TL;DR

• FOMC Meeting: hawkish statement and dovish Q&A session, Powell took steps cautiously to evaluate other policies’ impacts.
• US January employment report coming this week, the market is eyeing for the newest data to assess the possibility of two rate cuts this year.
• Cryptocurrencies plummeted, with NEAR dropping by up to 50% and ETH by 30%.
• The crypto market lacks stimulation, and there is little innovation in this round.
• Venmo founder creates token for new social platform, new Pump.fun-like launchpad betas on Base. This week, 37 deals raised 110m, down 70% from the previous week.

Macro Overview

FOMC Meeting: hawkish statement and dovish Q&A session, Powell took steps cautiously to evaluate other policies’ impacts.

Although the Fed maintained the benchmark interest rate of 4.25%-4.5% as expected in the Jan 29th FOMC meeting, which is in line with market expectation, the meeting shared a relatively neutral policy stance, neither too hawkish or dovish. In his speech, Powell deleted words like “inflation has made progress toward the Committee’s 2% objective” and replaced them with “inflation remains somewhat elevated”. Powell simply explained this as a way for “language cleanup”. Given the abundant liquidity level, strong economy and slightly high inflation level, the overall statement leans more hawkish as no clear timeline/scale in ending QT, or policy changes guidelines are offered during the speech.

However, the press conference Q&A session shared more dovish information as Powell highlighted his focus on multiple factors to measure QT accomplishments, close observation on Trump’s policies including tariffs’, and that the policies are rather “meaningful restrictive” rather than “highly restrictive”. Also, Powell has shared positive-than-before views on crypto, saying that banks could provide services, while calling for clearer regulations. Given impacts of fiscal policies to-be-measured, especially that on inflations, the Fed is trying to act neutrally to avoid any confusion on the economical development.

As the January US non-farm payrolls, unemployment rate, and average hourly earnings data will be dropping this Friday, the market is eager to analyze whether the job market has actually been heated up. Given that the Dec data is significantly stronger than expected, investors are looking for the latest data to prove their analysis. As Trump administration’s pro-business policies will lift business optimism and encourage local hiring, an overheated job employment data could add to the speculation that the Fed will not actually deliver two rate cuts this year.

The dollar index experienced a significant recovery last week, as the US dollar advanced against other major currencies when the White House reiterated Trump’s imposing tariffs starting Saturday.

The total asset level went down slightly last week, and ended up at $6.82tn. Although great works in asset reduction have been done, in last week’s FOMC meeting Powell still stated that “the reserves are still abundant”, and that the Fed will wait for signals that “reserves are approaching a level somewhere above ample”.

Gold price fluctuated in the first half of last week, but immediately hiked after Trump announced his tariffs on multiple countries. The price went across the $2,800 line last Friday and ended up at $2,798.29 when the market closed.

Crypto Markets Overview

1. Main Assets

As of this Monday, the prices of Bitcoin and Ethereum were approximately $95,000 and $2,500, with a week-on-week decrease of 3.7% and 16.5%, respectively. This cycle is a relatively fragmented one. Due to the lack of real innovation and effective user base in Web3 during this round, investors are no longer buying into VC coins, while ETF funds are more point-to-point. The price of BTC is driven by politics, causing BTC to break away from the inertia of past cycles.

2. Total Market Cap

The total market capitalization of the cryptocurrency market stands at $3.07 trillion this Monday. Excluding Bitcoin and Ethereum, the market cap amounts to $864.6 billion, reflecting decreases of 2.2% and 11.8%, respectively.

3. Net Inflows

Last week, the total market value of stablecoins reached $217.4 billion, setting a new high for this cycle, with an increase of $1.9 billion compared to the previous week. The issuance was mainly concentrated in USDC, amounting to $1.2 billion. Last week, the net inflow of BTC ETF reached $500 million, while at the same time, 13.35k ETH flowed out from the ETH ETF.

4. Top 30 Crypto Assets Performance

Most of the Top 30 tokens fell last week, with ETH dropping to a low of 2326, a single-day drop of over 30%. NEAR dropped to a low of 2.7, with a decline of over 40%.The overall crypto market lacks stimulation; it can be said that this bull market is only for a few cryptocurrencies, not the entire industry.

The Key Crypto Highlights

1. Founder of Venmo launches token for video sharing platform JellyJelly

Iqram Magdon-Ismail, co-founder of Venmo, and Sam Lessin, investor in OpenAi, Anthropic and the first investor in Venmo, have been building the AI-powered video-sharing app named JellyJelly for several months. The app enables users to share clips from video calls on the platform easily, and the token ran to over $250m in a matter of hours in the hopes that web2 founders would be incentivised to build in the crypto space.

2. Flayer, a token creation platform on Base, launches beta powered by Uniswap V4

Flaunch is a platform on Base which allows for more equitable token launches, a less extractive fee model and one of the first protocols to integrate Uniswap V4. Unlike Pump.fun, which has so far sold millions in SOL, Flaunch claims to use 100% of its revenue to reward creators and execute token buybacks with bid walls.

3. Las Vegas sphere denies rumours of a WIF advertisement

Team members and influencers of the WIF memecoin had previously fundraised to “put the dog on the Sphere”, namely the Las Vegas Sphere, one of the most visible digital billboards in the world. However, the venue has denied claims of any agreement or links with the token, leading to rumours of the WIF backers being charged with fraud.

Key Venture Deals

1. Cipher Mining Secures $50M PIPE from SoftBank

Cipher Mining has secured a $50 million private investment in public equity (PIPE) from SoftBank, marking a significant move in the data center infrastructure space. The company’s hybrid approach combines bitcoin mining operations with high-performance computing services, particularly focused on AI applications. The fresh capital will support Cipher’s expansion of industrial-scale data centers and development of additional power capacity at strategic locations, positioning them at the intersection of crypto mining and advanced computing infrastructure.

2. D3 Raises $25M to Bridge Web2 and Web3 Domains

D3 has concluded a $25 million funding round to revolutionize domain name infrastructure using blockchain technology. The round is led by Paradigm, with participation from Coinbase Ventures and notable angel investors including Polygon co-founder Sandeep Nailwal, HubSpot’s Dharmesh Shah, and Richard Kirkendall. The project aims to enhance interoperability between traditional and blockchain-based internet infrastructure while improving security and utility for domain registration and trading systems.

3. Pod Raises $10M for Novel Consensusless Layer 1 Network

A new Layer 1 protocol developer, Pod, has secured $10 million in seed funding to build a revolutionary “consensusless” network architecture. The round was co-led by a16z CSX and 1kx, with participation from Flashbots, Blockchain Builders Fund, and Protagonist, alongside notable angel investors from leading blockchain projects. Pod’s innovative approach eliminates inter-validator communication and implements a unique transaction ordering system that prioritizes performance over persistent total order, aiming to achieve Google-search-level transaction speeds. The project’s architectural design represents a significant departure from traditional blockchain consensus mechanisms.

The number of deals closed in the previous week was 24, with Infra leading the way with 15 deals, representing 63% of the total number of deals. Meanwhile, Social had 1 deals, both Data and DeFi had 4 and GameFi had the least with 0.

The total amount of disclosed funding raised in the previous week was $281.08 million, with the most coming from Infra with $176.86m. DeFi deals did not disclose their raises, and thus the sector constituted the least funding.

Total weekly fundraising rose to $281.08 million for the first week of February, an increase of 150% compared to the week prior. Weekly fundraising in the previous week was up 73% year over year for the same period.