Something to remember: 

“The willow submits to the wind and prospers until one day it is many willows—a wall against the wind. This is the willow’s purpose.”

Week Ahead

What’s driving markets?

• Fed Meeting Minutes take a hawkish tone, sending equities lower and crypto markets spiraling

• Market maker GSR announces restructuring and scaling back, causing liquidity to retreat from the market and accelerating the sell off

• Heavy liquidations on Deribit, Binance, and other options derivatives exchanges drove selling, indicating that built up leveraged long interest from ETF-related optimism has largely been wiped out

• Next ETF decision date: Blackrock’s iShares Bitcoin Trust on September 2nd

Catalysts

• Wednesday, Aug 23rd @4:30pm: NVIDIA reports earnings

• Friday, Aug 25th: Fed Chair Jerome Powell speech @ Jackson Hole Economic Symposium

Major Headlines

Federal Judge grants the SEC’s request to appeal decision in the case against Ripple. Both sides have previously indicated their intention to appeal Judge Torres’ ruling that certain sales of XRP did not constitute sales of unregistered securities. Ripple technically has until September 1st to submit their appeal, and the SEC has until the following week on September 8th. The appeal process itself will not affect proceedings with other parts of the case, such as the allegations against Ripple executives Brad Garlinghouse and Chris Larsen that they raised $1.3B in an unregistered securities offering. However, if the SEC wins an appeal here, a 2nd circuit judge will likely grant a “stay” which would hit the pause button on the other aspects of the case until the appeal is fully resolved. 

Charts

• August 17th saw $182m in long liquidations within 12 hours across the top 8 centralized derivatives exchanges

• DeFi liquidations reached over $75m within the same period of time, with the majority concentrated in the MakerDAO protocol

• BTC price correlation with US equities and investment grade bonds has spiked back to nearly 40% this month after consistent declines in 2023. This indicates that as volatility has left crypto markets, major macroeconomic events have taken over as the primary driving force behind price action when it does occur

Research Content

• DeFi-optimized layer 1 network Sei goes live

• US FDIC releases 2023 risk report

• Monetary Authority of Singapore (MAS) releases stablecoin guidelines

• Former FTX executive Ryan Salame pleads the 5th regarding Sam Bankman-Fried’s alleged illicit campaign finance donations

• Bybit announces KYC policy

• SEC indicates it may be open to multiple Ethereum ETF listings 

• Grayscale posts tweet indicated their ETF team is hiring

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