The week started with a significant drop in the cryptocurrency market, influenced by DeepSeek news and a negative reaction in traditional stock markets. Bitcoin (BTC) fell from $105,000 to $97,700, gradually recovering as the market digested the information. The total crypto market capitalization saw a slight decline of less than 1%, settling at $3.708 trillion from $3.732 trillion the previous week.
Performance of Key Cryptocurrencies
Bitcoin (BTC) rose 1.1% over the week, while Ethereum (ETH) underperformed, falling 1.45% compared to the previous week.
Daily Liquidations and Funding Rates
Daily liquidations on long positions spiked at the start of the week, with over $660 million liquidated on Monday due to the DeepSeek news. Short liquidations remained relatively stable, averaging just over $100 million per day. Funding rates largely held steady, with most major cryptocurrencies hovering in the single-digit to low double-digit range.
Key Events of the Week
MicroStrategy’s Bitcoin Acquisition: Michael Saylor announced that MicroStrategy did not purchase any Bitcoin last week, maintaining its holdings at 471,107 BTC.
MicroStrategy Announces STRK: The company introduced STRK, a new convertible preferred stock offering, with a planned issuance of 2.5 million shares.
Project News
Abstract Chain Goes Live: The Abstract chain launched its mainnet, introducing the Abstract Global Wallet and Abstract Live, a streaming platform for content creators.
Virtuals Protocol Expands to Solana: The AI agent launchpad Virtuals Protocol extended its platform to Solana, enabling token migration supported by LayerZero. Liquidity pools for AI agent tokens will be backed by Meteora using VIRTUAL pairs, similar to Base.
Chart of the Week: Solana (SOL)
Solana remains one of the most active ecosystems, with increased development and strong trading volume. Despite broader market volatility, Solana-related projects like Jupiter (JUP) and Jito (JTO) saw notable gains. SOL’s price movement will be crucial to watch in the coming weeks.
Restaking Layer 2 project Karak Network introduced the Karak Foundation and announced the upcoming launch of its Karak token (KAR), which is expected to be airdropped to eligible users. Those who have interacted with Karak’s ecosystem may benefit from future distributions.
Memecoin of the Week: JellyJelly (JELLY)
Sam Lessin, co-founder of Venmo, launched JellyJelly, a memecoin for his new social app Jelly on Solana. This marks the second major founder-led memecoin launch recently, following Vine creator Rus Yusupov’s introduction of the VINE token. The trend suggests increasing mainstream interest in blockchain-based social tokens.
Educational Section: What Are AI Agent Tokens?
AI agent tokens are a growing trend in crypto, representing assets used to power autonomous AI-driven applications within blockchain ecosystems. These tokens typically facilitate machine-to-machine transactions, smart contract automation, and decentralized AI operations. The expansion of Virtuals Protocol to Solana highlights the growing importance of AI in crypto.
Conclusion
This week was marked by a volatile start, with a sharp sell-off that liquidated nearly $1 billion in the crypto markets within 24 hours. However, the market found stability and gradually recovered. Bitcoin outperformed most altcoins, strengthening its dominance as investors turned to safer assets amid uncertainty.
The launch of DeepSeek’s AI model sparked fears of shifting technological dominance, significantly impacting U.S. stock markets, particularly semiconductor companies like Nvidia. Meanwhile, the crypto market saw continued innovation, with notable project developments such as Abstract’s mainnet launch and Virtuals Protocol’s expansion to Solana.
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