Author: @arndxt_xo Compiled by: Vernacular Blockchain

Historically, Bitcoin usually performs strongly in February in the years after halving

1. Cycle review and forecast

1) 2017 and 2021 cycle review

2017: Bitcoin saw a correction in January but resumed its upward trend in February.

2021: Similarly, BTC resumed its upward trend in February after falling in January.

2) Forecast for 2025

If history repeats itself, February this year may also usher in to a similar uptrend.

3) Market rumors and potential driving factors

Recently, market sentiment is related to Bitcoin Speculation about executive orders continues to heat up.

Although it has not been confirmed, historical experience shows that such events usually have a significant boost to the market.

Next, we will conduct an in-depth analysis of the performance of each field??

2. Industry Overview

1) Infrastructure& Interoperability

Reduce network tribalism and achieve cross-chain connections< /p>

Development dynamics:

Superposition (Arbitrum L3) and Abstract (Hydra integrated with Stargate) are launching more efficient asset transfer and data sharing solutions.

LayerZero extends reach, allowing applications on Superposition to draw liquidity from over 100 connected chains.

Arcana Network cooperates with Scroll to allow users to pay gas fees with stablecoins (USDC/USDT) on any chain, greatly simplifying the user's entry process.

View:

These developments demonstrate that the push for cross-chain interoperability continues to gain momentum . Seamlessly moving assets and data from L1 to L2 to L3 is increasingly becoming an essential requirement in the industry.

Projects that can integrate user-friendly interfaces, gas abstractions, and universal cross-chain bridges are expected to reduce the obstacles that have hindered the popularity of DeFi in the past due to "cyber tribalism" .

Looking to the future, we may see the launch of customized L3 in more vertical fields, such as focusing on games, RWA (real world assets) and institutional-level DeFi .

2) Liquidity, borrowing and real-world assets

The Holy Grail of credit and loan ecology

Developments:

Coinbase has launched BTC-collateralized loans for US users. Providing a more mainstream audience with the ability to leverage Bitcoin assets.

Tradable partners with ZKsync to bring $1.7 billion worth of raised credits (RWA) on-chain, demonstrating how institutional-grade products can further penetrate the DeFi space.

Plume Network has attracted more than 4.5 billion US dollars in asset commitments for asset tokenization. Before the launch, TVL had reached 64 million US dollars, and at the same time it launched a network worth 2500 US dollars. RWAfi Ecological Fund worth US$10,000.

Viewpoint:

The boundaries between CeFi and DeFi are increasingly blurred, which is an important sign of the maturity of the industry.

Coinbase enters the crypto mortgage market , indicating that centralized trading platforms are willing to provide products traditionally associated with DeFi platforms. This may divert DeFi users, but it also verifies the importance of on-chain lending as a key financial tool.

RWA The integration of is considered to be the "Holy Grail" connecting traditional finance and on-chain liquidity.

If this trend continues, DeFi may usher in stronger returns, deeper liquidity, and greater institutional trust, but it may also Along with more regulatory scrutiny.

The development of these two fields is not only technological and ecological progress, but also reflects the transformation path of the entire industry from "novel technologies" to mainstream financial tools.

3) Liquid Staking & Synthetic Bitcoin

Staking mechanism innovation

Developments:

Babylon Labs launches $YBTC, a liquidity staking backed by BTC 1:1 Token, integrated with pSTAKE.

BrahmaFi has launched the Onchain+ plan, which combines multi-chain strategies and AI agents (ConsoleKit) to achieve automated DeFi operations.

Viewpoint:

Liquidity staking has proven to be the key to unlocking additional benefits for stakers means without sacrificing liquidity. By tokenizing pledged assets (such as BTC, ETH, etc.), DeFi participants can use them as collateral or trade freely.

This "dual benefit" model (both earning staking rewards and potentially obtaining DeFi benefits) will likely further accelerate development.

However, there is an inherent risk: the more times an asset is "liquid pledged", the greater the complexity of the system. Protocols must be transparent and fully auditable to prevent hidden leverage from eroding system stability.

4) Ecological expansion and strategic cooperation

Large-scale user introduction and enterprise cooperation

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Developments:

Polygon Labs and India's largest telecom company Reliance Jio (with more than 450 million users ) to integrate blockchain solutions into Jio’s applications.

Ledger integrates Uniswap into Ledger Live Desktop to provide a smoother experience for hardware wallet users.

Abstract is preparing for the mainnet, suggesting that a wave of innovation in multi-chain products is coming.

Viewpoint:

Large-scale user introduction and enterprise cooperation are the mainstream of the blockchain industry key. This not only increases the exposure of blockchain technology, but also further verifies its value through actual application scenarios.

Especially in high-growth markets like India, Polygon’s partnership with Reliance Jio could become an important example in driving blockchain adoption.

5) Airdrops, incentives and liquidity mining

Intensified user competition

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Developments:

Scroll, Quai Network, Fuel and Bubblemaps are launching airdrops from many projects Activities or extended reward seasons have different community participation standards.

Vertex (reward 2.1 million $SEIToken) and Derive (reward 2000,000 $DRV to liquidity providers) and other protocols continue to provide user incentives. Nodepay and Solayer provide an early claim process or a direct distribution model during the TGE stage.

Opinion:

Airdrops have proven to be an effective way to launch an initial user base, but It has also gradually become the “standard” in the competition for new protocols.

As more and more projects offer incentives, user fatigue may become an issue. The key to the project is to attract users through real usefulness, not just "chasing incentives."

In the long term, protocols need to find a balance between incentive mechanisms and sustainable token economics. The best strategy is to design a reward system that attracts new users and retains them through real product value.

3. Narrative Overview

From liquidity staking and ecological cooperation to user incentives, the current industry focus is on improving user experience and participation through innovation and strategy. These developments not only promote the improvement of infrastructure, but also mark that DeFi is gradually moving towards a more mature and efficient stage.

1) BTC price trend and macro impact

Market dynamics

On the first Monday of the new year, a significant "bull market trap" appeared in the market. Bitcoin ($BTC) surged after the New York market opened, with Coinbase premium attracting investors believing a bull run is coming. However, this signal proved to be false. The next day, the price of Bitcoin quickly stalled and fell sharply, and the altcoin market subsequently weakened.

2) Uncertainty caused by key macro factors

Inflation concerns: January 10 Strong job market data (NFP report) released on the same day showed underlying inflationary pressures, which may lead to fewer interest rate cuts, becoming a bearish signal for the stock and crypto markets.

USD Index (DXY): Hits new high at 110.

10-Year Treasury Yield: YTD up from 4.6% to 4.8%.

S&P 500: Backtesting pre-election price levels.

3) AIToken correction and opportunity

Consolidation situation

$VIRTUAL: Down 57% from $5.2 billion in market cap.

$AI16Z: Down 63% from $2.5 billion market cap.

$ZEREBRO: Down 73% from $820 million market cap.

$FAI: Down from $650 million to $500 million.

$AIXBT: Still near all-time highs despite market weakness.

$GOAT: Down 55%, performance remains weak.

Emerging Winners

$ANON: From $20 million to $240 million.

$AVA: From $60 million to $300 million.

$PIPPIN: From $15 million to $320 million.

4. Memecoins dynamics

1) FARTCOIN

A meme coin loosely related to AI narrative, After experiencing a 56% decline, it rebounded 75%. There is widespread speculation that its market capitalization could exceed $5 billion or even higher.

$$BUTTHOLE and $$LLM

$BUTTHOLE: to $140 millionDown 70% from highs.

$LLM: Related to AI Narrative, down 75% after reaching $150 million.

2) Dino currency and USA currency (represented by $XRP)

$XRP : Up 6% year to date, outperforming the market.

Ripple's ties to the incoming U.S. government and CEO Brad Garlinghouse's relationships with key figures have boosted sentiment.

3) Other tokens with strong performance

$HBAR

$XLM

$ADA

5. Other significant trends

Strong performance

$SPX: Breakout $1 billion market capitalization, hitting a high of $1.6 billion, now down 30%.

$GIGA: Close to $1 billion but encounters resistance, down 30%.

$SUI: Hits $54 billion FDV all-time high, down just 13%.

New project online

$BIO: As the first major DeSci protocol to go online, FDV is 3 billion US dollars, but is now down 55%.

$GRASS: Posting a strong rebound after weeks of sideways trading.

$USUAL: Down 66% from all-time high amid controversy over changes to USD0++ redemption rules.

Tokens that need to be cautious

$FTM: Due to the trading contract being removed from the shelves, it may have a second life, but there are significant migration problems.

$RUNE: Facing with The risks associated with ThorFi borrowing have been compared to LUNA

Animal-themed meme coins: $POPCAT, $WIF and $NEIRO performed the worst, with $POPCAT higher than ever. point down 73%.

6. Looking forward to 2025

The market has opened a new chapter, but the macroeconomic environment and the diversity of the Token market remind us to remain cautious and look for potential opportunities.

Looking forward to reaching new highs in 2025 with more market participants!