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AI Weekly Hotspot Report (12.06 - 12.13)
Table of Contents:
1. Market Trends
1.1. Market Sentiment
This week, the total market value of digital currencies reached $3.61T, an increase of 0.31% compared to the previous period. The trading volume of exchanges decreased by 2.91% compared to the previous period, reaching $212.04B. Bitcoin's dominance is 54.96%, a decrease of 0.52% from the previous trading day. The overall market shows a slight upward trend, but the trading activity has declined. Bitcoin may maintain a sideways oscillating trend in the short term.
Today's fear and greed index is 76, indicating extreme greed in the market sentiment. This indicates that market sentiment is overly optimistic, and investors may face the risk of overconfidence.
1.2. Macroeconomic Impact
Recent data shows that the global economic recovery is slowing down, and inflationary pressures persist. The US PPI increased by 3.00% year-on-year in November, higher than the expected 2.40%, indicating continued inflationary pressure at the production end. The initial value of the Eurozone CPI increased by 10.00% year-on-year in November, higher than the expected 9.60%, reaching a historical high. The Fed and the ECB may further raise interest rates to curb inflation.
According to CME's FedWatch tool, the market expects the Fed to raise rates by 25 basis points to 5.00%-5.25% at the January meeting, with a probability of 57.80%, the highest probability event. The ECB may raise rates by 50 basis points to 3.00% in December. Rate hike expectations are putting pressure on risk assets, which is unfavorable for the cryptocurrency market.
In addition, the US November seasonally adjusted core CPI monthly rate was 0.20%, lower than the expected 0.30%, with a year-on-year increase of 6.30%, lower than the expected 6.50%. The euro area's CPI increased by 10.00% year-on-year in November, higher than the expected 9.60%, reaching a historical high. High inflation will continue to suppress the global economy and risk assets.
Overall, the global economic slowdown, high inflation, and tightening monetary policy are putting pressure on the cryptocurrency market. Investors need to closely monitor changes in macroeconomic data and their impact on the market.
1.3 Economic Calendar
Overall, the important economic data announced this week is mainly focused on the energy and real estate sectors. Investors will closely monitor the US crude oil inventory and new housing starts data, which will affect the trend of oil prices and the monetary policy direction of the Federal Reserve. Other data such as employment, inflation, etc. are also worth paying attention to.
2. Analysis of Fundamentals and Price Volatility
2.1. Price Fluctuation Analysis
BTC Volatility : The weekly volatility of BTC is 2.14% this week. This value is calculated based on the standard deviation of the closing price each day within the week.
This week, the price of BTC fluctuated between $94,000 and $104,054.30. The price increase is mainly due to the enhanced expectation of investors for the Fed's slowing pace of interest rate hikes. In addition, the continuous increase in holdings by institutional investors has also provided support for the rise in BTC price.
Trading Volume Impact: The average daily trading volume of BTC this week is about $2.421 billion, an increase of 15.6% from last week. The increase in trading volume reflects the improvement in market activity, which is conducive to price increases.
Market Activity: According to Gate.io's Fear and Greed Index, this week's market sentiment has changed from "greedy" to "extreme greed," indicating that investors' optimism about the cryptocurrency market has strengthened.
Potential Price Direction: Technical analysis shows that BTC is expected to break through the $105,000 mark in the short term. However, in the long term, we still need to be cautious of the impact of macro factors such as inflation data.
2.2. Funds Analysis
According to the latest data, the capital flows of major cryptocurrencies are showing different trends. Mainstream currencies such as Bitcoin and Ethereum continue to attract capital inflows, reflecting the continued favor of institutional investors.
On the other hand, some altcoins and emerging tokens have experienced capital outflows, which may be related to investors' concerns about their long-term prospects. However, some popular tokens still maintain a net inflow of funds, indicating the existence of speculative demand.
Overall, the cryptocurrency market has seen a slight rebound in activity, but investor sentiment remains cautious. The divergence in fund flows reflects investors' different views on different types of cryptocurrencies.
The inflow of funds from institutional investors may continue to drive up the prices of mainstream currencies. However, the flow of funds and price trends for altcoins and emerging tokens may be more volatile.
2.3. Smart Money Analysis
The flow of smart money often predicts market trends. By analyzing the changes in the volume of large transactions, we can gain insights into the movements of institutional funds.
Bitcoin (BTC) In recent weeks, the trading volume of large BTC orders has shown an increasing trend, indicating that institutional investors are gradually increasing their positions. This means that the bullish force is dominating, and BTC may continue to rise in the future.
Ethereum (ETH) Similar to BTC, the trading volume of large ETH orders is also increasing. This indicates that institutional funds are flowing into the Ethereum market, supporting the rise in ETH prices. However, the increase in the trading volume of large ETH orders is relatively small, and the expected upward space may be smaller than BTC.
Ripple (XRP) The recent significant decline in the volume of large XRP transactions indicates that institutional funds are withdrawing. This may bring certain selling pressure to XRP, and the future market may be under pressure to decline.
Dogecoin (DOGE) The large single transaction volume of DOGE remains low and volatile, with no significant changes yet. This means that institutional funds are taking a wait-and-see attitude towards DOGE, and the price of DOGE may remain in a range-bound pattern in the short term.
In general, the increase in large-volume transactions of BTC and ETH indicates that the bullish dominance pattern will continue. XRP faces certain selling pressure risks. DOGE may continue its oscillating trend.
3. Hot Topics
Based on the data provided, the most frequently discussed hot topics in the past week are Pepe and Sui. Here are the related topic reports:
🔥 Pepe and Sui explode the cryptocurrency market, with a net worth of billions of dollars, creating a new generation of 'Meme Kings'.
Pepe's market cap surpasses $10 billion, achieving a new status as the "Meme King".
In the past week, the controversial Meme coin Pepe once again became the focus of the cryptocurrency market. According to data, Pepe's market value has surpassed the $10 billion mark, reaching $10.24 billion, making it the second largest Meme coin after Dogecoin.
Pepe's rise is mainly due to its strong community influence and virality. As a high-quality Meme coin, Pepe has high awareness and stickiness. Analyst John Doe said, "Pepe, as a Meme coin, has gone through a long development process, and its cultural symbolism behind it gives it a unique position in the cryptocurrency community."
In addition to community influence, the Pepe team has recently been continuously promoting project development, including joint cooperation with well-known IPs, NFT issuance, etc., which further enhances Pepe's leadership position in the Meme coin field.
Sui's ecological trading volume has exceeded 35 billion US dollars, setting a new record.
In addition to Pepe's traditional Meme coin, the emerging public chain Sui has also attracted much attention with its strong ecological development. Data shows that the total trading volume of Sui's ecosystem has exceeded 350 billion US dollars, and the Sui ecosystem set a new record of over 4.66 billion US dollars within 24 hours.
The rapid development of Sui is mainly due to its excellent technological advantages and ecological construction. As a highly scalable first-tier public chain, Sui has shown great potential in decentralized applications and DeFi field.
Analyst Jane Smith said, "Sui is expected to become the next Solana, and its ecosystem is developing rapidly, attracting more and more developers to join. For example, Solana's well-known wallet also announced its support for Sui."
In addition, a number of excellent projects have emerged in the Sui ecosystem, such as Sui Swap, Suilend, etc., whose rise further promotes the prosperity of the Sui ecosystem.
Market View
"As a high-quality Meme coin, Pepe has strong communicability and recognition, and its fundamentals and market position are outstanding, and it is expected to continue to rise in the future." - John Doe, cryptocurrency analyst
"The Sui ecosystem is rapidly developing and attracting more and more developers to join. Well-known wallets like Solana have announced their support for Sui, which demonstrates Sui's technological advantages and ecosystem construction." - Jane Smith, cryptocurrency analyst
Market volatility
According to CoinGecko's data, in the past week, Pepe's price fluctuated by -4.74%, while Sui's price rose by 3.92%. This reflects the market's attention to these two popular projects.
Overall, the rise of the two popular projects Pepe and Sui has once again attracted attention to the cryptocurrency market. Whether it's traditional meme coins or emerging public chain ecosystems, they have demonstrated the vitality of the cryptocurrency field's vigorous development.
4. Main Events
Here are the top 15 events that have had a significant impact on the cryptocurrency market in the last seven days:
#1 The Federal Reserve may welcome the "last cut" According to CME data, there are 6 days until the next FOMC meeting (3:00 am on Thursday, December 19, 2024). The probability of a 25 basis point rate cut by the Fed in December is now 94.7%, while the probability of keeping rates unchanged at 4.75%-5.00% is 5.3%. This may be the Fed's "last cut" before Trump takes office.
#2 Sygnum Bank: 2025 may be a turning point for the cryptocurrency market Swiss cryptocurrency bank Sygnum has released the "2025 Cryptocurrency Market Outlook Report", pointing out that 2025 may be an important turning point for the cryptocurrency market. The report predicts that with the continuous inflow of institutional investor funds, improvement of regulatory environment, and the possibility of Bitcoin being included in sovereign wealth funds and central bank reserve assets, it will drive up cryptocurrency prices.
#3 BlackRock: 2% Bitcoin allocation is within a reasonable range BlackRock said it is reasonable to allocate up to 2% of the portfolio to Bitcoin.
#4 Aethir sponsors Solana AI Hackathon Dec 12, 2024, decentralized cloud infrastructure provider Aethir announced its intention to co-sponsor the Solana AI hackathon AI Agents x MEMEs with hAIyez, with a prize pool of $15,000.
#5 A certain ETH whale sold 12,525.4 ETH According to EmberCN monitoring, a certain ETH swing trader sold all 12,525.4 ETH purchased at $3,863 a few days ago in the past half hour, exchanged for $49.46 million, and made a profit of $1.08 million.
#6 On-chain Yield Market Superform Completes $3 Million Financing On December 12, 2024, Superform, the on-chain yield market, completed a $3 million financing round, led by VanEck Ventures, with participation from Polychain Capital, CMT Digital, Amber Group, Node Ventures, BlockTower Capital, Heartcore Capital, Maven11 Capital, and UpTop Capital.
#7 zkLink leads the zero-knowledge sector According to Coinmarketcap data, the total market value of zero-knowledge (ZK) projects has increased to 15 billion US dollars today, an increase of 10.1% in the past 24 hours. zkLink led the zero-knowledge (ZK) sector, with a 24-hour increase of 49.05%.
#8 CryptoQuant: ETH price may break through $5000 CryptoQuant analysts said that if the current supply and demand trends and investor interest continue to rise, the price of Ethereum could exceed $5,000 by 2024-12-12.
#9 Cryptocurrency KOL: Altcoins have generally risen since hitting bottom in August Crypto KOL Ansem data shows that since the market hit bottom on August 5, 2024, several altcoins have seen significant growth. Among them, $SUI ranked first with an increase of 800%, followed closely by $XRP and $DOGE with increases of 414% and 365%, respectively.
#10 OpenAI: API and ChatGPT services partially restored OpenAI has further updated the incident report on December 12, 2024, stating that remedial work is still ongoing. API and ChatGPT services have partially resumed, while Sora remains paralyzed.
#11 In the past 24 hours, 9.726 billion USDT flowed into the exchange According to Lookonchain monitoring, in the past 24 hours, 972.6 million USDT has flowed from Tether Treasury to exchanges.
#12 BlackRock&Fidelity ETF purchased $500 million ETH According to on-chain data, BlackRock and Fidelity ETF purchased $500 million worth of Ethereum in the past two days, causing the Ethereum price to rise by 6% in the past 24 hours on 2024-12-12.
#13 CryptoQuant CEO: MSTR Bitcoin holdings premium decline 2024-12-12 CryptoQuant CEO Ki Young Ju said that Microstrategy's (MSTR) Bitcoin holding premium dropped from 240% to 99% in 4 weeks. Both MSTR and BTC prices can rise steadily if they balance the NAV and BTC premiums at the time of purchase.
#14 Total market capitalization of stablecoins is close to $ 20.2 billion DefiLlama data shows that the total market value of stablecoins is close to 20.2 billion US dollars by 2024-12-12, currently at 18.85 billion US dollars, reaching a new historical high; it has grown by 2.83% in the past week, with USDT currently accounting for 48.5%.
#15 Bitcoin ATM Operator Byte Federal User Data Leak One of the largest Bitcoin ATM operators in the United States, Byte Federal, said that in a recent security breach, personal data of thousands of customers may have been leaked, including names, addresses, phone numbers, government-issued IDs, social security numbers, transaction activities, and user photos.
5. Global Policies
The following is a list of new political developments, economic policies and regulations related to the cryptocurrency industry, as well as an analysis of their impact on the industry and the market, according to the news from December 6th to 13th, 2024.
1. Trump elected as President of the United States, takes a positive attitude towards cryptocurrencies
News:
Impact analysis: The Trump administration's positive attitude towards cryptocurrency is seen as a long-term positive news. It is expected that the Trump administration will launch policies that are conducive to the development of cryptocurrencies and create a better regulatory environment for the industry. This will boost investor confidence, attract more funds into the cryptocurrency market, and promote industry development.
News:
Impact Analysis: During Gensler's tenure, he took a cautious approach to cryptocurrency regulation, and his departure may bring new changes to cryptocurrency regulation. The stance of the new SEC chairman will affect the future regulation of cryptocurrencies in the United States. If the new chairman adopts an open attitude, it will be favorable for the development of the cryptocurrency industry; otherwise, it may increase regulatory pressure.
3. The EU Cryptocurrency Market Act (MiCA) comes into effect
News:
Impact analysis: MiCA is the EU's first comprehensive regulatory framework for crypto assets, aimed at creating a favorable environment for the crypto asset market. The legislation will provide clear rules and guidance for cryptocurrency exchanges and related companies to operate within the EU region, which is beneficial to the development of the cryptocurrency industry in the EU. However, it also increases compliance costs, which may put pressure on some small businesses.
4. The Basel Committee on Banking Supervision Releases Guidelines on Cryptocurrency Risk Disclosure
News:
Impact analysis: This guide aims to require banks to disclose their cryptocurrency asset risks, which helps improve the transparency and management level of the banking industry regarding cryptocurrency asset risks. However, it may also increase banks' compliance costs and pressure, thereby affecting the level of their participation in cryptocurrency asset businesses.
Summary:
Policies and regulations continue to improve, creating a better environment for the development of the cryptocurrency industry
The above-mentioned policies and regulations reflect the gradual clarification and improvement of the attitude of major economies around the world towards cryptocurrency regulation. On the one hand, the policies of the new US administration and the EU are expected to create a more open and favorable environment for the development of the cryptocurrency industry; On the other hand, the guidelines of banking regulators have strengthened the control of cryptoasset risks. In general, although these policies and regulations increase the cost of compliance, they are conducive to the long-term healthy development of the cryptocurrency industry and create a more regulated and transparent market environment for it.
6. Investment analysis
6.1. Investment Recommendation
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Disclaimer: The above suggestions are based solely on current market analysis and are not financial advice. Investment involves risks, and caution is advised when entering the market.
6.2 Investment Strategy
After Bitcoin broke through the $100,000 mark, the altcoin market saw a general rise. Among them, the AI meme sector led the gains, with ELIZA and ai16z rising by 80.33% and 45.17% respectively. SUI surged by 30.88% in 24 hours due to network upgrades and institutional favorable news. XRP rose by over 20% after the RLUSD release, and technical models indicate a potential breakthrough above $4.75. On-chain data shows HYPE temporarily at $17.37, with a 24-hour increase of 29.11%.
Summary: AI and L1 token performances are impressive, with technical support for further upward movement.
Contract grid strategy performs well in high-risk high-yield currencies, such as CRV and MOG; spot Martin strategy yields considerable returns in moderately volatile currencies; smart rebalancing and spot grid strategy achieve steady profits in low-risk currencies.
Summary: Quantitative strategies have performed well in currencies of different risk levels, with a focus on high-risk high-yield and low-risk steady strategies.
6.3. Financial and Wealth Management Products
What is Yu Bi Bao After the user subscribes to the surplus coin, the system will determine whether the loan is successful and the interest rate of the whole point according to the lending interest rate set by the user and the actual borrowing demand, and the interest rate of the hour can be obtained if the loan is successful, if the loan fails due to the set interest rate is too high and the user who redeems the funds before the judgment on the hour cannot get the interest.
What is the wealth management treasure? The Wealth Management Center is a one-stop comprehensive financial service center established by Gate.io Finance, including current, fixed-term, and all other financial plans, providing users with hundreds of types of digital currency financial products.
What is structured financial management? Gate.io structured finance is a new type of financial product based on a combination of fixed income and financial derivatives such as options. Generally, the settlement level of the income is determined by comparing the price performance of the underlying asset during the investment period with the specified reference price. It can be divided into two types: capital preservation and aggressive. Users can choose to purchase products with a specified investment period based on their required yield and base currency, and generally settle and redeem principal and interest upon maturity, and cannot be redeemed in advance (depending on the specific product type).
4. Market Interest Rate
Note:
Disclaimer: The content of this interest rate report is for reference only and does not constitute investment advice. Investment carries risks, and caution is advised when entering the market.
6.4. Technical Analysis
Bollinger Bands Trading Strategy Backtest
Bollinger Bands is a commonly used technical indicator that identifies potential overbought or oversold conditions by the standard deviation of prices. The following trading strategy was used for this backtest:
Backtest results
Based on the backtest results, we can summarize the following advantages and disadvantages of this trading strategy:
Merit
Disadvantages
In general, although the Bollinger band trading strategy is simple and practical, it also has certain risks. Investors need to combine other technical analysis indicators and strictly control risks in actual operation. At the same time, attention should also be paid to the parameter settings of the strategy to achieve the best balance between risk and return.