Plasma Rockets to $5.5B TVL as XPL Flips Base

Plasma’s mainnet beta and XPL token launch made waves last week, so we’ll take a look at this new competitor, plus:

• ETH ETFs bleed: Spot funds saw major outflows last week.
• Is the 50-day EMA showing us where the HYPE price goes next?
• New approval standards at the SEC lead to ETF application changes.
• And which memecoin do you need to be holding as we enter Q4?

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Chart of the Day

This chart from Glassnode indicates that there is solid support for bitcoin to start a further move up as we head out of September and into Q4.

It shows the young supply MVRV, meaning it gives an idea of short-term holder realized price. And critically, the MVRV here has reset down to around 1, creating the conditions for a fresh move.

Additionally, you can see that the 135-day SMA is marked–a long-term support and resistance level–and price is currently holding above that line.

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Trade of the Day

Like many coins, HYPE is consolidating around its 50-day EMA. After hitting a fresh ATH near $59 a couple of weeks ago, it retraced sharply to $39 amid perps DEX competition from ASTER, and then bounced but was rejected off the EMA.

So, the 50-day is the level to watch. Holding above here gives a path towards $50, which then clears the way for a run back to ATHs. Failure to sustain above the EMA, however, brings a rollover towards $43 support–just below where it is now–and a breakdown below this would bring the $39 lows back into play.

Leaning bullish though, taking a long position above $45 with stops under $42 makes sense if the opportunity is there, with a price target in the $55 to $60 range if $50 is reclaimed.

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Alpha Leak

• DeFi protocol Falcon Finance, which issues the USDf synthetic stablecoin, yesterday launched its native token FF. This is a governance token, it’s now at a $2.1 billion FDV, and it will bring holder benefits when staked, as detailed in this thread from Falcon.
• Sonic Summit is taking place now in Singapore, just ahead of TOKEN2049. Look out for announcements around Sonic product drops, protocol updates, and potential partnerships.
• The testnet for Ethereum upgrade Fusaka goes live on October 1st on Holesky (Ethereum’s main testing ground). It raises block gas limits from 45 million to 60 million, meaning increased computation per block to improve scalability.
• On September 27th, Hyperliquid enabled permissionless quote assets, letting anyone launch perps markets with non-USD collateral, which could potentially be a massive unlock for custom markets.
• And sticking with Hyperliquid, on September 28th the protocol dropped 4,600 Hypurr NFTs, mostly to Genesis participants, with the rest to the Hyper Foundation and contributors. The floor price is currently at 1,114  HYPE (around $50,000), as the rewards keep coming for early Hyperliquid users.

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News Roundup

Plasma TVL Soars After Launch

There seems to be a new runner every weekend at the moment, and while perps DEX tokens like ASTER and AVNT were the dominant narrative last week, this weekend saw Plasma dominating crypto attention.

In short, Plasma is EVM-compatible, and is designed specifically for stablecoins and money movement, with backing from Tether CEO Paolo Aordino. The team has also teased Plasma One, a crypto-native neobank project.

Plasma launched both its mainnet beta and native token, XPL, last Thursday, and adoption has been immediate. The network is now the sixth-largest by DeFi TVL, flipping Base with over $5.4 billion locked in, although it’s only the 52nd ranked coin by market cap, at $1.9 billion, so there’s a mismatch between TVL and market cap.

With its focus on money transfers, Plasma is a direct competitor to Tron and Ripple, suggesting there is plenty of room for XPL to grow. That said though, XPL’s initial rally was hype-driven, and that price surge has now retraced sharply (likely due to airdrop receivers taking profits), so it looks like Plasma could be a long-term grower, although it may still need time to cool off and consolidate.

ETH ETFs Largest Outflow Week

Last week saw the largest ever outflows for the spot ETH ETFs since they launched last year, with $795.6 million leaving the funds. And at the same time, it was a negative week for the spot BTC ETFs too, which experienced outflows of $902.5 million, including $418.3 million on Friday.

However, it was a different story when it came to Solana, with a week of positive ETF inflows coming in for a total of $59.6 million. This figure is on a lower scale than those for the BTC and ETH funds, but keep in mind that this is just for one product–the Rex-Osprey SOL + Staking ETF–that only launched in July.

Also, there are more SOL ETFs in the pipeline, with products expected from Franklin, Fidelity, CoinShares, Bitwise, Grayscale, VanEck, and Canary. If these are able to launch soon–and there’s more on that below–then the timing could be perfect if Q4 is bullish for crypto.

ETF Filings to Be Withdrawn With New Standards Incoming

According to a post from journalist Eleanor Terrett, the SEC has told fund managers that previously filed to launch altcoin ETFs to withdraw their filings, and that includes applications for ETFs holding LTC, XRP, ADA, DOGE, and SOL.

However, don’t worry, this is not a throwback to the SEC’s Gary Gensler era when it opposed crypto, as the reason is that the SEC recently approved generic listing standards for “commodity-based trust shares”, which includes crypto products.

This means that there will be a straightforward framework in place making it quicker and easier for crypto ETFs to launch, and as such, the SEC will no longer require the kinds of filings that are now due to be withdrawn.

That said, at the moment there are no further details about how soon ETFs may be able to launch, but notably, ETF analyst Eric Balchunas now puts the odds of approval for altcoin ETFs at effectively 100%.

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Degen Play of the Day

If Q4 heats up, then memecoins will be part of the picture, and in that case, a top candidate to lead the charge is PENGU, which has been central to the memecoin meta this cycle.

You can see on the chart that it put in an explosive rally starting at the end of June and peaking in July, and has subsequently been in a downwards consolidation pattern for over two months, with a resistance line flipping to support but the trend lower continuing.

While it’s not clear exactly when this might rally into a strong uptrend again (and of course, it isn’t certain that it will), if you’re looking for a memecoin spot hold in anticipation of a bullish end to the year, then PENGU looks like a logical choice.

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Wealth Mastery (Lark Davis, and the Wealth Mastery writing team) are not providing you individually tailored investment advice. Nor is Wealth Mastery registered to provide investment advice, is not a financial adviser, and is not a broker-dealer. The material provided is for educational purposes only. Wealth Mastery is not responsible for any gains or losses that result from your cryptocurrency investments. Investing in cryptocurrency involves a high degree of risk and should be considered only by persons who can afford to sustain a loss of their entire investment. Investors should consult their financial adviser before investing in cryptocurrency.

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