Crypto Market Weekly Report: DeFi and AI Sectors Lead Market Rebound

Market Overview

This week, the cryptocurrency market has shown a noticeable Rebound, with the sentiment index rising from 11% to 35%. Although it is still in the fear zone, there has been significant improvement. The market capitalization of stablecoins continues to grow, indicating that institutional funds are still entering the market. The market's recovery is mainly driven by two factors: first, the US CPI data met expectations; second, there is an optimistic expectation regarding regulatory easing. Small-cap tokens have outperformed the broader market, particularly DeFi and AI-related tokens, which have seen significant gains, indicating that funds are beginning to shift from Bitcoin to small-cap tokens.

Decentralized Finance生态发展

The TVL of the DeFi sector has slightly increased to 53.5 billion USD, a month-on-month growth of about 1%. It is worth noting that DeFAI, as a product combining DeFi and AI, has seen its market value surge from 600 million USD to 3.2 billion USD within a week, demonstrating the market's strong enthusiasm for innovative DeFi applications.

Development of the AI Track

The AI Agent sector continues to develop strongly, shifting from simple AI token trading to deeper application scenario development. The rise of DeFAI marks the entry of AI applications in the crypto field into the 2.0 stage, mainly reflected in four directions: user-friendly AI interfaces, portfolio management, infrastructure development, and market analysis and prediction. Leading projects like Griffain, Anon, and AXIBT show that the market is transitioning from the proof of concept stage to the practical application stage.

Public Chain Performance Analysis

Layer 1 public chains are showing a stable upward trend overall, but the increase is not as significant as that of the Decentralized Finance and AI sectors. Among mainstream public chains, those with advantages in AI and DeFi ecosystems are performing better, reflecting that the value of underlying public chains is increasingly dependent on the prosperity of their upper-layer application ecosystems. It is worth noting that public chains supporting AI computation are beginning to attract market attention, indicating that a new round of public chain competition may revolve around AI computing capabilities.

Future Market Outlook

The short-term market will be influenced by the Federal Reserve's January interest rate meeting and related policies, and volatility is expected to increase. It is recommended that investors focus on projects with existing real application scenarios when selecting DeFAI projects, avoiding the chase of purely conceptual speculation. In terms of DeFi investment, opportunities for returns in gun pool projects can be considered, but leverage risk must be strictly controlled. Regarding timing, it is advised to observe policy changes in the short term, avoid blindly chasing highs, and ensure the safety of the investment portfolio.

Hot Track

Decentralized Finance

This week, DeFAI has become the focus of the market, with its market capitalization skyrocketing from $600 million to $3.2 billion, an increase of more than 4 times in just one week. The DeFAI project is mainly divided into four categories: abstract/user-friendly AI, yield optimization and portfolio management, DeFAI infrastructure or platforms, and market analysis and forecasting. Currently, DeFAI is still in its early stages, with most projects focused on abstract AI and market analysis, with representative projects including Griffain, Anon, and AXIBT. Although DeFAI is growing rapidly, most functionalities have yet to be realized, and investors should pay attention to the progress of actual applications and be wary of speculation risks.

Decentralized Finance赛道

In the past week, the TVL of DeFi projects increased from $53 billion to $53.5 billion, a growth rate of 0.94%. The growth was primarily driven by the overall upward trend in the market, especially after the release of the US CPI, which led to a widespread market rally, attracting funds back into DeFi projects. The market holds an optimistic attitude towards future policy changes, further driving capital inflow into the DeFi industry.

Other Track Performance

public chain

Public chains such as Sonic, Hyperliquid, Algorand, BSquared, and Mode have made significant progress in technological innovation, ecosystem development, and strategic cooperation. Among them, Sonic has launched multi-currency DeFi applications and innovatively introduced real-time deposit functions; Hyperliquid successfully issued the SOLV token; Algorand completed the 4.0 version upgrade; BSquared is actively promoting the transformation of Bitcoin into an AI innovation center; Mode has demonstrated strong development momentum in the DeFAI field.

Overview of the Gainers List

Projects such as ANON, BUZZ, CGPT, ARC, and GRIFFAIN have performed exceptionally well this week. These projects have made significant breakthroughs in technological innovation, ecosystem expansion, and strategic partnerships, driving a substantial increase in token prices.

Overall Overview of Market Themes

According to weekly return rate statistics, the PayFi sector performed the best, while the RWA sector performed the worst. In the PayFi sector, XRP, BCH, and XLM showed strong performance, especially XRP, which surged by 44.58% due to the impact of policy expectations. In the RWA sector, the main tokens OM, ONDO, and MKR all experienced varying degrees of decline.

Outlook for Next Week

Macro Factors Assessment

Key events next week include the inauguration of the new government and personnel changes in regulatory agencies. The market expects the new government may introduce favorable policies for encryption, but if it does not meet expectations, it may trigger market fluctuations. Investors are advised to closely monitor relevant developments, and market volatility is expected to intensify next week.

Sector Rotation Trend

• DeFi sector: Investors expect the market may experience a general rise in the first quarter, leaning towards holding coins and participating in yield farming projects to increase returns.
• AI Sector: Market attention is shifting from AI Agent to DeFAI, which is seen as an emerging track that combines the potential of AI and the funding advantages of Decentralized Finance, and is expected to attract significant capital and traffic.

Overall, the market is in a phase of oscillating upward movement, and the DeFi and AI-related sectors are expected to continue leading the market trends. Investors should pay attention to substantial technological advancements and practical applications while being wary of risks associated with pure concept speculation.