Bitget Daily Digest (February 11) | AI agents make a strong comeback, Trump family project WLFI buys $MOVE 

Market highlights

1. AI agents sector rebounds sharply, poised to reclaim the narrative lead. Popular tokens like $AVA, $ARC, and $SWARMS see significant gains, with SoSoValue data showing that this sector is leading in growth. Meanwhile, the test token concept, led by $TST, enters a consolidation phase after a decline, with $TCC and $TUT following suit. Speculative activity even extends to SOL-based assets like $WOMP.

2. Trump family crypto project WLFI makes a move. After a brief dormancy, WLFI purchases over 800,000 $MOVE tokens. Meanwhile, Tesla discloses its Bitcoin holdings in a 10-K filing with the SEC, confirming it holds 11,509 BTC, aligning with previous reports from Arkham.

3. According to yesterday’s report from The Kobeissi Letter, Ethereum short positions grew by 40% in a week and have surged 500% since November 2024. This extreme shorting leads to a 37% ETH crash on February 2, wiping over $1 trillion from the crypto market. However, despite the increase in short positions, ETH sees over $2 billion in inflows, with a single-week record of $854 million. Hedge funds continue shorting ETH, attempting to suppress its recovery.

4. NYSE Arca files for the first Cardano spot ETF. The application will enter the SEC review preparatory process. Analysts predict that $LTC spot ETF has the highest approval probability at 90%, followed by $DOGE and $SOL at over 70%. Meanwhile, $XRP's approval odds are down to 65% due to ongoing legal battles with the SEC. Disagreements over regulatory frameworks remain a key variable.

Market overview

1. $BTC edges higher amid broad market gains. Tokens within the same ecosystem, like $CHEEMS and $KOMA, surge amid growing interest in $TST. The AI sector rebounds significantly, while the newly launched $JAILSTOOL sees strong growth.

2. Nasdaq closes nearly 1% higher, with Nvidia up nearly 3%. Chinese concept stocks gain 2.6%, while Alibaba rises 7.5%. Meanwhile, gold has hit record highs seven times in the past eight days. 

3. Currently standing at 97,900 USDT, Bitcoin is in a potential liquidation zone. A 1000-point drop to around 96,900 USDT could trigger over $70 million in cumulative long-position liquidations. Conversely, a rise to 98,900 USDT could lead to more than $394 million in cumulative short-position liquidations. With short liquidation volumes far surpassing long positions, it's advisable to manage leverage carefully to avoid large-scale liquidations. 

4. Over the past day, Bitcoin saw $14.7 billion in spot inflows and $14.9 billion in outflows, resulting in a net outflow of 200 million. 

5. In the last 24 hours, $BTC, $XRP, $TRUMP, $ONDO, and $VINE led in net outflows in futures trading, signaling potential trading opportunities. 

6. According to the latest data from SoSoValue, U.S. spot Bitcoin ETFs recorded a single-day outflow of $71.522 million, while the cumulative inflows are $113.557 billion. Spot Ethereum ETFs saw a single-day outflow of $22.4573 million, with cumulative inflows of $3.157 billion, with total holdings at $10.045 billion. 

Highlights on X

1. @Haotian: The third wave of AI agents – DeFAI could be the game-changer driven by VC and community

The next wave of AI agents needs to break free from the meme trap and shift towards a high-barrier value creation model driven by both VC and community support. DeFAI (DeFi + AI) could emerge as a key sector—AI agents, through autonomous asset custody and decision-making, can address trust issues in traditional DeFi while leveraging robust existing infrastructure to validate use cases more efficiently. The market is undergoing a shakeout, eliminating speculative projects. In the long run, only teams with strong technical capabilities, well-structured incentives, and clear product-market fit (PMF) will lead the space, restoring fundamental value and sustaining a long-term bull market. Any hype-driven, unsustainable "false prosperity" will ultimately backfire on market expectations.

X post: https://x.com/tmel0211/status/1888852210693574984

2. @Aylo: Solana's speculative ecosystem Is driving its valuation — far from overvalued

Despite the overall market downturn, Solana continues to generate higher revenue than Ethereum, with its ecosystem revenue reaching nearly 10x that of Ethereum's. No Layer 2 (L2) solution has been able to change this reality at the data level. Solana's strong economic activity is fundamentally supported by its persistent speculative and trading ecosystem—a model similar to online gambling, which maintains a stable user base regardless of market conditions. Speculation is a core demand in the crypto industry, and Solana has successfully captured this market, establishing a Baseline Economic Security that underpins the SOL token. Going forward, Solana needs to foster more non-speculative applications to justify higher valuations and strengthen its Lindy effect, paving the way for institutional adoption. From a valuation perspective, Solana remains reasonably positioned among L1/L2 networks and is not significantly overvalued.

X post: https://x.com/alpha_pls/status/1888994014931661082

3. @lanhubiji: The market is stuck in a PvP loop—No new growth narrative in sight

In the last cycle, DeFi was the dominant narrative driving capital inflows, but this time, the market lacks a compelling use case, leaving it trapped in an endless PvP trading loop and nihilism. The only promising narrative—AI agents—was shut down just as it began gaining traction. For this sector to rebound, it will need time and real-world adoption. Right now, the crypto market has become a zero-sum game, where decentralization, trustlessness, and security are no longer the focus. Instead, high-frequency PvP trading dominates, benefiting elite traders while shrinking overall liquidity rather than expanding it. For the industry to achieve long-term sustainable growth, it must revitalize key sectors such as crypto payments, value storage, DeFi, AI agents, and RWAs (real-world assets). Otherwise, over time, Ethereum could lose its foundation, and even Bitcoin may not remain unaffected.

X post: https://x.com/lanhubiji/status/1888827661885272091

4. Phyrex: TGA withdrawals ≠ QE—A short-term liquidity boost with long-term risks

While Treasury General Account (TGA) withdrawals may provide a temporary liquidity boost, superficially resembling quantitative easing (QE), they are fundamentally different:

-QE expands the Fed's balance sheet, lowers long-term interest rates, and injects liquidity into financial markets in a structured manner.

-TGA withdrawals, on the other hand, are merely fiscal fund transfers—they do not alter interest rate structures and are not a sustainable source of liquidity.

Over the long run, U.S. Treasury debt issuance could absorb liquidity, especially when combined with the Fed's balance sheet reduction and anti-inflation policies. This suggests that any liquidity expansion may be short-lived. The market appears to be overhyping the impact of TGA withdrawals while overlooking their temporary nature. In 2023, these withdrawals helped support asset prices, including BTC and U.S. equities. However, if the Treasury resumes debt issuance or the Fed maintains restrictive monetary policy, liquidity could shift from expansion to contraction, exerting downward pressure on valuations. In the short term (Feb–April), markets may benefit from capital injections. But in the long term, policy tightening could trigger a valuation correction.

X post: https://x.com/Phyrex_Ni/status/1888945022709768204

Institutional insights

1.Greeks.live: Bitcoin continues to fluctuate below $100,000 as market sentiment turns bearish

X post: https://x.com/BTC__options/status/1888967569274753530

2.PitchBook: Crypto VC investment "rebounds" in 2024, investors still favor mature teams

Article: https://blockworks.co/news/q4-deal-values-jump

3.Bitfinex report: Bitcoin is behaving more like a risk asset than a store of value

Article: https://blog.bitfinex.com/bitfinex-alpha/bitfinex-alpha-btc-behaving-more-as-risk-on-asset-less-as-store-of-value/

4.Matrixport: Ethereum's March upgrade unlikely to trigger a major rally

X post: https://x.com/Matrixport_CN/status/1888845360082370897

News updates

1. Maxine Waters, a U.S. lawmaker, proposes a stablecoin regulation bill.

2. Japan's Financial Services Agency (FSA) plans to classify crypto as a financial product similar to securities, introduce tax cuts, and approve crypto ETFs.

3. South Korea's Financial Supervisory Service plans to establish a self-regulatory framework for the crypto industry in 2025.

4. Korea Exchange (KRX) chair calls for the listing of crypto ETFs to boost market confidence.

Project updates

1. NYSE Arca submits Cardano ETF application on behalf of Grayscale.

2. Trump family's crypto project WLFI purchases over 800,000 MOVE tokens.

3. Virtuals Protocol's Launchpad is set to go live soon; $VIRTUAL is now tradable on Solana.

4. Merlin Chain announces an upcoming PoS network upgrade.

5. PancakeSwap burns approximately 9.05 million CAKE tokens, worth around $15 million.

6. Metaplanet plans to issue 4 billion yen (about $27 million) in ordinary bonds to buy more Bitcoin.

7. Nasdaq submits applications for CoinShares' LTC and XRP ETFs.

8. Arweave's computing platform AO plans to launch its first AO-powered payment services this week.

9. Jupiter co-founder: Contacted the CAR deployment team for on-chain verification but hasn't received off-chain confirmation yet.

10. Kaito AI's founder announces adjustments to the Yaps mechanism, introducing algorithmic bans and penalty measures.

Recommended reads

1.Trump impersonator or hacker's ploy?   CAR president caught in token controversy

The meteoric rise of the CAR token is both an extension of crypto's get-rich-quick myth and a cautionary tale of tech misuse and eroding trust. As political narratives and decentralization ideals intertwine, investors should take a more critical view of the "state-backed" hype. Ultimately, the co-evolution of regulation and technology may hold the key to resolving these tensions.

Read the full article here: https://www.bitgetapps.com/zh-CN/news/detail/12560604561583

2.$JAILSTOOL soars to $200 million in record time—One celebrity X post ignites a memecoin frenzy

How much higher can this token go? That's entirely up to Dave Portnoy.

Read the full article here: https://www.bitgetapps.com/zh-CN/news/detail/12560604561252