Daily News | BTC Options’ Bullish Buying May Drive BTC to $74K; Paxos Will Issue Interest-bearing Stablecoin USDL; Stablecoin Minting Protocol M^0 Financing of $35M

2024-06-06, 03:32

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## Crypto Daily Digest: The concentrated bullish buying of BTC options may boost BTC to breakthrough new highs; Paxos International will issue regulated interest-bearing stablecoins USDL; Stablecoin minting protocol M^0 financing $35 million
First, let's examine the <a href="/es/price/bitcoin-btc" target="_blank" class="blog_inner_link">Bitcoin</a> ETFs’ trading activities. According to Farside Investor data, on June 5, Grayscale Bitcoin spot ETFs (GBTC) continued to receive $14.6 million in inflows of funds; Meanwhile, Fidelity Bitcoin spot ETF (FBTC) had an inflow of $220.6 million, Bitwise Bitcoin spot ETF (BITB) had an inflow of $18.5 million, and ARK 21 Shares Bitcoin spot ETF (ARKB) had an inflow of $71.4 million.

The combined net inflow of US spot Bitcoin ETFs reached the second highest in history, reaching $886.6 million.

**Bitcoin options traders expect prices to reach a new high, breaking through $74,000**
Market data shows that Bitcoin (BTC) option traders constantly bet on the asset hitting a new high this month. In a market update on Wednesday, QCP, a digital asset hedge fund, stated, "Our trading department has seen strong bullish movements and has purchased a large number of bull options due in June, indicating that the options market may break through a historic high of $74,000 this month."

Joshua Lim, the co-founder of Arbelos Markets, a major trading company for crypto derivatives, pointed out that Tuesday's "bullish option buying was very concentrated," with about 1,100 bull option contracts due on June 28 being bought, and with exercise prices ranging from $74,000 to $80,000, equivalent to approximately $80 million in nominal demand.

In a Telegram broadcast, Paradigm, an institutional crypto derivatives trading network, said, "Today's options <a href="/es/price/flow-flow" target="_blank" class="blog_inner_link">Flow</a> is clearly bullish. At the end of June, there was a large bullish spread in BTC prices, while at the end of July, the scale was relatively small."

Matrixport pointed out that breaking through the $72,000 level may trigger a bearish squeeze, as about $1.5 billion worth of leveraged futures contracts are betting on lower prices concentrated in this range, which may be liquidated, exacerbating the upward trend.

**Paxos International will issue regulated interest-bearing stablecoins USDL**
Paxos International is issuing an interest-bearing stablecoin called Lift Dollar (USDL). USDL will be regulated by the Abu Dhabi Global Market (ADGM) and pay overnight returns based on the interest earned by Paxos International on its support reserves.

USDL will be backed by liquid US government securities and cash equivalent reserve assets in a 1:1 ratio in accordance with the requirements of the ADGM Financial Services Regulatory Authority. Paxos International will not earn interest from these reserves, but will charge token holders issuance fees.

Paxos also announces that USDL will be released in Argentina through distributors Ripio, Buenbit, Manteca, and Plus Crypto.

Paxos claims that USDL is the first of its kind. The <a href="/es/price/ethereum-eth" target="_blank" class="blog_inner_link">Ethereum</a> smart contract will use a " rebasing " mechanism to allocate USDL revenue based on market conditions. According to Bloomberg, the yield will reach around 5%. Paxos International stated in a statement that USDL is the first interest-bearing & regulated stablecoin. stablecoin holders can also earn interest through staking, re-staking, and yield farming.

**Bain Capital Crypto led a $35 million A-round financing for the stablecoin minting protocol M^0**
M^0 (M Zero) is a decentralized stablecoin minting protocol that raised $35 million in A-round financing led by Bain Capital Crypto. The official stated that it has been deployed on the Ethereum mainnet and will be launched in the coming weeks.

M^0 is a stablecoin minting protocol based on Ethereum. Approved entities can create a stablecoin called M, which is "only over-guaranteed by US treasury bonds". To mint M, the entity needs to obtain permission from the protocol management department. Once approved, they will provide their own standardized "high-quality" collateral, which independent validators will inspect to ensure it meets the standards.

On Wednesday, M^0 stated that other investors in this round of financing include Galaxy Ventures, Wintermute Ventures, GSR, Caladan, and SCB 10X. Luca Prosperi, Chairman of the M^0 Foundation's Board of Directors, stated that this round of financing was in the form of equity plus tokens. M^0 has issued two types of "governance tokens" to investors - POWER and ZERO, but must comply with the lock up period.

The A-round financing of M^0 was in April 2023, and the company raised $22.5 million in a seed round financing led by Pantera Capital. The A-round financing brought the total financing amount of M^0 to $57.5 million. Prosperi pointed out that the demand for A-round financing is 2.5 times the amount raised.

## Market Trends: BTC is consolidating at a high level, while Altcoins are generally rising
BTC is consolidating at around $71,000 and may look for new directions. The consolidation period usually reflects market sentiment, and investors should closely monitor key support and resistance levels. The inflow of nearly $900 million in spot ETFs indicates strong interest from institutional investors and may indicate future upward potential.

ETH broke through $3,850, its breakthrough may trigger further gains, especially driven by the Layer 2 solution and DeFi project.

<a href="/es/price/bnb-bnb" target="_blank" class="blog_inner_link">BNB</a> broke through $700, reaching a historic high, demonstrating strong market demand. Projects in the BNB ecosystem, such as BB and BURGER, also benefit from this.
### Macroeconomics
US stock market surged: The strong performance of the stock market usually boosts investment sentiment in risky assets, including cryptocurrencies.

Interest rate cuts may be expected: The US is expected to lower interest rates by 70% in September, and the Bank of Canada has already lowered rates. This may lead to more funds flowing into high-risk assets such as cryptocurrencies.
### Market Hotspots:
Meme sectors: SLERF, GME, PEOPLE, etc., performed well, increasing over 20%. Investors can focus on these highly volatile assets, but should monitor risk management.

BNB ecosystem: Projects such as BB and BURGER benefit from the BNB’s rise and may have further room for growth. Users can consider seeking investment opportunities in these projects.

Pow sector: KAS rose 20% and reached a historic high, with the possibility of launching the krc20 standard in the future. The krc20 standard is similar to Ethereum's ERC20 standard, this may attract more projects to be released on the Kas chain.

TAIKO was launched on Gate.io, but the price performance was average. Its market cap of $2.5 billion may be considered high, and investors should be cautious.

Overall, the current market performance is strong, but the crypto market has high volatility, and investors should be mentally prepared.

## Macro: Data supports the Fed to relax policies, with the S&P 500 and Nasdaq reaching historic highs and global stock markets rising
On Wednesday, June 5, driven by technology stocks, the S&P 500 index and Nasdaq index hit historic closing highs. The market has digested economic data, which may support the Federal Reserve in initiating a highly anticipated policy easing cycle.

Index performance: The Dow Jones index rose 0.25%, the Standard & Poor's index rose 1.18%, and the Nasdaq index rose 1.96%.

The May private employment report released on Wednesday showed that the tension in the labor market has eased, which may prompt the Federal Reserve to start cutting interest rates this year. Tuesday's report pointed out that the number of job vacancies in April dropped to the lowest level in over three years.

Technology stocks lead the 11 sectors of the S&P 500 index, followed by telecommunications and industrial stocks. The chip sector rose 4.5%, driven by Nvidia and Taiwanese semiconductor manufacturing companies. Nvidia's market value has surpassed the $3 trillion mark for the first time, surpassing Apple to become the world's second largest and most valuable company.

The strong rise on Wall Street, decreased volatility, decreased bond yields, and relatively stable US dollar combined should be good news for Asian investors on Thursday.

The Indian stock market rose more than 3% on Wednesday, recovering half the decline on Tuesday. The Nifty 50 Index and the Standard&Poor's BSE Sensex Index of the National Stock Exchange of India are currently above Friday's levels, as previous election and final results have caused fluctuations.

The euro slightly strengthened on Thursday in the money market as the European Central Bank (ECB) will announce policy decisions, and traders believe that rate cuts are almost certain. The US dollar, on the other hand, fell due to the market's renewed bet that the Federal Reserve is expected to initiate an easing cycle this year. The euro rose 0.07% to $1.0876 as traders looked forward to the European Central Bank meeting later that day to receive guidance on the bank's interest rate outlook.

The Japanese yen recovered some of the previous trading day's decline and rose 0.4% to 155.50 yen against the US dollar.

Data shows that the expansion rate of business activity in the Eurozone reached its fastest pace in a year in May, as the growth rate of the service industry exceeded the contraction of the manufacturing industry. The Pan European STOXX 600 index rose 0.8%, while the MSCI Asia Pacific region's most extensive stock index rose 1%. However, the Nikkei index was again affected by the strengthening of the yen, and the Tokyo stock market fell 0.9%.

Regarding commodities, oil prices rose in early Asian trading on Thursday. The market expects the Federal Reserve to cut interest rates in September, and the market rebounds from the sell-off caused by increased US inventories and OPEC+supply plans. Brent crude oil futures rose 27 cents, or 0.34%, to $78.68 per barrel, while West Texas Intermediate crude oil futures rose 36 cents, or 0.49%, to $74.43 per barrel.

<div class="blog-details-info">
<div>Author:**Sherry S. & Icing**, Gate.io Researcher
<div>Translator:Joy Z.
<div class="info-tips">\*This article represents only the views of the researcher and does not constitute any investment suggestions.
<div>\*Gate.io reserves all rights to this article. Reposting of the article will be permitted provided Gate.io is referenced. In all cases, legal action will be taken due to copyright infringement.
</div>

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