Bitget Daily Digest (January 27) | JUP buyback becomes market spotlight; DeFAI and AI agents experience major pullbacks

Market highlights

1. Jupiter, Solana's leading DEX, has announced that 50% of its protocol fees will be allocated for JUP token buybacks. To date, 3 billion tokens have already been burned. Combined with its ecosystem expansion efforts over the past two years—including platforms like SolanaFM, Coinhall, Sonarwatch (the on-chain tracker), Ultimate Wallet (the mobile wallet), and the memecoin trading platform Moonshot—Jupiter has launched its omnichain network, Jupnet, which could create a "revenue-buyback-ecosystem expansion" flywheel that drives long-term growth.

2. The market has experienced a significant pullback, with recent hot sectors like DeFAI and AI agents undergoing steep corrections. Tokens like $BUZZ and $GRIFT have posted notable losses, while memecoin $TRUMP, associated with Donald Trump, has also dropped. In contrast, U.S.-focused projects like $LINK, $RSR, and $AAVE are showing more resilience against the downturn.

3. Multiple projects will be unlocking tokens this week. On January 29, Tribal (TRIBL) will unlock 22.07 million tokens (approximately $30.23 million), accounting for 14.03% of its circulating supply. On January 31, Optimism (OP) will unlock 31.34 million tokens (around $48.27 million), or 2.32% of its circulating supply. On February 1, Sui (SUI) and ZetaChain (ZETA) will unlock 64.19 million tokens (worth $249 million, or 2.13%) and 44.26 million tokens (worth $20.07 million, or 6.98%) respectively. Notably, the TRIBL unlock represents a much larger proportion of its supply, suggesting potential short-term selling pressure.

4. MicroStrategy founder Michael Saylor has released his 12th consecutive SaylorTracker update. Historically, the company has often purchased Bitcoin shortly after such updates, suggesting another potential BTC accumulation phase may be on the horizon.

Market overview

1. $BTC has experienced a short-term dip, falling to $102,332. The overall market is in decline, with the top 50 tokens showing bearish trends. However, $VINE's trading volume is second only to $BGB and $BTC, taking the third spot, while the newly listed token $MDOGS surges significantly.

2. The rise in U.S. stocks paused last Friday, dragged down by tech stocks. Meanwhile, Chinese stocks and the RMB rallied, and the U.S. dollar saw a decline over the week. This week, seven major U.S. tech companies are set to release their quarterly earnings reports.

3. Currently standing at 102,790 USDT, Bitcoin is in a potential liquidation zone. A 1000-point drop to around 101,790 USDT could trigger over $180 million in cumulative long-position liquidations. Conversely, a rise to 103,790 USDT could lead to more than $63 million in cumulative short-position liquidations. With long liquidation volumes far surpassing short positions, it's advisable to manage leverage carefully to avoid large-scale liquidations. 

4. Over the past day, Bitcoin saw $1.35 billion in spot inflows and $1.504 billion in outflows, resulting in a net outflow of $154 million. 

5. In the last 24 hours, $BTC, $ETH, $SOL, $XRP, and $DOGE led in net outflows in futures trading, signaling potential trading opportunities. 

Highlights on X

1. @FaceBig Brothers: "Altcoin season is dead" narrative and the battle between KOL traps and crypto fundamentals

The prevailing "altcoin season is dead" narrative is largely driven by fear tactic from certain KOLs who employ linear thinking (e.g., "surge in token supply = lack of market capital to adopt"). This view overlooks the fundamental dynamics of the crypto industry. At its core, crypto is a "game of human interaction." If only BTC rises without an altcoin season, it undermines the diversity of the industry's ecosystem and the survival needs of various participants (developers, communities, market makers, and regulators). The cyclical explosions in major ecosystems like ETH and SOL, as well as memecoins, are the natural result of capital allocation, community consensus, and industry development—not solely dictated by token supply. A true altcoin season isn't about uniform gains but rather the concentration of capital in quality projects, which have strong communities, high attention, and compelling narratives, while eliminating inefficient, low-liquidity tokens.

X post: https://x.com/Wilsonchen1101/status/1883260539079696857

2. @Rui: VC coins, airdrops, and a technological dream

Between 2022 and 2024, the crypto market was dominated by VC-backed coins like APT and SUI, which relied heavily on aggressive airdrop campaigns but ultimately resulted in hollow ecosystems. ETFs have further amplified the overvaluation of airdrop-based projects like Sei and Pyth, which quickly collapsed during the bear market. Starknet emerges as the "final champion" of this cycle. Meanwhile, memecoins have diverted retail investor attention, and intensified airdrop sell-offs have diminished exchange liquidity. Under the Trump narrative, attempts to support ecosystems like APT and STX have faltered, while SUI and ENA are bucking the trend through effective market-making and community incentives. New projects are fiercely competing for user attention, with community strength and early token allocations becoming crucial. Though technological narratives have waned, underlying innovations remain highly anticipated, and the market is seeking a new equilibrium amid bubbles and restructuring.

X post: https://x.com/YeruiZhang/status/1883380142921400681

3. @Michael_Liu93: From market-making tactics to "two-stage takeoff" trading strategies

The "two-stage" trading strategy centers on project teams capitalizing on initial hype, selling at market peaks, and accumulating at lows to close the profit loop. Control rates (75%+ ownership) and market sentiment are key to determining the success of the second surge. In common cases (A/B), a project typically sees an Initial price surge to a $60–$100 million market cap, followed by an 80% drop for consolidation. Tokens concentrated at the bottom, accompanied by positive market sentiment, enable projects to reach major exchange thresholds. Key factors for retail investors to watch:

1. Whether market makers profited during the first wave (selling high and accumulating low).

2. Token concentration (to avoid catastrophic loss of control).

3. Market sentiment's ability to support a psychological breakthrough of $100M market cap.

4. Whether project teams maintain disciplined trading practices, avoiding reckless actions that jeopardize long-term viability. Second-wave opportunities are limited to projects with genuine initial hype. After a 70%-80% correction, it might be the right time to enter—but avoid competing with whales for token accumulation. The on-chain ecosystem operates as a symbiotic game: project teams must share profits to sustain the market (market cap as low as $500K is enough for teams to maintain effective control), while retail investors must identify "profit loop" signals. Out of 34 million tokens, 99% hold little value. Only the true survivors will deliver a compelling second-wave success story.

X post: https://x.com/Michael_Liu93/status/1883405142449598946

4. moon: Hyperliquid's valuation analysis

Hyperliquid has solidified its position in the top 10 industry earners through perpetual futures trading (which is essential in the market) and may break into the top five this year. Its token will serve as L1 gas, driving demand similar to SOL's current cycle. Future functionalities may include exchange utility (fee discounts or collateral for trading), coupled with staking yields of 2–3%, airdrops, and Season 2 rewards. With 42% of tokens locked for user incentives, Hyperliquid offers over $10 billion in potential airdrop opportunities—the largest across all chains. The project ranks among the top five most loyal crypto communities. The only "risk" lies in vague FUD about alleged "North Korean hacking", which ironically highlights its ecosystem value and the panic it has caused among traditional players. With dominance in derivatives, a robust tokenomics model, and a fervent community, Hyperliquid is potentially the most undervalued alpha in this cycle.

X post: https://x.com/MoonOverlord/status/1883552625255448891

Institutional insights

1.BlackRock: Fed likely to raise interest rates if economy continues to perform strongly

Article: https://cryptodnes.bg/en/blackrock-ceo-makes-bold-prediction-about-u-s-economys-future/

2.Cathie Wood: Memecoins like $TRUMP may lack utility but play a crucial role in introducing cryptocurrencies to new audiences

Article: https://crypto.news/cathie-wood-crypto-deregulation-unleash-animal-spirits/

3.CryptoQuant: Bitcoin is currently in the late stage of its bull market, but there is still room for growth

X post: https://x.com/ki_young_ju/status/1883458483879809303

News updates

1. CME FedWatch: The probability of the Fed cutting interest rates by 25 basis points in January is only 2.1%.

2. U.S. Senator Ted Cruz plans to introduce a resolution next week aimed at overturning IRS's new DeFi broker regulations.

3. Eric Trump confirms that US-based crypto projects will enjoy zero capital gains tax.

4. Representatives from the Supreme People's Court, Supreme People's Procuratorate, and Ministry of Public Security attended a seminar on the disposal of virtual currencies in Beijing.

Project updates

1. Jupiter allocates 50% of its protocol fee revenue for JUP buyback. Jupiter's protocol revenue is expected to reach $102 million in 2024, with Jupiter Perps serving as the main source of revenue.

2. Michael Saylor posts his investment tracking chart for the 12th consecutive week, hinting at further Bitcoin purchases.

3. The core contributors of Virtuals announce plans to expand to the Solana blockchain in the first week of February.

4. Stablecoin market cap continues to reach new all-time highs, with a 2.97% increase over the past week.

5. X community developer seeks comments from the community on whether to integrate Vine into the X platform.

6. DeBot: Security issues raised by the SlowMist team were promptly addressed.

7. Shenyu highlights that staking ETFs, RWAs, and AI tech developments will be critical turning points for Ethereum over the next 18 months.

8. Vitalik Buterin emphasizes the importance of ETH in the network's expansion plans, fee burning, staking, and increasing blob revenue.

9. ZUMi Finance completes a $4.9 million buyback of iZi tokens in 2024.

10. Trump's crypto project WLFI holds a total of $388 million worth of tokens such as ETH and WBTC, and 41.81 million stablecoins.