Rapture #262: Market Commentary and Increased DOJ Involvement

Finally, we had some real market action. Today, the market effectively broke out to the upside of the range we have been in since December 16th. BTC now sits above $17,200 and ETH is around $1,300. While not a huge breakout for the entire market, there are some areas of the market that have been performing exceptionally well. Most of the major miner selling that I referenced in previous Raptures seems to have subsided, so this short term rally could have some legs. Not jazzed up enough to think the bear market is over... yet.

Additionally, the DOJ has gotten far more active in pursuing cases against the heroes of the last bull market. While some announcements of these cases have been publicly announced, there are others that touch upon alleged cases that are being built. If the rumors are true, the DOJ is casting an incredibly wide net in rooting out malfeasance in the crypto markets.

ETH staking related coins continue to outperform

I alluded in Rapture #263 to the fact that the ETH staking related tokens were receiving a bid in anticipation of the unlock happening likely in March 2023. Gasoline seems to have been poured on this fire trend over the past week.

LDO is now up more than 101% in the past fourteen days while SSV has risen more than 40% in the past two weeks. Part of the recent bullish action related to LDO can be explained by an insane short squeeze, as the market was extremely short LDO recently as can be seen by the extreme negative funding rates. Smaller Ethereum staking tokens are also experiencing positive price action. SWISE, the token that is tied to staking operator stakewise, is up almost 100% since fourteen days ago.

ETH staking related tokens continue to get the only major market action in liquid fungible tokens now that BONK hype has subsided.

If you are interested in comparing the major liquid staking tokens tokens related FDVs, Eth Staked, and other metrics, you should check out this google sheet maintained by @karl_0x.

If we get any sort of major significant relief in traditional markets that correlates with major digital assets, or a relief rally in crypto, these ETH staking related tokens could fly up into the unlock event, similar to how many of these same tokens significantly outperformed before the Ethereum merge event.

DOJ brings the heat

Yet the ETH staking tokens aren't the only ones bringing the heat. After FTX, it is open season  for the DOJ. For example, the NYAG recently sued former CEO of Celsius Alexander Mashinsky, to the surprise of no one. In Rapture #225, I talked about how Mashinsky was being sued by an ex partner who claimed Mashinsky transferred assets that were held by Celsisus to his wife's wallet. Seems that the NYAG decided they wanted to also pursue a case of Mashinsky defrauding his customers.

Additionally, the DOJ and SEC have recently opened investigations into DCG over inter company loans and money transfers.

There are even more rumors that DOJ/SEC is pursuing decisive and quick wins within the entire crypto lending and fund ecosystem, with "any and all desks in the cross hairs."

Some of the funds rumored to be under investigation are massive. I won't name names, but if you scroll through the tweet threads, you can find them.

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