Weekly Alpha #39 - The state of the market
Latest DeFi Alphas Delivered in a Concise Newsletter.
Welcome to the latest edition of Weekly Alpha.
I deliver insights on the cryptocurrency market, emerging projects, macroeconomic trends, and DeFi directly to your inbox.
In this edition of The Weekly Alpha:
📈 The state of the market
📆 This week in DeFi
🎧 Pocasts of the week
🔓 Token Unlocks
The state of the market 📈
It has been a challenging few weeks since the election of Donald Trump, primarily due to tariffs and market uncertainty, which has led to a correction in the crypto market.
The most affected coins are, unsurprisingly, those with weak fundamentals, such as memecoins and many AI-focused coins that were likely overvalued in the short to medium term.
The Memecoin Market
I understand this may be an unpopular opinion, but for the market to regain its health, 99% of memecoins need to disappear. The pump-and-dump dynamics have attracted many bad actors, similar to what we've seen in previous bull markets, and we all know how that typically ends.
DeFi Fundamentals
As a DeFi power user, I believe that the fundamentals are strong and that DeFi continues to thrive, especially on Ethereum. While Ethereum may not be the best-performing Layer 1 in terms of current price action, it is, in my opinion, the best long-term investment. Solana, with its highly centralized and monolithic architecture, is unlikely to sustain long-term growth. Simply increasing block size does not address fundamental issues, and there are other Layer 1 solutions with similar levels of centralization, such as SUI and others.
For those like me who use DeFi to slowly accumulate more tokens through yield generation, Ethereum offers the best long-term guarantees. Over the years, I have seen many speculative bets and gambling-like investments, such as EOS, come and go.
Final Thoughts
I am convinced that this is not the end of the bull market, even though it is playing out differently this time. Liquidity is not rotating from Bitcoin to altcoins due to traditional finance (TradFi) investors bringing liquidity to Bitcoin off-chain via ETF inflows.
I believe there is still a strong place for DeFi and some altcoins. However, the current situation, with thousands of new tokens being created daily in a pump-and-dump casino-like environment, is not sustainable. There simply isn't enough liquidity to support this, and it is not healthy for the market, especially after the Melania launch. I think we need a reset and a return to fundamentals if we want to see another leg up in the bull market.
What I’m reading this week 📆
News 🗞️
In this section, I curate the week's most impactful DeFi news. This way, you can bypass the chatter on Twitter and concentrate on the essential updates.
Tornado Cash developer Alexey Pertsev leaves prison custody - read
MegaETH defies airdrop farming craze, dives headfirst into NFTs - read
Ondo Finance to Launch RWA-focused Layer 1 Blockchain - read
DeFi Lenders Processed Nearly $300 Million of Liquidations on Feb. 3 - read
Why DeFi Will Benefit From Trade Wars - read
What I’m listening this week 🎧
In this section, I feature the week's most compelling DeFi podcasts and videos.
Bell Curve: Market Volatility, Stablecoin Regulation, and Saylor’s Next Move
The Rollup: How AI x ZK Will Power A New Era of Crypto with Scott Dykstra
When Shift Happens: Why Crypto AI Agents Won’t Take Over The World
Bankless: The U.S. Crypto Task Force Is REAL! Their Bullish Plans For 2025 Explained
the defiant: The Ethereum Controversy: What's Next for the Foundation?
Token Unlocks 🔓
BERA (12.08% of circulating supply) - Feb 10
EIGEN (0.55% of circulating Supply) - Feb 11
ATH (10.21% of circulating supply) - Feb 12
Wrapping up for this week. For daily DeFi updates, follow me on Twitter
None of the information in this newsletter constitutes financial advice. While I personally use most of the protocols that I discuss, it's important to understand that they involve substantial risk. Don’t invest what you can’t afford to lose