Weekly Updates

Caddi Weekly Update - May 11th

Ethereum validators earn $46M in staking rewards rate surge. Binance Unveils Capital Connect Platform to Bridge Institutional Investors and Crypto Fund Managers. Crypto Whales Continue to Accumulate Pepecoin as Trading Volume Shifts to Binance.
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ETH Validation Rewards

Ethereum validators earned a record $46 million in staking rewards in the first week of May, as the staking rewards rate surged to a record 8.6% post-Merge. The increase is attributed to the recent memecoin craze surrounding Pepe (PEPE) and the rise in Ethereum network fees. Validators earned 24,997 Ether in the week, representing a 40% increase over the previous week.

The surge in fees has resulted in higher income for validators processing transactions on the Ethereum network, in addition to regular validator rewards. Validators are mandated to stake a minimum of 32 ETH, valued at around $58,000.

The staking rate signifies the expected annualized return for validators. ETH staking has been gaining significant interest from institutions since the network's move to a proof-of-stake consensus mechanism with the Merge in 2022, and following the recent Shapella upgrade enabling validator withdrawals for the first time.

Binance: The Tinder For Institutional Investors and Crypto Fund Managers

Binance has launched Capital Connect, a platform that connects institutional investors with crypto investment fund managers. The platform will provide information on assets under management (AUM), performance records, minimum investment amounts, and other important information. Binance VIP-level users, including brokers, hedge funds, family offices, and high-net-worth individuals, can access Capital Connect. The platform aims to make it safe and efficient for institutional investors to gain exposure to the crypto market. Once contacted, investment managers can review institutional client information before accepting a connection.

Over 20 funds have been listed, and Binance will continue to add more in the coming months. Binance VIP and Institutional Head Catherine Chen said that Capital Connect would create information disclosure standards for market participants with different investing and fundraising needs. Binance will enforce institutional Know-Your-Customer (KYC) and Know-Your-Business (KYB) standards to all interested parties but will not be involved in discussions or deals between investors and fund managers. During Q1 2023, Binance onboarded 8.3% more institutional clients than the previous quarter, while during 2022, the number of active institutional users rose by 65%, according to the exchange.

PEPE Volume Shifts to Binance

On-chain analytics tool Lookonchain reported that despite the nearly 50% drop in price, three whales have started to accumulate Pepecoin (PEPE) earlier this week. The coin has seen over $420 million traded in the past 24 hours as trading volumes have shifted from decentralized exchange Uniswap to crypto exchange Binance after the latter listed the tokens in its innovation zone last week.

In the past 24 hours, Binance saw over $160 million worth of pepecoin trading compared to $55 million on Uniswap. DEXTools data also shows that Pepe token holders have crossed the 100,000 unique holders mark on Tuesday, implying continual buying activity despite the price decline.

The shift in trading volume from Uniswap to Binance is likely due to more accessibility for retail traders and significantly lesser fees per trade on Binance, compared to an average of $35 per PEPE trade on Uniswap as of Wednesday. Despite the recent price correction, traders are adding to their holdings in a move that suggests bullish price action for the tokens in the coming weeks. As larger market participants are buying up the meme coin even as prices dunk, another leg up might be on the cards soon.

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