The crypto market is experiencing fluctuations and downward movement, with capital return becoming evident.

This week, the cryptocurrency market has shown a volatile downward trend, with the market sentiment index dropping from 11% to 8%. The market capitalization of stablecoins has started to grow rapidly, with USDT reaching 142.7 billion and USDC reaching 57.2 billion, an increase of 0.49% and 2.32% respectively, indicating that institutional funds are re-entering the market, primarily driven by the growth of U.S. funds. Although the release of economic data and the minutes from the Federal Reserve's Open Market Committee eased concerns about a U.S. economic recession, the market is gradually expecting that the Federal Reserve will cut interest rates three times this year and may start in May, but this has not improved market sentiment. Recent policy changes have triggered sharp fluctuations in Bitcoin prices, exacerbating market panic, and most altcoins have underperformed against the benchmark index.

Bullish Asset Analysis

BTC

Recently, the overall trend of BTC and the crypto market has been weak, mainly influenced by the following factors:

1. Macro level:

   • Trump's tariff policy raises concerns about inflation and lowers GDP expectations
   • The US-Ukraine mineral agreement is shelved
   • Uncertainty of Federal Reserve interest rate cuts

2. BTC itself:

   • Long-term high-level operations lead to profit-taking.
   • Lack of new positive news and capital inflow
   • The Bitcoin strategic reserve policy is below expectations.
   • Institutions continue to sell off

Bullish reasons:

1. Macroeconomic improvement:

   • Economic data and Federal Reserve meeting minutes ease recession fears
   • The market expects three rate cuts this year, possibly starting in May.

2. BTC fundamentals:

   • Panic selling after a rapid decline
   • On-chain data shows that most holders have not sold.
   • Whales begin accumulating

S

Although the S token has fallen this week along with the market, the fundamentals of Sonic remain unchanged:

• TVL still grew by 9.23%
• The main on-chain DeFi projects have all achieved growth.
• High yield maintenance: Beets liquidity pool APY is about 30%, average lending interest rate is 14%.
• Daily income of $210,000, ranking 6th among all public chains.

The decline of the S token is mainly influenced by the overall market, the fundamentals remain unchanged, and the bullish logic still exists.

AAVE

AAVE rose against the trend by 21.38% this week, showing outstanding performance:

• TVL increased by 5.86%, ranking second among the top 20 DeFi projects.
• Proposal to optimize governance and token economic model:
  • Buyback Tokens
  • Increase staking rewards
  • Optimize liquidity
• The White House supports the abolition of DeFi trading report rules to ease compliance burdens.

AAVE's financial condition is good, supporting innovation, which may trigger a DeFi repurchase craze, and the future outlook is optimistic.

BERA

Despite the decline of the BERA token this week, the on-chain data of Berachain is positive:

• Although the growth rate of the top ecological project TVL has slowed down, it still maintains growth.
• Infrared Finance and BEX showed remarkable growth, reaching 31.15% and 25.22% respectively.
• High APY attracts users: WBERA about 120%, stablecoin pool 16%, lending up to 48.08%

The decline of BERA is mainly influenced by the market environment, while the project's fundamentals remain unchanged, and the logic for an increase still exists.

Bearish Underlying Analysis

APE

APE mainly involves the NFT and Gamefi sectors, but in this market cycle:

• Most of the market share in these tracks is occupied by Memes.
• Users decrease, almost no new funds inflow
• On March 16, 15.37 million APE will be unlocked, accounting for 1.54% of the total locked amount.
• The unlocked tokens are mostly held by VC or continuously sold off.

APT

Aptos performed well this week due to Bitwise's submission of a spot ETF application, but:

• Not included in the cryptocurrency reserve list mentioned by Trump
• If the White House summit announces reserve details, it may divert attention from APT.
• On March 12, 11.3 million APT will be unlocked, accounting for 1% of the total locked amount.
• Unlocking tokens in the hands of institutions may continue to exert selling pressure.

MERL

Merlin chain TVL decreased significantly by 12.44%:

• MerlinSwap decreased by 34.33%
• Pell Network decreased by 87.11%
• As BTC-L2, the ecosystem is limited, and major projects are experiencing a significant decline.
• The overall performance of the BTC ecosystem is poor.
• The decline in BTC has led to the withdrawal of staked funds.

MERL only fell by 1.8% this week, and a further drop may occur.

TON

Toncoin链上TVL下降10.68%:

• Almost all ecosystem projects' TVL have decreased.
• TVL has been on a continuous downward trend since last year.
• SocialFi has long been on the fringe of the industry.
• The popularity of on-chain mini-games is waning, and the yield is decreasing.
• Investors are not optimistic about the on-chain ecosystem.

TON may continue to be in a downtrend.

Market Sentiment and Hot Tracks

The market sentiment index has dropped to 8%, entering the extreme fear zone.

The PayFi sector performed the best, mainly influenced by XRP, LTC, and XLM. The Sociafi sector performed the worst, mainly dragged down by TON and CHZ.

Important Events Next Week

• March 12: US February CPI year-on-year announcement
• March 13: Web3 Amsterdam 2025 Conference

Summary

This week, the crypto market has presented a complex pattern amid fluctuations and panic. Although the inflow of stablecoin funds and the stable performance of some hot projects are positive signs, the overall situation is still influenced by macro policy uncertainty and insufficient investor confidence. Projects like BTC, AAVE, and Berachain are expected to stand out due to their fundamental advantages and innovative strategies. Investors need to continuously pay attention to on-chain data, policy trends, and the upcoming unlocking events to seize opportunities and avoid risks.