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Good Morning. I hope you’re doing okay on this downside. We’re in a full-blown price discovery mode, and it will only get more volatile if we get a decisive breakthrough above the $3T market cap. Don’t get shaken out.

In Today's Email:

• What Matters: $2B BTC ready to move 🔁 

• Case Study: Ethena’s Airdrop S2  🪂 

• Governance & Features: 600M DAI for USDe 💵 

You read and share. We listen and improve. Send us feedback at [email protected].

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WHAT MATTERS

$2.1B Silk Road Bitcoin Moved by US Government

State of play: A wallet owned by the US government transferred 30,175 Bitcoins, valued at $2.1B at the time of the transaction, to a Coinbase wallet on Tuesday.

• The US government seized about 50,000 Bitcoins from the Silk Road website in late 2022.

• The US government's last confirmed sale was in March last year when it sold 9,861 Bitcoins for $216M.

• Following the news, the value of Bitcoin dropped further to below $65,000. It is now trading in the range of $66,195 to $65,450.

Why it matters: It might be a sign that the US Government thinks the current market environment is favorable and have enough liquidity from the demand side to absorb $2B worth of BTC selling.

For builders and investors: The BTC ecosystem, particularly around BRC-20 and Inscriptions, is a completely different planet that’s worth exploring. So many alphas there that haven’t been uncovered by the western crypto markets.

CASE STUDY

Should We Farm $ENA in Season 2?

Credits to Thor Hartvigsen for the original thread.

State of play: Ethena's $ENA was airdropped yesterday. On the same day, Ethena also announced the beginning of season 2, called the ‘Sats Campaign.’

Season 1 Reward. The Shard campaign lasted for 6 weeks and generated approximately 360B Shards (points) in total.

• The airdrop is valued at almost $600M, according to the price at the time of writing.

• Locking $10,000 USDe on day one yielded a ~$6,400 ENA airdrop, a 64% yield or 560% APY.

• Buying $10,000 YT-USDe on Pendle at launch led to ~$80,000 in ENA today, an 802% return or 6989% APY.

Season 2 Won’t be as Crazy as Season 1. Season 2 will run for 153 days unless the 5B supply is hit before the deadline. With 1.5B current USDe supply, 3.5B 'Sats' will be farmed.

• Assuming 15 shards earned per $, the total will be 8T Sats by September's end.

• If 5% of supply is allocated to S2 and $ENA's FDV is $12B, a $20,000 deposit will earn a 20x daily boost resulting in 61M Sats in 153 days.

• 61M Sats will be worth ~$4,571 in $ENA or equal to a 22.86% return or 54.68% APY.

Pendle’s USDe Pool on Mantle

• Pendle's USDe pool on Mantle will be live for 113 days. Currently, it has ~5x leverage but is expected to reach 10x within 24 hours.

• With similar assumptions as above, the return is estimated to be $33,000 in $ENA, a $13,000 gain on an initial $20,000, resulting in a 68% yield or 223% APY.

Take a peek at our referral reward at the bottom of this issue. Share this newsletter and receive our list of 500 crypto VC individuals 👇

INSIGHTS

Upbit’s Trading Volume Down 75% on Monday

Upbit, South Korea's largest CEX, saw a 75% drop in daily trading volume from this year's peak on Monday, indicating a slowdown in altcoin trading and potential valuation challenges for digital assets beyond bitcoin and ether.

• Upbit only registered ~$3B of volume on April 1st.

• Upbit's volume spiked in two weeks before March 5, fueled by Bitcoin's climb above $70,000 and Ethereum's Dencun upgrade.

• At its peak, trading on South Korea's crypto exchanges even exceeded local stock market activity.

• South Korean crypto enthusiasts prefer altcoins over bitcoin and ether.

• According to an October DeSpread Research study, Upbit investors seek high returns from altcoins despite their risks.

FEATURES & GOVERNANCE UPDATE

MakerDAO $600M DAI Allocation to USDe

On Monday, a proposal to allocate 600M DAI into USDe and sUSDE was posted in the MakerDAO forum. Both USDe and sUSDe are issued by Ethena Labs.

• The proposal named Morpho Labs as the channel to allocate the 600M DAI into USDe and sUSDe.

• The proposal suggests capping allocation at 600M for now.

• USDe's supply of 1.34B tokens makes up 1.74% of the total Ethereum stablecoin supply.

Aave Chain Initiative through its founder, Marc Zeller, reacted to Maker’s proposal with a proposal to remove the collateral status of $DAI in Aave.

• The proposal aims to update the risk parameters for DAI by setting the LTV to 0% across all Aave deployments.

• It also aims to remove the sDAI booster from the Merit program.

• Marc Zeller stated that “DAI remains an onboarded asset that users are free to borrow.”

Other notable feature updates:

• Linear launches V2.

• BadgerDAO launches eBTC.

• MIMSwap goes live on Blast.

• AltLayer ALT staking goes live.

• Metaplex launches Core on devnet.

• Notional V3 goes live on Ethereum Mainnet.

QUICK BITES

• SEC Peirce denounces SAB 121.

• Crypto(.)com to launch in South Korea.

• GoldenTree sells its crypto arm to Republic.

• Binance taps board of directors for the first time.

• Celestia brings Blobstream solution to Arbitrum Orbit.

• US Government prepares to move $2B of Silk Road BTC.

• Paradigm is in talks of raising $750M for a new crypto fund.

• dYdX plans a legal entity in Cayman, scrapping the existing treasury.

• Coinbase & Circle challenge the Basel committee’s stablecoin requirements.

• Singapore widens crypto regulation, enhancing user protection requirements.

NOTEWORTHY READS & MEME

• Our Network’s read on liquid staking tokens.

• Andre Cronje’s read on Ethena’s risks.

• Eugene Ng Ah Sio’s read on tracking trading performance.

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Disclaimer: All the information presented in this publication and its affiliates is strictly for educational purposes only. It should not be construed or taken as financial, legal, investment, or any other form of advice.