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Bitget Research: CPI Data Causes Pullback in U.S. Stocks, Crypto Market Experiences Decline

John & Victoria
2024/07/12
Bitget Research: CPI Data Causes Pullback in U.S. Stocks, Crypto Market Experiences Decline
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 unadjusted core CPI annual rate in the U.S. for June recorded at 3.3%, lower than the market expectation of 3.4%, marking the lowest level since April 2021.
  • Sectors with strong wealth creation effect: Solana memecoins and Ethereum ecosystem.
  • Top searched tokens and topics: Nillion Network and Bitcoin.
  • Potential airdrop opportunities: Espresso and Mezo.
Data collection time: July 12, 2024, 4:00 AM (UTC)

1. Market Environment

The unadjusted core CPI annual rate in the U.S. for June recorded at 3.3%, lower than the market expectation of 3.4%, marking the lowest level since April 2021. U.S. tech stocks experienced significant losses yesterday with Nvidia dropping 5.57%, Tesla by 8.44%, Meta by over 4%, and Apple, Microsoft, Google, and Amazon each falling by more than 2%. This drop was primarily due to the realization of rate cut expectations, which led to a decrease in bond market interest rates and an increase in prices. Institutions began exiting the overbought stock market and turning to bonds. Bitcoin, as a correlated risk asset, also fell due to the negative impact from U.S. stocks.
In the trading market, according to Arkham's monitoring, the German government wallet transferred out 10,627 BTC in the past 24 hours, and then transferred back 4169 BTC from CEXs, currently holding 9094 BTC (approximately $522.29 million). The remaining selling pressure has already diminished its impact on the market.

2. Wealth Creation Sectors

2.1 Sector Movements – Solana Memecoins (MOTHER and BODEN)

Primary reasons:
  • DWFLabs announced a new strategic partnership with Iggy Azalea, and mentioned their commitment to supporting innovative projects in the Web3 domain.
  • U.S. President Biden stated at a press conference that he will not drop out of the election.
Gainers: In the past 24 hours, MOTHER and BODEN increased by 10.8% and 21.32%, respectively.
Factors affecting future market conditions:
  • SOL trend: The price of SOL impacts the prices of Solana ecosystem tokens, as many pairs on DEXs are priced in SOL. Keep an eye on the price trend of SOL. If SOL maintains its upward trend, holding SOL ecosystem assets is advisable.
  • Changes in open interest: SOL's recent increase in open interest suggests increased hot money inflows. Utilize tv.coinglass to gauge the movement of major funds and monitor futures data, particularly focusing on the uptick in net long positions. Keep an eye on futures data for any increase in open interest (OI) and trading volume. Such trends typically signify heightened bullish sentiment, implying potential stability in holdings.

2.2 Sectors to Focus on Next – ETH Ecosystem (ENS and ETHFI)

Primary reasons:
  • The Etherfi season 2 airdrop checker is now live. Season 3 will run from July 1 to September 14, with 25 million ETHFI to be distributed.
  • Bloomberg ETF analyst Eric Balchunas predicts that the U.S. SEC might approve the spot Ethereum ETFs on July 18.
Factors affecting future market conditions:
  • The situation surrounding the spot Ethereum ETFs will directly influence the price of ETH and the trajectory of prominent projects in the Ethereum ecosystem. Additionally, following the SEC's announcement that it considers the Lido and Rocket Pool staking projects as securities, whether it will similarly classify projects like SSV as securities could significantly impact this segment of the market.

3. Top Searches

3.1 Popular DApps

Nillion Network
Nillion, a decentralized network based on Nil Message Compute (NMC), announced the launch of the second phase of Catalyst Convergence. This phase includes enabling developers to build and deploy Blind applications on the network, using NIL tokens from their Faucet to drive projects, directly interacting with the test network to access SDK functionalities, utilizing Petnet for secure storage and computation, employing Blind computation to manage and process sensitive data, and deploying the Nada AI software package.

3.2 X (former Twitter)

Bitget Research: CPI Data Causes Pullback in U.S. Stocks, Crypto Market Experiences Decline image 0
Bitcoin:
Affected by yesterday's CPI data, BTC has experienced a decline over the past 24 hours. Today's Fear and Greed Index is at 25, shifting from fear to extreme fear.

3.3 Google Search (Global and Regional)

Bitget Research: CPI Data Causes Pullback in U.S. Stocks, Crypto Market Experiences Decline image 1
Global focus:
Aerodrome:
Since the DEX based on Base, Aerodrome, announced that Coinbase Ventures has acquired AERO tokens in the secondary market, it has been discovered that the Coinbase Ventures address has bought at least 4.7 million AERO (approximately $2.7 million). Additionally, TradingVaults used by Coinbase Ventures hold another 1.5 million AERO (approximately $936,000). The last batch of these purchases was completed 8 days ago, and all acquired tokens are locked within the Aerodrome ecosystem.
Regional focus:
(1) Google Trends in Asian countries do not reveal any clear trends; BTC has emerged as a market focal point. Additionally, the Ton ecosystem game, Hamster Kombat, has garnered attention for potential airdrop opportunities.
(2) Hot searches in Europe and the Americas also lack distinct features. Terms like Coinbase and Crypto AI have made the list, and there is no consensus on the sectors and projects of interest. Bitget has emerged as a CEX of interest among users in the UK.

4. Potential Airdrop Opportunities

Espresso
Espresso is a shared sequencer market project utilizing ZK-Rollups to address consensus and interoperability issues across Layer 2 solutions. At the core of Espresso's strategy are privacy and decentralization, with the project's core team comprising members of the Stanford University Applied Cryptography Group.
The project recently announced the completion of its Series B financing round, raising $28 million led by A16Z, with participation from Polychain, Coinbase Ventures, Sequoia, and others, boasting an impressive lineup of investors.
How to participate: The project is currently in its early stages, and users can participate by running validator nodes, which may qualify them for early airdrops. For detailed instructions, refer to the official documentation: https://docs.espressosys.com/sequencer/guides/running-a-sequencer-node.
Mezo
Mezo is a BTC Layer 2 project focusing on the BTC ecosystem. It assists BTC holders with on-chain transfers and financial management, driving the development of the BTC DeFi system. Mezo recently announced the completion of a $21 million funding round with participation from industry-leading institutions such as Pantera Capital, Hack VC, and Multicoin Capital.
The official announcement of their BTC asset staking plan and the introduction of a referral system have set strong expectations for an upcoming airdrop. The project is currently in the early stages of its operation.
How to participate: 1. Visit the project's official website and find an invite code on Discord; 2. Enter the invite code and connect a Unisat wallet; 3. Deposit BTC.
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