts. Among them, IO and APT have a large proportion and scale of unlocked circulation, so pay more attention.
2. Overview of the cryptocurrency market, a quick read on the weekly rise and fall of popular coins/fund flows
Data shows that in the past week, the cryptocurrency market, divided by conceptual sectors, saw significant net inflows concentrated in Layer 1, #solana , and Fans tokens, while outflows were smaller in the Launchpool and #RWA sectors. Additionally, several tokens have experienced substantial upward rotations in the past week. The following are the top 200 by market capitalization: SPX, AIOZ, IO, MOG, XDC, and PENGU have relatively high increases. SUI has also reached a new high.
3. Spot ETF capital inflow and outflow situation.
CoinAnk data shows that last week, #BTC the spot ETF overall showed a slight net inflow, despite the market closure on Wednesday and significant net outflows on Thursday, the inflows on the remaining days made up for this gap, with a total weekly net inflow of $255.3 million, increasing 2421.94 BTC. Among them, on Thursday, BlackRock's IBIT once again recorded the largest single-day reduction of 3516.57 BTC, while on Friday, market sentiment warmed, with inflows of 2601.9 BTC, and Fidelity increased its holdings by 3684.64 BTC on that day. Last Friday, the US spot Bitcoin ETF bought BTC worth $908 million in a single day. Currently, the BTC price has rebounded and remains in a wide fluctuation around $99,000. The total net asset value of Bitcoin spot ETFs is $111.457 billion, with an ETF net asset ratio (market capitalization relative to the total market capitalization of Bitcoin) of 5.72%, and the historical cumulative net inflow has reached $35.909 billion.
Last week, the US Ethereum spot ETF saw a net outflow of $38.1 million. The total net asset value of the Ethereum spot ETF is $13.034 billion, with an ETF net asset ratio (market capitalization relative to the total market capitalization of Ethereum) of 3%, and the historical cumulative net inflow has reached $2.639 billion.
We believe that last week, the US spot Bitcoin ETF had a slight net inflow overall, despite a market closure on Wednesday and significant net outflows on Thursday, the strong inflows on the remaining days compensated for the gap. In particular, Fidelity's increase on Friday, with several ETFs purchasing up to $908 million of BTC in a single day, may reflect institutional investors' positive attitude towards Bitcoin and a warming market sentiment. The total net asset value and historical cumulative net inflow data of Bitcoin spot ETFs are astonishing, further proving Bitcoin's attractiveness as an asset class and market depth.
Last week, the US Ethereum spot ETF saw a net outflow of $38.1 million, with a historical cumulative net inflow of $2.639 billion. This net outflow phenomenon may be related to market short-term expectations and trading dynamics regarding Ethereum, but overall, the market performance of the Ethereum ETF still shows some growth potential, though it remains less favored than BTC.
4. Interpretation of contract #资金费率 heatmap.
According to CoinAnk's funding rate heatmap analysis: utilizing funding rates to obtain low-risk arbitrage opportunities for high annualized returns.
(1) Funding rate heatmap: The funding rate heatmap displays the funding rates of different cryptocurrencies (such as BTC, ETH, SOL, XRP, etc.) over a certain period (here it is 1 month, with options to switch to 1 day, 1 week, 2 weeks, 1 month, 3 months, 6 months, etc.). The funding rate is an important concept in futures trading used to balance the interests between longs and shorts.
Annualized rate: The annualized rate converts the funding rate into an annual interest rate. It reflects the fee ratio that longs or shorts need to pay over one year. For example, a rate settled every 8 hours multiplied by 3 times is the daily rate, and multiplied by 365 days gives the annualized rate.
Color meanings: The colors in the chart range from deep blue to yellow, where blue represents negative funding rates, with deeper blue indicating a greater negative value; green represents positive funding rates, and the deeper the color from yellow to orange, the greater the positive funding rate.
A positive funding rate means that longs (buyers) need to pay a certain fee to shorts (sellers), which usually occurs when market sentiment is highly bullish. A negative funding rate means that shorts need to pay a certain fee to longs, which usually occurs when market sentiment is highly bearish.
(2) Data interpretation:
Trends in funding rate changes: The chart shows that the funding rates of different cryptocurrencies exhibit significant changes over different time periods. For instance, during certain periods, the funding rate of BTC is relatively high and positive, indicating strong bullish sentiment towards BTC in the market. During other periods, some cryptocurrencies have negative funding rates, indicating strong bearish sentiment towards these cryptocurrencies in the market.
Comparison of different cryptocurrencies: The chart shows the funding rates of various cryptocurrencies. For example, the funding rates of ETH and XRP differ from BTC during certain periods, reflecting the differences in supply and demand and investor sentiment in the market.
(3) Funding rate arbitrage strategies
In futures contract trading, one can utilize the differences in funding rates for arbitrage. Here are some common arbitrage strategies:
Principle of positive arbitrage: When the funding rate of a certain exchange is positive and relatively high, one can sell futures contracts (open a short position) on that exchange while buying an equal amount of cryptocurrency in the spot market.
In this way, short positions will receive funding rates paid by long positions, while long positions in the spot market can enjoy potential price appreciation benefits. Even if the market declines, the short position can offset losses; if the market rises, then the spot can offset the losses of the short position, and the additional gain will be the funding fee.
Reverse arbitrage principle: When the funding rate of a certain exchange is negative and relatively low, one can buy futures contracts (open a long position) on that exchange while selling an equal amount of cryptocurrency in the spot market, if possible, or hedge through other means, such as shorting contracts of other cryptocurrencies with a positive funding rate, or seeking cross-market arbitrage where the funding rate directions of the same cryptocurrency differ across exchanges.
In this way, long positions will receive funding rates paid by short positions, and hedging operations can reduce the risk of holding positions.
It is important to note that arbitrage operations carry certain risks, including market price fluctuations, exchange risks, transaction costs, etc. Before engaging in arbitrage operations, one must fully assess risks and returns and formulate reasonable trading strategies. Specific content can be found in the selected news section or educational section.
