Sam Martin

BTC, ETH, SOL and LUNA Take Hits in Digital Asset Sell-off: Markets Wrap

<div id="highlights-block_617725d07bf3f" class="highlights">
        <ul>
                <li>Ethereum has outperformed BTC since the latter half of October</li>
                <li>DOT enters price discovery </li>
            </ul>
    
</div>



<p>Ethereum has outperformed BTC by 20% since the latter half of October.</p>



<p>ETH issuance was net negative over the last seven days, giving Ethereum enthusiasts a snapshot of what &#8216;ultra-sound money&#8217; could look like post merge. </p>



<p>The BTC market has seen a drastic decline in the amount of leverage in the system, which makes further downside due to liquidations less likely. </p>



<p>Polkadot (DOT) enters price discovery, last trading at $50.20.</p>



<p>A user mistakenly sold a CryptoPunk, the most infamous Ethereum NFT project, for 4.444 ETH instead of 4,444 ETH.</p>



<h3 class="wp-block-heading"><strong>Latest in Macro:</strong></h3>



<ul class="wp-block-list"><li>S&amp;P 500: 4,613, +.18%</li><li>NASDAQ: 15,595, +.63%</li><li>Gold: $1,793, +.51%</li><li>WTI Crude Oil: $83.94, +.44%</li><li>10-Year Treasury: 1.559%, +.003%</li></ul>



<h3 class="wp-block-heading"><strong>Latest in Crypto:</strong></h3>



<ul class="wp-block-list"><li>BTC: $60,916, -.90%</li><li>ETH: $4,315, +.24%</li><li>ETH/BTC: .0708, +1.21%</li><li>BTC.D: 43.73%, -.87%</li></ul>



<h3 class="wp-block-heading"><strong>E</strong>TH outperforms BTC</h3>



<p>ETH has outperformed BTC by nearly 20% since the last half of October. After surpassing all-time highs <a href="https://cms.blockworks.co/mana-sand-axs-explode-on-facebooks-meta-news-eth-beats-ath-markets-wrap/" target="_blank" rel="noreferrer noopener">last week,</a> ETH retested the highs made in April of 2021 as support.  </p>



<p>The put-call ratio sits at 0.913 and funding rates are creeping higher, according to data from <a href="https://app.laevitas.ch/dashboard" target="_blank" rel="noreferrer noopener">Laevitas.ch</a>. These two metrics indicate that traders are betting on further upside.</p>



<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="1024" height="638" src="https://blockworks-co.imgix.net/wp-content/uploads/2021/11/ETHBTC_2021-11-01_16-46-02-1024x638.png" alt="" class="wp-image-10182" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2021/11/ETHBTC_2021-11-01_16-46-02-1024x638.png?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/ETHBTC_2021-11-01_16-46-02-1024x638.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/ETHBTC_2021-11-01_16-46-02-1024x638.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/ETHBTC_2021-11-01_16-46-02-1024x638.png?w=412 412w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/ETHBTC_2021-11-01_16-46-02-1024x638.png?w=419 419w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/ETHBTC_2021-11-01_16-46-02-1024x638.png?w=351 351w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/ETHBTC_2021-11-01_16-46-02-1024x638.png?w=80 80w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/ETHBTC_2021-11-01_16-46-02-1024x638.png?w=1086 1086w" sizes="auto, (max-width: 1024px) 100vw, 1024px" /><figcaption>Source: Trading View</figcaption></figure>



<p>ETH issuance was net negative over the last seven days and will likely become more deflationary when the merge goes live in Q1/Q2 of 2022. This is possible due to the EIP-1559 upgrade that went <a href="https://cms.blockworks.co/eip-1559-is-live-thanks-to-ethereums-london-hard-fork/" target="_blank" rel="noreferrer noopener">live</a> on the mainnet in August, causing the base fee that users pay to transact on the network to be burned. When the number of transaction fees that are burned outpace the block subsidy paid out to miners, the total supply decreases. </p>



<div class="wp-block-image"><figure class="aligncenter size-full"><img loading="lazy" decoding="async" width="315" height="399" src="https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-4.35.20-PM.png" alt="" class="wp-image-10183" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-4.35.20-PM.png?w=315 315w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-4.35.20-PM.png?w=237 237w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-4.35.20-PM.png?w=203 203w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-4.35.20-PM.png?w=206 206w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-4.35.20-PM.png?w=173 173w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-4.35.20-PM.png?w=63 63w" sizes="auto, (max-width: 315px) 100vw, 315px" /><figcaption>Source: watchtheburn.com</figcaption></figure></div>



<p>Average gas prices, or the cost to transact on the base layer of Ethereum, has been trending upward over the past week. Users can check estimated gas fees on <a href="https://etherscan.io" target="_blank" rel="noreferrer noopener">etherscan.io</a> to avoid transacting during periods of elevated activity.  </p>



<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="1024" height="939" src="https://blockworks-co.imgix.net/wp-content/uploads/2021/11/chart-1024x939.jpeg" alt="" class="wp-image-10188" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2021/11/chart-1024x939.jpeg?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/chart-1024x939.jpeg?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/chart-1024x939.jpeg?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/chart-1024x939.jpeg?w=280 280w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/chart-1024x939.jpeg?w=285 285w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/chart-1024x939.jpeg?w=239 239w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/chart-1024x939.jpeg?w=80 80w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/chart-1024x939.jpeg?w=1200 1200w" sizes="auto, (max-width: 1024px) 100vw, 1024px" /><figcaption>Source: etherscan.io</figcaption></figure>



<h3 class="wp-block-heading"><strong>Bitcoin</strong></h3>



<p>BTC fundamentals look good:</p>



<ul class="wp-block-list"><li>The balance of BTC on exchanges remains at three-year lows.</li><li>The CME is becoming one of the leading futures exchanges in terms of open interest, implying that there is increased institutional adoption. </li><li>The realized price, or cost basis of holders, of BTC is at all-time highs.</li><li>Miners are the most profitable they have been in over two years. </li><li>The percentage of futures open interest that is crypto-margined has dropped to 46% versus reaching as high as 69% during the April, 2021 peak. The less leverage behind longs, the smaller the chance of a liquidation event spurring further downside. </li></ul>



<div class="wp-block-image"><figure class="aligncenter size-large"><img loading="lazy" decoding="async" width="1024" height="582" src="https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.29.17-PM-1024x582.png" alt="" class="wp-image-10189" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.29.17-PM-1024x582.png?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.29.17-PM-1024x582.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.29.17-PM-1024x582.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.29.17-PM-1024x582.png?w=428 428w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.29.17-PM-1024x582.png?w=460 460w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.29.17-PM-1024x582.png?w=386 386w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.29.17-PM-1024x582.png?w=80 80w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.29.17-PM-1024x582.png?w=1185 1185w" sizes="auto, (max-width: 1024px) 100vw, 1024px" /><figcaption>Source: Glassnode</figcaption></figure></div>



<h3 class="wp-block-heading">Polkadot enters price discovery</h3>



<p>Polkadot (DOT) is a platform that allows diverse blockchains to transfer messages, including value, in a trust-free fashion; sharing their unique features while pooling their security. In brief, Polkadot is a scalable heterogeneous multi-chain technology.</p>



<p>Polkadot is heterogeneous because it is entirely flexible and makes no assumption about the nature or structure of the chains in the network. Even non-blockchain systems or data structures can become parachains if they fulfill a set of criteria.</p>



<p>Polkadot may be considered equivalent to a set of independent chains such as Ethereum, except with important additions: pooled security and trust-free interchain transact-ability, according to <a href="https://www.coingecko.com/en/coins/polkadot" target="_blank" rel="noreferrer noopener">CoinGecko</a>.</p>



<p>&#8220;DOT will serve three key functions in Polkadot, namely (i) providing governance for the network, (ii) operating the network, and (iii) creating parachains by bonding DOT,&#8221; as <a href="https://polkadot.network/dot-token/" target="_blank" rel="noreferrer noopener">stated</a> on Polkadot&#8217;s official website. </p>



<p>DOT was the best performing altcoin of the day when sorting by the largest amount of open interest. DOT was last trading at $50.30, up 17.58% over the last 24 hours. DOT is now in price discovery after passing its May highs of $47.33.</p>



<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="1024" height="161" src="https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.35.11-PM-1024x161.png" alt="" class="wp-image-10190" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.35.11-PM-1024x161.png?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.35.11-PM-1024x161.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.35.11-PM-1024x161.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.35.11-PM-1024x161.png?w=428 428w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.35.11-PM-1024x161.png?w=470 470w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.35.11-PM-1024x161.png?w=389 389w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.35.11-PM-1024x161.png?w=80 80w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.35.11-PM-1024x161.png?w=1195 1195w" sizes="auto, (max-width: 1024px) 100vw, 1024px" /><figcaption>Source: Laevitas.ch</figcaption></figure>



<h3 class="wp-block-heading">Non-Fungible Tokens (NFTs)</h3>



<p>A user mistakenly sold a CryptoPunk, the most infamous Ethereum NFT project, for 4.444 ETH instead of 4,444 ETH, <a href="https://www.larvalabs.com/cryptopunks/details/7557" target="_blank" rel="noreferrer noopener">according</a> to data from Larva Labs. This cost the seller millions of dollars in potential profit. </p>



<p>Trading data from <a href="https://opensea.io/rankings" target="_blank" rel="noreferrer noopener">OpenSea</a> and <a href="https://solanalysis.com" target="_blank" rel="noreferrer noopener">Solanalysis</a> of some of the top Solana and Ethereum projects can be found in the photos below:</p>



<div class="wp-block-image"><figure class="aligncenter size-large"><img loading="lazy" decoding="async" width="1024" height="332" src="https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.53.10-PM-1024x332.png" alt="" class="wp-image-10191" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.53.10-PM-1024x332.png?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.53.10-PM-1024x332.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.53.10-PM-1024x332.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.53.10-PM-1024x332.png?w=428 428w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.53.10-PM-1024x332.png?w=470 470w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.53.10-PM-1024x332.png?w=389 389w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.53.10-PM-1024x332.png?w=80 80w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.53.10-PM-1024x332.png?w=1225 1225w" sizes="auto, (max-width: 1024px) 100vw, 1024px" /><figcaption>Top Ethereum Projects</figcaption></figure></div>



<div class="wp-block-image"><figure class="aligncenter size-large"><img loading="lazy" decoding="async" width="1024" height="292" src="https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.53.21-PM-1024x292.png" alt="" class="wp-image-10192" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.53.21-PM-1024x292.png?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.53.21-PM-1024x292.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.53.21-PM-1024x292.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.53.21-PM-1024x292.png?w=428 428w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.53.21-PM-1024x292.png?w=470 470w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.53.21-PM-1024x292.png?w=389 389w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.53.21-PM-1024x292.png?w=80 80w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-01-at-5.53.21-PM-1024x292.png?w=1224 1224w" sizes="auto, (max-width: 1024px) 100vw, 1024px" /><figcaption>Top Solana Projects </figcaption></figure></div>



<p>If you made it this far, thanks for reading! I am looking forward to catching up tomorrow.</p>



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