Market Overview
Key Market Trends
· Market Sentiment and Trends: The market sentiment index fell from 91% to 53%, still in the greed zone, but BTC maintained high volatility while Altcoins were generally under pressure, indicating increased market segmentation.
· Capital Flow Analysis: The market capitalization of USDT and USDC both increased (2.91% and 3.23% respectively), and the total TVL of DeFi continued to rise to $54.1 billion, indicating that the market is still attracting new capital inflows.
· DeFi Sector Performance: The DeFi sector led the market with a weekly return of 16.47%, DEX trading volume reached a new high of $63 billion in 2024, showing strong development momentum.
· Meme Coin Market: The Meme coin sector returned to market attention, showing active performance amid market volatility, bringing new liquidity and user growth to the market.
· Hotspot Attention: DEX projects received the highest attention, while sectors like AI and GameFi performed weakly, reflecting that market attention is concentrating on infrastructure and liquidity sectors.
· Investment Suggestions: Investors are advised to remain cautious, focus on reStaking projects and DEX sector opportunities, and closely monitor the potential market volatility from the upcoming FOMC meeting.
Market Sentiment Index Analysis
The market sentiment index fell from 91% last week to 53%, still in the bullish zone.
Altcoins underperformed the benchmark index this week, showing a downward trend. After the decline in the first half of the week, most targets failed to recoup their losses. Affected by leveraged positions, the market saw about $2 billion in forced liquidations, and long positions were significantly deleveraged. Given the current market structure, Altcoins are expected to move in sync with the benchmark index in the short term, with a low probability of independent trends.
Overall Market Trend Overview
· The cryptocurrency market was in a wide range this week, with the sentiment index still in the bullish phase.
· Crypto projects related to DeFi performed well, indicating the market's continued focus on improving basic yields.
· DEX-related projects performed well this week, indicating that on-chain investors are actively participating in on-chain investment activities.
· The Meme coin sector re-entered the market's vision this week and began to receive attention.
Hotspot Sectors
DEX
This week, due to the overall large price fluctuations in the market, many trading opportunities were created for investors, and on-chain investors flocked to use DEXs for trading. With the continuous influx of on-chain capital and users into the DEX sector, it has driven the growth of DEX projects this week.
DEX On-Chain Data
The most intuitive data to observe for DEXs is their TVL and trading volume, which can directly reflect the state of the DEX sector.
· TVL: The TVL of DEX sector projects surged this week, from $25.22B last week to the current $26.58B, an increase of 5.39%, indicating that capital is actively entering DEX projects.
· DEX Weekly Trading Volume: DEX trading volume reached the highest level in mid-2024, reaching $63 billion, with a 24-hour trading volume of $7.58 billion, indicating a surge in DEX sector trading volume.
The DEX sector is showing a clear trend of business model upgrades. Protocols like Hyperliquid and dYdX, representing the top projects, are undergoing a strategic transformation from single trading functions to comprehensive financial infrastructure. This evolutionary path is reflected in: the protocols are based on their own chain-layer architecture, achieving vertical integration through functional aggregation, and building a one-stop DeFi service ecosystem. This architectural innovation marks the evolution of the DEX sector from a single trading level to an all-round financial infrastructure, and the reconstruction of the sector's value is underway.
Sui
The Sui ecosystem has been a hot topic in the market this week, with the SUI price rising 7.8% this week, outperforming BTC and ETH. DeFi projects in the Sui ecosystem have shown excellent growth performance this week.
Sui Chain DeFi Project Data
· TVL: The TVL of Sui surged this week, from $1.598B last week to the current $1.793B, an increase of 12.88%, indicating that on-chain capital is actively entering the Sui chain.
· Accounts: The total number of users on the Sui chain reached 66,543,317, an increase of 2,184,755 from 64,358,562 last week, an increase of 3.39%. Although the growth rate does not seem large, the fact that it was able to grow in the midst of the volatile market conditions also indicates that Sui chain has certain attractiveness to traffic.
· DEX Trading Volume: The main DEXs on the Sui chain are Cetus, Aftermath Finance, and BlueMove DEX. This week, the total trading volume of DEXs on the Sui chain exceeded $35 billion, with a daily average trading volume of $466 million, indicating that DEXs on the Sui chain are very active.
· DeFi Project TVL Growth: The top 3 projects by TVL in the Sui ecosystem are NAVI Protocol, Suilend, and Aftermath Finance, belonging to the lending and DEX sectors respectively, with TVL growth rates of 1.14%, 17.22%, and 1.72% this week. It can be seen that despite the volatile trend, capital is constantly entering the DeFi sector projects in the Sui ecosystem.
The most direct indicator of whether a public chain is favored by the market is the growth or decline of its TVL. Based on the above data, we can see that the Sui chain is currently maintaining rapid development. Since the SUI price is stronger than the overall market, the underlying asset of the Sui ecosystem is constantly rising, driving the growth of APYs of DeFi projects on the chain. At the same time, the overall market conditions have seen significant volatility, presenting profit opportunities, which has attracted a large number of on-chain users to participate, promoting the development of the entire Sui ecosystem.
DeFi Sector
TVL Growth Ranking
Top 5 projects by TVL growth in the past week (excluding projects with TVL less than $30 million), data source: Defilama
Synthetix (SNX): (Recommendation: 4 stars)
· Project Introduction: Synthetix is a decentralized synthetic asset protocol built on Ethereum, aiming to provide on-chain exposure to real-world assets through blockchain technology. Synthetix's core functionality includes allowing users to mint synthetic assets by collateralizing their SNX tokens.
· Latest Developments: This week, Synthetix increased the APY for LP users by implementing SCCP-373, which increased the trading fee share for V3 LPs from 40% to 60%, and the Synthetix Treasury plans to charge some integration fees to increase V3 LP revenue. Synthetix also announced the completion of the acquisition of the leveraged token platform TLX, and will integrate TLX's leveraged token functionality, drive its launch through parameter improvements and contract redeployment, and launch a leveraged token incentive program.
Babylon (Unissued): (Recommendation: 5 stars)
· Project Introduction: The Babylon project is a project that aims to use the security of Bitcoin to enhance the security of other Proof-of-Stake blockchains. The core idea is to activate idle Bitcoin assets through a trustless staking mechanism, solving the contradiction between Bitcoin holders' pursuit of asset security and participation in high-yield projects.
Here is the English translation of the text, with the specified terms translated as instructed:· Latest developments: Although the market price fluctuated quite violently this week, BTC's performance has been very strong, still maintaining at a high level. In addition, users are generally optimistic about BTC's subsequent development, so they are more determined to hold it while wanting to unlock the liquidity of holding BTC, and will therefore choose more BTC-based yield projects. This week, Binance announced that users can directly stake BTC on Babylon to earn yields directly from their Binance accounts, bringing huge new inflows of capital to Babylon. During the event period, Binance also offered up to 12% points increase in rewards for participating Binance users, incentivizing a large number of Binance users to participate.
Usual Money (USUAL): (Recommendation: 3 stars)
· Project introduction: Usual Money is a Binance-backed stablecoin project aimed at providing a new decentralized stablecoin solution. The core mechanism of the project includes three main tokens: the stablecoin USD0, the bond product USD0++, and the governance token USUAL.
· Latest developments: Recently, Usual Money has undergone a Checker upgrade. After the upgrade, the annualized yield for USD0++ holders reached 48%, the average APY on Curve for USD0/USD0++ is 54%, and the average annualized yield for USD0/USDC is 52%. Meanwhile, the USUAL minting volume has been reduced by 17%, increasing the price of USUAL. This has attracted many users to participate in Usual Money to obtain high annualized arbitrage yields.
BounceBit (BB): (Recommendation: 4 stars)
· Project introduction: BounceBit is a reStaking base layer on the Bitcoin ecosystem. In its design, it collaborates deeply with Binance to build high-yield CeDeFi components, and has also built the BounceBit Chain to provide specific use cases for reStaking.
· Latest developments: Recently, BounceBit has increased the staking rates for various tokens, with the 30-day annualized yield reaching 54.25% for USDT, 24.55% for BTC, 37.13% for BNB, and 37.7% for ETH, attracting a large number of users to stake their assets on BounceBit. This week, BounceBit also partnered with Ondo to bring tokenized RWA into BounceBit, entering the RWA track.
Equilibria (EQB): (Recommendation: 3 stars)
· Project introduction: Equilibria is a Miner's Pool project, with the main goal of creating high yields for users. Utilizing the yield-boosting model of Pendle's veToken, it provides higher yields for LPs through the tokenized version of vePENDLE, called ePENDLE, and also provides additional rewards for PENDLE holders.
· Latest developments: This week, Equilibria strengthened its cooperation with Curve, launching a new enhanced pool - scrvUSD pool, to increase user yields. It then added SolvBTC, cmETH, and ePENDLE enhanced pools, pushing the highest APY to 59%, attracting a large number of users to participate in arbitrage.
In summary, we can see that the projects with fast TVL growth this week are mainly concentrated in the stablecoin yield sector (Miner's Pools).
Overall Sector Performance
· Steady growth in stablecoin market cap: USDT grew from $141 billion last week to $145.1 billion, an increase of 2.91%. USDC grew from $40.2 billion to $41.5 billion, an increase of 3.23%. This shows that both the non-US market-dominated USDT and the US market-dominated USDC have seen growth, indicating that the overall market is still seeing continuous capital inflows.
· Increasing liquidity: The risk-free arbitrage rate in the traditional market is constantly declining due to the continued interest rate cuts, while the arbitrage rate of on-chain DeFi projects is constantly increasing due to the appreciation of cryptocurrency assets, making a return to DeFi a very good choice.
· Capital situation: The TVL of DeFi projects has increased from $53.2 billion last week to $54.1 billion, a new inflow of 1.69%. It has continued to maintain positive growth this week and has been on a sustained upward trend for nearly two months, proving that there is continuous capital inflow into DeFi projects.
In-depth Analysis
Drivers of the uptrend: The core driving factors of this round of uptrend can be summarized as the following transmission path: the market entering a bull market cycle has driven an increase in liquidity demand, which in turn has pushed up the basic lending interest rate level, amplifying the profit space of the arbitrage cycle strategy in DeFi protocols.
Specifically:
· Market environment: The bull market cycle has led to an overall increase in liquidity demand
· Interest rate end: The rise in basic lending rates reflects the market's pricing expectations for capital
· Yield end: The expansion of the yield of the arbitrage cycle strategy has significantly improved the inherent value support of the DeFi sector, forming a virtuous growth momentum.
Performance of Other Tracks
Public Chains
Top 5 public chains by TVL growth in the past week (excluding public chains with relatively small TVL), data source: Defilama
Hyperliquid: Due to the large market fluctuations this week, the number of users participating in on-chain transactions has surged, especially those participating in contract trading. This week, Hyperliquid's open interest contracts reached $3.5 billion, quickly surpassing the traditional Perp DEX leader DYDX, becoming the largest Perp DEX on-chain. Hyperliquid's trading volume has also increased rapidly, especially after the launch of the popular project ME.
Sui: This week, the launch of the Movement token has driven the rise of the Move ecosystem, and Sui, as the leader of the Move ecosystem, has received widespread market attention. This week, Sui partnered with Backpack wallet to support the SUI token, and also reached a protocol with Phantom wallet to integrate SUI. Meanwhile, the popular Meme coin KAPI appeared on the Sui chain this week, attracting traffic and capital to the Sui ecosystem. This week, the daily trading volume of the DEX on the Sui chain exceeded $466 million, proving the rapid development of the on-chain ecosystem of Sui.
Algorand: This week, the Meme coin project MONKO on the Algorand chain was quite hot in the market, attracting some attention and capital to the Algorand chain. Meanwhile, Algorand also announced strong support for RWA track projects on the Algorand chain. This week, Coinbase announced that it will no longer support stablecoins that do not meet the MiCA standard for its European customers, while Algorand's two main stablecoins USDCa and EURD are MiCA-compliant, allowing them to continue providing on-chain stablecoin services to European users.
PulseChain: This week, Meme coin projects on the PulseChain chain have started to become active, although there are no particularly outstanding projects, they have still brought a certain wealth effect to the chain, contributing some attention and new capital to PulseChain. PulseChain's largest DEX, PulseX, saw a 62% increase in trading volume this week, contributing to the increase in PulseChain's TVL. Meanwhile, the PLS token, which has flowed out of the PulseChain ecosystem, will be listed on Binance, so users are starting to enter the PulseChain ecosystem to earn PLS.
Bitcoin: This week, the overall market experienced a pullback in the first half of the week, with prices across the board experiencing a significant decline. However, BTC performed well during this period, with a relatively small decline, and then returned to historical highs in the second half of the week. Users are more optimistic about BTC's future upside, and are more determined to hold BTC. As a result, users are choosing to deposit their BTC assets into BTCFi projects to earn additional yields, leading to an increase in Bitcoin's TVL.
Top Gainers Overview
Top 5 token gainers in the past week (excluding tokens with small trading volume and meme coins), data source: Coinmarketcap
This week's top gainers list shows a concentration in the public chain sector. The rising tokens are mostly from the public chain track.
Recently, Usual Money has upgraded its Checker, and after the upgrade, the annualized yield of USD0++ bond holders reached 48%, the average APY of USD0/USD0++ on Curve is 54%, and the average annualized yield of USD0/USDC is 52%. At the same time, the minting of USUAL has been reduced by 17%, and the price of USUAL has been increased. This has attracted many users to participate in Usual Money to obtain high annualized arbitrage returns. Recently, Bitget has been continuously listing tokens with high market heat, especially some Meme tokens, which has brought certain users and capital to it, helping Bitget increase its trading volume. This week, Bitget's CEO announced that the company is reconsidering entering the US market and plans to expand its business under the potentially crypto-friendly policies of the Trump administration. This week, Bitget's trading volume has surpassed OKX, making it the third largest CEX. Recently, Sushi has launched the Dojo Agent and Tweet Token functions, which allow users to tokenize their favorite tweets or directly create their own Meme coins from Twitter, significantly increasing Sushi's trading volume. This week, the Sushi Dao proposed a diversification strategy, shifting assets from 100% SUSHI tokens to 70% stablecoins, 20% blue-chip cryptocurrencies, and 10% DeFi tokens, in order to reduce volatility, enhance liquidity, and generate yield through staking, lending, and liquidity provision. This week, ORCA strengthened its cooperation with Binance, with Binance Wealth Management, One-Click Buy, Flash Swap, Leverage, Dollar Cost Averaging, and Binance Futures all listing ORCA. Meanwhile, ORCA has launched a new Token creation tool this week, supporting the Solana and Eclipse networks, allowing users to customize tokens without coding. ORCA has also partnered with HawkFi and NATIX Network to enhance the DeFi experience and support the Solana AI Hackathon. This week, Across Protocol announced a significant partnership with Binance, with the ACX token being listed without any listing fees. Binance Wealth Management, One-Click Buy, Flash Swap, Leverage, Dollar Cost Averaging, and Binance Futures have all listed ACX. ACX has also partnered with HTX Global and Bitvavo exchanges, and collaborated with Yodl to provide cross-chain payment services, while continuing to deepen its cooperation with Uniswap.
