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Table of Contents for This Week's Research Report:

I. Preview of Key Events in Macro-Economic Data and the Cryptocurrency Market for the Week;

II. Review of Key News in the Cryptocurrency Industry;

III. Community Interaction and Sharing;

IV. Interpretation of Important Events, Data, and Research Institute;

V. Institutional Perspectives and Overseas Views;

VI. Ranking of Cryptocurrency Market Gains and Selection of Community Hot Coins from Last Week;

VII. Attention to Project Token Unlocking Negative Data;

VIII. Ranking of Cryptocurrency Market Concept Sectors;

IX. Summary of Global Market Macro Analysis;

X. Research Institute's Post-Market Judgment.

I. Preview of Key Events in Macro-Economic Data and the Cryptocurrency Market for the Week (Exclusive):

February 26 (Monday): U.S. new home sales data; World Mobile Communications Congress opens; WTO Ministerial Conference. OKX closes all mining pool products and related services.

February 27 (Tuesday): Japan's CPI for January; U.S. durable goods orders for January; Speech by a member of the Federal Reserve Board; U.S. consumer confidence index for February; Annual report meeting of the President of the European Central Bank; Monetary policy report of the Central Bank of Russia. Cosmos community users disclose the Cosmos Hub fork AtomOne's mainnet launch.

February 28 (Wednesday): Eurozone economic indicators for February; Speech by the President of the Atlanta Federal Reserve; U.S. retail inventories for January; U.S. fourth-quarter PCE; U.S. fourth-quarter GDP. ETHGlobal announces the 2024 Hackathon schedule; Pragma Denver will take place.

February 29 (Thursday): Speech by the President of the Atlanta Federal Reserve, President of the Boston Federal Reserve, and attendance by the President of the New York Federal Reserve; Japan's industrial output for January, retail sales for January; France's GDP for the fourth quarter; U.S. PCE price index for January; Canada's GDP for the fourth quarter; Hong Kong Treasury Department requires virtual asset service providers to submit license applications by the end of the month; Blast mainnet launch.

March 1 (Friday): Speech by the President of the Chicago Federal Reserve, President of the Cleveland Federal Reserve; Japan's unemployment rate for January, manufacturing PMI for February; South Korea's import and export data for February; Speech by the President of the New York Federal Reserve; Eurozone's final manufacturing PMI for February, unemployment rate for January, initial CPI for February; U.S. manufacturing PMI for February, consumer confidence index; Speech by a member of the Federal Reserve Board; Seoul Stock Exchange closed for Independence Movement Day; Ordinals developers state that the Runestone airdrop window is expected to be between Friday and next Wednesday. Ronin will gradually reduce the Katana liquidity mining program rewards starting from the end of February.

II. Review of Key News in the Cryptocurrency Industry (Exclusive Summary):

Data Aspect:

Recently, the cryptocurrency market has shown some notable data changes. According to statistics, the probability of the Federal Reserve maintaining interest rates in March is as high as 97.5%, indicating the central bank's consideration of inflation and financial stability. At the same time, the market value of stablecoins has surpassed $140 billion for the first time since the end of 2022, indicating a continuous increase in demand for stable assets. Additionally, the circulating shares of Grayscale GBTC fell below 500 million, drawing attention to investment products related to Bitcoin. Furthermore, the daily trading volume of the U.S. spot Bitcoin ETF reached $3.2 billion, the second-highest level in history, demonstrating institutional investors' enthusiasm for Bitcoin.

Project and Platform Aspect:

Microstrategy purchased approximately 3,000 bitcoins for about $155.4 million in cash, further expanding its Bitcoin holdings. Additionally, this week will see the unlocking of tokens such as DYDX, OP, and PRIME, and the changes in their circulation may affect market prices. Meanwhile, JPMorgan announced plans to offer actively managed Bitcoin funds to its private wealth clients, signaling further involvement of traditional financial institutions in the cryptocurrency market. Furthermore, the Uniswap Foundation proposed to allocate protocol fees to staked UNI token holders to incentivize community participation and governance.

Macro Policy and Regulatory Aspect:

The U.S. Energy Information Administration has suspended its investigation of Bitcoin miners, a decision that may impact the regulatory environment for the cryptocurrency industry. Meanwhile, the U.S. Securities and Exchange Commission (SEC) is seeking public opinion on the possibility of introducing Bitcoin spot ETF options trading, which may pave the way for the future development of cryptocurrency derivative markets. In addition, the European Union has established a new anti-money laundering agency in Frankfurt, Germany, to strengthen regulation of the cryptocurrency industry, aiming to maintain financial market stability and transparency.

Institutional Research Reports and Perspectives:

There have been many interesting and in-depth discussions emerging in the market. The Global Macro Director of Fidelity believes that the market value of Bitcoin is expected to reach one-fourth of the gold market, highlighting the position and potential of cryptocurrencies in the global financial market. Meanwhile, analysis indicates that open interest in Ethereum options has reached a multi-month high, showing a bullish trend that may provide investors with clues about market sentiment. Additionally, concerns raised by S&P Global about the potential concentration risk of a spot Ethereum ETF have also attracted market attention and discussion. Coinbase has outlined three reasons to recommend SEC approval of the Grayscale spot Ethereum ETF, demonstrating industry recognition and expectations for cryptocurrency investment products. Furthermore, HODL15Capital's perspective points out that record-breaking trading volume of Bitcoin ETFs has not led to record-breaking capital inflows, reminding us to pay attention to the deeper implications behind trading volume. Finally, Michael Saylor stated that he will continue to buy Bitcoin forever and has no plans to sell, demonstrating long-term investors' confidence and determination in cryptocurrencies.

III. Community Interaction and Sharing:

Recent market trends and data indicate that Bitcoin and other cryptocurrencies are in a critical upward cycle. From our perspective, this trend is driven by various factors: historical data provides strong references for Bitcoin price trends. In previous halving cycles, Bitcoin has shown significant rebound effects. This regular market behavior suggests that in the upcoming halving event, Bitcoin may once again achieve a price leap.

The approval of Bitcoin spot ETFs and capital inflows have injected new vitality into the market. These ETF products not only provide investors with more convenient investment channels but also bring Bitcoin into the view of traditional investment portfolios, further enhancing its market position and awareness.

Expectations of a rate cut by the Federal Reserve also bring positive signals to the cryptocurrency market. In the face of global economic uncertainty, a rate cut may drive investors to seek higher-return investment opportunities, with cryptocurrencies such as Bitcoin becoming an attractive choice.

At the same time, on-chain data also shows positive signals in the market. The active participation of whales and institutional investors, as well as net outflows from exchanges, indicate that the market is accumulating strength, preparing for the next round of price increases.

Bitcoin and other cryptocurrencies are in a period of opportunity and upward momentum. With the approaching halving event, further development of ETF products, and changes in the global economic environment, this trend is expected to be further consolidated and strengthened in the future, and we will continue to keep an eye on it.

IV. Interpretation of Important Events and Data, and Research Institute's Analysis:

Regarding the news that Microstrategy and its subsidiaries purchased approximately 3,000 bitcoins for about $155.4 million in cash at an average price of about $51,813 per bitcoin from February 15 to February 25, MSTR's stock price hit a new high after the U.S. stock market opened.

Our research institute believes that after the news of Microstrategy's massive purchase of $155.4 million in Bitcoin was reported last night, Bitcoin surged significantly. Leveraging the news of the record-high trading volume of the Bitcoin spot ETF, the market rose from a low of $50,900 to above $57,000. Microstrategy's decision has attracted widespread attention in the market. Their purchase price of $51,813 in the current market environment demonstrates their company's recognition of the value of Bitcoin and has led to a significant increase in the coin price, surpassing Microstrategy's purchase cost.

From the perspective of our research institute, Microstrategy's move has multiple implications. Firstly, as the world's largest corporate Bitcoin holder, Microstrategy continues to expand its Bitcoin holdings, further solidifying its leadership position in the cryptocurrency field. This decision not only reflects the company's deep involvement in the cryptocurrency market but also indicates its positive expectations for future market trends. Secondly, through the purchase of Bitcoin, Microstrategy has also gained significant returns in the U.S. stock market. After the U.S. stock market opened, MSTR's stock price hit a phase high, fully demonstrating the market's recognition of its decision. This recognition comes not only from investors' approval of its corporate strategic transformation but also from the optimistic outlook for the cryptocurrency market. Additionally, Microstrategy's decision to purchase Bitcoin also serves as a market benchmark. As a widely influential company, its decisions often guide other enterprises and investors in their understanding and attitude towards the cryptocurrency market. Therefore, this decision is expected to attract more funds into the cryptocurrency market, further driving market growth.

Therefore, Microstrategy's decision to purchase Bitcoin has multiple positive effects. It not only reflects the company's deep involvement in and positive expectations for the cryptocurrency market but also enhances its performance in the U.S. stock market and has a positive impact on the entire cryptocurrency market.

V. Institutional Perspectives and Overseas Views:

Overview Summary: Bitcoin has returned to the $55,000 level, benefiting from ETF demand and Microstrategy's purchases. Since the beginning of the year, Bitcoin has risen by 30%, sparking speculative interest in small tokens. The market generally expects Bitcoin to maintain its upward trend. Most Bitcoin addresses are in a state of unrealized gains, a situation not seen since the 2021 bull market. The funding rate for Bitcoin futures contracts on Binance has exceeded 100%, indicating a bullish market. Institutions prefer Ethereum and Bitcoin, especially Ethereum. In contrast, retail users tend to favor altcoins, but institutions have reduced their altcoin positions and are more focused on stable assets and decentralized finance protocols. Risk assets are performing well, driving traditional investors into the crypto market. However, inflation pressure and macroeconomic factors may pose challenges to Bitcoin. Analysts are concerned about the market in the coming year, believing that economic slowdown may occur in the second half of 2024, which could be detrimental to Bitcoin. Open interest in CME Bitcoin and Ethereum futures has increased significantly, indicating heightened market sentiment. The crypto interest rate market is active, with leverage levels rising, potentially presenting lending opportunities. JPMorgan's report suggests that retail investors dominated the market's rise in February, and future cryptocurrency catalysts such as the Bitcoin halving and Ethereum upgrade may trigger retail FOMO sentiment. Below is the detailed content:

Bitcoin has returned to the $55,000 level for the first time since the end of 2021, supported by investor demand for ETFs and further purchases by Microstrategy. Since the beginning of the year, the price of Bitcoin has risen by 30%, continuing its long-term upward momentum, sparking speculative interest in small tokens such as Ether and BNB. Katie Stockton, founder of Fairlead Strategies, stated in a report that given Bitcoin's breakthrough and positive medium-term momentum, it is expected that Bitcoin will not experience a significant pullback. Sean Farrell, head of digital asset strategy at Fundstrat Global Advisors, stated that despite rising interest rates, the bullish momentum of cryptocurrencies is evident.

Ninety-five percent of Bitcoin addresses are now in a state of unrealized gains. The last time this percentage was this high was at the peak of the 2021 bull market when the price of Bitcoin exceeded $60,000, according to data from IntoTheBlock.

According to data from Velo Data and CoinGlass, the annualized funding rate for perpetual Bitcoin futures contracts on Binance has exceeded 100% for the first time in at least a year. The funding rates on Bybit and Deribit have risen to 95% and 56%, respectively. The rising funding rates indicate a bullish market sentiment or a bias towards bullish leverage. Markus Thielen, founder of 10X Research, stated that the increase in funding rates may be due to traders betting on a continued inflow of funds into the U.S. spot ETF.

A new report from Bybit Research indicates that institutions have allocated most of their portfolios to Ethereum, with Bitcoin following closely behind, in stark contrast to retail users who favor the latter. According to a survey of traders on the exchange, institutions have increased the concentration of their portfolios in Bitcoin and Ethereum to 80% due to the expected Dencun upgrade, with a significant increase in Ethereum investments. Meanwhile, the report added that retail users have lower concentration in these assets and a higher tendency towards altcoins. The report also stated that despite high returns in 2023, institutions have significantly reduced their altcoin positions, especially in volatile categories such as meme coins, artificial intelligence (AI), and BRC-20 tokens. In contrast, institutions are more focused on stable asset tokens and decentralized finance (DeFi) protocols such as Layer-1.

Matrixport stated on social media that risk assets have performed well so far this year. Bitcoin and Ethereum have risen by 30-36%, making them among the best-performing risk assets. These cryptocurrency returns will drive traditional investors' FOMO sentiment.

Aurelie Barthere, a research analyst at Nansen Principle, stated that Bitcoin may face severe macroeconomic resistance due to high U.S. inflation. Sticky inflation data from the U.S. Consumer Price Index (CPI), Producer Price Index (PPI) for January, and popular employment reports have led analysts to be concerned about Bitcoin and the cryptocurrency market in the coming year. Strong employment data indicates increased economic demand, which may lead to increased spending, while rising consumer price index and producer price index indicate rising costs of goods and services, exacerbating inflation pressure as businesses may pass these costs on to consumers. Barthere stated, "I think a small recession/slowdown is more likely to occur in the second half of 2024, which will be a resistance for Bitcoin."

Matrixport's report stated that BTC prices rose by 23% last month, with 12% coming from U.S. trading hours. While U.S. buying flow seems to be the most important, all regions have made positive contributions to Bitcoin price development.

According to data from cryptounfolded, open interest in CME Bitcoin futures contracts increased by 58% in February, reaching $6.8 billion, while open interest in CME Ethereum futures contracts increased by 86% to approximately $1.1 billion.

BTC is now gradually driving the derivatives bull market, with the main term option IV at its highest level in nearly a year. The current excited market sentiment is likely to drive up prices, and IV still has the potential to hit new highs. In the crypto interest rate market, the market has become active recently, with leverage levels continuing to rise, and there have been some high-interest orders in the interest rate market. If there is a big market movement in the near future, it is likely to present good lending opportunities.

In a research report on Thursday, JPMorgan stated that retail investors may have been the main reason for the strong rise in the cryptocurrency market in February. Analysts led by Nikolaos Panigirtzoglou stated that three major cryptocurrency catalysts are expected in the coming months, including the Bitcoin halving event, the Ethereum upgrade, and the SEC's decision on the Ethereum spot ETF, which are the reasons for retail FOMO. The first two catalyst events have been largely priced in, while the likelihood of the third catalyst event occurring is only 50%. This retail impulse can be seen from the accumulated Bitcoin flow on-chain, with smaller wallets having a larger flow, indicating high retail investor participation. The report noted that platforms dominated by retail investors such as Block (SQ), PayPal (PYPL), and Robinhood (HOOD) saw increased trading activity and investor flow in the fourth quarter of 2023, and Coinbase (COIN) also saw growth, all representing increased trading activity by retail investors during the same period.

VI. Ranking of Cryptocurrency Market Gains and Selection of Community Hot Coins from Last Week:

VI. Ranking of Cryptocurrency Market Gains and Selection of Community Hot Coins from Last Week:

In the past week, the altcoin market has shown a strong upward trend. Among many tokens, the COTI token has performed particularly well, with an increase of over 1.5 times, becoming a leading force in the market. Additionally, the xVG token has also shown impressive performance, with an increase of nearly 100%. At the same time, tokens such as THETA, MXC, and ABT have also seen increases ranging from 75% to 90%, attracting widespread market attention.

The strong performance of these tokens reflects active capital flow in the market and investors' enthusiastic pursuit of altcoins. In the current market environment, it is advisable to continue monitoring these significantly rising tokens to capture potential trading opportunities.

However, it is important to note that market hotspots may change at any time, and participants should maintain keen market insights and flexible operational strategies when engaging in trading. By closely monitoring market dynamics and adjusting investment portfolios in a timely manner, better market opportunities can be seized to achieve stable investment returns.

In summary, the strong upward trend of the altcoin market in the past week has provided market participants with abundant trading opportunities. In this week's trading, we can continue to focus on these significantly rising tokens and adapt flexibly to market changes to achieve favorable trading results.

VII. Project Token Unlocking and Negative Data Attention:

According to Token Unlocks data, this week, tokens such as DYDX, OP, and PRIME will experience a one-time large-scale unlocking, with a total release value of approximately $334 million. Specifically:

• Nym (NYM) will unlock 25 million tokens on February 27 at 8:00, worth approximately $5.36 million, accounting for about 3.63% of the circulating supply.
• Yield Guild Games (YGG) will unlock 16.69 million tokens on February 27 at 10:00, worth approximately $8.95 million, accounting for about 5.57% of the circulating supply.
• SingularityNET (AGIX) will unlock 8.97 million tokens on February 28 at 8:00, worth approximately $6.56 million, accounting for about 0.71% of the circulating supply.
• Echelon Prime (PRIME) will unlock 1.66 million tokens on February 29 at 8:00, worth approximately $20.97 million, accounting for about 4.89% of the circulating supply.
• Sui (SUI) will unlock 4 million tokens on February 29 at 8:00, worth approximately $6.56 million, accounting for about 0.34% of the circulating supply.
• Optimism (OP) will unlock 24.16 million tokens on February 29 at 12:00, worth approximately $88.66 million, accounting for about 2.52% of the circulating supply.
• Manta Network (MANTA) will unlock 1.87 million tokens on March 1 at 7:59, worth approximately $5.58 million, accounting for about 0.74% of the circulating supply.
• DYDX (dYdX) will unlock 33.33 million tokens on March 1 at 8:00, worth approximately $117 million, accounting for about 11.09% of the circulating supply.
• ZetaChain (ZETA) will unlock 5.29 million tokens on March 1 at 8:00, worth approximately $12.33 million, accounting for about 2.24% of the circulating supply.

In the cryptocurrency market, token unlocking events often have significant market impacts. This week, we will focus on tokens that may experience market fluctuations due to the negative effects of unlocking. Among them, the unlocking scale of DYDX and PRIME tokens is particularly significant and should be given special attention.

Unlock Event Analysis: An unlocking event refers to the process of tokens transitioning from a locked state to a circulating state. When a large number of tokens are released into the market in a short period, it may increase the market's supply, thereby exerting pressure on prices. The large unlocking scale of DYDX and PRIME tokens implies that a large number of tokens are about to enter the market, which may have an adverse impact on their prices.

Market Impact and Strategy: Unlock events may provide trading opportunities for investors to capitalize on potential market fluctuations. In the spot market, investors should carefully consider whether to participate, as the negative effects of unlocking may lead to price declines. In the futures market, it may be prudent to utilize the anticipated market volatility to seek short opportunities while managing risks and staying attentive to market changes.

VIII. Last Week's Conceptual Sector Ranking in the Cryptocurrency Market:

In the performance of conceptual sectors over the past week, several areas have demonstrated a strong upward trend. Specifically, the Avalanche ecosystem, Utility Tokens, DeFi Derivatives, Artificial Intelligence (AI), and the 2024 Halving Expectations sectors have shown outstanding performance in the past seven days, leading other conceptual sectors.

In this context, it is important to closely monitor the rotational speculative trends of the sectors to which these significantly rising tokens belong. The significant increase in the AVAX token, part of the Avalanche ecosystem, in the past week indicates an increasing market recognition of its technology and applications. Utility tokens are typically associated with specific application scenarios, and their leading increase may indicate growing demand for related applications. The strong performance of the DeFi Derivatives and AI sectors reflects continued market attention and enthusiasm for decentralized finance and artificial intelligence technology.

Additionally, the rise in the 2024 Halving Expectations sector may be related to the halving of mining rewards for certain cryptocurrencies, an event that typically has a certain impact on token prices. When monitoring the rotational speculative trends of these sectors, investors should conduct comprehensive analysis based on specific technological advancements, market demand, and macroeconomic conditions.

Overall, the performance of conceptual sectors in the past week has exhibited diverse characteristics. Investors should allocate assets reasonably based on their risk tolerance and investment objectives to capture market opportunities and mitigate investment risks.

IX. Summary of Global Market Macro Analysis:

Last week, all three major U.S. stock indexes recorded gains, with the Dow Jones Industrial Average up 1.3%, the Nasdaq Composite up 1.4%, and the S&P 500 up 1.66%. The technology sector led the market, with NVIDIA seeing a significant weekly increase of 8.54%. Tech giants such as Google, Meta, and Microsoft also recorded varying degrees of gains. Apple saw a relatively small increase of only 0.12%, while Tesla fell by 3.99%.

Outlook for the week: A series of heavyweight economic data will be released, including China's official manufacturing PMI for February, and the U.S. PCE price index for January. Investors need to pay attention to the impact of the data on market sentiment. The disclosure season for annual reports of A-share listed companies has officially begun, with many companies set to release their 2023 annual reports, and the market will focus on corporate profit situations. The 2024 Mobile World Congress (MWC 2024) will be held in Barcelona, Spain this week, and developments such as Huawei's communication models and 5G-related products are worth paying attention to.

Research analysis: The strong rebound in the U.S. stock market last week was mainly due to investors' optimistic expectations for the economic outlook and the good performance of corporate earnings season. It is widely expected that the economic data to be released this week will show that economic growth still faces certain pressures, but inflation pressures have eased somewhat, which may benefit the U.S. stock market. With the disclosure season for A-share annual reports underway, investors can focus on the annual reports of high-quality companies and make investment decisions based on the macroeconomic situation and industry development trends. The upcoming 2024 Mobile World Congress (MWC 2024) will showcase the latest mobile communication technology and products, providing investment opportunities for investors in related fields.

Key factors: The Federal Reserve's interest rate hike cycle is ongoing, and investors need to pay attention to the impact of interest rate hikes on the economy and the stock market. Global economic growth is slowing, and investors need to be aware of the downside risks to the economy. Geopolitical risks still exist, and investors need to pay attention to the impact of geopolitical events on the market.

The recent increased volatility in the U.S. stock market requires investors to be prepared for market fluctuations. It is important to monitor changes in the Federal Reserve's monetary policy and adjust investment strategies accordingly. Geopolitical risks still exist, and it is important to monitor the impact of geopolitical events on the market.

X. Future Market Judgment:

After Microstrategy announced the purchase of $150 million worth of Bitcoin at an average price of $51,813, Bitcoin saw a significant surge. Leveraging the news of the historic high trading volume of the Bitcoin spot ETF, the price rose from below Microstrategy's purchase cost of $50,900 to above $57,400. This position is very close to the resistance level near $57,500 mentioned in our research report last week, and it is also the 78.6% Fibonacci retracement level from the previous bull market.

Considering the significant appreciation of the U.S. dollar since last year, as well as the substantial depreciation of other global fiat currencies, in reality, the price of Bitcoin in other fiat currencies has reached or approached historic highs. Therefore, when we mentioned in the research report title that 95% of Bitcoin addresses are currently in a state of unrealized gains, the last time the percentage was this high was at the peak of the 2021 bull market, when the price of Bitcoin was over $60,000. Of course, the pricing power of Bitcoin is currently in the U.S. market, as evidenced by the fact that last month, the price of Bitcoin rose by 23%, with 12% of the increase coming from U.S. trading hours, directly leading the market's uptrend. Therefore, analyzing the price in USD trading pairs is more accurate, and the market is still dominated by bulls.

There are signs of a breakthrough in the recent upward channel on the daily chart. It is important to observe whether the closing price in the subsequent trading days this week can remain above $55,350, which is crucial for the future direction of the market. If it holds, there is a chance to test the historical high and the secondary high, with resistance levels at $64,850 and $69,000. If the market is under pressure and constrained by the resistance of the upper channel, a pullback is likely. The current short-term support levels are around $52,800 and $50,520, with medium-term support at $48,000, $46,600, and $44,000.

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February 27, 2024

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