Market Overview
Summary of the main market trends
1. The overall market has entered a wait-and-see phase
The market sentiment index dropped to 14.9%, a significant drop from last week's 41%, indicating that the market has entered a fear phase. BTC showed a strong rise at the beginning of this week, but then turned to volatility due to multiple factors. Altcoins performed weaker than the overall market, indicating that funds are still gathering towards BTC.
2. The DeFi ecosystem maintains its growth momentum
The TVL of DeFi in the entire network has steadily increased from 33.2 billion US dollars to 33.6 billion US dollars. The market size of stablecoins has expanded, and the market value of USDC has ended the downward trend in the previous three weeks and turned to an upward trend. The BTCFi track has performed outstandingly, and the increase in TVL of many projects has significantly exceeded the increase in BTC prices.
3. Track performance shows obvious differentiation
Meme coin led the gains, with a weekly return of 13.72%, mainly benefiting from improved market sentiment. Layer2 and GameFi performed the weakest, with weekly returns of -2.53% and -4.01% respectively.
4. The impact of macro factors intensifies
U.S. employment data and inflation indicators performed below expectations; technology stock earnings reports were generally lower than market expectations; the U.S. election and the Federal Reserve's interest rate meeting are approaching, and the risk of market volatility is increasing.
5. Capital flows present new characteristics
DeFi projects continue to attract capital inflows, especially BTCFi-related projects. The market share structure of stablecoins has begun to change, and USDC has stopped falling and rebounded.
Market Sentiment Index Analysis
The market sentiment index dropped to 14.9%, a significant correction from last week's 41%. Market sentiment is in a fear stage.
Altcoin did not follow the trend of the market this week. The market rose rapidly in the first few days of the week, and then fell after Wednesday as various macro data and financial reports were released. Altcoin did not follow the market's rise in the first half of the week, and fell sharply after Wednesday, resulting in Altcoin's trend being weaker than the market this week.
The market is currently in a neutral phase, and with the approaching US election, the market is subject to a high risk of volatility due to external factors. Altcoins will continue to fluctuate with the broader market, waiting for the direction of the broader market.
Overview of overall market trends
The cryptocurrency market is in a volatile upward trend this week, and the sentiment index has entered the fear stage, and a reversal may occur at any time.
Defi-related crypto projects performed outstandingly, showing the market's continued focus on improving basic returns.
The TVL of the BTCFi project in the Defi track also showed an upward trend this week following the rise of the broader market, and the trend was stronger than the performance of the broader market, showing that investors are optimistic about its future performance.
Hot Tracks
DeFi Track
TVL Growth Ranking
The top 5 projects with the highest TVL growth in the past week (excluding public projects with smaller TVL, the standard is more than 30 million US dollars), data source: Defilama
Merchant Moe (MOE) (Recommendation Index: 3 stars)
Project Introduction: Merchant Moe is the largest DEX on the Mantle chain. As part of the Trader Joe ecosystem, Merchant Moe aims to change on-chain transactions through its liquidity book protocol. It provides a comprehensive and user-friendly DeFi experience that enables users to conduct seamless transactions, discrete liquidity, and obtain real yield.
Latest development: Mantle issued tokens this week, and its token COOK was listed on Merchant Moe, launching the COOK/MNT liquidity pool. Users who trade in the COOK/MNT liquidity pool can get extra MOE as a reward. In addition, Merchant Moe conducted a voting activity this week. In order to encourage users to participate, veMOE users were given 63% APY, which attracted a large number of users to participate. In addition, with the rise of the market this week, on-chain trading activities have also become active. As the largest DEX on the Mantle chain, the trading volume on Merchant Moe has increased by 198%.
DeSyn Protocol（DSN）：（Recommendation index: 2 stars）
Project Introduction: DeSyn Protocol is a decentralized asset management platform built on the Ethereum chain, providing a full set of financial products to maximize the potential of investors' funds, including derivative synthetic assets, leveraged pledge ETFs, income-earning funds, RWA funds, and customized strategies, all driven by smart contracts.
Latest development: DeSyn Protocol has recently reached cooperation with multiple public chains, including Core and AILayer, to expand DeSyn's ecosystem and improve accessibility, and optimized and deployed Restaking products, integrated point rewards and automatic airdrop distribution, and repaired and updated the mainnet, solving key performance issues on the main network, thereby improving the stability and functionality of the platform. This week, DeSyn Protocol launched a joint mining S3 activity with Bitlayer. Users who deposit at least 0.000076 wBTC per day can get up to 25 BTR boxes and share $500,000 in DSN.
Bedrock (unissued): (Recommendation index: 4 stars)
Project Introduction: Bedrock is a multi-asset liquidity re-pledge protocol that obtains native token rewards through re-pledge while providing security for the ecosystem. Bedrock supports multiple assets for restaking and is supported by a non-custodial solution designed in cooperation with RockX. Bedrock uses its universal standards to unlock the liquidity and maximum value of tokens.
Latest development: This week, Bedrock launched the Epoch staking activity and increased the uniBTC limit on Etherum, BNB Chain, Arbiturm and Optimsim chains, while giving high rewards to users who participated in the activities on these four chains, including 84 Bedrock diamonds, Babylon points and 1.5 times Epoch points. At the same time, a pyramid scheme activity was launched on the chain. Users who invite people to participate in Restaking on Bedrock can earn 30% of all the diamonds they generate. In addition, new users will also receive an additional 30%. Due to the large increase in BTC this week, users are more enthusiastic about participating.
Aera (no token issued): (Recommendation index: 3 stars)
Project Introduction: Aera is a treasury management protocol that DAOs can use to deploy fund management strategies that grow with the market while also having downside risk. Developed by the team behind Gauntle, Aera enables DAOs to easily choose and implement long-term strategies for their treasury departments without the burden of complex governance, all with transparent on-chain reporting and the unique needs of non-custodial treasury DAOs designed around it.
Latest development: This week, Puffer Finance compounded interest through Eigenlayer programmatic incentives, in which a hybrid TWAP strategy was executed through the Aera Treasury to increase user returns. Compound voted to increase the use of the Compound Reserve Aera Treasury. The Treasury strategy will target risk-adjusted returns and aims to expand TVL by using idle reserve tokens (WETH, DAI, and USDC) in the Compound v3 market.
Pell Network (no token issued): (Recommendation index: 3 stars)
Project Introduction: Pell Network is the first project to provide crypto-economic security for all AVS through BTC re-staking. Pell Network achieves this goal by providing a decentralized token economic security leasing platform. The platform mainly serves Bitcoin holders and aggregates BTC and its liquid pledge derivative assets scattered on various Layer2 through Restaking technology.
Latest development: Pell Network recently received $3 million in seed funding from Halo Capital, Mirana Ventures and Paper Ventures. This week, Pell Network and BitBoy announced a partnership to bring classic games to BTC-related chains.
To sum up, we can see that the projects with faster TVL growth this week are mainly concentrated in the BTCFi track and the Defi track.
Overall performance on the track
The market value of stablecoins has grown steadily: USDT has increased from $125.6 billion last week to $125.9 billion, and USDC has increased from $34.4 billion last week to $34.9 billion, an increase of 0.23% and 1.45% respectively. The total amount of stablecoins in the market has remained the same, and USDC, which is mainly in the US market, has ended its three-week downward trend and turned to an upward trend.
Liquidity is gradually increasing: The risk-free arbitrage rate in the traditional market is constantly decreasing as interest rates continue to fall, while the arbitrage rate of on-chain Defi projects is constantly increasing due to the increase in the value of cryptocurrency assets. Returning to Defi will be a very good choice.
New growth point: In addition to traditional projects such as lending and DEX, Defi has added two powerful engines at this stage - LSD and Restaking projects of BTC and ETH.
Funding situation: The TVL of Defi projects has increased from $33.2 billion last week to $33.6 billion now, and has continued to rise in recent weeks, proving that funds are constantly flowing into Defi projects.
Deep analysis
- Driving force for the rise: The market as a whole has seen an overall rise this week, and Altcoins have also followed the upward trend, but the Defi track has shown a stronger trend than Altcoins, and still provides users with higher APY returns. The main reason is that market investors are still very optimistic about the future price trends of the two basic assets BTC and ETH, so they still hold them firmly, and the price of BTC has been rising recently, which has further increased the benefits brought to customers, so investors actively participate in various Defi projects to increase the benefits obtained when holding assets.
- Growth leader: For Defi projects, the growth of TVL is the most intuitive expression of it. This week, the underlying assets showed an upward trend. At the same time, we can see that the overall TVL increase of Defi projects is greater than the increase in the price of the underlying assets, so in fact, Defi projects have always been in a trend of capital inflow. Through the statistics of the project TVL increase list, it can be seen that the project with the largest increase this week is the BTCFi project in the Defi track. The essence of the BTCFi project is to guide users to deposit assets into its project, which helps users to find the most profitable underlying protocols in the market, and finally the funds deposited by users are transferred to various underlying protocols. Therefore, when investing in the near future, investors should pay more attention to the BTCFi project that issues LRT based on BTC.
BTCFi Track
Track status
This week, projects in the BTCFi track also rose due to the rise in market prices. In the entire BTCFi track, the liquidity pledge projects that pledged BTC to mint packaged assets LST performed the best. All projects had varying degrees of increase in TVL, and even the TVL increase of most projects far exceeded the price increase of BTC. Its performance in the BTCFi track is still a strong sub-track.
Current track conditions:
BTC rose 3.36% this week. After excluding the decline of BTC, the TVL of Bedrock, Lombard, Lorenzo, Pell Network, PumpBTC, Solv Protocol and Stakestone, which are projects issuing LRT based on BTC, increased by 58.53%, 7.85%, 46.26%, 42.32%, 4.11%, 8.81% and 1.02% respectively.
BedRock supports the use of wBTC to pledge to obtain uniBTC, and supports staking wBTC to obtain basic income. This week, Bedrock launched the staking activity of Epoch, and increased the limit of uniBTC on Etherum, BNB Chain, Arbiturm and Optimsim chains, and gave high rewards to users who participated in the activities on these four chains, including 84 Bedrock diamonds, Babylon points and 1.5 times Epoch points. At the same time, a pyramid scheme activity was launched on the chain. Users who invite people to participate in Restaking on Bedrock can earn 30% of all the diamonds they generate. In addition, new users will receive an additional 30% increase.
· Lombard allows users to stake Bitcoin through Babylon, and Lombard manages the re-staking process. Lombard launched the Luminary program, in which all newly staked BTC will receive double points. In cooperation with DeFi Vault, DeFi Vault provides LBTC with a stable annualized APY of 6%. Hourglass and Lombard launched joint mining, allowing users to obtain up to 162 times Lombard points by purchasing PYT.
After launching SAL, Solv Protocol actively cooperated with various ecological projects and Defi projects to access as much liquidity as possible. This week, Solv Protocol joined the core mining pool of Venus Protocol, and SolvBTC.CORE, which cooperated with Core, opened the second phase. The limit on Core is 500 BTC. Investors can earn 4% APY through liquidity on Core. In cooperation with Bera Chain, Bera fren was launched, which is a protocol that builds infrastructure around the proof of liquidity (PoL) mechanism pioneered by Berachain.
Lorenzo Protocol launched a staking campaign with OKX Web3 this week to provide 2 million Lorenzo points and a 20% multiplier on all Lorenzo base points earned to OKX Web3 wallet users, partnered with Bitlayer to host a Mining Gala, rewarding participating users with 1 million Lorenzo points, and partnered with Cygnus Finance to integrate stBTC into Cygnus’ full-chain liquidity verification system.
PumpBTC announced this week that it has completed a $10 million seed round of financing, led by SevenX Ventures and Mirana Ventures, with participation from well-known institutions such as UTXO and Mantle Ecosystem Fund, and has attracted attention from multiple projects such as Quantstamp and Veda.
Pell Network recently received $3 million in seed funding from Halo Capital, Mirana Ventures, and Paper Ventures. This week, Pell Network and BitBoy announced a partnership to bring classic games to BTC-related chains.
· Stakestone: It is expected to adopt a model similar to ETH-STONE, where users stake native Bitcoin to Babylon and mint yield-based STONEBTC for cross-chain liquidity. This week, Stakestone announced a partnership with Bitget Wallet.
In the entire BTCFi, the recent performance is relatively outstanding in various projects that issue LST based on BTC. For the BTCFi project, TVL is an important indicator of its prosperity. From the above data, it can be seen that with the rise in BTC prices this week, the TVL of the BTCFi project has also risen. This is mainly because users are more optimistic about the future development trend of BTC. Most investors believe that BTC should be held firmly at this stage, so that they hope to obtain more other benefits while holding BTC. Therefore, they deposit their own BTC into other protocols and package them into packaged assets to become LST tokens. At the same time, they use LST tokens to pledge in other projects to obtain more benefits, so that the BTC in their hands can achieve the effect of killing two birds with one stone. Therefore, from a medium- and long-term perspective, BTC has the conditions and space for rising, which has also become the basic driving force for the vigorous development of the BTCFi project. Therefore, the BTCFi track is worth considering for investment users.
Other track performance
Public Chain
The top 5 public chains with the highest TVL growth in the past week (excluding public chains with smaller TVL), data source: Defilama
BSquared: This week, BSquared collaborated with a number of projects, including Native Network, to enhance the capabilities of BTC-L2, achieve trust-minimized bridging, and aggregate liquidity across the entire BTC ecosystem through rapid finalization; at the same time, a strategic agreement was reached with Chainlink CCIP to make it BSquared's cross-chain infrastructure; and it collaborated with Up Network to develop an Android fork to attract more Web 2 users to BSquared.
Mantle: This week, Mantle issued the token COOK, which is used as Mantle's governance token. The previous MNT was used as the on-chain gas token. COOK was quickly launched on some CEX and DEX after its issuance, attracting some market attention for Mantle. At the same time, Mantle announced the issuance of a new LRT after mETH - cmETH, which is a permissionless and composable LRT that can further increase the returns of investment users. This week, Mantle and OKX Web3 jointly launched a Telegram mini-game activity to enhance its on-chain activities.
Core: SolvBTC.CORE opened its second phase this week, with a limit of 500 BTC on Core. Investors can earn 4% APY through liquidity on Core, and deposits in Core's dApps can earn 4 times the points of deposits in Core's dApps. The number of active users on the Core chain reached 900,000 this week, indicating that the activity of users participating in transactions on the Core chain has increased significantly.
dydx: Driven by BTC recently, the price of the crypto market has shown an upward trend this week, and the number of users engaging in transactions has increased significantly. As a DEX ranked high on the chain, dydx's trading volume has also risen rapidly this week along with the market trend. In addition, dydx has learned from Polymarket to open a prediction plate for the US election. As the US election approaches, the number of transactions on dydx to trade Trump's winning rate has also increased rapidly, further driving the increase in dydx's TVL. In addition, the founder of dydx returned to dydx this week to serve as CEO again, saying that he would lay off 35% of employees and further develop dydx, which made some users optimistic about the future development of dydx.
Polygon: With the approach of the US election, the gambling prediction project Polymarket on the Polygon chain has received huge attention from the market. Especially as the US presidential election is about to take place next Tuesday, more than US$2 billion has been gambled on Polymarket, driving up the TVL of the Polygon chain.
Overview of the Rising Stars
The top 5 tokens with the highest growth in the past week (excluding tokens with small trading volume and meme coins), data source: Coinmarketcap
There is no "sector concentration" feature in this week's gaining list, and the rising tokens belong to SocialFi, Depin, public chain, AI and decentralized sorter.
MASK: The main goal of Mask Network is to provide decentralized tools for the existing centralized Internet, build a bridge between the real world and the encrypted world, and realize the liberalization and privacy of personal data. Recently, due to the high popularity of the US presidential election, it has aroused heated discussions on the Internet, which has led to a surge in the number of on-chain interactions of Mask.
NOS: Nosana is a decentralized GPU cloud computing platform that aims to provide accessible and affordable AI computing power through the Solana chain. Nosana uses the token NOS to enable users to monetize idle hardware and provide affordable AI computing power, thereby solving the GPU shortage problem and combining AI with cryptocurrency to enhance AI process execution. There is no good news for Nosana this week.
PAAL: Paal AI is an ecosystem that combines artificial intelligence and machine learning technologies to simplify tasks that usually require human intelligence. Paal AI's main goal is to change the way people access and navigate cryptocurrency and blockchain technology through the power of artificial intelligence, enabling users to make decisions. This week, Paal AI launched a new product, PaalX, which is an automatic DEX with AI capabilities. It is the first time for the DEX industry to combine AI with DEX.
KAIA: Kaia is a mainnet born from the merger of Klaytn and Finschia chains, aiming to create an open source, transparent and permissionless public chain suitable for everyone. Kaia supports EVM smart contracts and has the lowest transaction latency in the leading EVM L1, with a block time of 1 second and instant finality, providing a smooth user experience for application scenarios that require near real-time response. This week, Kaia released Portal V1.2, adding incentives for multiple core Defi pools, and changing Kaia's token KLAY to KAIA.
LQTY: Liquity is a decentralized stablecoin lending protocol, whose main business is to provide interest-free lending and stablecoin management. There is no good news for Liquity this week.
From the above table, we can see that most of the Altcoin tokens were in a weak trend this week. They did not follow the rising trend of BTC in a timely manner, but instead sucked blood from the rise of BTC.
Meme Token Gainer List
The overall market is on an upward trend this week, and tokens in various tracks are also on an upward trend. This week, the performance of Meme projects is stronger than the market, especially the Meme coin projects on the Solana and Ethereum chains, which have risen significantly this week, creating a wealth effect.
Social Media Hotspots
Based on the top five daily growth in LunarCrush and the top five AI scores in Scopechat, the statistics for this week (10.26-11.1) are as follows:
The most frequently appearing theme is L1s, and the tokens on the list are as follows (tokens with small trading volumes and meme coins are not included):
According to data analysis, the Layer 1 blockchain projects received the most attention on social media this week, and generally did not follow the market to show an upward trend. However, when BTC rose alone in the market, the performance of major public chains often outperformed other sectors. In particular, the performance of Ethereum at this stage has caused dissatisfaction among users in the market, which has accelerated the withdrawal of funds from Ethereum to choose new public chains. This phenomenon reflects that in the current market environment, investors have relatively stable confidence in infrastructure projects.
Overall overview of market themes
In terms of weekly returns, the Meme track performed the best, while the GameFi track performed the worst.
Meme track: This week, Meme coin projects started a sharp rise under the hot spot of the US election and the optimistic sentiment of the general rise of the market, which has a significant wealth-making effect. Market users have begun to return to the Meme track to play games. Among them, DOGE and SHIB account for a large proportion of the Meme coin track, 50.71% and 22.43% respectively. This week, DOGE and SHIB rose by 11.13% and 7.32% respectively, expanding the increase of the entire Meme coin track. In addition, Musk once again shill for DOGE, which attracted a lot of traffic to the Meme track.
· Gamefi track: In this cycle of this year, the Gamefi track has not received much attention from the market, and thus little capital and traffic have entered, resulting in the lack of the previous wealth-making effect of the Gamefi track, which has led to a decreasing attention. Among the tracks, IMX, BEAM, GAL, and AXS account for as much as 62.96% of the total. This week, these coins have shown a downward trend, resulting in the worst performance of the Gamefi track.
Crypto Events Next Week
The 2024 US presidential election will be held on Tuesday (November 5)
Wednesday (November 6) Thailand Summit
Bank of England rate decision on Thursday (November 7)
Fed Chairman Powell holds monetary policy press conference on Friday (November 8); Fed interest rate decision (upper limit)
Outlook for next week
The US ADP employment and US core PCE price index released on Wednesday and Thursday this week did not perform well, reflecting that inflation is still stubborn and the US economy is relatively hot. At the same time, the financial reports of technology stocks released this week are not ideal, and the financial reports of Coinbase and MicroStrategy are also not ideal. In addition, Trump's election situation has been repeated, which has led to the strong upward trend of the market price at the beginning of this week turning into a volatile decline over the weekend. The US presidential election will be released next week, and the Federal Reserve will also release an interest rate decision, which is expected to have a greater impact on the market fluctuations within the period. However, it is expected that the market will choose the initial trend after the election results are announced next week, so investors should adopt a cautious strategy to avoid short-term extreme market conditions that may occur next week.
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