Weekly Market Insight: February Week 2

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Market Updates

10 Feb 2025

Headline News

- Despite Trump halting tariffs on Mexico, Canada and low-cost packages from China, the market stayed extremely cautious. After recovering from Monday liquidation, Bitcoin was traded at a tightening range and closed the week with a 1.07% decline.
- However, Bitcoin ETFs still experienced a weekly net inflow of $203.54 million. Stablecoin market cap extended its 6th consecutive increase, resulting in over $4.33 billion new stablecoin issued on chain.

Macro-Outlook

- The U.S. Manufacturing PMI increased to 50.9 in January, higher than the expected 49.8. It is the first expansion in manufacturing after 26 consecutive months of contraction. Meanwhile, services PMI increased to 52.8 in January, well below expectation of 54.3.
- The U.S. Non-Farm Payrolls increased 143K in January, below market expectation of 170K. The unemployment rate in January decreased to 4%, the lowest level since March 2024 and below the market expectation of 4.1%.
- Trump announced his plans to unveil reciprocal tariffs next week. The market expects the upcoming announcement to include new tariffs on EU countries.

Upcoming Economic Calendar including,

- Tuesday, February 11 and 12, 11:00pm: Testimony of Jerome Powell to Congress
- Wednesday, February 12, 9:30pm: The U.S. Inflation Rate in January
- Thursday, February 13, 9:30pm: The U.S. PPI in January
- Friday, February 14, 9:30pm: The U.S. Retail Sales in January

Weekly-Cryptos-Overview

- The Czech president signed a bill exempting Bitcoin holding more than 3 years from capital gain tax.
- The Ethereum Foundation transferred 50,000 ETH to a multi-signature wallet which plans to participate in Ethereum DeFi protocols.

Layer 1 and Layer 2s

- Beachain has launched its mainnet. Berachain pioneered the concept of Proof of Liquidity, where applications are built on top of the shared liquidity pools and being incentivised by the mechanism.
- Solayer has released its LAYER token details with 51.23% allocated to the community. Team & advisor and investors allocation will be vested with the first cliff release in a year. LAYER utility will be centered around governance at launch, while the team plans to enable LAYER to participate in staking and gas payment in the future.
- Polygon released Agglayer v0.2 on the mainnet, allowing chains with different security models to connect with pessimistic proof.
- MegaETH introduced its flagship soulbound NFT collection, The Fluffle. The NFT holders will be entitled to 5% allocation of the token supply with 6 month linear vest.
- AO has launched its mainnet, a decentralized supercomputing environment powered by Arweave.
- Story Protocol released its IP token, allocating 58.4% to ecosystem, community and foundation. The token is used for staking, gas payment (portion of the gas is burnt for each transaction) and governance. The first significant increment of unlocking is scheduled 10 months after launch.
- Avail, Symbiotic and Radius introduced Alpha Engine, enabling developers to seamlessly launch high throughput rollups through shared security and capture revenue from MEV.

Dapps

- Ondo Finance held the Ondo Summit in New York last week. During the event, the team introduced Ondo Nexus, enabling instant liquidity for tokenised Treasury issued by third party issuers such as Franklin Templeton, WisdomTree, Wellington Management, and Fundbridge Capital. The team also introduced Ondo Chain, featuring permissioned validators ran by select financial institutions, publishing key off-chain data and ran their own DVN to detect address details such as KYC and sanction information. The team also reintroduced Ondo Global Market (Ondo GM), a platform for tokenised securities and plans to launch it within 2025.
- Pendle released 2025 roadmap that focuses on v2 improvement with opening up permissionless listing and dynamic fees, expanding to Solana, Hyperliquid and TON networks, integrating RWA assets, and the launch of Boros.
- Frax Finance launched Borrow Automated Market Maker (BAMM), enabling users to borrow and lend from LP positions from Fraxswap on Fraxtal chain, significantly increasing users' capital efficiency.
- Coop Records launched its first music collection on Soneium via Sonova launchpad.
- Goldfinch launched Goldfinch Prime on Base, introducing institutional-grade private credit funds from multiple asset managers in a single vault.
- Thorchain plans to issue creditors a new TCY token, as part of efforts to resolve the $200 million debit crisis from ThorFi. TCY holders will be entitled to 10% of THORChain's revenue in perpetuity.
- HeyAnon, the DeFAI protocol, has launched its public beta v0.1 across multiple networks including Ethereum, Base, Sonic and more.
- Grass Protocol announced Phase 2 of Sion Upgrade, aiming to increase the efficiency of data scraping by 15x.
- Eigen Layer introduced Verifiable Agents using AVSs to verify inferences, implement output policy and Event-Driven Activations (EDA) which agents can react to specific on-chain/off-chain events.

Upcoming Alpha and Governance

- Ethereum developers confirmed Pectra testnet dates in February and March, potentially leading to a mainnet upgrade in April.
- Bittensor is expected to launch the highly anticipated dTAO upgrade on February 10.
- FTX creditors with claims less than $50,000 are expected to receive repayment on February 18.
- The SEC has delayed the decision on Ethereum ETF options trading to April 9.
- Uniswap introduced Unichain Validator Network (UVN), sharing 65% of revenue to validators and stakers. The UVN will be live on testnet for several months before going live.
- Usual passed the proposal to launch the USL module, creating a fixed borrowing cost vault for USD0++ to borrow USD0.
- Lido announced v3 will be coming soon without much details.

Token Unlock

- IO token unlocked on February 11, amount representing 2.58% of the token supply.
- APT token unlocked on February 12, amount representing 1.98% of the token supply.
- SAND token unlocked on February 14, amount representing 8.41% of the token supply.
- STRK token unlocked on February 15, amount representing 2.45% of the token supply.
- ARB token unlocked on February 16, amount representing 2.13% of the token supply.
- APE token unlocked on February 17, amount representing 2.12% of the token supply.
- MELANIA token unlocked on February 20, amount representing 23.3% of the token supply.
- IMX token unlocked on February 21, amount representing 1.41% of the token supply.
- PLUME token unlocked on February 21, amount representing 5.32% of the token supply.
- ALT token unlocked on February 25, amount representing 9.47% of the token supply.
- OP token unlocked on February 28, amount representing 2.39% of the token supply.
- GRASS token unlocked on February 28, amount representing 1.52% of the token supply.

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