Crypto market sentiment is low: Stablecoin rise shows capital inflow

This week, the cryptocurrency market experienced volatile declines, with the market sentiment index dropping from 11% to 8%. The market capitalization of stablecoins rose rapidly, with USDT reaching 142.7 billion and USDC reaching 57.2 billion, increasing by 0.49% and 2.32% respectively, indicating that institutional funds are re-entering the market, primarily driven by the growth of US funds. Although economic data and the Federal Reserve's statements alleviated concerns about recession, the market expects three rate cuts this year starting in May. However, policy fluctuations have caused Bitcoin prices to fluctuate, intensifying market panic, with alternative coins generally underperforming the benchmark index.

Market Hotspot Analysis

Aave performs outstandingly

Aave's TVL rose by 5.86% this week, ranking second among the top 20 Defi projects. The price of AAVE increased by 21.38%, performing excellently among the top 50 market cap tokens. The main reason:

1. Optimize ecosystem governance and token economic model, including repurchase plans, increasing staking rewards, etc.
2. The White House supports the repeal of DeFi trading report rules to lighten compliance burdens.

As a leader in DeFi, Aave's actions may influence the direction of industry development. As investors pay more attention to actual returns, Aave's buyback proposal showcases multiple advantages, potentially prompting more DeFi projects to follow suit. However, Aave's price-to-earnings ratio of 60.86 is significantly higher than Maker's 20.75, indicating a lower value for purchase.

Berachain continues to rise

Berachain's TVL rose by 17.21% this week, reaching $3.449 billion, ranking sixth among public chains. The main growth comes from:

• Infrared Finance: WBERA staking APY maintains around 120%
• BEX: The stablecoin pool APY is approximately 16%
• Dolomite: Borrowing rate up to 48.08%

Berachain attracts users with high APY, providing stable returns in a volatile market. Its key to development lies in driving a positive economic cycle, forming a sustainable growth path of "staking lock-up → liquidity release → DeFi empowerment → token appreciation → user return → re-staking → developer aggregation."

Currently, the BERA staking ratio on the Berachain chain is about 30%, with room for growth. In the future, continuous attention should be paid to changes in APY and TVL of on-chain DeFi projects, as these are key indicators reflecting the vitality of the ecosystem.

Market Outlook

Events to watch next week:

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

Overall, the market is still in a state of fluctuation and panic. Projects like BTC, AAVE, and Berachain are expected to stand out due to their fundamental advantages. Investors need to continuously pay attention to on-chain data, the direction of macro policies, and the impact of upcoming unlocking events on market sentiment to seize opportunities and avoid risks.