Narratives of the week : December 10
$BTC breaks $100k before dumping, XRP flips SOL, DeFi Renaissance, PEPE ATH
Welcome to this weekly recap, I am Viktor and you can find me here on Twitter and here on Telegram. Enjoy your reading !
$BTC and the market overall
The last edition of this newsletter was on November 26, when $BTC was making its local bottom at $91k. $BTC strongly bounced afterwards, and spent a few days consolidating around $96k while altcoins went crazy. BTC dominance reached a low below 55% on December 4.
BTC broke the $100k resistance on December 5, and it very quickly teleported to $104k. On the same day, it then managed to dump back below $100k, and then even to have a flash crash that wicked down as low as $91k on some exchanges. What was very strange was that altcoins barely flinched on that day, which suggested that altcoins were strong… Well, that has been an illusion for a few days, as $BTC went back above $100k and stabilized there, but it dumped significantly yesterday, along with the whole altcoin market.
$BTC dumped to $94k, and the altcoins had a giant dump too, with more than $1.5bn of longs liquidated yesterday. As I am writing, the dip has just been retested by $BTC, and altcoins dumped today as well. You don’t get a bull market with 0 pullback, it’s not comfortable of course, but make sure not to be over-levered and we should be fine.
Saylor has been buying every week since the Trump victory, and I expect him to continue doing so, since the MSTR premium to NAV has not been collapsing. He still has $9bn in ATM to continue buying, and by doing that he reduces the overall leverage of Microstrategy, which will enable him to issue convertible bonds later, and buy more $BTC with that.
Dino continuation : $XRP to $290bn FDV
Dino coins remained the strongest category in the market until December 3. $XRP has obviously been the most impressive one given its size, it flipped Solana market cap on December 1st, and 24 hours later, XRP market cap was… 50% higher than Solana ! $XRP topped at $2.9 on December 3, which corresponds to $165bn MC / $290bn FDV. That was absolutely insane, and I have a hard time thinking this was not the top. I think that if you size it properly (ie not too large), this is a great hedge short for the bull run, but be very careful with that, it might not be worth the headache…
The other dino coins have also had crazy pumps : $HBAR topped at $15bn mcap after an 8x in a month, $ADA topped at $46bn after a 4X, $ALGO pumped almost 6x, $XLM reached almost $20bn after a 7x, $IOTA 6x’d, $VET 4x’d…
$TRX also had a noticeable squeeze in a day, with its market cap going from $20bn to almost $40bn in a few hours before dumping -40%.
DeFi Renaissance ?
The category that benefitted the most from the rotation out of dino coins has definitely been ETH DeFi coins. It is not too surprising given the fact that dino coins pumping was a sign of “fundamentals” being important again. Normies and retail seem to actually like to buy the future of finance instead of random shitcoins, and DeFi is compelling in that regard.
$AAVE went up +80% in 2 weeks, $UNI pumped more than 2X, $CRV went up 5X from early November prices, 4x for $CVX, almost 4x for $SUSHI too.
What is noticeable is that most of the best-performing categories since the Trump victory have been categories that have also been the best hedge shorts for months if not years.
Metaverse coins fall into this category too, they have been underperforming since their late 2021 gigantic pump, but were among the top performers during the last weeks, and have had a new push in early December. $SAND went up almost 5x in a month, and has been the leader of ‘metaverse coins’ ($MANA, $GALA, $AXS).
The RWA narrative
Another meta that is a great candidate as a normie-friendly narrative is RWA, and we have indeed seen some strength coming from that category, and especially its leader, $ONDO. It went up 2x from bottom in November, and had another +50% push to almost $2 (ie $20bn FDV…) in early December.
One of the catalysts for the RWA narrative has also been the nomination of Paul Atkins as SEC Chairman by Trump. Paul Atkins was an advisor for Reserve Protocol, which is an RWA project, and this lead to a huge spike in $RSR price of almost 3x in a day, but it is now down -50% from ATH.
New ATH for $PEPE, memecoins still weak overall
Overall, memecoins have still been underperforming over the last 2 weeks, but there is a bit of dispersion on that front.
On December 2, Coinbase announced the listing of $MOODENG which at the time was $300M mcap, ie much lower than every memecoin listed on Coinbase. This logically propelled the price of MOODENG from $0.3 to $0.65 in a few hours, but MOODENG took a hit after that because Coinbase announced the listing of $MOG one day later, and then of $GIGA and $TURBO on December 4. $MOG performed very well in the days following its listing, as it reached a new ATH above $1.5bn market cap.
The other large cap memecoin that performed well and that reached a new ATH is $PEPE, it almost kissed $12bn mcap and is currently worth 2/3 of SHIB market cap (I expect PEPE to flip SHIB at some point).
$BABYDOGE is also on fire and had a +150% pump in three days after Elon Musk tweeted ‘Doge and MiniDoge’.
ETH touched $4000
$ETH has been able to reach $4000 in early December, but it ended up being a strong resistance, as we are already back to $3600. Overall, ETHBTC has been doing okay since Mid-November but 0.04 is now acting as resistance too.
Besides DeFi coins which can be considered as ETH-adjacent coins, there are a few other ETH beta coins that have been doing well : $EIGEN reached a new ATH at $5.2 after a 2x pump, $PUFFER reached a new ATH at $1 after a 3x, $ENS pumped +130% in a few days, $SCR is grinding up and standing at $1bn FDV, $LDO went up +145 from bottom to top in November and early December.
I particularly like $LDO at its current valuation, because it seems low to me.
What else happened in the altcoin market ?
HyperLiquid finally launched its $HYPE token on November 29, and it has been the largest airdrop in crypto history. It launched at $3bn FDV and reached $15bn FDV in less than 2 weeks. If you consider that it is a perp DEX, it is overvalued, and if you consider that it is an alt L1, it is almost undervalued. It is by far the most loved project on CT, and its price action has been impressive. The memecoins in the HyperLiquid ecosystem pumped hard too ($PURR, $PIP, etc)
The AI agent sector remains one of the hottest ones on-chain, especially on the infrastructure side, with $VIRTUAL pumping 3x in a week and reaching $2bn FDV, with $AI16Z coming back from its dump and reaching $700M mcap, and with $EMP pumping 7x in 2 weeks.
$ENA has been one of the strongest coins since early November, it pumped from $0.4 to $1.15. The funding rates have been very elevated in November, which means that USDe is giving away a high APR of over 25%, which means that more USDe get minted and it attracts more attention to $ENA, which is a great flywheel during a bull run.
On December 2, Fantom announced the block zero of the new Sonic network, which is the ‘new version of Fantom’. This did not result in a sell the news effect on $FTM.
$SUI reached a new ATH on December 6 at almost $45bn FDV. It seems very large to me, but the good thing is that it makes many other alt L1s look very cheap, and that is great for the catch-up trades.
$BNB reached a new ATH on December 4 and almost went to $800, ie $115bn market cap. Overall, it’s been weak vs the market since early November.
$CULT, the memecoin related to the Milady/Remilio community, finally launched this week, and it currently stands around $600M FDV. Don’t forget to claim your airdrop ASAP if you hold some of the NFTs, as there is only a 1-week window to claim.
Movement, which is a Move-VM (like Sui and Aptos) ZK-L2 on Ethereum, has launched its token $MOVE yesterday, and it is currently trading at more than $7bn FDV.
On November 27, a U.S. appeals court overturned the sanctions on Tornado Cash, ruling that immutable smart contracts aren't property under federal law. This lead the price of $TORN to almost 10X in a few hours, and it also had a positive effect on other privacy tokens such as $ZEC.
OpenAI has released Sora yesterday, and that was anticipated by the market via longs on $WLD or $LPT which performed well in the first days of December.
Thank you for reading this article,
Cheers,
Viktor.