Cryptocurrency Market Performance

Currently, the total market capitalization of cryptocurrencies is $3.4 trillion, with BTC accounting for 56.33%, which is $1.92 trillion. The market capitalization of stablecoins is $205.8 billion, with a 7-day increase of 0.27%, of which USDT accounts for 66.79%.

This week, the price of BTC has shown a fluctuating upward trend, with the current price at $97,905; ETH has also shown a fluctuating upward trend, with the current price at $3,586.

Among the top 200 projects on CoinMarketCap, most have declined, and a small portion have increased, including: ZEREBRO with a 7-day increase of 90.02%, SPX with a 7-day increase of 62.36%, DEXE with a 7-day increase of 46.87%, and FARTCOIN with a 7-day increase of 64.64%.

This week, the net inflow of the US Bitcoin Spot ETF was $255.3 million, and the net outflow of the US Ethereum Spot ETF was $72 million.

The "Fear & Greed Index" on January 3 was 73 (lower than the previous week), and the sentiment for the past 7 days has been Greed.

Market forecast: After Christmas, the liquidity of the cryptocurrency market has begun to recover, and the overall market has shown a fluctuating upward trend this week, with the AI Agent sector seeing larger gains. However, the inflow of ETFs has been general, and the increase in stablecoins has been small. The Federal Reserve is most likely not to cut interest rates in January, and the market is expected to continue to warm up next week, but it will take time to see explosive growth. This week, the focus can be on the AI and Desci sectors.

Understanding the Present

Review of the Week's Major Events

1. On December 28, Nick Timiraos, a renowned journalist at The Wall Street Journal known as the "Fed whisperer," wrote that the Federal Reserve is trying to re-evaluate the impact of the Trump administration's new policies on the US economy and inflation. The market generally believes that the Federal Reserve's future interest rate cuts may be slower, fewer, and more cautious. The uncertainty about the Federal Reserve's interest rate cuts by 2025 is rising, and investors not only face the possibility of the Federal Reserve temporarily suspending interest rate cuts for a period of time, but also the turmoil that the Trump administration's new policies may bring.

2. On December 30, a lawsuit filed by Blockchain Association, DeFi Education Fund, and Texas Blockchain Council, supported by a16z Crypto, claimed that the US Internal Revenue Service and the Treasury Department have exceeded their statutory authority, violating the Administrative Procedure Act (APA) and the Constitution. DeFi builders should be confident that industry lawyers are working to protect this technology.

3. On December 30, Chris Burniske, a partner at Placeholder, posted on X that "while BTC is playing with fire, ETHBTC, SOLETH, and SOLBTC are still performing well. This makes me think it's not a weakening of market risk appetite, but more likely driven by year-end liquidity factors, as people are squaring their books for 2024."

4. On December 31, according to GitHub data, the autonomous agent framework Eliza developed by the a16z team ranked first on the GitHub trending list in December, with 4,531 new stars added this month, accumulating a total of 7,015 stars.

5. On January 3, Aave founder Stani Kulechov tweeted that the team will release innovative contracts on the modular social networking protocol Lens Network. This includes features such as social (expanded feeds, groups, charts, username rules), ICO/crowdfunding, ERC20 New flavour, Novel bonding curves, new ERC721 contracts, governance, reward systems, and yield programs. All content will be open-source and freely available for users.

6. On January 3, the cryptocurrency prediction platform Polymarket previously stated that the likelihood of a Solana ETF listing in the US by 2025 is around 77%. VanEck research chief Matthew Sigel said this prediction "is underestimated." In June 2024, VanEck and competitor asset manager 21Shares sought approval from US regulators to list a physical Solana ETF. In November last year, shortly after Trump's victory in the US presidential election, Matthew Sigel said the likelihood of the US approving a SOL ETF by 2025 is "very high".

7. MicroStrategy, Tether, and CleanSpark have purchased additional Bitcoin.

On December 30, MicroStrategy acquired 2,138 BTC for approximately $209 million, at an average price of $97,837, and realized a 47.8% BTC gain for the quarter and a 74.1% BTC gain year-to-date. As of December 29, 2024, MicroStrategy holds 446,400 BTC, with an average cost basis of $62,428 and a total cost of $27.9 billion.

On December 31, the CleanSpark Cold Wallet withdrew 3,158 BTC from the Coinbase Prime Deposit for $293.39 million, and currently holds approximately 9,907 BTC in total.

Tether has withdrawn the 7,628.9 BTCUSDT it purchased this quarter from Bitfinex. Tether currently holds a total of 82,983 BTC ($76.8 billion), making it the 6th largest BTC wallet address. Its average purchase price is around $36,222, with an unrealized gain of $47.2 billion.

Macroeconomic Factors

1. On December 28, Nate Geraci, president of ETF Store, posted on social media that Volatility Shares has filed with the US Securities and Exchange Commission for an ETF based on Solana futures, covering 1x, 2x, and -1x leverage exposures. Solana futures contracts are only traded on exchanges registered with the Commodity Futures Trading Commission.

2. On December 30, according to Cointelegraph, former German Finance Minister Christian Lindner called for Bitcoin to be included in the reserves of the European Central Bank and the German Bundesbank.

3. On December 31, according to CME's "Fed Watch" data, the probability of the Federal Reserve cutting interest rates by 25 basis points in January 2023 is 11.8%, and the probability of keeping rates unchanged is 88.2%.

4. On January 2, Goldman Sachs released a report stating that its forecast for Federal Reserve interest rate cuts this year has been reduced from 100 basis points to 75 basis points, and its report on the rebound in core inflation has been greatly exaggerated.

5. On January 3, ECB Governing Council member Stournaras said that the ECB's interest rates are expected to be lowered to 2% by this fall.

6. On January 3, the reserves of the US banking system are a crucial factor for the Federal Reserve in deciding to continue reducing its balance sheet. The reserves declined to around $2.89 trillion in the week ending January 1, falling below the $3 trillion mark and reaching the lowest level since October 2020.

ETFs

According to statistics, during the period from December 30 to January 3, the net inflow of the US Bitcoin Spot ETF was $255.3 million; as of January 3, GBTC (Grayscale) has a total outflow of $21.473 billion, currently holding $20.17 billion, and IBIT (BlackRock) currently holds $54.306 billion. The total market value of the US Bitcoin Spot ETFs is $113.567 billion.

The net outflow of the US Ethereum Spot ETF was $72 million.

Envisioning the Future

Upcoming Events

1. a16z GAMES will hold the SPEEDRUN 004 accelerator program in San Francisco from January 6 to March 23, 2025.

2. METAVSUMMIT will be held in Dubai, UAE on January 7-8, 2025.

3. Move DevCon will be held in Shenzhen on January 11, 2025.

4. CoinDesk will host Consensus Hong Kong from February 18-20, 2025 in Hong Kong.

Project Progress

1. The pre-sale date for the BNB Chain AI agent protocol BAD is January 6, 2025, and Floki will support the launch of the BAD protocol on the BNB Chain, with 35% of the tokens to be airdropped to the Floki ecosystem.

2. The Synthetix Base LP incentive program will continue until January 7, rewarding liquidity providers (LPs) on the Base chain with 80,000 SNX and 100,000 USDC.

Token Unlocks

1. Kaspa (KAS) will unlock 182 million tokens on January 6, worth approximately $21.39 million, accounting for 0.72% of the circulating supply.

2. Ethereum Name Service (ENS) will unlock 1.46 million tokens on January 7, worth approximately $54.66 million, accounting for 1.46% of the circulating supply;

3. GMT (GMT) will unlock 92.22 million tokens on January 9, worth approximately $14.99 million, accounting for 1.54% of the circulating supply;

4. Cheelee (CHEEL) will unlock 11.66 million tokens on January 10, worth approximately $95.26 million, accounting for 1.17% of the circulating supply.