By Omkar Godbole (All times ET unless indicated otherwise)
The crypto market is showing signs of stabilizing, with bitcoin recovering to $102,000 and positive signals from futures tied to the Nasdaq. Leading the recovery among major cryptocurrencies is XRP, up 11%, followed by SOL with a 7% increase. AI coins, hit hard on Monday, are posting gains of as much as 4%.
Risk sentiment is likely being supported by skepticism surrounding the claims of Chinese tech startup DeepSeek, which asserts it spent only $6 million to develop its competitor to ChatGPT. Critics speculate the figure omits costs associated with earlier research and experimentation on architectures, algorithms and data. Additionally, a concept rooted in the Jevons Paradox suggests that advancements in efficiency often lead to increased usage rather than reduced consumption, leading to net positive growth in the industry.
That’s good news for bitcoin and the broader crypto industry because they align with the narrative of U.S. exceptionalism, particularly given President Trump’s crypto-friendly stance and plans to establish a strategic digital asset reserve.
Speaking of the strategic reserve, Arizona lawmakers have advanced a bill that would permit government entities or public funds to invest up to 10% of their capital in bitcoin and other digital assets.
The broader outlook remains bullish, with on-chain data pointing to capitulation of weak hands and continued accumulation by large investors.
“According to CryptoQuant data, the share of investors with a balance of at least 1,000 BTC who purchased coins in the last 155 days increased from 43% to 60%, reflecting the emergence of large players amid optimistic sentiment,” said Alex Kuptsikevich, chief market analyst at the FxPro.
QCP Capital expects this week to test BTC’s correlation with equities, particularly as a favorable regulatory environment offers potential support. Stay alert!
What to Watch
- Crypto:
- Jan. 28, 1:00 p.m.: Hedera (HBAR) network upgrade (v0.57.5).
- Jan. 29: Cardano’s Plomin hard fork network upgrade.
- Jan. 29: Ice Open Network (ION) mainnet launch.
- Feb. 2, 8:00 p.m.: Core blockchain Athena hard fork network upgrade (v1.0.14)
- Feb. 4: MicroStrategy (MSTR) Q4, FY 2024 earnings.
- Feb. 4: Pepecoin (PEPE) halving. At block 400,000, the reward will drop to 31,250 PEPE.
- Feb. 5, 3:00 p.m.: Boba Network’s Holocene hard fork network upgrade for its Ethereum-based L2 mainnet.
- Feb. 6, 8:00 a.m.: Shentu Chain network upgrade (v2.14.0).
- Feb. 12: Hut 8 Corp. (HUT) Q4 2024 earnings.
- Feb. 15: Qtum (QTUM) hard fork network upgrade at block 4,590,000.
- Feb. 18 (after market close): Semler Scientific (SMLR) Q4 2024 earnings.
- Feb. 20: Coinbase Global (COIN) Q4 2024 earnings.
- Macro
Token Events
- Governance votes & calls
- Morpho DAO is voting whether to reduce MORPHO rewards by 30% across all assets and networks and set all assets other than those with ETH or USD denominations to have the same reward rate as BTC-denominated assets.
- Sky DAO is voting whether to reduce the WBTC liquidation threshold from 55% to 50% on SparkLend Ethereum.
- Yearn DAO is voting whether to fund and endorse Bearn, a new subDAO aiming to build and launch products on Berachain.
- Unlocks
- Jan. 28: Tribal Token (TRIBL) to unlock 14% of its circulating supply worth $60 million.
- Jan. 31: Optimism (OP) to unlock 2.32% of circulating supply worth $52.9 million.
- Jan. 31: Jupiter (JUP) to unlock 41.5% of circulating supply worth $626 million.
- Feb. 1: Sui (SUI) to unlocked about 2.13% of its circulating supply worth $226 million.
- Token Listings
- Jan. 28: Pudgy Penguins (PENGU) and Magic Eden (ME) to be listed on Kraken.
- Jan. 29: Cronos (CRO), Movement (MOVE) and Usual (USUAL) to be listed on Kraken.
Conferences:
Token Talk
By Shaurya Malwa
- AI-focused Venice AI (VVV) zoomed to a $1 billion market capitalization on Monday on its appeal of offering private, uncensored AI inference access without per-request fees.
- The Base-based token was listed on Coinbase — one of the rare assets listed on the exchange on the day of launch — which may have helped propel the move.
- Users stake VVV tokens to gain API access to AI stalwart DeepSeek, with ongoing rewards from token emissions.
Derivatives Positioning
- CME’s bitcoin and ether futures saw a notable drop in open interest on Monday, as traders de-risked during a sharp slide in Nvidia and other Nasdaq stocks.
- Perpetual funding rates for major coins have stabilized in the range of an annualized 5%-10%. Funding rates for BTC had briefly flipped bearish below zero early Monday.
- BTC calls are pricier than puts across all timeframes, while ETH’s front-end puts trade pricier, reflecting concerns of extended price drops in the next couple of days.
Market Movements:
- BTC is up 1.32% from 4 p.m. ET Monday to $98,784.45 (24hrs: +4.07%)
- ETH is up 1.62% at $3,050.20 (24hrs: +4.52%)
- CoinDesk 20 is up 3.2% to 3,536.28 (24hrs: +6.73%)
- CESR Composite Staking Rate is up 18 bps to 3.19%
- BTC funding rate is at 0.0084% (9.2221% annualized) on Binance
- DXY is up 0.57% at 107.95
- Gold is up 0.34% at $2,743.59/oz
- Silver is up 0.35% to $30.16/oz
- Nikkei 225 closed -1.39% at 39,016.87
- Hang Seng closed +0.14% to 20,225.11
- FTSE is up 0.58% at 8,553.75
- Euro Stoxx 50 is up 0.47% at 5,212.71
- DJIA closed on Monday +0.65% to 44,713.58
- S&P 500 closed -1.46% at 6,012.28
- Nasdaq closed -3.07% at 19,341.83
- S&P/TSX Composite Index closed -0.7% at 25,289.15
- S&P 40 Latin America closed +0.34% at 2,330.61
- U.S. 10-year Treasury is up 3 bps at 4.57%
- E-mini S&P 500 futures are up 0.39% at 6070.50
- E-mini Nasdaq-100 futures are up 0.67% at 21,400.25
- E-mini Dow Jones Industrial Average Index futures are unchanged at 44,935.00
Bitcoin Stats:
- BTC Dominance: 59.16 (0.15%)
- Ethereum to bitcoin ratio: 0.031 (-0.32%)
- Hashrate (seven-day moving average): 767 EH/s
- Hashprice (spot): $58.7
- Total Fees: 6.13 BTC/ $616,619
- CME Futures Open Interest: 170,240 BTC
- BTC priced in gold: 37.6 oz
- BTC vs gold market cap: 10.68%
Technical Analysis
- ETH carved out a candle with a long tail Monday, signaling bear fatigue at intraday lows. That’s often seen as a sign of an impending trend change higher.
- Prices, however, remain trapped in a descending channel, suggesting a bearish outlook.
Crypto Equities
- MicroStrategy (MSTR): closed on Monday at $347.92 (-1.63%), down 0.36% at $346.66 in pre-market.
- Coinbase Global (COIN): closed at $277.99 (-6.71%), up 0.76% at $280.11 in pre-market.
- Galaxy Digital Holdings (GLXY): closed at C$27.36 (-15.87%).
- MARA Holdings (MARA): closed at $18.28 (-8.53%), up 0.63% at $18.40 in pre-market.
- Riot Platforms (RIOT): closed at $11.45 (-15.44%), down 6.87% at $12.61 in pre-market.
- Core Scientific (CORZ): closed at $11.28 (-29.41%), up 2.22% at $11.53 in pre-market.
- CleanSpark (CLSK): closed at $10.31 (-10.62%), up 1.21% at $10.43 in pre-market.
- CoinShares Valkyrie Bitcoin Miners ETF (WGMI): closed at $20.78 (-20.75%), down 3.99% at $21.61 in pre-market.
- Semler Scientific (SMLR): closed at $50.43 (-9.07%).
- Exodus Movement (EXOD): closed at $74 (+20.82%), unchanged in pre-market.
ETF Flows
ETF Flows
Spot BTC ETFs:
- Daily net flow: -$457.6 million
- Cumulative net flows: $39.49 billion
- Total BTC holdings ~ 1.157 million.
Spot ETH ETFs
- Daily net flow: -$136.2 million
- Cumulative net flows: $2.67 billion
- Total ETH holdings ~ 3.59 million.
Source: Farside Investors
Overnight Flows
Chart of the Day
- Daily trading volume on Solana-based decentralized exchanges has dropped sharply to less than $10 billon from the high of $35 billion registered on Jan. 18, when the TRUMP token debuted and triggered a memecoin frenzy.
- Volumes, however, remain elevated at the average activity levels seen in November and December.
While You Were Sleeping
- KuCoin to Pay Nearly $300M Fine After Pleading Guilty to DOJ Charges (CoinDesk): Crypto exchange KuCoin pleaded guilty to operating an unlicensed money-transmitting business, agreeing to pay $297 million in penalties and to exit the U.S. for two years.
- Tuttle Capital Proposes First-Ever Leveraged ETFs of TRUMP, MELANIA, Cardano, Others (CoinDesk): Tuttle Capital Management filed 10 2x leveraged crypto ETF proposals with the SEC, including those tracking TRUMP and MELANIA memecoins.
- Mad Money’s Jim Cramer Says ‘Own Bitcoin, Not MicroStrategy’ (CoinDesk): On Monday’s Mad Money, Jim Cramer endorsed owning bitcoin while cautioning against MicroStrategy, the largest corporate bitcoin holder. Critics frequently interpret his advice as a contrarian indicator.
- Ripple’s CEO Brad Garlinghouse Bats for Diversified U.S. Crypto Reserve (CoinDesk): Ripple CEO Brad Garlinghouse supports a U.S. digital asset reserve representing multiple tokens, not just bitcoin, calling BTC maximalism “the enemy of crypto progress.”
- BOJ to Raise Rates Again by July, Eventually Eye Hike to 1.5%, Says Ex-Policymaker (Reuters): Former Bank of Japan board member Makoto Sakurai predicts the bank will raise interest rates again by mid-2025, targeting 1.5% within two years.
- Dollar Climbs as Trump Puts Tariff Threats Back on the Agenda (Bloomberg): The dollar strengthened against major currencies, with the yen leading losses after falling over 0.9%, as President Trump and Treasury Secretary Scott Bessent reignited tariff concerns.
- OpenAI’s Altman Vows ‘Better Models’ as China’s DeepSeek Disrupts Global Race (Financial Times): On Monday, OpenAI CEO Sam Altman responded to DeepSeek’s generative AI rival to ChatGPT by pledging to accelerate product launches and deliver superior models.
In the Ether
