What major events in the cryptocurrency market are worth looking forward to in February?

Original Title: What to expect in crypto in February

Original Author: The DeFi Investor

Original Translation: Luccy, BlockBeats

Editor's Note: The DeFi Investor analyzes the significant events and trends that may occur in the cryptocurrency space in February, predicting several important events, including the launch of a Bitcoin spot ETF in Hong Kong, Starknet token release, EigenLayer staking rewards, Frax Finance's L2, expectations for the Dencun upgrade, and the unlocking of APT and SAND. As of the publication of this article, some predictions have already come true, and BlockBeats now presents the original text as follows:

Is February a bullish or bearish month for cryptocurrency?

Interestingly, historically, February is usually one of the best-performing months for Bitcoin, with only two red Februarys in its entire history.

For Ethereum (ETH), the situation is even better, as there has only been one red February in its history. However, Bitcoin has never closed up for six consecutive months, and it has been in an upward trend for about five months now.

Regardless of Bitcoin's future price movements, this month will be another filled with narratives and new trading opportunities. Therefore, here are some significant events expected to occur in February:

The First BTC ETF Launch in Hong Kong?

China's major asset management company—Harvest Global Investments—applied a few weeks ago to launch the first BTC ETF in Hong Kong. Another financial giant—VSFG—has set the first quarter of 2024 as the target for launching a BTC ETF.

Additionally, Hong Kong regulators confirmed last December that they are seriously considering accepting applications for spot Bitcoin ETFs. Harvest Global Investments seems to aim to launch Hong Kong's first spot Bitcoin ETF after February 10.

It sounds incredible, but perhaps we will see the approval of a spot BTC ETF in Hong Kong this month. Furthermore, if this happens, VSFG has revealed that they plan to launch a spot ETH ETF in Hong Kong in the second quarter.

The launch of the US spot Bitcoin ETF has been a tremendous success, with total net inflows exceeding $1.5 billion despite significant selling pressure from Grayscale. A spot BTC ETF in Hong Kong could also attract substantial funds.

Starknet Token Release

Starknet is a key project in the Ethereum L2 space and one of the first ZK-Rollup L2 networks built on Ethereum.

While there is no official confirmation, many who are very familiar with the Starknet ecosystem expect the STRK token to go live in February.

The project team confirmed that they took a snapshot for token distribution over 60 days ago, so the token release should not be far off.

Why is this important?

Whenever a significant L2 project announces the launch of its token, its ecosystem activity and TVL typically surge from that moment until the token generation event concludes. For example, in the case of Arbitrum, its TVL increased by $500 million within a week after the ARB token launch was confirmed.

Before the ARB token was launched, many tokens in the Arbitrum ecosystem also saw price spikes, followed by a gradual sell-off after the ARB token generation event. Thus, the token release ultimately proved to be a sell-the-news event.

In the coming weeks, similar situations may occur with Starknet ecosystem tokens, so this is something to keep in mind, especially if you are trading narratives.

EigenLayer Deposit Reopening

Later today, the largest restaking protocol, Eigenlayer, will reopen deposits.

They have removed the individual 200k ETH cap on LSTs, but now the restaking points allocated for any liquid staking tokens or liquid restaking tokens will be limited to a maximum of 33% of the total issuance in the future.

Personally, I am leveraging a relatively large proportion of my ETH holdings to mine EigenLayer airdrops, as I believe this is one of the best yield opportunities for ETH at the moment. In short, I am using four liquid restaking protocols to mine EigenLayer airdrops:

• Kelp DAO: Currently, you can earn 100,000 Kelp points for minting 1 rsETH, valid for a limited time.
• Eigenpie: Until February 12, Eigenpie points have a 2x bonus.
• EtherFi: Using EtherFi, you can earn an additional 20 EigenLayer points for each ETH staked (using my referral link, you can earn an additional 1k EtherFi points for each ETH restaked).
• Renzo: Until February 11, you can earn 200 ezPoint rewards for each ETH restaked.

EigenLayer's TVL currently stands at $2.1 billion. Its growth rate this year has been incredible, and with many ecosystem airdrops being announced weekly, I don't think its popularity will fade anytime soon.

Next, the final testnet for EigenLayer's second phase is scheduled for February 7. The second phase will allow restakers to start delegating their ETH to operators running active validation services. Here is a good overview of EigenLayer's second phase:

Frax Finance's L2 Launch

Frax Finance is a DeFi product ecosystem on Ethereum, with its most popular products including the FRAX stablecoin and a liquid staking token called frxETH.

The team has been working on Frax's own L2 blockchain for a long time, and it now appears that the expected launch date is February 7. Fraxtal (the name of Frax's upcoming L2) is not just another simple Optimism fork, as it will bring several interesting innovations:

• Gas token flexibility: Fraxtal will use both frxETH and FRAX as gas tokens.
• Block space incentives: Users, applications, and developers will be rewarded for using veFXS, which is the staked version of FXS.
• BAMM: A new type of lending AMM (developed by the Frax team) will allow users to leverage any token within 1 to 2 months after Fraxtal launches on the new L2 without needing an oracle.

Curve Finance and Ra (a DEX created by the Ramses Exchange team) have confirmed that they will deploy on Fraxtal. The founder of Frax Finance has also boldly predicted that Fraxtal will attract hundreds of millions of dollars in its first month.

Final Testing of Ethereum's Dencun Upgrade

The final testnet release for one of the most important Ethereum upgrades is scheduled for February 7. If all goes well, Ethereum's Dencun upgrade could officially go live on the mainnet in March or April.

The Dencun upgrade is significant mainly because it introduces proto-danksharding. Proto-danksharding is expected to significantly reduce L2 transaction fees by lowering the "rent" that L2s have to pay, making them more affordable.

Over the past two years, L2 has seen substantial growth, and if Dencun can meet the community's expectations, it is likely to attract a large number of new users to Ethereum L2, as it will make them more affordable.

Major Token Unlocks

A new month brings new token unlocks.

Wu Blockchain has created a table showing the largest token unlocks expected in February, with two particularly catching my attention:

• APT: $229 million worth of APT (7.3% of its circulating supply) will unlock on February 11.
• SAND: $94 million worth of SAND (9% of its circulating supply) will unlock on February 14.

Additionally, there is a $330 million AVAX token unlock scheduled for February 22. However, despite the large dollar amount, the $330 million of AVAX only accounts for 2.6% of the token's circulating supply.

Other Events

If you are curious about what other significant events might occur in the cryptocurrency space this month, take a look at the crypto calendar below. I believe there are a few other key dates worth noting:

• February 13: US CPI data
• February 12: Next key date in the Ripple-SEC lawsuit
• February 23: CZ's hearing