In this week’s update on the crypto market, renowned crypto analyst firm Kaiko delves into recent market shifts. It provides valuable insights into the impact of zero-fee trading on Binance, the play-to-earn token activity, and the long-term volatility of BTC and ETH. Moreover, it delves into the recent launches of Worldcoin and Arkham tokens.
Crypto Market Insights
The report reveals that zero-fee trading significantly impacted Binance’s trading volumes. While it initially boosted trade volumes to an all-time high, the subsequent decline in zero-fee trading volumes suggests that Binance may have suffered considerable revenue losses. Nonetheless, the exchange increased its market share substantially during this period.
The study also examines the decline of play-to-earn (P2E) tokens in the metaverse market. Tokens like Axie Infinity and the Sandbox experienced a sharp decrease in trade volume and daily active users, leading to a shift in market share from U.S. exchanges to Binance and Korean markets.
Another noteworthy observation is the rise of AI-related projects, particularly after the launch of ChatGPT. AI-linked tokens initially witnessed a surge in volume but later experienced a decline, with some reaching yearly lows in June.
The report covers the unique launches of Worldcoin and Arkham tokens, both experiencing significant price divergences. Worldcoin’s launch was noteworthy for its innovative approach to distributing tokens to market makers and quickly achieving price discovery.
Furthermore, the study touches on the impact of Q1’s regulatory crackdown and the traditional banking crisis, which caused skittishness among market makers. However, since the start of Q2, market spreads have improved, indicating increased market-maker activity.
The report also highlights Coinbase’s convertible bonds and declining yields, despite the SEC suing the exchange. Nonetheless, Coinbase’s role as a custodian and growing demand for BTC bodes well for the platform.
Finally, the Bank of Japan’s relaxed yield curve control policy (YCC) and its potential impact on global liquidity, as well as the opposite movement between BTC and global Treasury yields and bond volatility, are discussed.
However, Kaiko’s research report provides comprehensive insights into the cryptocurrency market, shedding light on various trends that have shaped the industry over the past year. These trends offer valuable knowledge to investors and traders looking to navigate the evolving crypto landscape.
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