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Weekly Market Highlights - 26 August, 2022

Binance Research
2022-08-26 09:15
Happy Friday! The Weekly Market Highlights is an initiative from the Binance Research team to round up the week, summarizing key market events and views from the team.
🔎 Macro / Tradfi
  • U.S. Fed chairman Jerome Powell will speak on Friday morning EST at the Federal Reserve’s annual Jackson Hole, Wyoming, symposium. Fed watchers expect from Powell a tougher and more hawkish version of the Central Bank’s promise to slow inflation by raising interest rates. Probability of a 0.75% rate hike has increased over the past week - traders are now pricing a 62.5% chance of a 0.75% hike in Sep.
  • Power prices rose to records around Europe. To date, European gas prices have surged almost 40% this month and nearly 300% this year. The energy crisis further haunts the Euro as it tumbles to a 20-year low against the dollar. Concerns among investors are growing as the U.S. Central Bank seems to be laying the ground for more aggressive rate hikes than previously anticipated.
🔎 Crypto
  • The Ethereum Merge now has a confirmed activation date. The Bellatrix upgrade will activate on September 5, and the Merge itself will be completed between September 10-20. Meanwhile, Ethereum 2.0 client Teku has released version 22.8.1, which includes required upgrades for all mainnet users. We observe a weakening correlation between ETH and equities, which might imply that the Merge is driving ETH prices, causing a decoupling of ETH and stocks.
  • Most trades today are still conducted on centralized exchanges. The DEX/CEX ratio rose from 6.8% to 15.3% in 2021 but has declined from its peak of 16.5% in January 2022 to 13.0% in July 2022. The year-to-date fall is likely contributed by an overall decline in DeFi activity this year. Nonetheless, the DEX/CEX ratio today is still nearly double that of the beginning of 2021. More details can be found here.
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Binance Research
About Binance Research: Binance Research is the research arm of Binance, the world's leading cryptocurrency exchange. The team is committed to delivering objective, independent, and comprehensive analysis and aims to be the thought leader in the crypto space. Our analysts publish insightful thought pieces regularly on topics related but not limited to, the crypto ecosystem, blockchain technologies, and the latest market themes.
General Disclosure: This material is prepared by Binance Research and is not intended to be relied upon as a forecast or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities, cryptocurrencies or to adopt any investment strategy. The use of terminology and the views expressed are intended to promote understanding and the responsible development of the sector and should not be interpreted as definitive legal views or those of Binance. The opinions expressed are as of the date shown above and are the opinions of the writer, they may change as subsequent conditions vary. The information and opinions contained in this material are derived from proprietary and non-proprietary sources deemed by Binance Research to be reliable, are not necessarily all-inclusive and are not guaranteed as to accuracy. As such, no warranty of accuracy or reliability is given and no responsibility arising in any other way for errors and omissions (including responsibility to any person by reason of negligence) is accepted by Binance. This material may contain ’forward looking’ information that is not purely historical in nature. Such information may include, among other things, projections and forecasts. There is no guarantee that any forecasts made will come to pass. Reliance upon information in this material is at the sole discretion of the reader. This material is intended for information purposes only and does not constitute investment advice or an offer or solicitation to purchase or sell in any securities, cryptocurrencies or any investment strategy nor shall any securities or cryptocurrency be offered or sold to any person in any jurisdiction in which an offer, solicitation, purchase or sale would be unlawful under the laws of such jurisdiction. Investment involves risks.
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