This market environment has been brutal for late alt entries and many alts have already given back most of their 2024 gains. I think there are two ways people are approaching it:
Traders will wait for confirmation of Bitcoin breaking back above 60K before bidding again.
Holders will hold their alts / bid more at this level while being comfortable that it might dip slightly further because if it dips further it is more likely that it is over.
I don’t think that the market is over but that we were wildly overextended with a big amount of tourists flooding the market which we could see with pre-sale raising absurd amounts of money in a short time. A flush was needed and only the faithful would be rewarded in this painful market.
Either way, despite all the turbulence from a price perspective the market doesn’t sleep. There have still been tons of things that have happened over the past week.
Market Digest
Zachxbt launches a thread covering how Lazarus Group stole over 200M from 25 hacks
Prior Binance CEO CZ sentenced to 4 months in prison
Kamino Finance launches airdrop
Eigenlayer launches airdrop parameters which include a non-transferable token
Consensys suing the SEC for regulatory overreach
Heroglyph protocol launches whitepaper
Gauntlet posts retrospective after ezETH depeg
Offchain Labs uncovered several security issues in Optimism testate
Airdrops
Airdrops I’m farming at the moment are:
Grass - DePin network partnered with Solana
Orderly Network by performing swaps here (based on volume)
Oasis - Decentralized AI network
Bridge Flow
It’s clear that during times of uncertainty, Ethereum is the home chain as there is a flight to quality. It has sucked capital from every chain or L2 as the market has continued to show weakness which is a sign of the times. Quite clear at this point that the attention will remain on Ethereum, Solana, and Base which continue to capture the majority of the mind share.
DEX Volumes
After the on-chain volume completely dying out over the past week, it has gotten ignited over the past 2 days due to the price action of BTC and ETH over the past days which is a good sign even prices are going lower since people have gone from complacency to reaching a capitulation stage and selling their alts which is required for the dust to settle before things can turn out for the better again.
Pair volume
On-chain has been lacking severely in volume and only a select few alts have experienced any significant interest such as PEPE which always is a mainstay, APU which is a PEPE derivative that has been doing extremely well, PRIME, ELON, ENA, LINK, and BST.
However, liquidity will most likely concentrate around few alts soon to trigger an on-chain season so keep your eyes open.
Activity remains across Base and DEGEN continues to be among the leading tokens. However, there was a heavy selloff this week not only due to the market environment but also due to an airdrop distribution to Farcaster users. DRM can be ignored because it was a blatant rug, meanwhile AERO and BRETT continue to receive heavy interest as the tokens with the highest market caps on Base. Both of them are worth adding to your watchlist for different reasons.
PENDLE saw a bump in activity on trading volume over the past week, unfortunately, due to the wrong reasons as it was sold off due to a misunderstanding of the Eigenlayer season 1 airdrop. This might have been a slight overreaction from the market if you have faith that the protocol will continue to ship. FLY has received some scarce action but otherwise, there is not much going on here at the moment.
NFT Trading Volume
Azuki has been the strongest performer of the week as they appear to be making a comeback after having surged 30% over the past week. Most NFT collections took a hit with the market, but it looks like ETH NFT collections are returning to life. MAYC continues to grind up even though BAYC is struggling in value. Even Moonbirds have surged after revealing the launch of a new Metaverse.
Interesting mints
Paingelz on Solana - Had a mint price of 0.8 SOL and minted out while currently trading at 1.3 SOL floor. It’s worth taking a look at these.
Net Inflow
People are still very risk averse which can be seen with the tokens accumulated over the past week with LSDs and LRTs being the leading market sector as altcoins have been slaughtered over the past few weeks. FET is the go-to AI token people decide to accumulate for main AI exposure. ENA seems to be the go-to ceDeFi token for the same purposes.
Same story on Base as we see on mainnet. While we have seen a few pump and dumps over the past week, the only memes on this list that have shown any kind of staying power are BRETT (after receiving some FUD about being insider coordinated), TRUMP, MONKE, ROCKY and DOG. This is not an endorsement to ape them, but there is healthy memecoin price action and there is Burj Khalifa where the insiders just blatantly dump on you.
It’s been even slower on Arbitrum with ARB being the only alt that has received heavy inflow over the past week alongside RWAS which is a real-world asset platform. Right now it looks like people are mainly farming incentives on Arbitrum by using stable assets in liquidity pools with on-chain trading volume lacking outside of ARB and PENDLE every now and then.
Sleuthing
Today it’s better to focus on on-chain fundamentals as the activity has been scarce. Despite all the bearishness flowing around at the moment, stablecoin supply continues to increase on-chain which is a healthy sign and has surpassed 2021 levels.
Token Unlocks
Cetus - 1,25% of supply worth $1,22m on May 3rd
Tangible - 6,78% of supply worth $3,14m on May 4th
Rarible - 0,3% of supply worth $219,000 on May 5th
Liquity - 0,75% of supply worth $736,568 on May 5th
ImmutableX - 1,39% of supply worth $55,77m on May 7th
dYdX - 0,57% of supply worth $11m on May 7th
That’s it for this week, thanks for reading this as always, and hope everyone is holding up well. See you in the next one.
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