Crypto Market Weekly Report: Highlights and Shadows in the Fall

This week, the crypto market has shown a rapid fall trend, with the market sentiment index plummeting from 33% to 11%. The market capitalization of stablecoins has stagnated, indicating that institutional funds are beginning to withdraw. The panic in the market is primarily due to a significant asset theft incident at a trading platform, as well as the inflation concerns raised by Trump's proposed radical tariff policy, which has reduced the likelihood of interest rate cuts by the Federal Reserve and intensified worries about a recession in the United States. These factors have strongly impacted market sentiment, leading to an overall state of extreme panic, with most altcoins underperforming the benchmark index.

Bullish Underlying

LTC

This week, LTC has risen against the trend, showing strong performance amid the overall market fall. The main reason is the market's heightened expectations for its ETF approval. A capital company has proposed a spot LTC ETF, which has been listed in the relevant system, and the betting rate on a certain prediction market has reached 87%. Currently, the market has high expectations for the approval of the LTC spot ETF, and it is expected that there will be ongoing speculation on this event before the official approval.

S

Sonic has recently entered the Defi industry, attracting a large number of users and funds through high APY from on-chain projects. Its main liquidity staking project has a maximum APY of 123%, and the average lending interest rate for S tokens in the lending protocol is 10.21%, allowing users to achieve a yield of over 20%. The price of S tokens has risen against the trend, further increasing user returns and attracting more participants, creating a virtuous cycle of increasing demand and rising prices.

SOSO

The SoSoValue project team can adjust its development direction based on market trends. It has transformed from an AI technology-enhanced investment service platform into a wealth management service center, focusing on promoting high APY. Recently, it launched the second season of mining activities, where users can stake tokens to earn up to 42% APY, attracting more users to participate and enhancing the bullish expectations for the SOSO token.

BERA

The Berachain project team quickly adjusted the on-chain LSD project's staking yield, with a maximum APY of 123%. In its lending project, the lending rate for BERA reached 23.68%, allowing users participating in arbitrage to achieve around 100% risk-free annualized returns. This strategy effectively curbed the fall trend and promoted the rise in BERA token prices.

Bearish Target

ETH

A certain exchange has encountered a large-scale ETH theft incident. Although the stolen funds have been replenished, FUD sentiment still persists in the market. Security vulnerabilities have raised concerns about the overall security of the Ethereum ecosystem. In addition, the upcoming technical upgrade of Ethereum has failed to inject sufficient momentum into the ETH price, and a pullback is expected after the upgrade.

SOL

The hype around Meme coins has subsided, and Solana, as a major public chain, has been affected. Its TVL has significantly decreased, and on-chain transaction volume has plummeted. The upcoming token unlock may create selling pressure, exacerbating the market's panic towards SOL.

ADA

The TVL on the Cardano chain has significantly fallen, with eco-projects generally experiencing capital outflows. The on-chain DEX trading volume has notably decreased, and the lending rates are sluggish, reflecting a decline in user participation. If the capital outflows continue, it is expected that ADA will remain under pressure.

AI

The AI and Gamefi sector where Sleepless AI operates has seen significant corrections. The market has lost interest in the Play to earn model of Gamefi, and AI projects are generally considered to be overvalued. The upcoming large-scale token unlocks may bring short-term downward pressure.

TKO

As a major exchange token in Southeast Asia, it has been negatively affected by recent security incidents at exchanges. A large number of tokens set to be unlocked may put pressure on the price.

RUNE

THORChain has come under scrutiny due to suspicious transactions, and the main developer has announced their departure. It is expected that with the decline in trading volume and market skepticism, the token price may continue to fall.

Hot Track Analysis

Sonic

The TVL of Sonic chain continues to grow rapidly, increasing by 10.32% this week to reach $683 million, making it one of the few public chains that still maintains capital inflow amid the market fall. Its token S rose by 7.63% this week, indicating market recognition.

Sonic has recently shifted to the Defi track, adopting high APY strategies to attract users. Major on-chain projects offer up to 123% APY, with borrowing rates around 10%, allowing users to gain 100%+ arbitrage opportunities. This strategy is highly attractive in the current market environment, promoting user engagement and token demand.

The key to future development lies in maintaining the efficient operation of the economic flywheel, achieving a positive cycle of staking, liquidity, DeFi empowerment, and user growth. It is necessary to pay attention to the sustainability of on-chain APY to assess the development momentum of the Sonic chain.

Berachain

Berachain's TVL slightly increased by 4.66% this week, reaching $3.194 billion, ranking sixth among public chains' TVL. Its token BERA price rose by 7.26%, showing strong performance.

Berachain attracts users by increasing the on-chain project APY. The main LSD project has an APY as high as 190.12%, with a lending rate of 23.68%, providing users with high-yield arbitrage opportunities.

Berachain faces challenges similar to Sonic. While high APY strategies have promoted ecological development and token price increases in the short term, their long-term sustainability is questionable. In the future, attention should be paid to the emergence of new projects and the sustainability of high APY.

Market Theme Overview

This week, the Sociafi sector performed the best, while the PayFi sector performed the worst. In Sociafi, the fall of TON and CHZ was relatively small, while in PayFi, the fall of XRP and XLM was significant, affecting the overall sector performance.

Important Events Next Week

• March 3: US February ISM Manufacturing PMI
• March 5: U.S. February ADP employment numbers; Ethereum testnet launches Pectra upgrade
• March 7: U.S. February non-farm payroll data and unemployment rate

Summary

This week, the crypto market experienced a significant fall, causing widespread concern among investors. Some projects are attracting users through high APY strategies, but long-term stability remains to be observed. Investors are advised to closely monitor market dynamics and operate with caution.