Weekly Institutional Insights — U.S. Job Report Dampens Rate Cut Hope; Staking Tokens Such As ENA and BB Outperform
June 10, 2024: Last week, Bitcoin climbed back above $70K following strong Bitcoin ETF inflows, but has since fallen below this critical level in the wake of an iron-hot U.S. job report released on Friday, June 6, 2024.
Nevertheless, we continue to observe stellar performance from tokens that feature staking functionality, including Ethena and BounceBit. Meanwhile, Notcoin has been on a tear as Telegram’s crypto ecosystem impresses the market.
Enjoy our weekly take on the market summary!
Macro Outlooks
Strong U.S. Job Market Dampens Rate Cut Hope
The U.S. job market surged in May 2024, with employment growth exceeding expectations. Nonfarm payrolls increased by 272,000, surpassing the projections of economists surveyed by Bloomberg. Wages also showed acceleration, with average hourly earnings rising 0.4% from April 2024 and 4.1% from a year earlier, both higher than the previous report.
However, the unemployment rate ticked up to 4% from 3.9%, reaching that level for the first time in over two years.
While the strong employment and wage data was generally positive news for American workers, it presented a challenge for investors and traders. Jay Bryson, chief economist at Wells Fargo, characterized the report as "Fed-unfriendly" and "easing-unfriendly," suggesting the Federal Reserve is likely to refrain from cutting interest rates in the coming months in response to robust labor market conditions.
Coupled with the slight uptick in the unemployment rate, the combination of robust job growth and accelerating wages presents a complex economic picture, suggesting the labor market remains strong — but also raising questions about the potential impact on the Federal Reserve's monetary policy decisions going forward.
Next week, the CPI on Wednesday and PPI on Thursday will draw investors’ attention.
ETF Flows Highlight
Source: CoinGlass
The strong inflows from last week pushed Bitcoin above $70K. Crypto has become largely dominated by ETF flows, and sustained inflows would likely lead to a supply shock in the world’s largest cryptocurrency. Despite the pullback in Bitcoin’s price on Friday, the market is still optimistic about its near-performance as ETF flows remain positive.
Tokens of the Week (Ending June 7, 2024)
TAIKO Jumps 26.68% After Taiko Introduces Fully Permissionless Proposing
Taiko (TAIKO), launched in May 2024, is a fully open-source, Ethereum-equivalent ZK-rollup scaling solution designed for decentralized, secure and permissionless operations. Having introduced fully permissionless proposing and proving on its network, Taiko is the first rollup to offer these features. This functionality enables global users to independently set up nodes and provers, advancing Taiko's decentralization. The network uses a based rollup model to eliminate centralized sequencing, and incorporates a multi-prover system to enhance security. Users on Taiko are encouraged to participate and help develop this decentralized platform.
BB Jumps 20.7% after BounceBit and Ethena Labs Launch New Staking Feature with Multifaceted Earning Opportunities
BounceBit (BB), founded in 2024, is a Bitcoin staking protocol that merges DeFi and CeFi yield mechanisms, allowing investors to earn through multiple methods. It also features a web3 universe for developing and automatically integrating new projects into its platform.
BounceBit and Ethena Labs have launched a staking feature on portal.bouncebit.io that allows users to stake BBUSD to earn sUSDe yield, 5x Sats/day and BB rewards. This new feature, part of the Ethena tab, integrates a $3 billion TVL yield-bearing protocol with BounceBit's unique staking mechanism and Ethena's Sats campaign, offering a multifaceted earning opportunity.
ENA Jumps 10.6% After Ethena's USDe Stablecoin Matches Solana's Market Cap in Just Four Months
Ethena (ENA), founded in 2023, introduces USDe, a synthetic dollar on Ethereum that offers a decentralized alternative to traditional stablecoins. Its system’s Internet Bond for global savings uses delta hedging to manage volatility, aiming to transform the financial ecosystem by enhancing Ethereum's utility.
Ethena Labs' USDe stablecoin has reached a market cap of $3.06 billion, equaling the total market cap of all stablecoins on the Solana blockchain just four months post-launch. This growth positions USDe as the fourth-largest stablecoin, partly due to its high yield of 33.5%. Ethena also reported a higher weekly revenue of $7 million compared to Solana's $6.3 million. Additionally, an upcoming airdrop is linked to a points program for users who hold or stake USDe, with the goal of reaching a $5 billion market cap by September 1, 2024.
NOT Jumps 47% as Its Market Cap Reaches $1.81 Billion
Notcoin (NOT), launched in January 2024, is a clicker game on Telegram in which players tap a coin to earn the in-game currency, NOT, limited by an energy system. Players can climb a global leaderboard, complete social media–based quests, use boosts to increase earnings and spend those earnings on cosmetic game upgrades. NOT surged 47% in one day and 308.73% over the week, making it a top market performer. Its market cap reached $1.81 billion. In addition, new features enable users to earn passive income with NOT tokens.
Airdrop Spotlight
TAIKO Airdrop is Now Open
Phase 1 of the TAIKO token airdrop is now open, allowing eligible users to claim a total of approximately 50 million tokens (5% of the initial supply) from Jun 5 to Jul 5, 2024. Eligible claimants include Taiko proposers, provers, bridgers, users (including those with Galxe points), developers, GitHub contributors and members of the Loopring community.
To claim their tokens, users must first bridge ETH to cover gas fees via either Taiko's official bridge or another ecosystem bridge, then follow the claim process at the designated website. For those who don’t qualify for this airdrop, 10% of the total supply is reserved for the upcoming Trailblazers program, which rewards active engagement within the Taiko ecosystem.
Catizen Introduces Play-to-Airdrop
Catizen, a Telegram-based gaming bot on The Open Network (TON), utilizes a play-to-airdrop model to foster mass adoption of web3 by onboarding users from Web 2.0. The platform, which boasts 11 million players globally, offers mini-games and practical mobile payments to engage users. Players can earn and spend Fish Coins, upgrading their digital cats and participating in the game's Launchpool for returns.
Catizen's effective integration into Telegram helps bridge the gap between traditional and decentralized web users, aiming to expand the web3 ecosystem effectively. The project plans to launch its own token and expand with more mini-games and features, positioning itself as a major gateway to web3 activities via gaming.
Stay tuned for more institutional insights and crypto updates next week!