Today’s Narrative - 💤Neutral💤

Macros

• Powell's QE stance signals QE is unlikely unless rates at zero, limiting stimulus.

• Market reaction remains limited, suggesting QE wasn't expected soon.

• CPI focus is on January CPI data release (8:30 AM ET) as key catalyst.

Cryptos

• Rally fades as yesterday's crypto gains prove unsustainable.

• Altcoin strength is seen in Raydium ($RAY), Jupiter ($JUP), Aerodrome Finance ($AERO) as layer 1 beta plays.

• $BNB momentum gains for Binance Coin ($BNB) amid CZ promotion and ecosystem focus.

• **$DBR watch is advised for DeBridge ($DBR) gaining attention for bridging.

• Whale profit taking sees whales realize ~$800M Bitcoin ($BTC) profits.

• $BTC socials hit a 3-month high in social activity.

• Spot $SOL ETF race sees SEC acknowledge multiple spot Solana ETFs bids.

• Franklin SOL Trust registered by Franklin Templeton, hinting at ETF.

• Trump & Ondo RWA partnership sees World Liberty Financial collaborate with Ondo Finance ($ONDO) for RWA tokenization.

• WLFI ETH/MOVE accumulation continues for WLFI in Ethereum ($ETH) & MOVE ($MOVE).

• Whale ETH buy shows whales bought 600K+ Ethereum ($ETH) last week.

• Uniswap L2 announced as Uniswap ($UNI) unveils "Unichain".

• BNB Chain 2025 roadmap unveiled, focusing on speed, costs, and AI, as detailed in the BNB Chain 2025 roadmap.

• Meme crash sees celebrity meme tokens plunge 78% from highs.  

• $DIN TGE details and airdrop checker announced by DIN.

• TON bridge partnership sees TON ($TON) collaborate with LayerZero.

• Gumi BTC buy planned as Japanese game studio Gumi Inc. aims for $6.58M $BTC buy.

Key Takeaway

• Focus on CPI Data Today (8:30 AM ET) as the major market catalyst.

• Focus on Maintaining a neutral stance in portfolio positioning before the CPI release.

• Focus on Monitoring altcoin strength and the reaction of $BTC and bond yields post-CPI to gauge market direction and potential trading opportunities.

Our Stance

Market sentiment is currently neutral as we await the critical CPI data release at 8:30 AM ET. Federal Reserve Chairman Powell's recent comments have effectively capped immediate upside potential by suggesting quantitative easing is unlikely unless interest rates reach zero. Despite this, the market reaction has been resilient, indicating underlying strength. Within the crypto space, altcoins, particularly those in the Solana ecosystem, are demonstrating relative strength and should be monitored closely. The CPI data will be the key determinant of short-term market direction: a hot CPI reading is likely to trigger a risk-off environment, while a weaker-than-expected CPI could fuel bullish momentum. Therefore, a cautious neutral stance is advisable pre-CPI release.

Here's how we're approaching the CPI data:

• Expected CPI: Headline CPI YoY expected at 2.9% (Dec: 2.9%), Core CPI YoY at 3.1% (Dec: 3.2%), Monthly CPI forecasted at +0.3% for both.

• Hot CPI Scenario (Above 3.0% Headline, Core High): Expect a sell-off. This would be the first reading above expectations in 3 months, potentially shocking markets and delaying rate cut expectations. Watch for rising bond yields and a stronger dollar (DXY) as risk-off indicators.

• CPI In-Line Scenario (~2.9% Headline, ~3.1% Core): Minimal short-term impact. Market focus shifts to future data.

• Weak CPI Scenario (Below 2.8% Headline, Core drops sharply): Expect bullish reaction. Cooling inflation fuels earlier rate cut bets, potentially causing a market whipsaw.

Our Advice: Cautious neutral stance pre-CPI. Focus on fundamentally strong altcoins. Avoid aggressive scalping during potential CPI volatility. Monitor market reaction post-CPI, especially $BTC and bond yields, for directional cues. CPI releases often mark local tops/bottoms within 24-48 hours, so be prepared for potential shifts.

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• Trump World & Liberty Financial partner with Ondo Finance to boost tokenized Real World Asset (RWA) adoption.

• Ondo's tokenized assets will be integrated into World Liberty Financial (WLFI) network as treasury reserves.

• Partnership aims to bring traditional finance on-chain and offer secure yield opportunities.

• Move provides WLFI network with access to traditional financial assets via tokenization.

• Collaboration signals growing trend of bridging TradFi and DeFi through RWAs.

You can read more here…

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• Pump.fun Platform has a token mechanism burning millions in SOL.

• 2.87 million SOL (over $287 million) locked in inactive liquidity pools.

• SOL Removed from Circulation, creating deflationary pressure.

• SOL Burning Mechanism is an unintended consequence of token graduation system.

• Market Watch on deflationary effect's impact on Solana (SOL) price. Market is watching how this deflationary effect impacts Solana's (SOL) price.

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🧐Research🧐

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TLDR;

• Palm scanning is emerging as a superior biometric authentication method, offering enhanced security and reliability compared to fingerprints.

• Humanity Protocol is leveraging palm biometrics to create "Proof of Humanity" (PoH) for Web3, aiming to ensure only real humans participate in decentralized systems.

• LayerZero Labs partnership strengthens Humanity Protocol, expanding its PoH verification across over 70 blockchains and 95+ dApps.

• Recent funding round co-led by Pantera Capital and Jump Crypto values Humanity Protocol at $1.1 billion, fueling development and expansion.

• Humanity Protocol is tackling critical Web3 challenges – bots and digital identity – with an innovative approach. Palm biometrics could be a key to a more secure and human-centric decentralized future.

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