AI Weekly Highlights Report (6.22-6.28)

You are reading the weekly industry hotspots report generated for you by Gate.io AI Lab. Get a glimpse of the most noteworthy market trends and important events of last week, and receive investment analysis and wealth management strategies recommended for you.

Word count: 9084 words | Reading time 15.7 minutes.

Contents:

1. Market Trends
2. Analysis of Fundamentals and Price Fluctuations
3. Hot Topics
4. Main Events
5. Global Policies
6. Investment Analysis

1. Market Trends

1.1. Market Sentiment

This week, the total market capitalization of digital money reached $10.5 trillion, a decrease of 2.78% from the previous period. The trading volume on exchanges increased by 5.21% to $125 billion. Bitcoin’s price has been trading sideways around $60,000, with trading volume falling slightly. Ethereum’s price has stabilized above $3,200 with the expectation of a favorable ETF. Overall, the market sentiment is cautious and watchful.

According to Gate.io’s Fear and Greed Index, today’s market sentiment is normal with an index of 47. The overall market sentiment remains neutral, with no signs of excessive fear or greed.

Crypto & Tradition Overview as of 10am UTC+8, Jun 28

1.2. Macroeconomic Impact

Recently, global economic data has shown that inflationary pressures remain high and the expectation of rate hikes by the Fed has strengthened. The US May PCE price index rose 4.3% year-on-year, higher than the expected 4.2%, and the core PCE price index rose 4.7% year-on-year, in line with expectations. The eurozone’s May CPI rose 6.1% year-on-year, higher than the expected 6%. The US June manufacturing PMI was 46.0, lower than the previous value of 46.9, marking the eighth consecutive month of contraction. The eurozone’s June manufacturing PMI was 43.6, lower than the previous value of 44.8, marking the seventh consecutive month of contraction.

US May PPI rose 1.1% YoY, lower than the expected 1.5%, and fell 0.3% MoM. Eurozone May PPI rose 0.8% YoY, lower than the previous value of 2.3%. The decline in producer price index may alleviate inflationary pressure, but it will still take time. The high inflation has raised expectations of a rate hike by the Federal Reserve. CME’s consensus shows a 92.5% probability of a 25 basis point rate hike in July and a 35.5% probability of another 25 basis point rate hike in September.

Overall, global economic growth has slowed down, and high inflation has led to tightening of monetary policies in major economies. As a new asset class, the cryptocurrency market may experience further price fluctuations. Investors need to closely follow changes in macroeconomic data and central bank policies.

2. Analysis of Funding and Price Fluctuations

2.1. Price Fluctuation Analysis

Bitcoin (BTC) The weekly volatility of BTC this week is 0.0125. BTC closed near $63,955 this week, down 3.89% from last week. The price of BTC showed a continuous oscillating downtrend this week, with the price mostly staying below $67,000 for the week, breaking below the key $64,000 level multiple times.

Analysis shows that the recent price trend of BTC mainly follows the fluctuation of the overall market. The lack of clear upward signals and price support in the encryption market has led to a continuous bearish and volatile market for BTC. Currently, the price of BTC is still in the adjustment phase after the decline, and it is difficult to return to the $68,000 level in the short term.

Volume Analysis The trading volume of BTC this week has decreased compared to last week, indicating a decrease in market speculation and a hesitant sentiment. The on-chain settlement volume and exchange spot trading volume have both significantly decreased, reflecting investors’ weariness.

Market activity and price direction Despite the good profitability of investors, the trading volume processed and transferred on the Bitcoin network has dropped significantly after reaching a new historical high, highlighting a decrease in market speculation interest. The demand is enough to absorb selling pressure, but not enough to drive further growth. Cash and arbitrage trading are still ongoing, and it is expected that the market will maintain a pattern of range-bound fluctuation trading.

2.2. Financial Analysis

According to the latest fund flow data, Bitcoin and Ethereum remain the main cryptocurrencies for funds inflow and outflow. Bitcoin has experienced a significant outflow of funds in the past week, with a net outflow amounting to 119.752 billion US dollars. This may be related to the distribution of compensation to Mt.Gox creditors, leading to a certain degree of selling pressure.

In contrast, Ethereum has shown a net inflow in the past week, with a net inflow amount of 53.054 billion US dollars. This may be related to the upcoming Ethereum Spot ETF, which has attracted institutional investor funds. However, due to the overall weak market sentiment, Ethereum’s price performance is still somewhat limited.

In terms of alts, Solana and Litecoin have both experienced significant outflows, totaling $99.407 billion and $17.614 billion, respectively, reflecting investors’ cautious attitude towards small-cap cryptocurrencies. In contrast, Filecoin and Cosmos are showing net inflows of $24.692 billion and $19.036 billion, respectively.

Overall, while Bitcoin and Ethereum continue to be the dominant forces of capital inflows, investors are more cautious about small market cap cryptocurrencies. This could affect the overall market activity and price trends. The flow of funds from institutional investors will be one of the key factors in future market performance.

2.3. Smart Money Analysis

BTC Smart Money Analysis According to Nansen data, smart money has flowed out of BTC for about $120 million in the past 24 hours. This indicates that institutional investors are gradually withdrawing their BTC positions. The price of BTC has been continuously declining over the past week, perhaps the main reason for institutional investors to take profit and leave. However, BTC is currently still near a critical support level. If the support level collapses, it may trigger further selling.

ETH Smart Money Analysis Unlike BTC, the 24-hour inflow of smart money into ETH is about 20 million US dollars. This indicates that institutional investors are buying ETH on dips. The relatively stable price of ETH in the past week may be the main reason for attracting institutional buying. However, the progress of ETH spot ETF approval may affect the future market trend. If the approval progress is below expectations, it may trigger selling pressure.

Other currency intelligent money analysis According to Nansen data, ACX, CRV, and PEPE are among the top in the 24-hour inflow list, with inflows of $2.087 million, $2.025 million, and $1.003 million respectively. This indicates that institutional investors are positioning themselves in these currencies. However, these currencies have relatively small market caps, high volatility, and relatively high investment risks.

In summary, BTC may face some selling pressure in the short term, while ETH may receive support from institutional funds. Although some small-cap coins have attracted certain capital inflows, the risks are also relatively high. Investors need to carefully manage the risks.

3. Hot Topics

🔥Blast airdrop detonates the encryption market, BLAST skyrockets by 18% and takes the top spot in one fell swoop!

🌟Blast project overview: Layer2 ecological newcomer, innovative marketing leads the trend

Blast, launched by Pacman, the founder of Blur, in November 2023, is a Layer 2 blockchain on Optimism Rollup, ensuring seamless compatibility with the Ethereum network. The core advantage of Blast lies in its innovative revenue design and ‘earn points and attract people’ marketing and communication model.

• Native Earnings Mechanism: Blast provides users with native earnings of Ethereum, including 5% automatic annual yield, without user operation.
• Stable Coin Investment Income: After users deposit stable coins such as USDC, the assets will be invested in the RWA protocol, and the income will be directly returned to the users.
• Gas fee allocation: Blast will directly allocate network revenue to DApp developers, who can choose to allocate it to users.
• Airdrop Rewards: Blast has launched an early incentive program to reward users with points and tokens.

The Blast ecosystem already covers areas such as Wallet, exchange, DeFi, GameFi, with a particularly prominent GameFi project. According to statistics, Blast’s on-chain TVL reaches as high as $2.95 billion, with 121 Dapps and over 1.55 million total wallet addresses.

“The innovation of Blast lies in opening up a new marketing approach by using the method of pulling people in to earn points for spreading.” - Gate.io researcher Carl Y.

🪙Blast Token Situation: Airdrop is Coming, Estimated Off-Exchange Valuation of $3 Billion

The total supply of Blast tokens is suspected to be 100 billion, and the official statement indicates that the community airdrop will be distributed to early access members (50%) and developers (50%).

• Airdrop Scale: According to estimates, approximately 14% of the total supply of BLAST tokens will be used for airdrops, with the circulating supply accounting for about 10%.
• Airdrop participants: Users who own Gold or points need to log in to the Blast dashboard to participate in the Airdrop.
• Airdrop time: Blast launched the airdrop activity on June 26, with a total expected amount of 17 billion BLAST tokens.

Once the airdrop news was announced, BLAST surged, currently at 0.02889 US dollars, with a 24-hour increase of 18.3%, and an off-site valuation as high as 3 billion US dollars.

“The BLAST airdrop news sparked high expectations in the market, but the token encountered massive selling, and the price once fell below $0.02.” - Odaily Planet Daily

🔮Outlook: Layer2 Ecological Rising Star, Unlimited Potential

As a Layer2 ecological new star, Blast is expected to change the income pattern of encrypted assets and provide new ways for asset seeking income. Its commitment to transparency, innovation, and community governance heralds Blast’s continued development and influence in the encryption field.

“Blast is finally going to launch its token. What are the highlights of its ecosystem development, worth looking forward to witnessing the changes it brings.” - Gate.io researcher Carl Y.

4. Main Events

1. 2024-06-27 Mt.Gox Creditor Compensation Plan The Mt.Gox creditors’ compensation plan has officially launched, and it is expected that about 141,000 BTC will be distributed to the creditors. This event may have a short-term downward impact on the price of Bitcoin. Analysts predict that in the coming weeks, the price of Bitcoin may fluctuate between $60,000 and $70,000.
2. 2024-06-27 Shibarium collaborates with AIRian The Ethereum L2 project Shibarium Network has reached a cooperation with the DePin project AIRian, providing exclusive airdrops for LEASH holders. This cooperation is expected to enhance the ecological activity of Shibarium and the value of the LEASH token.
3. 2024-06-27 Rune DOGE wallet number exceeds 73000 The number of independent wallets for Rune Dog has exceeded 73,000, with approximately 3,000 new wallets added in the past four weeks. This reflects the continuous growth of DOG token holders.
4. Expected Federal Reserve Interest Rate Decision on 2024-06-27 CME’s “Fed Watch” data shows that the probability of the Fed maintaining interest rates unchanged in August is 90.7%, and the probability of a cumulative 25 basis point rate cut in September is 57.3%. This expectation may affect the risk appetite of the cryptocurrency market.
5. NFT market sales decline on 2024-06-27 In the second quarter of 2024, NFT sales fell by 45%, consistent with the bearish trend of Bitcoin. This reflects the impact of the overall cryptocurrency market on the NFT market.
6. 2024-06-27 Ethereum L2 Ecosystem Expectation Analysts predict that the transaction throughput of Ethereum’s Layer 2 expansion ecosystem will exceed Solana by 100 times in the next five years. This expectation reflects the market’s optimistic outlook on the development prospects of Ethereum’s L2 ecosystem.
7. QCP Capital analyzes the Ethereum options market on 2024-06-26 Singaporean encryption investment firm QCP Capital analysis shows that Ethereum has shown strong support levels at $3200 and $2800. This analysis reflects the market’s recognition of Ethereum’s support levels.
8. 2024-06-26 Matrixport Analyzes Bitcoin Trends Matrixport’s report suggests that historically, there will be a rebound in Bitcoin after short selling. The relative strength index has reached its lowest level since August last year. This analysis reflects the market’s expectation of a rebound in Bitcoin.
9. 2024-06-26 REVOX on-chain daily active users exceed 2 million The on-chain daily active users of the modular AI network REVOX have exceeded 2 million, ranking first among all dApps. This data reflects the increase in the activity of the REVOX ecosystem.
10. 2024-06-26 Zync Era token ZK fell 40% Token ZK issued by Zync Era fell by 40% in the first three days after release. This trend reflects the price fluctuation risk of new token issuance.

5. Global Policies

Bolivia lifts ban on Bitcoin and other cryptocurrencies

On June 26, 2024, the Central Bank of Bolivia officially announced that banks can now engage in cryptocurrency transactions. Although cryptocurrencies can now be traded through authorized electronic channels, the Central Bank of Bolivia reminds citizens that cryptocurrencies are not considered legal tender.

This move signals Bolivia’s relaxation of its regulation on cryptocurrencies, creating a favorable environment for the development of cryptocurrencies in the country. However, due to the fact that cryptocurrencies are still not considered legal tender, their use in Bolivia may be subject to certain limitations.

The U.S. Supreme Court ruled that the SEC’s use of internal judicial procedures to bring charges is unconstitutional.

On June 27, 2024, the U.S. Supreme Court ruled by a 6-3 vote that when the Securities and Exchange Commission seeks to impose penalties for fraudulent conduct, defendants have the right to a jury trial in federal court, rather than undergoing the agency’s ‘internal’ administrative proceedings. This ruling effectively binds all federal agencies, as they must seek to have cases heard in federal court.

This ruling limits the power of federal agencies such as the SEC to bring charges against cryptocurrency companies and individuals using internal procedures, which is seen as favorable to the cryptocurrency industry. However, it also means that the SEC will need stricter evidence standards when bringing lawsuits, which may increase the difficulty of litigation.

Turkey sentences unauthorised cryptocurrency providers to up to 22 years in prison

On June 27, 2024, the Turkish Parliament passed the Capital Markets Law Amendment, introducing new regulations on crypto assets. The main contents include: the Capital Markets Board has the authority to supervise cryptocurrency transactions and take measures and sanctions; individuals and legal entities operating unauthorized crypto asset services will face 3 to 5 years of imprisonment; service providers misappropriating entrusted funds or assets, including crypto assets, will face imprisonment ranging from 8 to 22 years.

This regulation strengthens Turkey’s regulation of the cryptocurrency industry, aiming to maintain market order and protect investor rights. However, it may also hinder the development of the country’s cryptocurrency industry and deter practitioners.

Summary

The above policies and regulations reflect the different attitudes of governments towards the cryptocurrency industry. Some countries are starting to relax their control, creating a favorable environment for the development of cryptocurrencies; however, there are also countries implementing strict regulatory measures aimed at regulating market order. The introduction of these policies and regulations will have a profound impact on the global cryptocurrency industry.

6. Investment Analysis

6.1. Investment Recommendation

Market Hotspots:

The presidential debate between Trump and Biden will be held at 9pm Eastern Time on the 27th, and related concept tokens such as MAGA and BODEN have divergent trends. 2. Solana launches the Blinks module, allowing users to directly perform on-chain operations on social media, seen as a bridge between Web2 and Web3. 3. Layer2 project Blast will airdrop tokens tonight, with a total of 100 billion tokens and an estimated off-exchange valuation of 30 billion USD.

Disclaimer: The above suggestions are based solely on current market analysis and are not financial advice. Investment carries risks, please proceed with caution.

6.2 Investment Strategy

This Week’s Popular Token Analysis

This week’s popular tokens include MAGA, PEPE, BRETT, WIF, POPCAT and other meme coins. Among them, MAGA is a conceptual token for the US election, representing Trump’s campaign slogan “Make America Great Again”. With the upcoming presidential debate, these tokens are expected to create a frenzy on social media, thus driving up prices. SOL is attracting attention due to the launch of the Blinks module, which enables cryptocurrency functions on social media. The Layer2 project BLAST is also worth paying attention to, as it is expected to airdrop tokens this week.

Trading Bot Strategy Analysis

1. The spot grid strategy profits from price fluctuations by setting grid buy and sell prices, suitable for volatile markets with controlled risks. The best-performing strategy this week is the ETH_USDT spot grid strategy, with a return rate of 126.93%.
2. The contract grid strategy sets up a grid in the contract market to magnify profits, but the risk is also higher. TURBO_USDT contract grid strategy has a weekly rate of return of 7145.58%, and the risk is higher.
3. The infinite grid strategy continues to buy and sell in the spot or contract market, with stable but limited returns. The PEOPLE_USDT infinite grid strategy has a weekly return rate of 232.74% with low risk.
4. The smart rebalancing strategy automatically adjusts the investment portfolio according to the set conditions, and the returns can be considerable but require reasonable conditions. The AXS5S_USDT and other smart rebalancing strategies have a weekly return rate of 138.76%.
5. The spot Martingale strategy utilizes the Martingale principle to profit in the spot market and is suitable for long-term operations. The CEL_USDT spot Martingale strategy has a weekly yield of 4742.02%, with higher risk.

Summary: Among the trading robot strategies this week, the contract grid and spot Martingale strategies performed the best, but also carried the highest risk; spot grid and infinite grid strategies had relatively stable returns and controllable risks; the intelligent rebalancing strategy balanced both returns and risks. Investors can choose a suitable strategy based on their risk preferences.

6.3. Financial Management Products

1. YubiBao

The Coin Balance helps match users with idle assets and borrowing needs. After subscribing to the Coin Balance, the system will determine whether the borrowing is successful and the interest rate for each hour based on the user’s set lending rate and actual borrowing needs. If the borrowing is successful, the user can earn interest for that hour. Coin Balance supports flexible deposits and withdrawals, and allows users to subscribe and redeem at any time within 24 hours.

The total amount of USDT in the wealth management of Yield Bao is 406,016,465.19 USDT, with an estimated annualized yield of 2.63% + 8.87%.

2. Financial Management Treasure

The financial management treasure 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 digital currency financial products of multiple types. Participating in different financial products may have different profit rules, and the profit will be calculated according to the specified annualized interest rate.

3. Structured Finance

Gate.io structural financial management is a new financial product based on a combination of fixed income and financial derivatives such as options. It generally determines the level of settlement income based on the relationship between the performance of the underlying asset during the investment period and the stipulated price, and can be divided into two types: principal-guaranteed and aggressive. Users can purchase products with specified investment periods based on their desired rate of return, standard money, etc.

4. Intrerest Rate in the Market

Annotation:

• The Financing Rates value of TradFi refers to the level of financing interest rates in the traditional financial market, including overnight, 1-month, and 6-month terms.
• The Financing Rates of CeFi refer to the range of interest rates provided by centralized cryptocurrency exchanges for funding.
• The Financing Rates of DeFi refer to the range of interest rates for fund financing on decentralized lending platforms.

Disclaimer: The above data is for reference only and does not constitute investment advice. Please conduct due diligence and assume the risk before making any investment decisions.

6.4. Analysis of ETH Trading Strategy Based on Bollinger Bands

Bollinger Bands is a commonly used technical indicator that identifies potential overbought or oversold conditions by calculating the standard deviation of prices. This article will introduce how to use the Bollinger Bands indicator to trade ETH and perform backtesting analysis of the strategy.

Trading Strategy

1. When the ETH price approaches or breaks above the upper band, take a sell action with a position of 20%.
2. When the ETH price approaches or breaks through the lower rail, make a purchase with a 20% position.
3. The initial principal is 100,000 USDT.

Backtesting Results

• Backtest time range: January 1, 2023 to June 27, 2024
• Final Yield: 32.67%
• Maximum Drawdown: -18.54%
• Annualized Volatility: 28.36%

Strategy Analysis

The backtesting results show that the ETH trading strategy based on the Bollinger Bands has achieved good returns during the backtesting period. This strategy can effectively capture the overbought and oversold conditions of ETH prices and perform buy and sell operations at the appropriate time.

However, this strategy also has some shortcomings:

1. There is a significant risk of maximum drawdown, with a maximum drawdown rate of -18.54%, which requires a high level of psychological tolerance for investors.
2. The annualized volatility is high, reaching 28.36%, indicating that the strategy’s returns have significant volatility.
3. This strategy relies solely on the Bollinger Bands indicator and lacks support from other auxiliary indicators, which may result in some false signals.

Therefore, in actual operation, it is possible to consider combining the Bollinger Bands indicator with other technical indicators to improve the accuracy of trading signals. At the same time, risk control should also be noted, setting reasonable stop loss and take profit points to avoid excessive drawdown risk.

Overall, the ETH trading strategy based on Bollinger Bands has a certain profit potential, but it also needs further optimization and improvement to enhance its robustness and operability.