Good morning, today is Wednesday, Nov. 23, 2022.

TL;DR

🔹 Bitcoin and Ether rose from their respective support level of $16,000 and $1,100 following an upbeat US market performance based on better-than-expected retailers’ earnings reports and hints from Fed officials that rate hikes may slow in early 2023.

🔹 BTC’s correlations to the DXY (US Dollar Index) and VIX (Volatility Index) are at 0.87 and 0.62, up from 0.86 and 0.54 a day ago. While the former is slowing its pace, the latter has increased exponentially, especially this week ahead of FOMC.

🔹 Wednesday, traders and investors alike will be eyeing the FOMC statement coming from Fed Chair Jerome Powell which is due for release at 19:00 UTC. October’s US durable goods orders (13:30 UTC) and new home sales (15:00 UTC) will also be closely watched by US participants.

🔹 The topic of the Day: SBF Issues Internal Apology Letter, Saudi Arabia's NFT Sales Surge 387% After Blowout Win Over Argentina

🔹 Happenings of the Week: Apple bids for millions of dollars for the rights to the FTX bankruptcy novel; Sequoia Capital apologizes to investors for losing $150 Million; CZ met with investors in Abu Dhabi in an attempt to raise funds for a recovery fund…

💰 . . .

Bitcoin (BTC) 24-Hour Change: 16,161 (+2.13%)

Ether (ETH) 24-Hour Change: 1,129 (+2.38%)

On early Wednesday, both BTC and ETH were slightly up after closing at +2.83% and +2.87% on Tuesday, respectively. Meanwhile, Asian equity indices were trading higher following an upbeat US market performance despite concerns for a rollback of relaxing measures in China as a new COVID variant was discovered and the first deaths were reported in six months.

Yesterday, the price movements of both cryptocurrencies began trading sluggishly but around 13:00 UTC before the US markets opened, US futures started to rally on indications that the Federal Reserve is open to slowing the pace of interest-rate hikes based on the statements of several Federal Reserve officials, and the optimism spread across global assets, including cryptocurrencies.

Today, traders and investors alike will be eyeing the FOMC statement coming from Fed Chair Jerome Powell which is due for release at 19:00 UTC. Before FOMC, October’s US durable goods orders (13:30 UTC) and new home sales (15:00 UTC) will be closely watched by US participants.

According to Sonia Meskin, head of US macro at BNY Mellon Investment Management, told Bloomberg, “I don’t know if I would read too much into the sort of daily repricing from the macro perspective at this stage, but I would be interested to see the labor market data for November and then any indication of whether this information weakening is sustained or not. I think those would really be more indicative of the future of the policy trajectory.”

In the decentralized space, Binance Chief Executive Officer Changpeng “CZ” Zhao and several deputies met with investors in Abu Dhabi last week in an effort to raise cash for a crypto industry recovery fund, although details on the size of the fund and the projects to support are still not decided and it’s likely several weeks before the vehicle takes off.

Returning to FTX’s ongoing crisis, Sam Bankman-Fried, founder of exchange FTX and trading house Alameda Research, apologized to employees in a letter that outlined a crash in “collateral” to $9 billion from $60 billion before filing for bankruptcy.

Meanwhile, Genesis Global Capital has hired investment bank Moelis & Company to explore options, including a potential bankruptcy, The New York Times reported.

3️⃣ . . .

Wednesday

13:30 UTC

US Durable Goods Orders OCT

Actual: Awaiting Data; Consensus: 0.4%; Previous: 0.4%

• In SEP, new orders for the US manufactured durable goods increased 0.4% MoM, following an upwardly revised 0.2% gain in AUG and beating market expectations for a 0.2% advance.
• New orders were up six of the last seven months. Excluding transportation, new orders decreased by 0.5 percent. Excluding defense, new orders increased by 1.4 percent. Transportation equipment, up five of the last six months, drove the increase, $1.9 billion or 2.1 percent to $95.4 billion.

15:00 UTC

US New Home Sales OCT

Actual: Awaiting Data; Consensus: 603K; Previous: 570K

• In SEP, new home sales in the United States fell 10.9% to a seasonally adjusted annualized rate of 603K, after jumping by a downwardly revised 24.7% in August and compared with market forecasts of 585K.
• Housing demand in the US has been sharply falling as the Federal Reserve is aggressively raising interest rates to combat the surge in inflation.
• Sales fell in the South (-20.2% to 356K) and the West (-0.7% to 135K) but rose in the Northeast (56% to 39K) and the Midwest (4.3% to 73K). The median sales price of new houses sold was $470,600, up 13.9% from a year ago and the average sales price was $517,700.
• There were 462,000 houses to sell, corresponding to 9.2 months of supply in inventory.

19:00 UTC

FOMC Minutes

During its last meeting, the Federal Reserve raised the target range for the federal funds rate by 75bps to 3.75%-4%, which marked a sixth consecutive rate hike and the fourth straight three-quarter point increase, pushing borrowing costs to a new high.

The Fed aims to attain a stance of monetary policy that is sufficiently restrictive to return inflation to 2%, which remains elevated around 40-year highs.

Policymakers also said that ongoing increases in the target range will be appropriate and that they will take into account the cumulative tightening of monetary policy, the lags with which monetary policy affects economic activity and inflation, and economic and financial developments when deciding on the size of further increases.

The message could signal a smaller rate hike in December but during the last press conference Chair Powell also noted the ultimate level of interest rates will be higher than previously expected.

2️⃣ . . .

Tuesday

13:30 UTC

Canada Retail Sales MoM SEP: Actual: -0.5%; Consensus: -0.5%; Previous: -0.7%

Retail Sales YoY SEP: Actual: 6.9%; Consensus: 5.1%; Previous: 7%

Last Friday, UK reported negative growth in October retail sales, though the data beat the consensus. Canada’s September data revealed a similar pattern in which retail sales growth remained negative, though beating estimates as well.

Although not entirely optimistic, the data from both countries do point to a slow recovery. At the time of the data release, the Canadian dollar fell against the US Dollar but subsequently rose as Wall Street made surprising gains which dragged down the Dollar Index.

• Considering September, retail sales fell by 0.5% from a month earlier, in line with preliminary estimates and contracting from the 0.4% advance in August.
• Retail sales fell in 7 of the 11 subsectors, led by the third consecutive decline in gasoline stations (-2.4%), despite higher sales volumes as gas prices declined 7.4% on the month.
• On the other hand, higher sales were seen for furniture and home furnishing stores (1.4%) and clothing stores (1.5%). On a yearly basis, retail trade rose by 6.9% in September, easing from the 7% jump in the prior month.

💡 . . .

Today's Markets at 01:10 UTC

BTC -0.31%; Ether -0.72%.

Asia: Japan +0.61%; Hong Kong -1.31%; China +0.13%; India +0.46%.

Europe: London +0.01%; Paris +0.35%; Frankfurt +0.29%.

Index Futures: Dow +0.01%; S&P -0.04%; Nasdaq -0.17%.

US Two-year Treasury unchanged at 4.523%.

US Ten-year Treasury down 6bps at 3.758%.

UK Ten-year Government down 8bps at 3.125%.

US Dollar Index -0.04% at 106.71.

FX: GBP: +0.07%; EUR: +0.03%; JPY: +0.01%; CNY: 0.00%.

Gold +0.04%; Brent Crude +1.04%.

Catalysts this week

• Wednesday: FOMC Minutes
• Thursday: Germany Ifo Business Climate
• Friday: Germany GfK Consumer Confidence

🏦 . . .

🟠 BTC

BTC Weekly timeframe:

• Major Level: 13,965 (Monthly High of Jun. 2019)
• Closest support zone: 15,950 - 15,830
• Key resistance level: 16,220 - 16,400

Analysis as of Nov. 23 - 27 Session.

BTC Weekly Resistance zones

1. 16,220 - 16,400
2. 16,400 - 16,880
3. 17,085 - 17,715

BTC Weekly Support zones

1. 15,950 - 15,830
2. 15,525 - 15,200
3. 14,650 - 14,030

BTC Daily Timeframe:

• Closest support zone: 15,860 - 15,580
• Closest resistance zone: 16,280 - 16,630
• Key Level: 15,952 (Weekly Close Between Nov. 02 - 09, 2020)

Nov. 23 00:26 UTC Update:

Bitcoin (BTC) was trading at $16,211, or +1.89% in a 24hr period.

BTC Daily Resistance zones

1. 16,280 - 16,630
2. 16,800 - 17,205
3. 17,575 - 18,025

BTC Daily Support zones

1. 15,860 - 15,580
2. 15,535 - 15,200
3. 15,100 - 14,640

🌐 . . .

🔵 ETH

Weekly Timeframe

• Major Level - 757 (Monthly High of Dec. 2020)
• Closest support zone: 1,110 - 1,060
• Key resistance zone: 1,180 - 1,265

Analysis as of Nov. 23 - 27 Session.

ETH Weekly Resistance zones

1. 1,180 - 1,265
2. 1,310 - 1,345
3. 1,390 - 1,450

ETH Weekly Support zones

1. 1,110 - 1,060
2. 1,035 - 990
3. 910 - 795

ETH Daily Timeframe

• Closest support zone: 1,140 - 1,120
• Closest resistance zone: 1,160 - 1,175
• Key Level: 1,010 (Weekly High from Dec. 28, 2020 - Jan. 04, 2021)

Nov. 23 00:40 UTC Update:

ETH was trading at $1,134, or +2.62% in a 24hr period.

ETH Daily Resistance zones

1. 1,160 - 1,175
2. 1,220 - 1,240
3. 1,255 - 1,270

ETH Daily Support zones

1. 1,140 - 1,120
2. 1,110 - 1,065
3. 1,045 - 1,010

⚠️. . .

📌 Today's topic: SBF Issues Internal Apology Letter, Saudi Arabia's NFT Sales Surge 387% After Blowout Win Over Argentina

SBF issued an open letter to FTX employees on Tuesday via a shared internal Slack account, CoinDesk reported, in which SBF said he was "deeply sorry for what happened. However, SBF did not respond positively to the misappropriation of client funds by FTX to support Alameda Research, Alameda's exemption from the normal liquidation process at FTX, or Alameda's loans to FTX executives, including himself.

According to SBF, FTX had about $60 billion in collateral and $2 billion in liabilities this spring, but the market crash and the drying up of industry credit caused the value of collateral to shrink to $25 billion and liabilities to jump to $8 billion, and another crash in November reduced the value of collateral by about 50% again to $17 billion, and the ensuing bank run reduced collateral by another $8 billion. The ensuing bank run reduced collateral by another $8 billion.

SBF said it did not realize the full size of the margin position or what the risks of a highly correlated collapse would mean. But due to "tremendous coordination pressure," it reluctantly agreed to FTX's bankruptcy filing. Still, "there may be a chance to save the company, but I can't guarantee what will happen because it's not my choice."

In addition, there are official real estate records showing that FTX, SBF's parents, and other executives of the exchange have purchased at least 19 properties in the Bahamas over the past two years, worth nearly $121 million, according to Reuters. Most of FTX's purchases were beachfront mansions, including seven condominiums in the upscale resort community of Albany, valued at nearly $72 million. The deeds to the properties indicate that the condominiums were purchased by a division of FTX for the housing of key employees.

In response, SBF also said in an internal letter that the loans were typically used to reinvest in the business, including the acquisition of all of Binance's FTX holdings, rather than for significant personal spending.

Meanwhile, on the second day of the World Cup, Saudi Arabia defeated Argentina, and the sales of the Saudi-themed NFT series "Saudi" surged 387%. Meanwhile, the Argentine fan token ARG has fallen more than 25% in the past 24 hours and is currently priced at $5.06. It is reported that fan tokens experienced a sharp correction before the start of the World Cup, with other fan tokens including Portugal (POR) and Brazil (BFT) falling on Monday, underperforming Bitcoin and ethereum.

👁️ . . .

Happenings of The Week (Nov. 18 - 23):

📣 Notables

🔹 Hong Kong Monetary Authority: Stablecoin mass redemptions may have a significant impact on the traditional financial system.

🔹 In their declaration, G20 leaders, including President Joe Biden, called for a global regulatory framework for crypto.

🔹 Singapore's deputy prime minister said he’ll take a tough stance on crypto speculation, especially targeting retail investors.

🔹 China's first metaverse computing center opened in Qingtian County, Zhejiang Province.

🔹 China's central bank and eight other departments are actively exploring the safe application of blockchain technology in financial scenarios such as transaction clearing.

🔹 Bank of England: the UK needs digital pounds and should include cryptocurrencies in the scope of regulation.

🔹 South Korean government asks each crypto company to establish a tax collection system and intends to advance crypto taxation next year.

📣 Nov. 23

🔹 Apple bids for millions of dollars for the rights to the FTX bankruptcy novel, expected to be made into a feature film.

🔹 FTX bankruptcy lawyer: a large number of FTX assets were either stolen or lost, and SBF did not officially relinquish control until Nov. 11.

🔹 Sequoia Capital apologizes to investors for losing $150 Million in FTX case, and says they’ll improve due diligence process moving forward.

🔹 Aave: Most CRV collateral positions have been liquidated, with $1.6 million of bad debt remaining.

📣 Nov. 22

🔹 Elon Musk to Twitter employees: No allowances, daycare, or team activities to cut down costs until financial situations improve internally.

🔹 Genesis says it may file for bankruptcy if it can't raise enough money.

🔹 Texas Securities Commission formally investigates NBA star Steph Curry and NFL star Tom Brady for their involvement in promoting cryptocurrency trading platform FTX in possible violation of U.S. securities laws.

🔹 U.S. Senators ask Fidelity to cancel Bitcoin Retirement Savings Plan.

📣 Nov. 21

🔹 Y-Combinator founder says “a trusted friend sees systemic risk in cryptocurrencies soon.”

🔹 Playboy's application to register NFT-related trademarks had been approved.

🔹 NEAR Protocol releases Staking Transparency Report which reported 469 Million NEARs were pledged or about 42% of the Total Supply.

🔹 JPMorgan Chase has registered the trademark "J.P. MORGAN WALLET”.

🔹 Ren 1.0 network to shut down in 30 days, officials suggest bridging Ren assets back to the native chain as soon as possible.

🔹 BTC Long-term Hodlers' losses are approaching the 2015 Bear Market.

🔹 The countries with the largest share of users before the FTX crash were South Korea, Singapore and Japan.

🔹 Porsche launches NFT page on its website and opens a Twitter account with the ETH symbol.

🔹 Sony filed a patent application for its technology described as "using tokens on a distributed ledger to track in-game unique digital assets.”

🔹 Vitalik Buterin: FTX incident is a "huge tragedy" and says cryptocurrencies have a long way to go to reach their full potential.

📣 Nov. 20

🔹 Bitcoin's third largest whale address outflows 1,800 BTC in the past week.

🔹 Trump reiterated that he has no intention of returning to Twitter.

🔹 CME CEO: We won't abandon crypto futures trading because of FTX's failure.

🔹 The Caribbean island nation of St. Nick is set to make BCH legal tender by 2023.

📣 Nov. 19

🔹 FTX announces the launch of a strategic review of its global assets and intends to sell or restructure certain businesses.

🔹 Grayscale: For security reasons, no on-chain wallet information will be disclosed via proof of reserve.

🔹 X2Y2 removed "custom royalty" and will enforce royalties on all NFTs.

🔹 The Ensign Group plans to launch a cryptocurrency hedge fund.

📣 Nov. 18

🔹 Oscar-nominated director David Darg and XTR Studios have begun production on the FTX documentary.

🔹 Tuvalu will be the first country to move into the metaverse as rising sea levels threaten survival.

🔹 New FTX CEO: Alameda had a "secret waiver" in the FTX auto-liquidation agreement.

🔹 Jump Crypto: no plans to close, still actively investing and trading.

🔹 ConsenSys Launches Ether Climate Platform ECP, Aims to Mitigate Energy Consumption Issues Prior to Ether Merger

📣 This week’s fundraising activities include but are not limited to:

🔹 Asset management and technology platform Fasanara Capital receives a $200 million mandate from the Canadian Pension Fund. Founded in 2011, Fasanara Capital, which describes itself as "a significant provider of liquidity to the crypto market," is understood to have just recently launched a $350 million fintech and crypto venture capital fund. Fasanara Capital CEO Francesco Filia said the latest $200 million in funding will help strengthen its portfolio companies, ensuring they have access to a range of financial products when they need them.

🔹 Web3 and virtual reality game developer Thirdverse closed a $15 million funding round led by MZ Web3 Fund, which has brought the company's total funding to $33 million to date. Other organizations that have invested in Thirdverse include 8DAO, YGG and OKX. Thirdverse plans to release at least 10 Web3 games by 2023 and is currently recruiting more game developers to expand its development team.

🔹 Web3 developer platform Buildspace closes $10M round led by a16z with participation from Y-Combinator. Buildspace aims to provide a Web3 learning platform for users and currently offers learning programs such as Solidity, Ether NFT, Solana Web3 App, and more.

🔹 Decentralized financial marketplace infrastructure startup Revv announced that it has closed a $5.5 million round of funding in Q2 led by Libertus Capital. Revv founder Adi Dommaraju said he hopes to build the new DeFi product by combining TradFi and Web2 practices with a crypto-native experience.

🔹 NFT utility platform Tropee closes $5.1 million funding round led by Tioga Capital. Tropee reportedly aims to empower utility for NFT by helping brands enhance the user experience from their collections.

🔹 Cryptographic privacy startup Nucleo closed a $4 million seed round led by Bain Capital and others. The company seeks to create a private, multi-signature solution for organizations to transact on the ethereum blockchain through zero-knowledge cryptography. The funding round will be used to develop DeFi services for organizations, further increase integration with the on-chain network, and scale the team.

🔹 Decentralized identity project Carv closes $4M in funding led by Temasek's Vertex Ventures. Carv's main products include an engine that aggregates gamer data from Web2 and Web3 and centralizes this information under a unique user ID. On the enterprise side, Carv provides a white-label data service for game operators to query cross-platform data on new users. Carv currently has partnerships with over 90 games and over 300,000 registered users.

🔹Web3 gaming infrastructure service provider Insert Stonks closed a $2.5 million pre-seeded round led by FunFair Ventures. Insert Stonks provides personalized tools to help players and developers profit from games quickly and transparently and is currently launching two platform tools, "is_engine" for game developers and "is_games" for gamers, which are compatible with most games on the market and can be integrated quickly.

🔹 NFT platform Hyakkit closed a $2 million seed round led by Step VC and others. Hyakki is dedicated to building marketing and utility infrastructure for Web3 and NFT, using AR and AI to provide marketing services and application scenarios for Web2 and Web3 brands so that NFT is not limited to JPEG images but can give brands more.

🔹 Blockchain digital securities platform DEFYCA closes a $1.3 million seed round led by QBN Capital and Blizzard Fund. DEFYCA developed the blockchain protocol DEFYCA Protocol to help cryptocurrency investors invest in traditional debt securities through Tokenized assets. These Tokenized assets will be incorporated into a liquidity pool, and processes including price discovery, settlement, and payment will be executed through smart contracts, subsequently creating a link between DeFi and TradFi (traditional finance).

🔹 Web3 data solution Vezgo closes a $750,000 funding round with participation from Bitnomic Capital and others. Reportedly spun off from investment aggregation platform Wealthica and operating independently, Vezgo aims to provide Web2 finance and fintech companies with access to data including centralized trading platforms, wallets, NFTs, and other on-chain data via APIs.

🔹 Knobs, a blockchain IoT project, closed a new round of funding with participation from Smart Capital for an amount not yet disclosed to the public. Knobs was founded in 2014. It operates in three main areas: blockchain, IoT (integration of devices to make them smart) and traditional software platforms. In the blockchain area, Knobs has so far filed two patents and a blockchain software platform registered with the Italian Copyright Office SIAE.

📣 This week’s on-chain criminal activities include but are not limited to:

🔹 Distributed Capital Founder Bo Shen: $42 Million Worth of Personal Wallet Assets Stolen. In his original statement, "A personal wallet that ends with the digits “894” with $42 million worth of assets, containing 38 million USDC, was stolen in the early morning hours of November 10, New York time. The stolen assets were personal funds and not related to distributed-related funds. The theft has been reported locally and both the FBI and lawyers have been involved. It is only a matter of time before civilization and justice prevail over barbarism and evil, the iron law of human society.”

🔹 FTX hack update: According to Etherscan on-chain data, the address marked as "FTX Accounts Drainer" starting with 0x59a has transferred approximately $200 million worth of ETH to 12 different crypto wallets, which started around 00:00 on November 22 (UTC+8 ). Within six minutes, the wallets made 12 transactions, each sending 15,000 ETH to a different crypto wallet address, and the 12 new wallet addresses have yet to do anything with the funds. Larry Cermak, vice president of research at The Block, said the entity has not yet started selling off the Ether that has been transferred to the 12 wallets because there is little remaining liquidity to convert Ether for renBTC.

🔹 sDAO contract business logic is flawed, attackers made over 13,000 BUSD in profit. Beosin analysis found an error in the business logic of the sDAO contract, where the getReward function is calculated based on the LP tokens owned by the contract and the LP tokens added by the user as parameters, and the calculated reward is positively correlated with the number of LP tokens added by the user, and not with the total number of LP tokens owned by the contract. The calculated reward is positively correlated with the number of LP tokens added by the user and negatively correlated with the total number of LP tokens owned by the contract, but the contract provides a withdrawTeam method to send all the BNBs owned by the contract and the specified tokens to the address specified in the contract, which can be called by anyone. After adding LP tokens to the contract, the attacker calls the withdrawTeam function to send all LP tokens to the specified address and immediately transfers a very small number of LP tokens to the contract, causing the attacker to use a very small value for the total number of LP tokens owned by the contract when calling getReward to get the reward, making the reward unusually large. Ultimately, the attacker gains approximately 13,662 BUSD through this vulnerability.

🔹 VenomSoftX, a malicious extension for stealing cryptocurrency, was discovered in Google Chrome and can be used to steal users' cryptocurrency and sensitive data. The extension is installed via the Windows version of the ViperSoftX malware and is a Java_script_-based RAT (Remote Access Trojan) and cryptocurrency hijacker. By analyzing the hard-coded wallet addresses in the ViperSoftX and VenomSoftX samples, Avast found that by November 8, 2022, both had earned its hackers a total of approximately $130,000. This stolen cryptocurrency was obtained by transferring attempted cryptocurrency transactions on the attacked devices, excluding profits from parallel activities.