🥂 Good morning, today is Monday, Dec. 12, 2022.

TL;DR

🔹 BTC, ETH remained stagnant as the outlook remained the same since Dec. 02. Notably, BTC’s volume surged on Sunday while that of ETH did not. Their correlations with equity indices were slightly down during the weekend but still nearly 90% higher since a week ago.

🔹 Last Friday, US PPI revealed higher-than-expected producer prices which dragged down US equities. Monday, equity futures point to a weak Asian opening amid cautions ahead of consumer prices data Tuesday, FOMC interest rate hikes Wednesday, and ECB and UK interest rate hikes Thursday.

🔹 The topic of the Day: Did Yuga Labs Conspire With Justin Bieber and Madonna?

🔹 Happenings of the Week: The Bank of England is seeking a proof of concept for a sample wallet for a CBDC; Chinese authorities have arrested 63 people in association with a massive crypto money laundering scheme; A report by WSJ raised red flags in Binance’s proof-of-reserves; Coinbase is offering free swaps from Tether’s USDT to USDC…

As of Dec. 11 23:04 UTC,

⚡️ Bitcoin (BTC) 24-Hour Change: 17,115 (-0.03%)

⚡️ Ether (ETH) 24-Hour Change: 1,265 (-0.37%)

Producer Prices Higher Than Expected, Consumer Prices Due Tuesday Ahead of Interest Rate Hikes

During the weekend, Bitcoin and Ether remained practically unchanged since last Friday, although notably, BTC’s volume on Sunday surged quite a bit which implied buyers and sellers were struggling to move its price in either direction. For this week’s technical outlook, which remained essentially unchanged since Dec. 02, scroll down to the technical analysis section of this article.

On Friday, PPI revealed that US producer prices increased by more than forecast in November as final demand rose 0.3% for a third month and was up 7.4% from a year earlier. The data incited a late-day slide in US equities which shattered the calm that prevailed throughout most of the trading session, with the S&P 500 closing near the day’s lows. The S&P 500’s correlations with BTC and ETH stood at 0.07 and 0.15, though down slightly during the weekend, were up from -0.71 and -0.62 a week ago.

Monday, equity futures indicated likely declines to come for Asian markets, at the start of a pivotal week with interest rate decisions due from the Federal Reserve, the European Central Bank, and a host of their peers.

Recession fears have resurfaced ahead of CPI data Tuesday and the Fed decision Wednesday when policymakers are expected to downshift to a 50 basis points hike. The ECB follows on Thursday, with consensus estimates for it to also deliver a 50 basis points hike. On the same day in the UK, the BOE is expected to raise rates to between 4% and 4.5% as inflation was last seen at 11.1%, more than five times the BOE’s 2% target.

P.S. If you’d like us to cover any specific macro data, or to expand upon technical analysis on your favorite coin, feel free to drop a message in our Reddit community. - Peter L.

💡 Today's Markets at Dec. 11 22:54 UTC

BTC -0.10%; Ether -0.47%.

Asia: Japan +1.19%; Hong Kong +2.32%; China +0.30%; India -0.61%.

Europe: London -0.27%; Paris +0.46%; Frankfurt +0.74%.

US Spot Indices: Dow -0.90%; S&P -0.73%; Nasdaq -0.70%.

US Index Futures: Dow -0.18%; S&P +0.06%; Nasdaq +0.32%.

US Two-year Treasury up 4bps at 4.353%.

US Ten-year Treasury up 10bps at 3.584%.

UK Ten-year Government up 10bps at 3.185%.

US Dollar Index +0.1% at 104.58.

FX in 24hrs: GBP: +0.19%; EUR: -0.18%; JPY: -0.02%; CNY: +0.13%.

Gold +0.48% at 1,796; Brent Crude -1.39% at 76.10.

🧠 Catalysts this week

• Monday: UK GDP, Australia Westpac Consumer Confidence Index
• Tuesday: Australia NAB Business Confidence, UK Unemployment Claimant Count, Germany ZEW Economic Sentiment Index, US Inflation Rate, Japan Tankan Large Manufacturers Index
• Wednesday: UK Inflation Rate, UK PPI, US Fed Interest Rate Decision, US FOMC Projections, US Fed Press Conference, Japan Balance of Trade
• Thursday: China Industrial Production, US Retail Sales, US Jobless Claims, ECB Press Conference
• Friday: UK GfK Consumer Confidence, UK Retail Sales

🏦 BTC

BTC Weekly timeframe:

• Major Level: 13,965 (Monthly High of Jun. 2019)
• Closest support zone: 17,090 - 16,880
• Key resistance zone: 17,175 - 17,450

Analysis as of Dec. 12 - Dec. 18 Session.

Note: This weekend has been another stagnant one. The price of BTC, as expected, remained unchanged since Friday, though the weekly volume has increased slightly in relative to last week. which implies traders are cautious ahead of this week’s US CPI data and FOMC interest rate hikes.

Since prices remained essentially unchanged, so do the S&R zones. In fact, the same S&R zones have been holding up since Dec. 02, which tells us both bulls and bears are unwilling to inject any more capital than necessary to pump/bring down BTC, perhaps until we have a clearer picture headed into Wednesday.

BTC Weekly Resistance zones

1. 17,175 - 17,450
2. 17,640 - 17,700
3. 17,815 - 18,025

BTC Weekly Support zones

1. 17,090 - 16,880
2. 16,690 - 16,430
3. 16,185 - 16,010

BTC Daily Timeframe:

• Closest support zone: 17,090 - 16,995
• Closest resistance zone: 17,175 - 17,205
• Key Level: 15,952 (Weekly Close Between Nov. 02 - 09, 2020)

Dec. 11 21:33 UTC Update:

Bitcoin (BTC) was trading at $17,150, or +0.18% in a 24hr period.

Note: At a closer glance at the daily timeframe, Sunday’s volume was quite notable. Even though the price of BTC remained essentially unchanged, the volume indicates there had been a struggle for supremacy between buyers and sellers.

For now, it would seem BTC was bound in a grid between $17,205 - $16,995. The economic data and changes coming from the US this week may be the catalyst we needed to change the outlook.

BTC Daily Resistance zones

1. 17,175 - 17,205
2. 17,370 - 17,450
3. 17,545 - 17,640

BTC Daily Support zones

1. 17,090 - 16,995
2. 16,875 - 16,635
3. 16,300 - 16,010

🌐 ETH

Weekly Timeframe

• Major Level - 757 (Monthly High of Dec. 2020)
• Closest support zone: 1,265 - 1,220
• Key resistance zone: 1,280 - 1,330

Analysis as of Dec. 12 - Dec. 18 Session.

Note: Likewise to BTC, the price of Ether struggled to advance, and decline, during the weekend. As of this writing, Ether was trading within the gap between the closest S&R zones and these zones have essentially been the same since Dec. 02.

ETH Weekly Resistance zones

1. 1,280 - 1,330
2. 1,345 - 1,390
3. 1,415 - 1,470

ETH Weekly Support zones

1. 1,265 - 1,220
2. 1,155 - 1,110
3. 1,060 - 1,035

ETH Daily Timeframe

• Closest support zone: 1,265 - 1,255
• Closest resistance zone: 1,280 - 1,300
• Key Level: 1,254 (Weekly close from Jan. 04, 2021 - Jan. 11, 2021)

Dec. 11 21:53 UTC Update:

ETH was trading at $1,265, or -0.18% in a 24hr period.

Note: Unlike BTC, Ether’s volume on Sunday was insignificant, which may actually be a good thing as it would imply traders are making their bets on BTC as US inflation data and interest rate hikes draw in closer. This isn’t to say Ether won’t be affected going forward, but the impact will be indirect than that of BTC when the events take place on Tuesday and Wednesday.

ETH Daily Resistance zones

1. 1,280 - 1,300
2. 1,310 - 1,315
3. 1,325 - 1,330

ETH Daily Support zones

1. 1,265 - 1,255
2. 1,245 - 1,220
3. 1,215 - 1,195

📌 Today's topic: Did Yuga Labs Conspire With Justin Bieber and Madonna?

What’s happening: A class action lawsuit filed Thursday alleges that a slew of celebrities—including Justin Bieber, Madonna, Steph Curry, and Paris Hilton—violated state and federal laws when they promoted Bored Ape Yacht Club NFTs while failing to disclose their financial relationships to Yuga Labs.

Zoom in: It details an elaborate alleged conspiracy, engineered by Hollywood’s elite, to boost the value of Bored Apes with a torrent of celebrity promotions—all while secretly enriching all involved via a covert payments scheme laundered through a prominent crypto company — Moonpay.

What they’re saying: “In our view, these claims are opportunistic and parasitic. We strongly believe that they are without merit, and look forward to proving as much,” a BAYC representative told Decrypt.

What makes it interesting: MoonPay, now valued at $3.4 billion, counts many of the suit’s celebrity defendants among its investors. Thursday’s suit argues that MoonPay was instead a “front operation,” which secretly passed payments from Yuga Labs—the $4 billion company behind BAYC—to celebrities who went on to promote the NFTs without disclosing their enrichment, at Guy Oseary—Madonna’s longtime representative’s direction.

What now: While courts have not yet ruled that so-called "blue chip" profile picture (PFP) NFT collections like BAYC constitute securities, an October report revealed that the SEC is investigating Yuga Labs over potential securities violations. The Thursday complaint also alleges that Bored Ape NFTs are unregistered securities.

Going forward: If proven, these allegations would further raise the bar for disclosure information.

👁 Happenings of The Week (Dec. 09 - Dec. 11):

📣 Notables

🔹 Congressional committee confirms SBF as FTX hearing witness on Tuesday, Dec. 13.

🔸 12.10: U.S. prosecutors are reportedly laying the groundwork for a potential fraud case against SBF. In other news, the former Alameda Research head Caroline Ellison hired a former crypto regulator at the SEC to represent her in an ongoing federal probe.

🔹 Chinese authorities have arrested 63 people in association with a massive money laundering scheme that allegedly laundered 12 billion yuan ($1.7 billion).

🔹 The European Parliament’s crypto ally Eva Kaili was arrested following corruption allegations. She has played a major role in shaping policy on crypto assets and blockchain since 2018.

🔹 The UK’s economic chief wants more investment in crypto businesses in the country and endorses work on a digital pound. The 30-point “Edinburgh Reforms” released on Friday morning is looking to vamp up the UK’s financial sector.

🔸 The Bank of England is seeking a proof of concept for a sample wallet for a CBDC and will take applications through Dec. 23. The budget range for the initial five-month contract is 200,000 pounds ($245,200).

📣 Dec. 11

🔹 According to accounting and financial specialists consulted by The Wall Street Journal, Binance's efforts to improve the transparency of its reserves also exposed red flags in the crypto exchange's finances, citing the report released by the audit firm Mazars lacks information related to the quality of internal controls and how Binance's systems liquidate assets to cover margin loans.

📣 Dec. 10

🔹 Grayscale Investments said the SEC has filed its first legal brief over the rejection of its application for a spot Bitcoin exchange-traded fund. In the 73-page response brief, the SEC argued its rejection was “reasonable, reasonably explained, supported by substantial evidence.” The SEC added futures and spot-based Bitcoin funds are "fundamentally different products.

📣 Dec. 09

🔹 German VC Picus Capital, known for backing startups such as Nested and Omni, launched picus.xyz, a new web3 investment arm. Picus Capital already backs web3 companies such as Spice, Stride and Arch.

🔹 The Block CEO Michael McCaffrey resigned after failing to disclose a series of loans from SBF’s Alameda Research. Chief Revenue Officer Bobby Moran named new CEO.

🔹 Several news outlets, including the Financial Times, The Wall Street Journal and The New York Times, have filed to unveil the creditors of collapsed crypto exchange FTX. FTX has more than 100,000 creditors, and the news organizations want their names, at least.

🔹 Three Arrows Capital co-founder Kyle Davies says it wasn’t luna that took it out, but FTX. SBF denied this happened, telling 3AC to focus on its own problems.

🔹 Bancor DAO mulls proposal for self-arbitrage bot to cover $26 million deficit. Bancor’s self-arbitrage bot will seek out opportunities in v3 pools.

🔹 Amber Group, a struggling crypto trading firm, owes around $130 million to troubled crypto lender Vauld's CEO Darshan Bathija.

🔹 Coinbase is offering free swaps from Tether’s USDT to its own USD Coin. The move follows a battle of words between Tether and some media outlets.

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

🔹 Digital collectibles company Forum3 raised $10 million in seed funding led by Decasonic. Forum3 is helping customers access digital collectibles and other web3 opportunities by removing friction, such as omitting the need for web3 wallets for customers to receive branded digital collectibles.

🔹 Crypto startup Outdefine has raised $2.5 million in a seed round co-led by Jump Crypto and TCG Crypto. Outdefine is a decentralized network that makes it easier for talent to find work through its hiring marketplace on Solana.

🔹 One-stop shop for NFT trading has raised $1.65 million in a seed round co-led by Infinity Ventures Crypto and Spartan Group. The firm aims to build an exchange that enables swaps and options on NFTs. It’s also launching ApeCoinStaking.io, a staking platform that combats geo-restrictions that some BAYC holders were facing when trying to stake their Apecoin.

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

🔹 Lending platform on Arbitrum — Lodestar Finance was exploited for about $6.5 million. The exploiter was able to successfully manipulate the exchange rate of the plvGLP token to 1.83 GLP per plvGLP — making it 83% more valuable than it should have been. Using the inflated tokens as collateral, the exploiter could then remove all available liquidity on Lodestar Finance through bad debt. The profits were bridged to Ethereum.