Global economic tensions, amplified by US President Donald Trump’s imposition of import tariffs, have stirred the global financial landscape, with the crypto markets feeling the ripple effects significantly. On February 3, the market experienced unprecedented volatility, resulting in over $10 billion worth of liquidations within a 24-hour period.
Crypto Market Liquidations Surge Past Expectations
The recent crypto market upheaval has potentially resulted in liquidations amounting to $10 billion, surpassing initial estimates, as per insights from Bybit CEO Ben Zhou. According to CoinGlass data, more than $2.24 billion was liquidated from the crypto markets within a single day on February 3.
Bybit’s co-founder and CEO, Ben Zhou, highlighted that Bybit alone accounted for $2.1 billion of these liquidations. Zhou expressed his concern, stating in a February 3 X post, “I am afraid that today’s real total liquidation is a lot more than $2 billion, by my estimation, it should be at least around $8 billion -10 billion.”
0G Foundation’s Strategic Investment in AI-Powered DeFi
In a bold move towards fostering innovation in the decentralized finance (DeFi) sector, 0G Foundation has launched an $88.88 million ecosystem fund. This initiative aims to expedite the development of AI-powered DeFi applications and autonomous agents, commonly referred to as DeFAI agents. The fund has garnered backing from prominent Web3 investors, including Hack VC, Delphi Ventures, Bankless Ventures, and OKX Ventures.
Michael Heinrich, co-founder and CEO of 0G Labs, emphasized the critical timing of this launch, stating, “The rapid growth of AI capabilities, coupled with the need for trustless, transparent systems in finance, makes this the ideal time to accelerate the development of autonomous agents.”
Solana’s Q4 Revenue Surge Driven by Memecoin Speculation
Solana’s network witnessed a remarkable 213% surge in application revenues during the fourth quarter of 2024, driven primarily by memecoin speculation, according to crypto research firm Messari. The cumulative app revenues soared from $268 million in Q3 2024 to $840 million in Q4, with a peak in November at $367 million.
The memecoin launchpad, Pump.fun, significantly contributed to this growth, reporting $235 million in Q4 revenue, marking a staggering 242% quarter-over-quarter increase.
THORChain’s Innovative Debt Restructuring Plan
THORChain, a decentralized liquidity protocol, has taken a decisive step to address its liquidity challenges. On January 23, the platform temporarily halted its lending and savers programs for Bitcoin (BTC) and Ether (ETH) to avert an insolvency crisis and restructure its debt. The community proposed various restructuring strategies, leading to a consensus on converting the defaulted debt into equity tokens.
On February 2, THORChain’s node operators approved this innovative proposal, ensuring the network’s stability while compensating affected users.
Fed’s Endorsement of Regulated Stablecoins
Federal Reserve Bank Governor Christopher Waller has voiced support for the adoption of stablecoins under clear regulatory frameworks, emphasizing their potential to reinforce the US dollar’s status as a global reserve currency. In a February 6 interview with the Atlantic Council, Waller remarked, “What I see with stablecoins is they are going to open up possibilities and other ways of doing payments on the rails.”
He further elaborated that well-regulated stablecoins could enhance the dollar’s international trade, finance, and investment capabilities.
DeFi Market Overview
According to data from Cointelegraph Markets Pro and TradingView, the past week saw most of the 100 largest cryptocurrencies by market capitalization ending in the red. Notably, the Virtuals Protocol (VIRTUAL) token declined over 46%, making it the biggest loser, while the Arweave (AR) token decreased by over 38%.
For a more in-depth analysis of the week’s most impactful developments in DeFi, make sure to join us next Friday for further stories, insights, and educational content in this rapidly evolving space.
Source: Cointelegraph
