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Ethereum’s 24hr Liquidations at $140M Exceed Bitcoin’s, Amidst Fears of stETH Depegging



Ethereum’s 24hr Liquidations at $140M Exceed Bitcoin’s, Amidst Fears of stETH Depegging


  • Ethereum’s 24-hour liquidations at $140 million have topped the list exceeding Bitcoin’s.
  • Ethereum has been hit by a sell-off that has seen the value of ETH drop to as low as $1,473.
  • The selling of ETH could be attributed to anxiety linked to the depegging of stETH on the various decentralized platforms such as Curve Finance and Lido Finance.

The number of liquidations related to the trading of Ethereum on the various futures platforms has exceeded that of Bitcoin.

At the time of writing, Ethereum liquidations in the last 24-hours have hit $140 million as highlighted in the following screenshot courtesy of Coinglass.com. Furthermore, the amount of Ethereum liquidations represent 35% of the total liquidations of $339 million in the last 24-hours.

Ethereum's 24hr Liquidations at $140M Exceed Bitcoin's, Amidst Fears of stETH Depegging 17
24-hour liquidations. Source, Coinglass.com.

Ethereum Hits a Local Low of $1,473

The liquidations related to Ethereum are a result of ETH hitting a local low of $1,423 earlier today. The local low is also around the $1,400 support level which is also close to Ethereum’s previous all-time high of $1,440 set in January 2018 during the 2017/2018 bull market. The daily ETH/USDT chart below provides a visual cue of the price action related to Ethereum.

Ethereum's 24hr Liquidations at $140M Exceed Bitcoin's, Amidst Fears of stETH Depegging 18

Also from the chart, it can be observed that the daily trade volume of Ethereum continues to be one of selling. This fact is further confirmed by the red histograms of the daily MACD. The daily MFI and RSI also confirm a downtrend for Ethereum with the earlier stated $1,400 price level acting as the last line of support before a plunge to the next available support around $1,274.

Anxiety Surrounding the Depegging of stETH Could be To Blame for Ethereum’s Woes in the Crypto Markets.

As to why Ethereum is experiencing a considerable downtrend, crypto-twitter is abuzz with observations that stETH is depegging on the various defi protocols such as Curve Finance and Lido Finance.

The depegging of stETH relative to the actual value of Ethereum was highlighted by the team at WuBlockchain through the following tweet. Further checking Curve Finance reveals that stETH is trading at 0.9607 ETH.

In the past 24h, ETH fell by 9.3%, and the liquidation amount reached $179m. In contrast, Bitcoin fell just 2.5%. The price of StETH in the Curve pool is still de-pegged, because people thought Celsius may sell more STETH.

— Wu Blockchain (@WuBlockchain) June 11, 2022

Ethereum's 24hr Liquidations at $140M Exceed Bitcoin's, Amidst Fears of stETH Depegging 19
stETH depegging on Curve Finance. Source, Curve.fi/steth.

stETH Depegging Could Be Causing Inaccurate Comparisons with UST’s Depeg Event in Early May

The depegging of stETH could be creating flashbacks of UST’s depegging early last month, as explained through the following statement by crypto-twitter community member @ChainLinkGod. He said:

The TerraUSD collapse really got people paranoid and confused Equating $stETH is $UST is illogical at a fundamental level.

One is a fully collateralized derivative of a staked token, the other was an undercollateralized ‘stablecoin’ Don’t confuse illiquidity with insolvency.

Similarly, the co-founder of Three Arrows Capital, Su Zhu, also believes there is no need to panic as stETH is backed with actual Ethereum. His analysis of stETH can be found in the following tweet.

Most of the steth fair discount analysis ive seen misses that from an onchain functionality perspective, steth is nearly pari passu w eth functionality in defi

It is the most sound source of native protocol yield on Ethereum

This makes it an attractive part of an eth-denom port

— Zhu Su 🔺 (@zhusu) June 12, 2022

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CoinFlex Will Issue $47M Worth of “Recovery Tokens” After Withdrawal Freeze



CoinFlex Will Issue $47M Worth of “Recovery Tokens” After Withdrawal Freeze
  • CoinFLeX will issue recovery tokens to help fund customers’ withdrawals.
  • The exchange had run into trouble after one individual’s accounts went into negative equity, resulting in the halting of withdrawals.
  • It will issue $47 million worth of the Recovery Value USD (rvUSD) tokens.

Futures crypto exchange CoinFLEX will issue recovery tokens called Recovery Value USD (rvUSD) as a solution to enable withdrawals again. The platform has suspended withdrawals as a result of market volatility, with some users even having a negative balance as a result.

$47 million of the rvUSD will be issued, and CoinFLEX hopes that this will help clear the outstanding debt from that one individual who had a negative balance. A whitepaper covers the details of the token, and there are several caveats to become an investor. The minimum subscription is 100,000 USDC.

The exchange aims to reopen withdrawals by June 30, but this will be subject to receiving funds for the rvUSD issuance. CoinFLEX says that it has been speaking to large buyers and “believes there is significant interest in the terms presented.”

CoinFLEX also said that it plans to implement transparency measures going forward. Additionally, it will work on a new model of futures in direct response to the recent incident. Regarding the transparency, CoinFLEX said,

“The notional (USD) value of every account’s futures positions will be made publicly available via an external auditing firm that will attest to these futures positions every hour. We will also make available the margin (collateral) backing these positions in USD value and break down the collateral by type 1 (stablecoins), type 2 (highly liquid coins), and type 3 (low liquidity coins).”

Crypto Community Not Too Convinced About rvUSD

The crypto community’s response to CoinFLEX’s rescue method has been ambivalent. FatMan, who has been known for his analysis of the Terra incident, called the move “amazingly degen.”

He summarizes the whole incident as the platform offering the individual a $47 million uncollateralized loan, turning his debt into a token while offering 20% APY on it. In other words, they are using this token to fund other customers’ withdrawals.

This may sound like something too good to be true — and that might very well be the case. Such unusual and potentially risky strategies will invite the attention of regulators like the United States Securities and Exchange Commission (SEC). That is the fear that some investors have, but it remains to be seen if this will actually play out that way.

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Crypto.com Removes 13 Crypto Tokens From Its Earn Program Including Shiba Inu, Dogecoin and Tezos



Crypto.com Removes 13 Crypto Tokens From Its Earn Program Including Shiba Inu, Dogecoin and Tezos
  • Crypto.com has removed 13 crypto tokens ,including Shiba Inu, Dogecoin and Tezos from its Earn program. 
  • The exchange has added Fantom, Ziliqa and Near to its Earn portfolio. 

Crypto.com, a leading cryptocurrency exchange, has decided to remove 13 cryptocurrencies from its Earn program. The exchange took to Twitter to share the update adding that it will be removing Doge, Shiba Inu, Tezos, and more from the program and will be adding Zilliqa, Fantom and Near to its Earn portfolio. 

Crypto.Com Has Removed 13 Cryptocurrencies From Its Earn Program

Crypto Earn is an initiative started by crypto.com to help users allocate their preferred crypto into the program to start accruing rewards. This would eventually help users expand their crypto assets by accumulating additional rewards in multiple cryptocurrencies. 

However, in an updated blog published earlier today, the exchange has decided to remove 13 crypto coins from its earn program including Doge, Shib, XTZ, MKR, EOS, OMG, FLOW, KNand C, ICX, COMP, BIFI, ONG, GAS, STRAX, and BNT. However, the exchange will also be adding three new tokens to its earn portfolio, i.e Zilliqa, Near, and Fantom. Per the updated blog post, users will be able to earn 5% rewards on FTM, and 6% rewards on ZIL and NEAR. 

“Effective from 27 June 2022, 10:00 UTC, we will be adding new tokens to Crypto Earn. Users can now enjoy rewards rates of up to 5% p.a. for FTM, and 6% p.a. for ZIL and NEAR.”

Crypto Community Reacts To Crypto.com’s Removal Of 13 Tokens. 

The response to crypto.com’s decision to remove 13 crypto tokens was mixed with multiple users expressing their discontentment on Twitter. Some users opined how the current crypto staking percentages are similar to the modern-day banking rates. 

Reduction of interest rates on stable coins again… no point holding them in your app. Get similar interest in a bank

— will (@WJB2201) June 27, 2022

While others responded that they were particularly unhappy about the exchange’s decision to remove Doge and Shib from its platform.

Why no more Shiba and Doge staking?

Are you trying to get people to leave your platform?

That was the reason I even started a CDC account!

— M42boost (@m42boost) June 27, 2022

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Ethereum’s Merge to Reduce Demand for GPUs, says Morgan Stanley



Ethereum’s Merge to Reduce Demand for GPUs, says Morgan Stanley


  • According to a Morgan Stanley analyst, demand for GPUs should reduce with Ethereum transitioning into a proof-of-stake network.
  • The crypto drawdown has further reduced the profitability of Ethereum mining.
  • However, the Ethereum mining community could venture into alternatives such as Ethereum Cash and Ravencoin.

Ethereum’s transition from a proof-of-work algorithm to proof-of-stake through the Merge of the Beacon Chain with the ETH mainnet could reduce demand for GPUs.

According to a research note by Morgan Stanley’s equity strategist Sheena Shah, the less energy-intensive proof-of-stake will reduce demand for GPU miners. In addition, the crypto drawdown in the markets has also resulted in reduced profits for Ethereum miners, further eliminating the need for GPUs. The note said:

and Ethereum currently require powerful computers for the mining process and consume a lot of energy which governments and regulators are increasingly concerned over. If Ethereum moves to using Proof-of-Stake (PoS) it will eliminate the need for miners (reducing demand for GPUs) and drastically reduce energy requirements.

Ethereum Miners Could Find Alternatives in Ethereum Classic and Ravecoin – Bloomberg.

However, in another analysis by Bloomberg in mid-June, it was forecasted that Ethereum miners would probably keep mining till the Merge occurs later this year. Furthermore, some miners considered transitioning their Ethereum miners to mine Ethereum Classic or Revencoin.

The team at Ethereum Classic has already started enticing existing Ethereum miners by requesting that they plan their migration to ETC before the Merge occurs. They further emphasized that Ethereum Classic was more than able to handle the abandoned Ethash hashrate. They explained:

This Merge event will disenfranchise the largest EVM’s Proof of Work mining ecosystem. Ethereum Classic is well positioned to absorb much of this abandoned Ethash hashrate.

However, Ethash miners might not realize that Ethereum Classic operates a modified version of Ethash called ETChash.

The Ethereum Classic team also pointed out that the Thanos Upgrade in November 2020 slowed the hashrate of the DAG. This, in turn, ‘has allowed GPU miners to operate their equipment longer on ETChash than Ethash.’ They added:

New ETChash miners will find comfort in knowing that Ethereum Classic made a long-term commitment to Proof of Work consensus through the network’s Die Hard Upgrade in 2018.

If you’re new to the ETC mining ecosystem, you’ve found a long-term home on Ethereum Classic. A battle-tested network where you can properly plan your mining business’ capital and operational expenditures around a predictable monetary policy and stable network that is widely integrated throughout the cryptoverse.

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