TL;DR

• Bitcoin experienced a significant drop in trading volume in the last 24 hours, with Ethereum showing weakness. The support level for Ethereum is around $2,300.
• Bitcoin ETFs saw a net outflow of $280 million, while Ethereum ETFs recorded a net outflow of $47.4 million.
• The Governor of the Bank of Japan stated that they will continue raising interest rates if economic and price performance meets expectations.
• Aave partnered with Sky to launch the Sky Aave Force initiative.
• In the last 24 hours, the crypto sector raised a total of $18.8 million, encompasing sectors like GameFi and blockchain security.
• Ethena Labs announced on September 2 the launch of its third-season airdrop campaign, building upon and expanding the content of the second season.

Market Analysis

According to Gate.io, as of 4:00 (UTC+0) on September 4 [1]:

• BTC —— In the last 24 hours, BTC experienced significant volatility. At around 13:00 (UTC+0) on September 3, BTC saw an initial decline alongside an increase in trading volume, followed by a sharp drop at 1:00 (UTC+0) the next day, hitting a low of $55,611. It then quickly rebounded to $56,797, resulting in an overall 24-hour decrease of about 2.79%. Trading volume surged during the decline, signaling strong selling pressure in the market. The moving average system suggests a bearish short-term outlook. Whether the rebound can continue remains uncertain; if it weakens, BTC may enter a new downward trend[2].

• ETH —— In the past 24 hours, ETH’s price movement closely followed BTC, also showing a notable downward trend. The price dropped from above $2,400 to a low of $2,306.65, reflecting a 24-hour decline of approximately 4.44%. In the short term, traders should monitor the support around $2,300 closely; if it fails to hold, there could be a risk of further downside [3].

• ETF —— On September 3, Bitcoin ETFs saw a total net outflow of $280 million, while Ethereum ETFs experienced a net outflow of $47.4 million.
• Altcoins —— Along with BTC’s decline, the altcoin market generally trended downward, though a few tokens like XMR and SUI bucked the trend with gains.
• U.S. Stock Market Indexes —— The three major U.S. indexes experienced significant declines: the S&P 500 fell by 2.12%, the Nasdaq by 3.26%, and the Dow Jones by 1.51%. The semiconductor sector, particularly Nvidia, saw the largest drop, with an 8.47% decline following its earnings report [4].
• Fear and Greed Index —— The Fear and Greed Index stood at 27, indicating a state of fear in the market. Future market trends should be closely monitored [5].

Top Performers

According to Gate.io, based on trading volume and price performance in the last 24 hours, the following token stood out as of 4:00 (UTC+0) on September 4:

UXLINK —— The token saw a daily increase of approximately 41.62%, with a circulating market cap of $15.652 million.
UXLINK is an innovative blockchain-based social platform within the Web3 ecosystem, integrating real-world social connections with decentralized technology to offer secure social interactions and crypto asset trading.
On September 3, UXLINK announced a new round of funding and its listing on multiple centralized exchanges, which may have contributed to its significant price increase in a single day [6].

QUICK —— The token experienced a daily increase of approximately 19.05%, with a market capitalization reaching $30.1702 million.
QuickSwap is a decentralized exchange (DEX) on the Polygon network, aiming to attract users through low transaction fees and fast trading experiences.
Recently, QuickSwap has been engaging frequently with Tron founder Justin Sun on Twitter, which the community speculates could signal a potential launch on the Tron network. Additionally, the project has initiated two proposals: one to burn tokens repurchased using revenue, and another to extend perpetual contract products to Ethereum. These events may have contributed to the rapid rise in QuickSwap’s token price [7].

HARD —— The token saw a daily increase of approximately 17.16%, with a circulating market cap of $21.7581 million.
HARD Protocol is a decentralized cross-chain money market built on the Kava blockchain, supporting the supply and borrowing of various crypto assets. It leverages Kava’s security and cross-chain capabilities to offer open decentralized financial services.
Recently, HARD Protocol announced the upcoming launch of Kava Lend v2, which will integrate with ecosystems such as Ethereum and Cosmos. These new developments are likely among the factors driving the price increase of HARD [8].

Data Highlights

Bitcoin ETFs saw a total net outflow of $280 million yesterday, while Ethereum ETFs experienced a net outflow of $47.4 million
According to SoSoValue data, the U.S. Bitcoin spot ETF recorded a single-day net outflow of $280 million on September 3, with a total daily trading volume of $1.561 billion. The cumulative net inflow of Bitcoin spot ETFs now stands at $17.312 billion, and the total value of BTC managed by these ETFs is $52.689 billion, representing 4.58% of Bitcoin’s total market capitalization.
This marks the fifth consecutive day of outflows, with the trend intensifying. The main factors behind this include continued outflows from Grayscale’s GBTC and a $160 million single-day outflow from Fidelity’s FBTC. Meanwhile, BlackRock’s IBIT, the largest Bitcoin ETF by net asset size, has paused inflows for two consecutive days. These developments further reflect a waning interest from external capital in crypto assets [9][10].

Ethereum Layer 1 revenue has dropped by 99%, while Layer 2 transaction volume and user base have doubled
According to the latest monitoring by TokenTerminal, over the past six months following the Dencun upgrade, Ethereum Layer 2 (L2) transaction fees have seen a significant decrease, intensifying competition among L2 scaling solutions. Adrian Brink, CEO of Anoma, pointed out that the number of L2 solutions on the Ethereum network currently far exceeds actual market demand. He estimates that the number of L2 solutions is roughly ten times what the industry needs. In this highly competitive environment, L2 solutions are competing to attract users by offering lower transaction fees.

As Layer 2 fees have significantly decreased, daily transaction counts and monthly active users on L2 networks have doubled. Users are gradually shifting to settling on Layer 2 solutions rather than relying on Ethereum’s base layer. This has created a self-reinforcing mechanism, further driving down network fees.

In contrast, Ethereum Layer 1’s performance has been markedly different. Compared to six months ago, its revenue has plummeted by 99%. On September 1, Ethereum’s mainnet daily revenue dropped to a low of $190,000, before seeing a slight recovery to $1.1 million on September 2, 2024.

The lower transaction fees on Ethereum Layer 2 have attracted more mainnet users to shift their activity to L2 solutions. As a result of decreasing fees on the mainnet, the amount of ETH being burned has also dropped, resulting in periods of daily inflation for Ethereum. This may be one of the contributing factors to the recent lackluster performance of ETH’s price [11].

NVIDIA’s stock price dropped 9.53%, while both the semiconductor and crypto AI sectors saw sharp declines
On Tuesday’s U.S. trading session, NVIDIA’s stock fell by 9.53%, pulling down tech stocks in the semiconductor sector. The VanEck Semiconductor ETF (SMH), a major semiconductor ETF, closed down 7.5%, marking its largest single-day drop since March 2020 [12].

Three key factors may have contributed to this decline. First, despite NVIDIA’s revenue growth in its latest earnings report, the growth rate failed to meet market expectations. This triggered a stock pullback, which began last week following the report. As a leading company in the semiconductor industry, NVIDIA significantly influences investor expectations for other players in the sector. Second, after hours, media reports revealed that the U.S. Department of Justice had issued subpoenas to NVIDIA and several third-party companies, seeking evidence of antitrust violations. This development likely intensified market anxiety, with some investors potentially selling off their shares upon receiving early news of the investigation. Lastly, broader market conditions also played a role, as macroeconomic factors, including potential rate hikes by the Bank of Japan and U.S. economic policies, led to a broad decline in the U.S. markets, with several indices falling more than 2% by the close.

These developments also impacted the crypto AI sector, with tokens like TAO, RENDER, and FET seeing significant declines of around 10% [13].

Spotlight Analysis

The Governor of the Bank of Japan (BOJ) stated that if economic and price performance aligns with expectations, the BOJ will continue raising interest rates
On September 3, BOJ Governor Kazuo Ueda submitted a document to a government panel, reiterating the central bank’s stance on continuing rate hikes if conditions meet expectations. This signals that the BOJ may adopt further monetary tightening policies to address economic and inflationary shifts [14].

Raising interest rates in Japan would increase the cost of international arbitrage, potentially leading to capital returning to Japan, especially given that the U.S. Federal Reserve has not indicated any clear plans for rate cuts. This could pressure global liquidity, particularly in emerging markets. Additionally, divergent interest rate environments may heighten risk-aversion sentiment, pushing investors away from high-risk assets like cryptocurrencies and toward more stable investments. Last month, the BOJ implemented its first rate hike in nearly 17 years, raising the benchmark rate from 0%-0.1% to 0.25%, which triggered a wave of sell-offs in high-risk assets, causing significant volatility in the foreign exchange, stock, and cryptocurrency markets.

Aave Partners with Sky to Launch Sky Aave Force Initiative
On September 3, Aave Labs announced on the X platform the launch of the Sky Aave Force initiative, a collaboration between Aave Labs and Sky (formerly MakerDAO). This initiative aims to promote the widespread adoption of DeFi by enhancing accessibility and integration with existing financial systems [15].

Two key highlights of this initiative are the deep collaboration between Spark and Aave and the introduction of a new deposit module. Spark, which recently launched Sky’s stablecoin USDS and Savings USDS (sUSDS), will be integrated into Aave V3. This integration is expected to expand the use cases of USDS and facilitate the exchange of DAI to USDS within Aave. Additionally, SPK tokens will be distributed as incentives to sUSDS suppliers, potentially making USDS yield more cost-effective compared to USDT and USDC. In the short term, this could drive an increase in Aave’s total value locked (TVL).

Furthermore, by introducing the D3M module in the Aave Lido market, Maker can directly inject USDS into the Lido market on Aave V3, boosting liquidity. This helps stabilize interest rates and reduce volatility. The collaboration between Maker, Aave, and Lido—leaders in decentralized stablecoins, lending markets, and liquid staking, respectively—will further reinforce their positions in their respective sectors.

FBI Report: North Korean Cybercriminals Intensify Attacks on Web3 Industry Professionals
According to a disclosure by the Federal Bureau of Investigation (FBI), North Korean cybercriminals are increasingly targeting professionals in the Web3 industry. The report highlights that North Korean hacker groups use sophisticated social engineering tactics and advanced technical skills to attack their victims. The investigation also suggests that North Korean malicious actors may soon launch targeted attacks on cryptocurrency exchange-traded funds (ETFs) [16].

The FBI advises readers to take precautions in the following areas:

1. Be wary of downloading malicious software in scenarios involving new job opportunities or business investments;
2. Avoid clicking on unknown download links or installing unfamiliar code, plugins, or software;
3. Remain vigilant against impersonation of direct or indirect contacts, especially when personal information or financial matters are involved.

Funding News

According to RootData, between September 3 and September 4, 2024, there were six funding rounds in the Web3 sector. Excluding undisclosed amounts, the highest funding round reached $16 million, with a total of $18.8 million raised, spanning sectors such as GameFi and blockchain security services [17].

Hypernative – On September 3, 2024, Web3 security company Hypernative announced the successful completion of a $16 million Series A funding round. Hypernative specializes in blockchain security, offering a real-time risk monitoring platform designed to detect potential threats before hacks occur, giving users time to take preventive measures. The funds raised will be used to enhance Hypernative’s AI-driven security solutions and expand its operations in the Asia-Pacific region and the United States.

CryptoHunter World – On September 3, 2024, CryptoHunter World announced the successful completion of a $2.8 million private funding round. CryptoHunter World is an innovative collectible RPG game that integrates blockchain technology, using GPS to merge players’ real-world movements with the game’s virtual world. Players earn token rewards based on their travel distance and combat performance. This funding will accelerate the game’s development, particularly in blockchain integration and optimizing the gaming experience.

UXLINK – On September 3, UXLINK announced on its official X platform that it had received strategic investment from Animoca. UXLINK is a pioneering Web3 social system designed for mass adoption, featuring a series of highly modular Dapps that provide everything from onboarding tools to graphical formation, group tools, and social trading, all seamlessly integrated into Telegram. UXLINK is already listed on several centralized exchanges, with a circulating market cap of approximately $15.652 million.

Airdrop Opportunities

Ethena Labs
Ethena Labs has successfully completed its Season 2 airdrop campaign, allocating 5% of the total ENA tokens as rewards to participants. Users will be able to check their ENA token balance on September 9 and claim them on September 30. The Season 3 airdrop began on September 4, 2024, and will run until March 23, 2025. Participants can accumulate points through various methods, such as holding USDe, staking sUSDe, or providing liquidity, with different activities earning different point multipliers. Some key rules are as follows:[18]

1. Users can view the amount of ENA tokens they are eligible for on September 9, and the tokens will be distributed on September 30.
2. The top 2,000 wallet addresses holding the most USDe will have 50% of their ENA rewards locked, subject to a six-month linear unlocking schedule.
3. To qualify for Season 3 rewards, users must convert their ENA tokens to sENA.
4. Users must maintain their average USDe balance as of September 1; otherwise, their ENA token allocation will be proportionally reduced.

Reference：

1. Gate.io, https://www.gate.io/price
2. Gate.io, https://www.gate.io/price/bitcoin-btc
3. Gate.io, https://www.gate.io/price/ethereum-eth
4. Yahoo Finance, https://finance.yahoo.com/markets/
5. Gate.io, https://www.gate.io/bigdata/homeindex
6. Gate.io, https://www.gate.io/price/uxlink-uxlink
7. Gate.io, https://www.gate.io/price/quickswap-quick
8. Gate.io, https://www.gate.io/price/hardprotocol-hard
9. SosoValue, https://sosovalue.xyz/assets/etf/us-btc-spot
10. SosoValue, https://sosovalue.xyz/assets/etf/us-eth-spot
11. Tokenterminal, https://tokenterminal.com
12. Yahoo Finance, https://finance.yahoo.com/sectors/technology/semiconductors/
13. CoinGecko, https://www.coingecko.com/en/categories/ai-agents
14. Bloomberg,https://www.bloomberg.com
15. Aave, https://x.com/aave/status/1830788022264045867
16. FBI, https://www.ic3.gov/Media/Y2024/PSA240903
17. Rootdata, https://www.rootdata.com/Fundraising
18. Mirror, https://mirror.xyz

Gate Research
Gate Research is a comprehensive blockchain and crypto research platform, providing readers with in-depth content, including technical analysis, hot insights, market reviews, industry research, trend forecasts, and macroeconomic policy analysis.

Click the Link to learn more

Disclaimer
Investing in the cryptocurrency market involves high risk, and it is recommended that users conduct independent research and fully understand the nature of the assets and products they are purchasing before making any investment decisions. Gate.io is not responsible for any losses or damages caused by such investment decisions.