Bitcoin and altcoins are hit, but derivatives data reflects the calming market

Bitcoin and altcoins are hit, but derivatives data reflects the calming market


Looking at the winners and losers of the past week, it is clear that when Bitcoin fell to $41,000, the total market value of cryptocurrencies fell by 12.7%, so traders were subjected to some severe tests. On December 3, this sharp downward trend reduced this figure from 2.37 trillion US dollars to 1.92 trillion US dollars, a total of 2 billion US dollars more Future contract is liquidated.

The biggest winners and losers from the top 80 coins.Source: Economics

Bitcoin (Bitcoin) The price dropped by 14.6% in the past week, which actually underperformed the broader altcoin market. Part of this unusual movement can be explained by the performance seen in decentralized applications, which perform better than most markets. Data shows ether (Ethereum) Fell 6.0%, Binance Coin (Bitcoin) Lost 7.3% and Solana (Sol) Decreased by 7.8%.

The biggest gainers this week include OKEx’s OKB token (OKB) and Bitfinex’s UNUS (LEO).Maybe these benefit from not having a U.S. entity because Regulatory uncertainty Continue to increase in the area. In addition, the scaling solution Polygon (Matic) And Algorand (ALGO) benefit from Ethereum’s $40 or higher network transaction fee.

Terra (LUNA) became the best performer last week after its built-in token burning mechanism Significantly reduced supply.At the same time, Stacks (STX), formerly known as Blockstacks, in D’Cent wallet Includes support for SIP010 token.

Shared solutions had a disappointing week

The worst performers are three decentralized sharing solutions: Theta Network (THETA), Filecoin (FILE) and Internet Computer (ICP). They are not alone, because some industry altcoins below the top 80 have also collapsed. Siacoin (SC) fell by 34% and Ankr Network (ANKR) fell by 31.8%.

After Binance successfully launched an independent fan token called SANTOS, Chiliz (CHZ) faced direct competition. Initially, the Chiliz platform was created to hold exclusive promotions, services, and vote for its fan tokens. Recently, the project has stepped into the irreplaceable NFT market. However, after football player Neymar launched a series with NFTStar, this move also lost its impact.

Despite the worst performance, the decentralized exchange aggregator 1inch Network (1INCH) concluded: 175 million U.S. dollars in Series B investment Round, these funds will be used to expand the effectiveness of the agreement.

Tether’s premium and futures’ perpetual premium remain well

OKEx Tether (USDT) The premium measures the difference between China’s peer-to-peer (P2P) transactions and the official U.S. dollar currency, and has declined slightly in the past week.

The point-to-point premium of OKEx USDT is relative to the U.S. dollar. Source: OKEx

The current reading of this indicator is 98%, which is slightly bearish, indicating weak demand for cryptocurrency traders to convert cash into stablecoins. Even in the best moments of the past two months, it failed to exceed 99%, so Chinese players are not excited about the general market.

The overall effect of last week’s revision was that the total number of open futures contracts fell by 28% to $16.7 billion. Nonetheless, the move was expected as the total market value fell and liquidation worth approximately US$3.9 billion occurred this week.

More importantly, the financing interest rates of Bitcoin and Ethereum futures quickly recovered from the price plunge on December 3. Although the long (buyer) and short (seller) positions are always matched in any futures contract, their leverage ratios are different.

Therefore, in order to balance their risks, the exchange will charge a funding rate to the party that uses more leverage and pay the fee to the other party.

BTC and ETH perpetual futures 8-hour financing rate. Source:

The data shows that as the 8-hour financing interest rate fell below zero, a mild bearish trend appeared on December 3 and 4. Negative funding rates indicate that the short (seller) is the one who pays the fees, but once the BTC and ETH prices rebound by 15% from the lows, this movement subsides.

The above data may not sound encouraging, but considering that Bitcoin has suffered considerable losses this week, the overall market structure has remained sound. If the situation were worse, people would certainly not expect a 99% Tether premium or a positive perpetual financing rate.

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