Bitcoin Tests $9k While Options and Futures are Stagnant

We’re kicking off the second half of 2020 in somewhat bearish territory as BTC tests 9k for the third time just this week. Open interest for both futures and options appear stagnant as traders look for opportunities to punt altcoins.


To no-one’s surprise, DEX volume was off the charts in Jun. The figure grew >70% m-m, breaking above the $1.5b mark. The key driver to this is from automated market makers which use liquidity pools to facilitate swaps. AMMs are a feature on platforms such as Uniswap and Curve.


In previous posts, we’ve talked about the risks around staking assets on DeFi platforms. Balancer saw some of its pools drained this week, not from a hack, but deeper understanding of the pricing and swap mechanisms.


The attacker took advantage of a pool with STA, a deflationary token. After multiple transactions back and forth, where each time a 1% fee was deducted, the balance of STA became close to zero. As a deflationary token, the value “increased” and was able to be swapped with other assets worth nearly half a million dollars. 


Lesson to be learned is to look at the underlying before committing assets to a new pool. Chasing high APY alone is risky business.


In other news:

  • USDC issuance eclipses $1b; still 9x lower than that of USDT.
  • Wirecard services return to normal after a temporary ban in the UK; is looking at new vendors.
  • Crypto OG + Bitfinex early investor, Zhao Dong, is rumoured to be detained by China police; our sources indicate the rumours are false.