🟣 Support broken, now what?

Bearish momentum and sentiment takes over

Author

Macauley Peterson
July 05, 2024

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Welcome back to 0xResearch. Here's what we’ve got for you today:

  • Supply or perceived supply

  • Particle Network, universal accounts

  • All Core Devs: Goodbye Goerli hello account abstraction

  • CT: Where are we now?

The tech-heavy Nasdaq continues to soar to new all-time highs, and even gold and other metals are performing well, yet bitcoin is in the red.

The $60,000 support was smashed — and the charts looked even bleaker 8 hours ago, when BTC drifted below $54,000.

What gives?

Between the German government and Mt. Gox a decent chunk of corn has been hitting the public markets — or at least panicking traders into thinking it might.

It remains to be seen how much of the supply previously locked in bureaucracy and bankruptcy will be ultimately be sold, and if the bitcoin ETF flows can pick up the slack. Flows have turned positive after the July 4th holiday, so there’s that.

Particle Network looks for allies

A fragmented rollup ecosystem not only hampers adoption and user experience but also results in redundant development, misaligned incentives, and wasted resources. Chain abstraction offers a potential solution, in theory, but it’s not clear what specific technologies to rally around.

Particle Network is taking a shot, with its Universal Accounts — currently live on testnet — and the Chain Abstraction Coalition.

Universal Accounts are created via an existing wallet or social login and use the Ethereum account abstraction standard, EIP-4337, to allows users to experience one account and balance across multiple blockchains without jumping through too many hoops.

The Chain Abstraction Coalition touts Arbitrum, Avalanche, Berachain, BNB Chain, Botanix and Linea among its ranks so far, all of which are expected to participate in “Co-Testnets,” aimed at gradually introducing chain abstraction to audiences.

Particle Network, founded in May 2022, recently secured $25 million in funding for its focus on simplifying and enhancing the Web3 experience through chain abstraction.

Goodbye Goerli

Thursday’s ACD call participants bid adieu to the Goerli one last time, reminding the world that Ethereum clients either having already dropped support or planning to do so soon.

The call focus was on hashing out changes to the EIP-7702 proposal, slated for Devnet-2 and discussing what small improvements could still be inserted to the Pectra upgrade.

One likely candidate, a change to make it easier to use your mobile phone as a hardware wallet.

— Macauley Peterson (X: @yeluacaM | Farcaster: @Macauley)

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Government dumpoooors get Gox’ed:

H/T Blockworks News editor David Canellis for this one.

After years of fud, this time the Mt. Gox bitcoin may really be coming liquid over the next 90 days. An initial transfer of 1,545 BTC hit the block explorers Friday morning.

An hour later, Germany sent more of its bitcoin stash to exchanges. That double whammy took BTC down below $54,000 for the first time since February.

Build on Bitcoin (BOB) marries Bitcoin security with the OP stack to create an EVM environment for Bitcoin applications.

Stablecoins have proven their product-market fit by effectively enabling DeFi as a financial system. Ethena is highly relevant as it strives to disconnect TradFi systems from DeFi and offer a capital efficient crypto-native synthetic dollar. USDe has reached a $3.5 billion TVL in only three months and is now the fourth largest “stablecoin” by market cap.

As devnets make progress, fears of overloading the next hard fork creep in.

he Mt. Gox repayments are finally here, whether the market is ready or not.

The insights, views and outlooks presented in the report are not to be taken as financial advice. Blockworks Research analysts are not registered broker/dealers or financial advisors. Blockworks Research analysts may hold assets mentioned in this report, further outlined in the Firm’s Financial Disclosures.