Daily Summary:

  • Ethereum on-chain liquidations in August are huge, Hayes is bearish in the short term

According to Farside Investor data, the U.S. spot Bitcoin ETF had a net outflow of $287 million yesterday, which was the largest single-day ETF outflow since May 1. Among them, FBTC had a net outflow of $162 million, GBTC had a net outflow of $50.4 million, and BlackRock IBIT had no inflow or outflow of funds.

Yesterday, the U.S. spot Ethereum ETF had a net outflow of US$47 million, of which Grayscale ETHE had a net outflow of US$52 million.

Ethereum on-chain liquidations hit second highest level in history in August

The total liquidation of Ethereum on-chain lending market reached $436 million in August, of which Aave accounted for $289 million, or about 66% of the total liquidation. This is the second highest monthly on-chain lending market liquidation amount in Ethereum history, only lower than May 2021, when the liquidation amount was about $671 million. The reason for these abnormally high on-chain loan liquidations is obvious: the price of ETH fell 22% month-on-month in August, and even fell 35% month-on-month at the monthly low.

Arthur Hayes: Short-term bearish, but won’t sell cryptocurrencies

In his latest blog post, crypto community KOL Arthur Hayes deeply analyzed the profound impact of the current Federal Reserve policy and fiscal environment on the market.

Hayes specifically emphasized that the current policy uncertainty of the Federal Reserve has a particularly significant impact on the cryptocurrency market. He noted that Bitcoin prices have become one of the most sensitive indicators of U.S. dollar liquidity conditions. Between the Federal Reserve’s interest rate policy and the Treasury Department’s liquidity operations, the price fluctuations of cryptoassets such as Bitcoin show deep linkage with traditional financial markets. Hayes believes that if interest rates rise again and market liquidity tightens, Bitcoin and other cryptocurrencies may face another round of price corrections.

“My shift in perspective has kept my hand hovering over the buy button,” Hayes said. “I am not selling crypto because of short-term bearishness. As I explained, my bearishness is only temporary.”

Market analysis: The market generally fell sharply, and BTC ETF outflows nearly $300 million

Market Trends

BTC plummeted to around $55,500. It is worth noting that BTC ETF saw a large outflow of nearly $300 million yesterday, the largest outflow since May 1, showing that institutional investors are concerned about the market outlook.

ETH prices also performed weakly, falling below $2,400; the ETH ETF also saw large outflows of funds, further exacerbating the depressed sentiment in the market.

In addition to mainstream cryptocurrencies, the altcoin market was not immune, with widespread sharp declines and overall investor sentiment being depressed.

Data indicators

-Today's AHR999 index is 0.6, which is very close to the bottom price. This indicator shows that the market may be about to bottom out and rebound, but we need to wait.

-Today's Fear and Greed Index is 27, indicating that market sentiment continues to be in a state of fear. Investors are generally pessimistic about the market outlook and have a strong risk aversion sentiment.

Market Hotspots

1. Ton Ecosystem: After Hamster Kombat announced that it would airdrop tokens on September 26, another Ton chain project, Catizen, also hinted that it would airdrop its own tokens in late September. Previously, Catizen had received investment from leading investment institutions.

2. Layer2 sector: Layer2 sector tokens generally fell. Previously, the popular Layer2 project Scroll is suspected to be about to issue tokens and will airdrop to users. The current market sentiment is low, and people no longer seem to buy into the Layer2 narrative.

Macroeconomics: US stocks fell across the board, Nvidia was subpoenaed by the US Department of Justice

The three major U.S. stock indexes all fell by more than 1%, with the S&P 500 falling 2.12% to 5,528.93 points, the Dow Jones Industrial Average falling 1.51% to 40,936.93 points, and the Nasdaq falling 3.26% to 17,136.30 points. In addition, the benchmark 10-year U.S. Treasury yield was 3.84%, and the 2-year Treasury yield, which is most sensitive to the Fed's policy rate, was 3.88%.

Among the popular U.S. stocks, Apple fell 2.72%, Microsoft fell 1.85%, Nvidia fell 9.53%, Google C fell 3.94%, Google A fell 3.69%, Amazon fell 1.26%, Meta fell 1.83%, TSMC fell 6.57%, Tesla fell 1.64%, and AMD fell 7.82%.

The plunge in Nvidia's stock price is not an isolated incident, but a concentrated outbreak of market concerns against the backdrop of a global economic slowdown. Recently, weak data on U.S. manufacturing conditions have shrunk for five consecutive months, exacerbating investors' concerns about the economic outlook. The volatility index, known as the "Wall Street panic index," rose from 15.6 to 20.7, reaching its highest level in three weeks, reflecting the market's strong expectations for future volatility.

In addition, the reaction of the U.S. government bond market further confirmed the cautious sentiment of the market. The yield of the benchmark 10-year U.S. Treasury bond fell 0.06 percentage points to 3.84%, while the yield of the policy-sensitive two-year U.S. Treasury bond fell 0.04 percentage points to 3.88%. These changes show that investors are seeking safer investment channels driven by risk aversion.

Summarize

The overall market performance is currently sluggish, with mainstream cryptocurrencies such as BTC and ETH falling sharply, and the altcoin market has not been spared. From the data indicators, the AHR999 index is close to the bottom price, and the fear and greed index shows that market sentiment is still in a state of fear. Despite this, the airdrop activities of the Ton ecosystem and Layer2 sector still brought some attention to the market, but whether the market can rebound in the short term still needs further observation.

Investors should remain cautious in the current market environment, pay close attention to market trends and data indicators, and rationally adjust investment strategies to cope with possible market fluctuations.