Memecoins lead crypto market

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Ethereum marks 73 consecutive days of supply inflation

Key points:

• Ethereum's new coin supply registers the longest inflationary period since the Merge.

• Dencun upgrade in March is the main cause.

News - Ethereum's supply of new coins has entered its longest inflationary period since the Merge in 2022, and the main reason seems to be the Dencun upgrade implemented in March.

Data from ultrasound.money, an Ethereum data dashboard, reveals a gradual increase in the total Ether supply. Over 112,000 ETH have been added since 14 April.

The reason behind this inflation? The finger points to the Dencun upgrade, which introduced nine Ethereum Improvement Proposals (EIPs). EIP-4844 appears to be the primary driver of this inflation.

EIP-4844 introduced "blobs," a mechanism that allows temporary, separate storage of transaction data. This reduces transaction fees on layer-2 networks built on Ethereum. Additionally, Dencun implemented "proto-danksharding," improving data availability for Ethereum's mainnet block space.

While these changes significantly lowered transaction costs on layer-2 networks like Arbitrum and Optimism, the amount of ETH burned on the mainnet has also decreased.

Despite the recent inflationary trend, the total ETH supply remains lower compared to pre-Merge levels. Since September 2022, over 1.5 billion ETH have been burned, with 1.36 billion added. This translates to an overall supply reduction of 345,000 ETH, or roughly $1.1 billion at current prices.

VanEck commits to fee waivers for Ethereum ETF amid competition

Key points:

• VanEck aims to lead in crypto ETF fees with a fee-free Ethereum ETF.

• The goal is to attract investors and boost trading volume in DeFi.

News - VanEck, a leading investment management firm, is taking a bold step to become a frontrunner in the emerging spot Ethereum ETF market. The company announced plans to waive fees for its potential Ethereum ETF, aiming to attract investors and boost trading volume.

Matthew Sigel, head of digital assets research at VanEck, revealed this strategy in a recent post. He emphasized VanEck's commitment to being a "leader on crypto ETF fees," even if it means incurring initial losses.

What’s the plan? "The plan is to make it up on volume," Sigel explained. He expressed hope that the fee-free structure would encourage investors to explore the potential of Ethereum within their portfolios, particularly within the realm of decentralized finance.

This announcement coincides with VanEck filing a Form 8-A for its Ethereum product on Tuesday, signifying further progress towards a spot ether ETF launch. However, industry experts caution that this is just a procedural step.

While the Securities and Exchange Commission (SEC) approved 19b-4 forms for eight spot ether ETFs last month, the regulatory body still needs to authorize the registration statements before trading can officially begin.

Memecoins, RWAs, and AI lead crypto profitability surge in first half of 2024

Key points:

• Memecoins, RWAs, and AI lead profitability surge in the first half of 2024.

• Memecoins see the highest average return rate (1834.22%).

News - As the first half of 2024 draws to a close, a surprising trio of sectors – memecoins, real-world assets (RWAs), and artificial intelligence – have emerged as the frontrunners in terms of profitability. This marks a significant shift in the cryptocurrency market's dynamics and investor preferences.

Memecoins, often dismissed as frivolous, have taken the crown with a staggering average return rate of 1834.22% in the first half. Newcomers like Brett and BOOK OF MEME have captured investor attention, with Brett skyrocketing a jaw-dropping 14,353.54% since launch.

This trend signifies a move away from traditional value investing towards more speculative, momentum-driven opportunities.

The dominance of RWAs - The second most profitable sector, RWAs, boasts a 213.49% return rate. Major institutions like BlackRock have played a key role in propelling this sector forward. RWA's success is fueled by the tokenization of real-world assets and positive discussions around regulations.

The AI sector also delivered impressive results, securing the third spot with an average return rate of 71.56%. Tokens like Arkham (ARKM) and AIOZ Network (AIOZ) saw significant gains, reflecting the growing synergy between AI and blockchain technology.

Despite the dominance of these three sectors, the once-reigning DeFi space has been overshadowed, failing to keep pace with the returns of memecoins, RWAs, and AI. In comparison, Bitcoin has seen a 45% year-to-date increase, while Ethereum sits at 49.65%.

Crypto markets await the impact of $10 Billion options expiry on Deribit

Key points:

• A significant expiry of Bitcoin and Ether options worth $10 billion is set for Friday on Deribit.

• This expiry could lead to increased volatility in the cryptocurrency market.

News - A $10 billion expiry of Bitcoin and Ether options contracts on Deribit is set for this Friday at 08:00 UTC. This expiry represents a substantial portion, over 40%, of the total open interest on the platform, and has the potential to trigger volatility in the broader cryptocurrency market.

Large quarterly expiries often lead to price swings due to increased trading activity and adjustments in positions.

According to Luuk Strijers, CEO of Deribit, over $2.7 billion worth of options contracts are expected to expire "in-the-money," meaning they will be profitable for their holders. This signifies a potential for rising prices as these contracts settle.

What’s more? Strijers attributes the price drop to a combination of factors, including miner sales, pressure from the German seizure of Bitcoin, and the upcoming transfer of Mt. Gox coins scheduled for early July.

However, despite the current bearish sentiment, options data suggests a potential shift in investor outlook. The data shows investors are willing to pay more for call options, which offer the right to buy Bitcoin and Ether, compared to put options, which give the right to sell.

More stories from the crypto ecosystem

• BONK gains 17%: Is this the beginning of a bull run?

• FLOKI: These historical trends point to a 100% price rise

• Metallica falls victim to crypto scam, X account hacked

• Bitcoin sees liquidations worth millions in a day: Is BTC’s price feeling the heat?

• ‘Mt. Gox repayment FUD’ affects Bitcoin: What will save BTC now?

Did you know?

• El Salvador holds roughly 2,380 Bitcoin, purchased at an average price of $44,300, meaning the $105 million investment is now worth more than $155 million.

• A 2021 Chainalysis report confirmed that cryptocurrency adoption is high in South America and Asia (apart from East Asia) because of the currency instability, poverty, and the ease of using cryptocurrencies.

• Before China’s crackdown on cryptocurrencies, the country used to account for a whopping 65% of the global crypto miners. This was as of May 2021. But by August of the same year, the strict actions forced China’s share of the global hashrate to zero.

Top 3 coins of the day

XRP

Key points:

• At press time, XRP was trading at $0.4714 with bears in charge.

• The coin had more bearish bets in its derivatives market as compared to last week.

What you should know - XRP has been stuck in a tight trading range between $0.4619 and $0.5532 since mid-April. Currently, the price is hovering near the lower end of the range, close to the $0.4636 support level. This indicates that selling pressure has been more dominant in recent times. For XRP to turn bullish, the bulls need to overcome the resistance at $0.5217 and convert it into support. This would signal a shift in momentum and could lead to a price increase. The RSI at 36.70 further strengthens the bearish trend. An RSI below 50 indicates that the asset is in oversold territory, which could potentially lead to a bounce in the short term. However, a sustained breakout above $0.5217 is necessary for a confirmed trend reversal.

Solana (SOL)

Key points:

• SOL was 2% down in the past week, highlighting sellers’ strength.

• At press time, it was trading at $137.

What you should know - Solana is currently testing a crucial support zone around $124. A breach of this level could send SOL down to the next support at $108, indicating a continuation of the downtrend. However, if the bulls manage to defend the $124 zone, there's a chance for a rebound towards the near-term resistance range of $191-$204. This would require a significant shift in buying pressure. The RSI hovering near 41 suggests a neutral market sentiment. A break below this level would strengthen the bearish case, while a rise above it could indicate a potential uptrend.

Pepe (PEPE)

Key points:

• PEPE was registering buying pressure, at the time of writing.

• It was up 12.28% over the last seven days.

What you should know - PEPE has shown bullish signs over the past week, but this needs to be viewed in the context of a 27% decline over the last month. While buying pressure could propel PEPE to its near-term resistance of $0.00001433 soon, a confirmed uptrend hinges on this resistance turning into support. The neutral RSI of 51 reflects a wait-and-see approach from investors. A decisive break above the resistance zone along with a rise in RSI would be a strong bullish signal. Conversely, a rejection at the resistance level could lead to a continuation of the downtrend.