ToE's Weekly Highlights #77
Altcoin season is imminent for a breakout
We are less than 30days to elections and 32 days for an FOMC meeting
Here’s what you need to know ahead of these events 👇🧵
Weekly Updates
Market Overview
This week saw a major geopolitical development as Iran launched nearly 200 ballistic missiles toward Israel, escalating tensions in the Middle East. The conflict is impacting global markets, causing concern among investors. Historically, such geopolitical events have led to short-term drops in crypto, especially Bitcoin (BTC). However, unless this conflict escalates significantly, the local bottom may be in sight.
The chart in a recent BlackRock report highlights that Bitcoin has historically rebounded following major geopolitical events. In the last six instances, BTC recovered quickly and even increased by over 15% in the following 60 days. Could we see history repeat itself? It’s uncertain and depends largely on how the situation unfolds, but many crypto catalysts could drive bullish sentiment into Q4.
Why I’m Bullish on BTC
Despite the volatility, I remain optimistic about Bitcoin’s long-term trajectory. After the Russia-Ukraine conflict began, BTC rose by 15% within 60 days. Comparatively, the recent events, while concerning, haven’t caused the same level of panic.
Additionally, a significant outflow of BTC from centralized exchanges has been reported — the largest since 2022. This signals strong demand for BTC, and it suggests that whales are not overly concerned by the dip.
On-chain Insights 🔍
BTC inflows to exchange wallets are down over 95% since the peak of the 2021 bull market, indicating decreased selling pressure. This could pave the way for a price surge, as fewer BTC on exchanges make it easier for the asset to pump.
Weekly alpha by @TheDeFinvestor
Narrative Overview
Everything you need to know in September
1. FOMC Meeting - September 18
The much-anticipated FOMC meeting led to a 50bps rate cut, which caused some initial chaos but ultimately sparked a +10% weekly pump in $BTC. This rate cut signals an increase in global liquidity, and since $BTC is closely tied to liquidity, many see this as a bullish sign for the months ahead.
2. Aleo Token Launch
Aleo, a new zk-powered Alt L1, launched its $ALEO token on September 18. Despite its $5bn FDV and being listed on Coinbase, it didn’t gain much attention initially. However, a low float setup led to a +160% short squeeze rally from its bottom before a subsequent sell-off.
3. Ton App Coins Struggled
Two new coins from the Ton app ecosystem—$HMSTR (Hamster Kombat) and $CATI (Catizen)—both experienced poor performance, seeing their FDV drop from $1bn to $500M. Despite this, many expect a strong pump in the future.
4. MicroStrategy’s BTC Buys
MicroStrategy announced two significant $BTC buys in September—$1.1bn on September 13 and an additional $400M on September 20. Both announcements did not mark local tops, signaling continued strength in accumulation.
5. Neiro Saga
The NeiroETH token listed on Binance perps, resulting in an +85% pump in an hour on September 6. Later in the month, Binance listed NEIROCTO, causing a significant market shift with wild swings in both tokens’ market caps.
6. Celestia’s $100M Raise
On September 23, Celestia announced a $100M VC raise, leading to a +25% pump, although this excitement was short-lived due to anticipated future selling pressure from OTC token sales.
7. Ethena Stablecoin Launch
Ethena launched a new stablecoin wrapped around the BlackRock BUILD fund on September 26, causing a +15% pump. They also announced a new DEX called Ethereal, using USDE as collateral.
Main Narratives:
1. BTC Higher Low, Then Higher High
For the third month in a row, $BTC saw a dump early on but then recovered, printing a higher high at $66k by the end of September. Altcoins began to show strength, particularly those backed by VCs and with solid fundamentals, indicating a shift from the earlier memecoin-dominated market.
2. VC Coins x Alt L1s Lead
The month’s best performers were VC-backed Alt L1s, led by $SUI (+123%), $SAGA (+114%), and $SEI (+63%).** $SUI** in particular gained a lot of mindshare, doubling its FDV and becoming a potential new SOL-like narrative.
3. $TAO Pumps and AI Narrative Gains
$TAO had a strong +100% pump in September, solidifying its position as the leading AI crypto token. This ignited an AI bid across other tokens like $NEAR, $PHB, and $FET.
4. Solana Mid-caps Outperform
While $SOL itself lagged, Solana ecosystem mid-caps like $CLOUD (+58%) and $DRIFT (+40%) significantly outperformed. There may be mean reversion in favor of larger caps like $JUP and $PYTH going forward.
5. Memecoins Catch-Up
Memecoins began to catch up toward the end of September, with $PEPE (+38%) and $WIF (+62%) leading the charge. $POPCAT was the strongest large-cap memecoin (+68%).
6. On-chain Mooners
On-chain memecoins like $MOODENG (Solana) and $SPX (Ethereum) saw significant gains. $MOODENG reached a $320M market cap, while $SPX pumped from $15M to $200M+.
Additional Comments:
• The gaming sector has lagged behind, though $PIXEL and $SUPER (+51%) could offer good R/R trades.
• $REEF defied expectations, pumping +700% and moving from $20M to $150M market cap in September.
• $BABYDOGE got listed on Binance spot, doubling from $150M to $400M mcap.
Other updates
🔍 Market Watch: What’s Happening?
• $AVAX: Major platform upgrade “Avalanche9000” launching this week.
• $RUNE: Thorchain prepares to unveil a new DeFi app layer.
• $EIGEN: Token mobility feature activated on Sep 30.
• $SIDUS: Hero enhancement facility launched on Oct 1.
• $WLD: Expands to Binance Futures on Oct 2.
• $ETH: Community gathers for a Rome conference starting Oct 4.
Token Unlocks Schedule
• $SUI: 107M USD unlock on Oct 1.
• $IMX: 59M USD unlock on Oct 4.
• $ADA: 7.5M USD unlock on Oct 2.
Data Highlights:
SUI’s Total Value Locked (TVL) has hit a new high of $1B ahead of its unlock, driving a 48% surge in recent weeks. Solana’s TVL has also reached $5.5B, marking a multi-month high.
Biggest EIGEN Airdrop:
Justin Sun was the 2nd largest claimant, receiving $8.75M in $EIGEN and later selling a portion for $21.66M in $USDT.
💵 Stablecoin Market Analysis
The stablecoin market remains strong with a total supply of $172B, down only 8.5% from its all-time high. USDT dominates, accounting for 70% of the total supply, while USDC takes 31%.
Layer 2 Stablecoins:
Ethereum controls 74% of the stablecoin supply, but Layer 2 networks are catching up, with Arbitrum leading at $4.5B and Base (backed by Coinbase) growing by an impressive 2095% in the past year.
Zooming Out on $ETH
ETH appears to be range-bound for now, with the market in a sideways or downtrend. The recommendation is to trade cautiously during this period of uncertainty. Patience is key until market conditions become more favorable.