CMC Market Pulse delivers actionable market insights, giving you all the key narratives and developments you need in under 5 minutes.
Market Overview 📉
Crypto markets took a tumble this week, despite a strong showing in the equities market. The week kicked off with a sell off into the CPI release and FOMC on Wednesday. Despite positive economic data for CPI, a hawkish Fed dampened the mood in the crypto markets, erasing the gains earlier in the day. The week ended with both BTC and ETH down significantly, with BTC down 5.98% and ETH down 8.92% over the week.
📌 The US Federal Reserve maintained interest rates at the current range of 5.25% to 5.50%, as analysts expected. However, the Fed only expects one rate cut this year as compared to three, delivering a hawkish tone — Link
📌 Republican Presidential candidate, Donald Trump, indicates his intention to become a “Crypto President.'' In the same week, he also makes an appeal to Bitcoin miners, stating that he wants “all the remaining” Bitcoin to be mined in the USA — Link
📌 Gary Gensler mentions in a Senate hearing that we could see an Ethereum spot ETF S1 filing approval sometime in summer — Link
Why does it matter?
CPI and PPI data came in better than expectations and the Fed expects an interest rate cut for this year. On the crypto front, the Bitcoin spot ETFs continue to see consistent inflows, Trump continues to push his support for crypto as part of his presidential campaign and the ETH S1 filing is sure to come within the next 3 months.
However, in spite of the seemingly positive news against a backdrop of strong equities and economic data, the cryptocurrency market is showing incredible weakness, losing 5.28% of the total crypto market capitalization over the week alone. Big moves in the week liquidated almost $1B in long positions over the past 7 days as well. The price action could potentially indicate a waning momentum in the market where bullish news can no longer move the market higher.
On the other hand, bullish investors argue that the fundamentals are all pointing favorably and that patience will be rewarded, despite how the current market is looking.
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Narrative of the Week 📰
In an overall red week, AI takes the spotlight briefly, with the announcement of Apple’s Apple Intelligence at the annual WWDC. AI tokens see renewed interest in a relatively bearish market especially with major announcements from several key projects in the AI Crypto sector.
📌 Decentralized GPU network, IO.NET, launches their token alongside the IO airdrop. In the same week, Akash Network’s founder Greg Osuri clashed with IO.NET claiming poor performance — Link
📌 Arweave’s parallel computing network AO Computer commences the minting of the AO token, with AR token holders, AOCRED holders and AR bridgers eligible to mint — Link
The merger between FET, OCEAN and AGIX, which was planned for this week, has been shifted to July 15th to accommodate third party integrations with exchanges and other stakeholders — Link
Why does it matter?
AI has been one of the hottest narratives this year, fuelled by Nvidia’s rally in the equities market, OpenAI’s newest releases and tech giants’ foray into the space. Likewise, crypto AI projects have moved in line with their traditional counterparts, seeing attention surge and wane alongside them.
New launches in the AI space such as Aethir (ATH) and IO.NET (IO) have done exceedingly well against a weak crypto market, with IO climbing to a high of $6.40, or 93% higher than its opening trading price of $3.30 on its Binance listing. The ATH token performed similarly, rallying 65% from its launch to a high of $0.1059.
With the entire AI industry still in its early days, startups built on the intersection of AI and crypto continue to spring up. Critics of the AI Crypto sector have derided this, stating that AI does not need crypto and that most AI Crypto startups eventually turn out to be vaporware. On the flip side, many proponents laud the space as pushing the limits of what is possible and support the ambitious nature of these AI Crypto projects.
Major Project Updates 🗓️
📌 The Solana Foundation has withdrawn delegated stakes from Solana validators who participate in mempools that enable sandwich attacks on Solana — Link
📌Solana Labs launched Bond, a blockchain-based customer loyalty platform aimed to let non-crypto brands engage with their customers, with blockchain at the back end — Link
📌 Optimism launches permissionless fraud proofs on the L2, enabling withdrawal from the chain without the need for a trusted third party — Link
📌 Cosmos-based chain, Injective, launches revised tokenomics for INJ, creating a mechanism for a deflationary token — Link
📌 Berachain launches bArtio B2, Berachain’s second public testnet, taking the chain one step closer to mainnet launch — Link
📌 Zero-knowledge Ethereum Virtual Machine (zkEVM) chain Taiko kicks off Trailblazers, a series of rewards allocated to Taiko’s on-chain users and decentralized applications on the chain — Link
Why does it matter?
The decision by the Solana Foundation to withdraw delegated SOL stakes from validators who enable sandwich attacks on Solana has drawn flak from critics who claim that the move indicates a centralization in the network and that the Solana Foundation is censoring their validators.
On the flip side, others defend the move, stating that since these are delegated stakes, the Solana Foundation should have the right to enforce that these validators do not participate in sandwich attacks, which are recognized as a net negative for the ecosystem. Additionally, validators who wish to support mempools are still able to, just without the Solana Foundation’s stake.
DeFi Brief 🏦
Source: https://coinmarketcap.com/chain-ranking/
📌 Paradigm-backed EigenLayer competitor, Symbiotic, launches on mainnet, with deposits reaching their cap in just under six hours. - Link
📌 Ethereum liquid staking solution, Lido Finance, introduces restaking solutions with partners including Mellow Protocol and Symbiotic. - Link
📌 Yield farming aggregator service, Beefy Finance, releases Cowcentrated Liquidity, their automated management solution for concentrated liquidity positions. - Link
📌 SushiSwap introduces Sushi Labs, a team dedicated to executing Sushi’s roadmap and exploring solutions to improving SushiSwap. - Link
📌 Curve founder, Michael Egorov, was liquidated for $140M in CRV loans on Curve’s LlamaLend. Egorov has since repaid the bad debt incurred on the platform resulting from the liquidation - Link
📌 On-chain tracking tool, Zapper, introduces their token ZAP, their native token which will be launching in Q4 2024 and used to incentivize the Zapper ecosystem. - Link
Why does it matter?
The launch of Symbiotic marks the first EigenLayer competitor on Ethereum. With the backing of Lido’s co-founders, Konstantin Lomashuk and Vasiliy Shapovalov, through their venture capital fund, Cyber Fund and Paradigm, Symbiotic has a strong foundation to build off. Additionally, Lido has also focused on integrating Symbiotic with the introduction of restaking vaults. While EigenLayer had the first mover advantage, having launched almost a year ago, with Symbiotic’s focused approach and strategic backers, Symbiotic could pose a significant threat to EigenLayer’s monopoly of the Ethereum restaking sector.
Memecoins 🚀
📌 Iggy Azalea relaunches her telecommunications company, enabling the purchases of mobile phones and cell plans with her memecoin, MOTHER, or SOL. - Link
📌 Social media personality, Andrew Tate and Ansem beef it out on Twitter, with two memecoins with the ticker DADDY launching for both sides. - Link
Chart of the Week 📊
Fundraises 💰
📌 Nuffle Labs raises $13M in funding led by Electric Capital, with support from Robot Ventures, NEAR Foundation Canonical Crypto and more. - Link
📌 Layer3 raises $12M in a Series A funding round led by ParaFi Capital and Greenfield, with participation from Amber Group, Mirana Ventures, and Lattice Fund, among others. - Link
📌 Data storage layer, Irys, raises $8.9M in funding with investments from Framework Ventures, Primitive Ventures, Hypersphere and Permanent Ventures. - Link
📌 Solana-based Squads Labs raises $10M in a Series A funding round led by Electric Capital, with participation from Coinbase Ventures, Placeholder VC, RockawayX and more. - Link
📌 Telegram-based game, Pixelverse, raised $5.5M from investors including Delphi Digital, Mechanism Capital, Merit Circle and Animoca Brands, among others. - Link
Airdrops Abound 🎁
📌 ZkEVM L2 chain, zkSync, announces the airdrop of 17.5% of the ZK token supply as part of their genesis airdrop. The airdrop will go live next Monday. - Link
📌 Omnichain perpetuals DEX, Orderly Network, announces their airdrop for 10% of the ORDER total token supply to their early adopters. - Link
📌 Prediction markets layer, Azuro Protocol, announces the checker for their first AZUR token airdrop for snapshot 1. - Link
📌 LayerZero’s CEO, Bryan Pellegrino confirms the LayerZero token generation event (TGE) and airdrop by the end of the month. - Link
Tweet of the Week 📝
Source: BoldLeonidas
A couple more liquidations, then up only?
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