The Federal Reserve's expectation of fewer rate cuts over the next 25 years has caused a market crash|Hotcoin Research Market Insights: December 16-20, 2024
Cryptocurrency Market Performance
Currently, the total market capitalization of cryptocurrencies is $3.35 trillion, with BTC accounting for 57.626%, which is $1.93 trillion. The market capitalization of stablecoins is $20.42 billion, with a 7-day increase of 1.05%, of which USDT accounts for 68.87%.
This week, BTC's price showed a range-bound fluctuation, with the current price at $97,738; ETH also showed a range-bound fluctuation, with the current price at $3,385.
Among the top 200 projects on CoinMarketCap, most have declined while a few have increased, including: HYPE with a 7-day increase of 42.74%, USUAL with a 7-day increase of 113.43%, and BGB with a 7-day increase of 32.04%.
This week, the net inflow for Bitcoin spot ETFs in the U.S. was $586 million; the net inflow for Ethereum spot ETFs in the U.S. was $153.7 million.
On December 20, the "Fear & Greed Index" was at 74 (lower than last week), with the sentiment this week being: 3 days of greed and 4 days of extreme greed.
Market Prediction: The continuous issuance of stablecoins and net inflows into ETFs have led to a decline in market sentiment due to the reduced expected rate cuts by the Federal Reserve in 2025. However, the market is currently in the mid-stage of a bull market, and it is a good time to buy on dips, with recent focus on the RWA track.
Understanding Now
Weekly Major Events Review
On December 16, according to Coinglass data, Bitcoin surged past $105,000 this morning, but the funding rates on major CEX and DEX are both below 0.01%, indicating that the market does not show a significant bullish sentiment or FOMO;
On December 17, according to Fortune, the U.S. Securities and Exchange Commission (SEC) recently issued a Wells Notice to the crypto investment company Unicoin, accusing it of fraud, misconduct, and unregistered securities issuance. Unicoin CEO Alex Konanykhin revealed that the company has sold approximately $3.5 billion worth of tokens, with around 70,000 investors, and its tokens are backed by physical assets such as 8,000 acres of land in the Bahamas. SEC Chairman Gensler will step down in January 2025, and this move is seen as the last wave of regulatory actions against the crypto industry during his tenure. Unicoin must respond by December 24, and the company stated it would choose legal confrontation rather than settlement;
On December 17, 21Shares' XRP Trust has been registered in Delaware, USA, under the name "21Shares XRP Trust." This entity will be established on June 3, 2024, and is classified as a statutory trust, with the registered agent being CSC Delaware Trust Company, located in Wilmington, Delaware;
BlockBeats previously reported that 21Shares had submitted an application to the SEC for the 21Shares Core XRP Trust, planning to launch a spot XRP ETF. This ETF aims to track the price of XRP and plans to list on the Cboe BZX exchange. The registration of this trust may pave the way for the launch of this ETF;
On December 18, according to Cointelegraph, Ripple's stablecoin RLUSD has officially launched;
On December 18, according to official data, Hyperliquid's open contract volume reached $4.28 billion on December 16, setting a new historical high;
On December 19, on-chain data showed that Trump's crypto project World Liberty increased its holdings by over 230,000 ENA;
On December 19, Bloomberg reported that MicroStrategy co-founder and chairman Michael Saylor stated that once the current fundraising plan is exhausted, the company will shift from a leveraged Bitcoin proxy plan to a focus on fixed-income securities to raise funds for purchasing cryptocurrencies;
On December 18, according to official news, Usual has partnered with Ethena Labs and Securitize, a tokenization platform under BlackRock, to make Ethena Labs and Securitize's upcoming stablecoin USDtb the main collateral asset for Usual's stablecoin USD0. As part of this collaboration, Usual will also launch a sUSDe vault for USD0++ holders, allowing Usual users to earn sUSDe APY, Ethena rewards, and additional USUAL rewards;
On December 19, data from IntoTheBlock revealed that a significant demand zone close to $100,000 has formed, with over 1.45 million BTC accumulated around an average price of $97,500, making it an important potential support area;
On December 19, the board of directors of U.S. publicly listed company reAlpha Tech Corp. (AIRE) approved a new investment policy, listing Bitcoin, Ethereum, and Solana as the company's main reserve assets. The company plans to use up to 25% of excess cash for purchasing cryptocurrencies after ensuring six months of operating expenses, with specific allocations adjusted based on market conditions and actual operational needs;
On December 19, the Federal Reserve concluded its 2024 annual interest rate decision, deciding to lower the benchmark rate by 25 basis points to a range of 4.25%-4.50%, marking the third consecutive rate cut, in line with expectations.
In this year's eight decisions, the Federal Reserve has cumulatively lowered rates by 100 basis points, including one 50 basis point cut, two 25 basis point cuts, and five instances of maintaining the rate;
- On December 20, Coinbase announced that it has suspended wBTC trading. Trading of wBTC on Coinbase Exchange and Coinbase Prime has been suspended, but users can still withdraw funds at any time.
Macroeconomics
On December 18, crypto asset management company Bitwise launched a Solana staking ETP in Europe, with the stock code BSOL, and Solana staking company Marinade will become Bitwise's staking provider;
On December 19, the Bank of Japan maintained its policy rate at 0.25%, marking the third consecutive pause in rate hikes;
On December 20, the SEC approved the listing and trading of Hashdex Nasdaq Crypto Index US ETF and Franklin Crypto Index ETF shares on Nasdaq and Cboe BZX exchanges, respectively;
On December 20, Japanese listed company Metaplanet announced it will issue its fifth series of interest-free ordinary bonds totaling 5 billion yen. The raised funds will be used to accelerate the purchase of Bitcoin, with the bond maturity date set for June 16, 2025. The company plans to secure funds for bond repayment through the exercise of the 12th series of warrants.
ETF
According to statistics, from December 16 to December 20, the net inflow of U.S. Bitcoin spot ETFs was $586 million; as of December 20, GBTC (Grayscale) had a total outflow of $21.247 billion, currently holding $20.057 billion, while IBIT (BlackRock) currently holds $53.339 billion. The total market capitalization of U.S. Bitcoin spot ETFs is $112.922 billion.
The net inflow of U.S. Ethereum spot ETFs was $15.37 million.
Envisioning the Future
Event Preview
- CoinDesk will hold Consensus Hong Kong from February 18 to 20, 2025, in Hong Kong.
Project Progress
The Sui lending protocol Scallop has launched a Christmas airdrop event. From December 14 to December 26, users who meet the criteria of borrowing value greater than $1,000 or holding more than 1,000 veSCA can participate in the distribution of 1 million SCA tokens;
Pump Science released a roadmap update and will announce new partnerships, prepare for mouse experiments, and develop the protocol on December 24.
Important Events
The new guidelines for the "Travel Rule" applicable to crypto assets by the European Banking Authority (EBA) will take effect on December 30, 2024;
The EU's Markets in Crypto-Assets Regulation (MiCA) guidance for cryptocurrency exchanges and other companies operating in the EU will take effect starting December 31.
Token Unlocking
Altlayer (ALT) will unlock 195 million tokens on December 25, valued at approximately $23.1 million, accounting for 1.95% of the circulating supply;
Immutable (IMX) will unlock 24.52 million tokens on December 27, valued at approximately $33.04 million, accounting for 1.23% of the circulating supply;
Axelar (AXL) will unlock 13.51 million tokens on December 27, valued at approximately $9.48 million, accounting for 1.14% of the circulating supply;
Open Campus (EDU) will unlock 19.07 million tokens on December 28, valued at approximately $9.34 million, accounting for 1.91% of the circulating supply.