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Distributed Ledger: Crypto crash: forced selling cools down; correlation with equities back in focus


Hello! Welcome back to Distributed Ledger, our weekly crypto newsletter that reaches your inbox every Thursday. I’ll walk you through what’s going on in the current bear market.

As usual, find me on Twitter at @FrancesYue_ to send feedback, or tell us what you think we should cover. You can also reach me through email to share your personal stories with crypto.

Crypto in a snap


lost 5.8% over the past seven days, trading at around $20,374 on Thursday, according to CoinDesk data. Ether

lost about 5.8% over the seven-day stretch to around $1,095. Meme token Dogecoin

gained 7.9% while another dog-themed token, Shiba Inu
went up about 23.3% from seven days ago.

Crypto Metrics

Biggest Gainers


%7-day return




Synthetix Network



Celsius Network









Source: CoinGecko as of June 23

Biggest Losers


%7-day return
















Source: CoinGecko as of June 23


Over the past weekend, a steep selloff sent bitcoin to as low as $17,601, before it rebounded to around $20,382 on Thursday. The plunge was largely driven by forced selling, according to Thomas Dunleavy, senior research analyst at Messari. 

The crypto market was in chaos after Celsius, one of the largest crypto lenders, paused withdrawals since June 12, while Three Arrows, one of the most active hedge funds in the space, reportedly failed to meet margin calls from several lenders, according to Financial Times. Investors were concerned about the contagion risks – I’ve written more about it here

During the recent selloffs, bitcoin and ether underperformed some smaller coins, which is “very unusual,” according to Dunleavy. Bitcoin and ether typically tend to outperform smaller coins during market downturn, as investors switch to the “flight to safety” mode.

The latest trend is “an indication that folks are just selling whatever they had to meet any sort of margin requirements,” according to Dunleavy. 

The market has since calmed down a bit, while “liquidity in terms of actual volumes which spikes during the sell off has also come down,” Dunleavy said. “I think the broader question right now is, as the crypto market contagion has kind of slowed down, if we’ll pick up the correlation with the stock market.”

“If macro trades down, will Bitcoin see another leg down? Or will we sort of hold the water here?” said Dunleavy.

SBF’s bailout?

Crypto billionaire Sam Bankman-Fried is injecting funds into two crypto companies that have been under the spotlight, after Celsius and Three Arrows showed signs of trouble. 

Celsius’s rival BlockFi announced Tuesday it had received a $250 million revolving line of credit from crypto exchange FTX to help bolster its balance sheet. BlockFi announced last week that it would lay off 20% of its employees, as the fast-changing macroeconomic environment weighs on the company’s growth rate.

Meanwhile, crypto brokerage Voyager Digital Ltd said its subsidiary Voyager Digital Holdings has entered into a definitive agreement to raise a $200 million cash and USDC revolver and a 15,000 BTC revolver from Alameda Ventures, the venture capital arm of Bankman-Fried’s quantitative crypto trading firm Alameda research. 

Voyager Digital Ltd. also revealed its subsidiary Voyager Digital LLC’s exposure to Three Arrows, including 15,250 bitcoin, or about $310 million based on the crypto’s recent price, and $350 million worth of the stable coin USDC. Voyager may issue a notice of default to Three Arrows for failure to repay its loan, the company said.

Short bitcoin ETF

ProShares on Tuesday launched its Short Bitcoin Strategy ETF, or BITI
the first inverse exchange-traded fund connected with bitcoin in the U.S. It arrived at a time when bitcoin is down roughly 70% from its all-time high.

BITI tracks the inverse of the daily performance of the S&P CME bitcoin futures index, according to the fund’s fact sheet. 

“BITI enables investors to conveniently obtain short exposure to bitcoin through buying an ETF in a traditional brokerage account,” ProShares’s chief executive Michael L. Sapir wrote in a statement Monday.

Still, like other inverse ETFs, BITI is designed to track the opposite of the underlying index over a single day. Investors who hold the fund for longer than one day may get returns worse than they expected, especially when volatility is heightened in the market. 

Crypto companies, funds

Shares of Coinbase Global Inc.

jumped 9.6% to $56.83 on Thursday, and they were up 11% over the past five trading sessions. Michael Saylor’s MicroStrategy Inc.

gained 4.9% Thursday to $179.20, and it was up 11% over the past five days.

Mining company Riot Blockchain Inc.

shares went up 2.9% to $4.74 Thursday, and were up 4.6% over the past five days. Shares of Marathon Digital Holdings Inc.

edged down 0.1% to $6.74, with a 2.8% gain over the past five days. Another miner, Ebang International Holdings Inc.
dropped 5.5% to $0.46 on Thursday, contributing to a 15.6% loss over the past five days. Inc.
shares traded up 5.1% lower to $31.19. The shares gained 11.4% over the five-session period.

Shares of Block Inc.
formerly known as Square, rose 8.6% to $65.89 contributing to a 14.6% gain for the week. Tesla Inc.

shares lost 1.7% to $696.48, while they were up 8.9% over the past five sessions.

PayPal Holdings Inc.

declined 0.3% to $72.78, and it was up 2.2% over the five-session stretch. Nvidia Corp.

shares dropped 1.9% to $160.46, looking at a 2.8% gain over the past five trading days.

Advanced Micro Devices Inc.

shares dropped 2.7% to $81.46 on Thursday, and were down 0.7% from five trading days ago.

Among crypto funds, ProShares Bitcoin Strategy ETF

rose 1.3% to $12.63 Thursday, while its Short Bitcoin Strategy ETF lost 1.4% to $40.73. Valkyrie Bitcoin Strategy ETF

edged up 1.3% to $7.85, while VanEck Bitcoin Strategy ETF

gained 0.7% to $19.75.

Grayscale Bitcoin Trust

was up 1.2% to $13.12.

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