Gm Nansen Explorers,
In this round-up, we dive into unshETH, analyze wallets that front run Binance listings, and share macro insights. Let’s dive in!
1. unshETH: Exploring Shared Liquidity and Trading Efficiency for LSDs
Osgur dives into unshETH, which aims to establish itself as the liquidity hub for LSDs by forming a shared liquidity pool for a diversified assortment of LSDs. The protocol simplifies access to liquidity for smaller-cap tokens and enhances decentralization of validators. The pool includes a governance-determined maximum weight for each asset, limiting the impact of any asset de-pegging. Unlike competitors Curve and Balancer, unshETH's basket promises superior risk-adjusted yields but introduces additional smart contract and governance risks. The platform uses two tokens: USH for incentivization and governance, and unshETH, representing the LSD basket. If unshETH gains sufficient traction, the resulting 'USH Wars' could create a high demand for the token. The overall success of unshETH depends on offering better swap rates for LSDs, overcoming competition, and progressing towards governance minimization and clarity on their tokenomics. While currently a risky proposition, if successful, unshETH could significantly contribute to the LSD market by mitigating monopolistic tendencies.
2. Binance Token Listings: A Look at Possible Frontrunning Activities
Yong Li identifies indications of potential frontrunning and insider trading related to Binance's token listings. This was established by analyzing wallets displaying suspicious trading activities, such as low transaction volume, layering of funds, and swift token sales post-listing. Some wallets were seen to accrue tokens before Binance's listing announcement, suggesting possible access to privileged information. Despite efforts to curtail such trading practices, these patterns still appear in recent listings such as SYN, GNS, and LQTY. By monitoring identified wallets with significant balances remaining, investors might be able to spot future opportunities.
3. On US and Chinese markets, and the recent crypto sell-off
The global macroeconomic picture is demonstrating late-cycle characteristics, with slowing growth and inflation. Policymakers' reactions will determine whether the outcome is a soft or hard landing. The US Fed is likely to pause further rate hikes for the year, but may not cut rates as early as bond markets suggest. Meanwhile, China has announced an easing package, hinting at more stimulus into 2024, potentially benefiting risk assets. Cryptocurrencies are trading within a range, pending a more accommodating US monetary policy. The divergence in the economic cycle is evident, with manufacturing verging on recession, while the services sector thrives, backed by household expenditure. Labor market indicators suggest a tight market with negative momentum, mirroring patterns before growth slowdowns in 2000 and 2007. In the coming months, tight monetary policy and reduced fiscal policy are expected. However, China's move towards growth-supportive policies may positively influence the crypto market. Aurelie shares her thoughts on the current macro environment and key data points to look at.
That's a wrap for this week! If there's anything you'd like to see in future issues, just let us know. Follow us on Telegram to get notifications when reports go live or head to our Research Portal to get more insights.