(47/52) Weekly Market Insight | December Week 1 | Holiday Optimism

Headline News: Holiday Optimism

• Market sentiment has stabilized as Bitcoin reclaimed the $90,000 level, ending a four-week streak of outflows with a fresh $70 million in net inflows last week. Optimism was being driven by the increasing probability of a December rate cut alongside key sector upgrades. The immediate focus is now on the Ethereum Fusaka upgrade, the most highly anticipated event scheduled for December 3.

Macro-Outlook: Pricing in a Near-Certain Rate Cut

• The US PPI increased by 0.3% in September, in line with the market expectations. The US durable goods in September also increased by 0.5%, above market expectations of 0.3%. Meanwhile, the retail sales in September increased by 0.2%, below the market forecasts of 0.4%.
• The latest Beige Book reported largely stable economic activity, though employment edged down and consumer spending declined despite strength in high-end retail.
• The market estimates the probability of a 25bps rate cut in December is about 86%.

Upcoming Economic Calendar including,

• Monday, December 1, 11:00pm: US ISM Manufacturing PMI in November
• Tuesday, December 2, 9:00am: Fed Chair Powell Speech
• Wednesday, December 3, 9:15pm: US ADP Employment Change in November
• Wednesday, December 3, 11:00pm: US ISM Service PMI in November
• Friday, December 5, 11:00pm: US PCE Price Index, Personal Income and Personal Spending in September ; Michigan Consumer Preliminary Sentiment for December

Weekly-Cryptos-Overview: Monad Mainnet; Ethereum Fusaka

• The Texas Blockchain Council President confirmed the state purchased $5 million worth of Bitcoin, becoming the first state to hold cryptocurrency in its treasury.
• The payments giant Klarna introduced KlarnaUSD, its first stablecoin launched on Tempo, a blockchain backed by Stripe and Paradigm, to accelerate stablecoin adoption for its 114 million users.
• Polymarket received CFTC approval for intermediation, allowing it to offer services to US customers through registered brokers. Galaxy Digital is also reportedly exploring partnerships to serve as a liquidity provider for prediction market platforms Polymarket and Kalshi.
• Robinhood announced a new futures and derivatives exchange, significantly deepening its investment in prediction markets and expanding its crypto product suite.
• S&P Global Ratings downgraded Tether stability assessment of USDT to “Weak,” citing limited transparency and a higher allocation to riskier reserve assets.
• Naver and Dunamu announced a plan to invest approximately $6.8 billion over five years to build next-generation financial infrastructure and issue a Won-pegged stablecoin.
• Upbit exchange experienced a security breach of approximately $38.5 million on the Solana network.
• Strategy CEO, Phong Le stated the company would sell Bitcoin if the mNAV of the company falls below 1. Strategy’s current mNAV is approximately 0.9, while mNAV based on enterprise value is about 1.15.

Layer 1 and Layer 2s

• The Monad Mainnet is officially live, opening its high-performance parallel EVM network to the public after months of anticipation. Sunrise, developed by Wormhole, facilitated the native listing of the MON token on Solana, providing deep liquidity on day one.
• Ethereum increased its Layer 1 gas limit from 45 million to 60 million with the majority validator consensus, a move designed to increase network throughput.
• Avail Nexus Mainnet is now live, aiming to unify liquidity and enable users to transfer seamlessly across different blockchains.

Dapps

• Ondo Finance partnered with Binance Wallet to integrate tokenized stocks and exchange-traded funds on its wallet platform via the BNB Chain.
• Jupiter launched Refinance, allowing users to move active borrow and lend positions from other protocols to Jupiter with zero slippage.
• Pendle Boros completed the first on-chain OTC Interest Rate Swap, executing an $8 million notional trade led by a digital asset management firm.
• OpenLedger Foundation announced the next cycle of its buyback program, allocating protocol revenue to repurchase 5 million OPEN tokens.
• Terminal Finance, the institutional liquidity hub for USDe, announced the protocol will shut down because the underlying Converge chain is unlikely to go live in the near future.
• Synapse unveiled Hypercall, an on-chain options venue built for every asset on the Hyperliquid network.
• Warden launched its WardenChain Mainnet, unlocking an agent app store, on-chain agent identity (ERC-8004), and instant agent monetization features.
• Fluid launched DEX V2, introducing smart collateral range orders and automated lending yields for liquidity providers.
• Yearn Finance suffered an exploit in its yETH vault, where an attacker minted unlimited tokens to drain the pool of approximately $3 million.

Governance and Upcoming Alpha

• Ethereum will undergo the Fusaka upgrade on December 4 (approximately between 5am to 6am), introducing 8x data throughput for Layer-2, capping transaction gas limit to prevent DoS attacks, native support for biometric signing and more.
• Cosmos community released a proposal to research a new revenue-based tokenomics model for ATOM.
• Spark community passed a proposal to adopt a buyback mechanism known as the SubDAO Proxy Management Plan, which would accumulate net revenue for token repurchases.

Token Unlock

• EIGEN token unlocks on December 1, amount representing 7.59% of the token supply.
• LA token unlocks on December 4, amount representing 5.94% of the token supply.
• LINEA token unlocks on December 10, amount representing 6.11% of the token supply.
• HOME token unlocks on December 10, amount representing 4.71% of the token supply.
• ZKC token unlocks on December 15, amount representing 7.46% of the token supply.
• VANA token unlocks on December 16, amount representing 19.9% of the token supply.
• ZRO token unlocks on December 20, amount representing 10.3% of the token supply.
• KAITO token unlocks on December 20, amount representing 3.46% of the token supply.
• XPL token unlocks on December 25, amount representing 4.94% of the token supply.
• SAHARA token unlocks on December 26, amount representing 7.42% of the token supply.