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Bitget Research: Crypto Market Short-Term Risk Aversion Intensifies, Awaiting the June 12 FOMC Meeting and CPI Data

Aaron & Tommy
2024/06/11
Bitget Research: Crypto Market Short-Term Risk Aversion Intensifies, Awaiting the June 12 FOMC Meeting and CPI Data
In the past 24 hours, many new popular tokens and topics have emerged in the market, which are likely to be the next wealth creation opportunities.

Overview

The market's focus is on the upcoming FOMC meeting and CPI data on June 12, which has intensified short-term risk aversion. Bitcoin price surged and then fell back to around $68,000. Overall, the market's wealth creation effect has been moderate:
  • Sectors with strong wealth creation effect: Memecoin sector, BTC inscription sector, EVM blue chip projects.
  • Top searched tokens and topics: Cookie3, zkSync, and POLYX.
  • Potential airdrop opportunities: LogX and Elixir.
Data collection time: June 11, 2024, 4:00 AM (UTC)

1. Market Environment

Yesterday, Bitcoin experienced a surge to $70,000 followed by a significant drop, now fluctuating around $68,000. Bitcoin ETFs saw their first net outflow this month after 19 consecutive days of net inflows, with an outflow of $64.9 million, contributing to the decline in Bitcoin's price.
On the macroeconomic front, with the U.S. CPI data and FOMC meeting set to be announced simultaneously on the 12th, short-term risk aversion has increased, leading to a market pullback. The focus of the FOMC meeting will be on Jerome Powell's post-meeting statements, with maintaining interest rates being the general market expectation. If the CPI shows an annual increase exceeding 3.5%, the market might continue to decline; however, if it is below 3.5%, a short-term rise in the market is highly likely.

2. Wealth Creation Sectors

2.1 Sector Movements – Memecoin Sector (PEOPLE)

Primary reasons:
As the quadrennial U.S. presidential election approaches, PEOPLE, a token closely associated with the election and supported by mainstream CEXs, has seen heightened community interest recently.
Gainers: PEOPLE has risen by over 14% in the past 7 days against the market trend.
Factors affecting future market conditions:
  • U.S. election progress: Monitoring how the election influences this sector is advisable, as favorable news could lead PEOPLE to rise first.
  • Dynamics of major investors: Understand whether major investors continue to invest by checking the futures data and primary market news. A sudden increase in open interest volume typically indicates significant investor involvement; ongoing monitoring of futures metrics is advisable.

2.2 Sector Movements – BTC Inscription Sector (ORDI)

Primary reasons:
  • UniSat announced during the Bitcoin Pizza Day that it would airdrop "pizza" to eligible wallets, which increased the popularity of inscription projects and warmed up the sector.
  • The inscription sector has rebounded from its earlier consolidation and volatility, now showing an upward trend.
Gainers: ORDI has risen by over 18% in the past 7 days against the market trend.
Factors affecting future market conditions:
  • News dynamics: Keep an eye on UniSat, influencers, and top exchanges for their support and updates on the inscription sector. Timely investments can be made if positive news is released.
  • Futures data changes: Historical data shows that ORDI's futures had a long/short ratio below 1 for an extended period, indicating that large capital was bullish on it. Continuous monitoring of CoinGlass data is advised to watch for shifts in this trend and to take profits accordingly.

2.3 Sectors to Focus on Next — ETH Ecosystem Projects

Primary reason: The decision on the spot Ethereum ETF is expected by the end of June or early July, which might lead to hype around ETH ecosystem assets. Recently, this sector has seen a significant pullback, creating attractive entry points.
Specific tokens:
  • UNI: The first DeFi Swap project on the blockchain, Uniswap, has generated US$2.022 million in transaction fees over the past 24 hours, showing substantial revenue.
  • LDO: A leading LSD project within the ETH ecosystem. It has a TVL of $34.4 billion but is valued at just under $2 billion, making it relatively undervalued.
  • PENDLE: The project's TVL has been on a continuous rise, now standing at $6.6 billion. The increase in stablecoin market cap and high demand in the restaking sector have led to an increased demand for PENDLE's services during the bull market.

3. Top Searches

3.1 Popular DApps

Cookie3:
Cookie3-related futures, Cookie Army Badge (CAB), is listed on the BSC, Arbitrum, and Base chains. Previously, on June 5, MarketingFi and AI data layer project Cookie3 has raised $5.5 million in funding. The project will launch its COOKIE token on June 13.

3.2 X (former Twitter)

Bitget Research: Crypto Market Short-Term Risk Aversion Intensifies, Awaiting the June 12 FOMC Meeting and CPI Data image 0
zkSync:
zkSync has recently posted on its official website about ZK Nation, revealing it as a community driven by a shared goal to manage, protect, and develop the zkSync protocol. Plans to announce the token distribution and delegation process for the zkSync protocol are set to be released within a week.
POLYX (Polymesh):
Similar to Mantra, Polymesh is an institutional-grade permissioned blockchain specifically designed for regulated assets. It has been active in promoting RWAs and has seen a counter-trend rise in the recent market downturn, with trading volume up by 200% in the last 24 hours.

3.3 Google Search (Global and Regional)

Bitget Research: Crypto Market Short-Term Risk Aversion Intensifies, Awaiting the June 12 FOMC Meeting and CPI Data image 1
Global focus:
Yesterday's Google Trends did not highlight any particular tokens/projects; however, multiple terms related to sports betting trended, likely due to the upcoming European Championship and Copa America. It is advisable to keep a close watch on the fan token sector in the near term.
Regional focus:
(1) Asia: Southeast Asian countries have shown a keen interest in the Ton ecosystem, with NOT and Blum consistently appearing in top searches. In Singapore, the AI project OLAS and the Layer 1 project ALGO are trending. Additionally, Avalanche has captured attention in South Korea.
(2) Europe and the USA: QUBIC has been trending in the UK, France, and Australia. Meanwhile, Spain, Poland, and Belgium have shown sustained interest in the AI and cloud computing project Grass, which is yet to launch its token.
(3) Latin America: In Brazil and Argentina, there is notable interest in the memecoin BRETT on the Base platform and other dog-themed memecoins like SHIB.

4. Potential Airdrop Opportunities

LogX
LogX is a Layer 2 solution dedicated to perpetual futures liquidity. Designed as a large aggregator, it pools liquidity from various chains. On February 13, 2024, LogX raised $6.1 million in a seed funding round with investors including Coinbase Ventures, IOSG Ventures, Sequoia Capital, and Saison Capital.
How to participate: Connect your wallet, deposit USDC, and engage in futures trading to boost volume. It is important to note that liquidity on different chains comes from different providers. Liquidity on Arbitrum, Optimism, and Base is provided by Orderly, whose point airdrop interaction is about to end. Therefore, trading on chains like Linea and Mode, which draw liquidity from LogX OG, might be preferable. If you are interacting with Linea, it is recommended to use the Linea chain for interaction to increase interaction activity on the Linea chain.
Elixir
Founded in 2022, Elixir is a modular DPoS liquidity network that allows anyone to provide liquidity directly to order books, enhancing liquidity for prominent crypto assets and enabling exchanges and protocols to direct their ledger liquidity.
On March 12, 2024, Elixir secured $8 million in Series B funding at a valuation of $800 million; on October 18, 2023, $7.5 million in Series A funding; and on January 17, 2023, $2.1 million in seed funding round with investors including Hack VC, GSR, Sui, and Amber Group.
How to participate: Earn points via Apothecary by depositing at least $100 worth of ETH to mint elxETH and unlock treasure boxes. elxETH is a native yield token backed on a 1:1 ratio by ETH, which will become a universal LP token across all chains upon mainnet launch, powering order book liquidity for exchanges. Additionally, liquidity for Elixir-supported protocols can be provided through https://agg.elixir.xyz/.
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