Crypto Market Weekly Report: Highlights and Shadows in the Falling Trend

This week, the crypto market has shown a rapid falling trend, with the market sentiment index plummeting from 33% to 11%. The market capitalization of stablecoins has basically stagnated, indicating that institutional funds are starting to withdraw. The panic in the market is mainly due to a large-scale asset theft incident at a certain trading platform and the aggressive tariff policies proposed by Trump. These factors have intensified concerns about inflation, reduced the likelihood of interest rate cuts by the Federal Reserve, and increased worries about a recession in the U.S. economy, causing a strong impact on market sentiment. The overall market has fallen into extreme panic, with most altcoins underperforming the benchmark index.

Next Week's Forecast Targets

Bullish targets: LTC, S, SOSO, BERA

LTC: This week it rose against the trend, mainly driven by the increased expectations of LTC ETF approval. The spot LTC ETF has been listed in the custody trust and clearing company systems, and the market has high expectations for its approval process. It is expected that the hype around this event will continue in the short term.

S: Sonic has recently entered the Defi industry, attracting a large number of users and funds through high APY. Its main on-chain liquidity staking project has an APY of up to 123%, with a lending interest rate of about 10%, allowing users to earn 20%+ risk-free returns. This has attracted more users to participate, increasing the demand for S tokens and creating a spiral upward trend.

SOSO: SoSoValue flexibly adjusts its development direction, shifting from an AI investment platform to a high APY wealth management service center. Recently launched the second season of mining activities, with staking rewards and airdrops reaching up to 42% APY, attracting more users to participate and enhancing the bullish expectations for SOSO tokens.

BERA: Berachain quickly adjusted the on-chain LSD project staking yield, with WBERA APY reaching as high as 123% and a borrowing rate of 23.68%, allowing arbitrage users to achieve a 100% risk-free annualized return. This strategy effectively curbed the falling trend and turned it into an upward trend.

bearish assets: ETH, SOL, ADA, AI, TKO, RUNE

ETH: A theft incident on a certain trading platform has triggered FUD sentiment in the market, and the upcoming testnet launch of the Pectra upgrade has failed to boost coin prices. A pullback is expected after its implementation.

SOL: The meme coin craze has retreated, with significant capital outflow on the Solana chain, and a notable decline in TVL and trading volume, leading to an almost collapsed ecosystem. A large-scale token unlock is imminent, which may create persistent selling pressure.

ADA: The TVL on the Cardano chain has significantly fallen, with ecological projects generally experiencing capital outflows, and on-chain trading activity has decreased markedly. ADA is expected to remain under pressure.

AI: The AI and Gamefi sectors where Sleepless AI is located have experienced significant corrections. The market has lost interest in the Play to earn model of Gamefi, and AI projects generally have high valuations. A large-scale token unlock is imminent, which may bring downward pressure in the short term.

TKO: As the largest encryption exchange token in Southeast Asia, it has performed poorly due to a certain trading platform's theft incident. A large number of tokens are about to be unlocked, and a fall is expected after the unlock.

RUNE: THORChain has recently attracted attention due to being exploited by hackers for money laundering, resulting in a significant increase in trading volume and transaction fees. However, after the market questioned its alleged involvement in money laundering, the core developers announced their resignation. It is expected that the trading volume will decrease in the future, and under the influence of negative sentiment, the token price may continue to fall.

Market Sentiment Index Analysis

The market sentiment index has dropped from 33% last week to 11%, nearing the extreme fear zone.

Hot Track

Sonic

The TVL of the Sonic chain maintains a high-speed growth, increasing by 10.32% this week to reach $683 million, making it one of the few public chains that still sees capital inflow during a significant fall in the market. Its token S increased by 7.63% this week, indicating market recognition.

Sonic shifts to a Defi strategy, attracting users through high APY. On-chain projects offer up to 123% APY, with borrowing rates around 10%, allowing users to gain over 100% arbitrage space. This greatly stimulates the demand for S tokens, driving up the price.

The key to future development lies in maintaining the efficient operation of the economic flywheel, achieving a virtuous cycle of staking, liquidity release, DeFi empowerment, and token appreciation. It is important to be wary of the risk that new funds cannot cover the arbitrage selling pressure, and to continuously monitor the changes in APY of on-chain DeFi projects.

Berachain

Berachain's TVL slightly increased by 4.66% this week to $3.194 billion, ranking sixth among public chains. Its token BERA rose by 7.26%, showing strong performance.

By increasing the on-chain LSD and lending project APY, Berachain has successfully curbed the early fall trend. The main LSD project APY reaches as high as 190.12%, with a lending interest rate of 23.68%, providing users with up to 100% risk-free arbitrage space.

The development path of Berachain is similar to that of Sonic, facing the same risk of arbitrage selling pressure. In the future, focus on whether new star projects emerge on-chain, as well as changes in the interest rates of LSD projects.

Overall Overview of Market Themes

The best performer this week is the Sociafi track, while the PayFi track performed the worst.

In the Sociafi track, TON and CHZ account for 95.17%, with a relatively small fall, driving the overall performance.

In the PayFi track, XRP, LTC, and XLM account for 94.62%, among which XRP and XLM have a significant fall, resulting in poor overall performance.

Next Week's Major Events in the Crypto Market

• March 3: US February ISM Manufacturing PMI
• March 5: US February ADP employment numbers; Pectra network upgrade launched on Ethereum testnet
• March 7: US February non-farm payroll data and unemployment rate

Summary

This week, the crypto market has fallen significantly, causing widespread concern among investors. A few projects like LTC, Sonic, SoSoValue, and Berachain are attracting users through high APY strategies. In the long term, market stability and the emergence of new projects will be key. Investors are advised to closely monitor market dynamics and operate cautiously.