As the Federal Reserve meeting approached this month, market sentiment quietly improved, lifting the gloom that had prevailed. On September 17, Bitcoin broke out impressively, climbing steadily over two days from below $58,000 to break through the $61,000 mark. When the Fed announced a significant interest rate cut, the crypto market responded with renewed vigor, dispelling worries and uncertainty. BTC recorded a rare six-day winning streak, posting a weekly gain of 7.52% and approaching $65,000, demonstrating strong recovery momentum.
The surge in coin prices effectively responded to all doubts and challenges. ETH also performed strongly, rising from a low of $2,150 to firmly establish a new position above $2,600, easing FUD sentiment. Notably, after the ETH/BTC ratio hit a three-year low, it showed remarkable resilience, reclaiming lost ground and returning to above 0.04, signaling a broad return of market confidence. AAVE stood out by breaking through the $180 mark, reaching a new high since May 2022, while many altcoins followed, adding significant vitality to the market.
Positive news continued as U.S. presidential candidate Harris publicly stated that if elected, she would support growth in AI and cryptocurrency investments. The total market capitalization of the crypto market once again exceeded $2.2 trillion. Recently, the daily trading volume in the crypto spot market surpassed $80 billion, more than double the low of $40 billion seen in June.
On-chain data shows that the total stablecoin market cap has broken through $172.2 billion, reaching a new high since May 2022, with a weekly increase of over 0.5%. CryptoQuant CEO Ki Young Ju noted on social media, "Institutions are no longer heavily shorting Bitcoin. The net position in CME futures has dropped by 75% over the past five months."
Market fear has finally returned to a normal neutral level. With the ongoing rebound, which sectors besides Bitcoin and Ethereum are performing well?
Sui’s Strong Performance
Sui has shown exceptionally strong performance recently. After falling below $0.50 in early August, it quickly rebounded to around $1.00. After several weeks of consolidation, it surged again from approximately $0.80, reaching nearly $1.80—a gain of over 100%.
This month, Sui has been in the spotlight with a series of positive developments. Mysten Labs launched pre-orders for a gaming handheld device in early September, priced at $600 each, which sold out quickly, generating significant buzz. A week later, Grayscale Trust announced it was opening SUI investments to qualified investors, creating a major channel for capital inflow. On the same day, Binance launched SUI coin-margined perpetual contracts with up to 20x leverage, further boosting its price momentum.
On September 17, Sui’s co-founder announced that USDC would soon expand to the Sui network. The following day, Sui’s Total Value Locked (TVL) reached a historic high, exceeding $1 billion.
Ecosystem tokens also saw substantial gains, including SUIP, CETUS, and NAVX. Even the meme coin BLUB rose steadily during this period, with its market cap climbing to $45 million.
Notable Projects
Scallop
Scallop is a lending protocol on Sui. Benefiting from SUI’s price increase, the launch of Swap V2, and reward campaigns, its TVL surged to $154 million. Its token price also rose from around $0.15 in early September to above $0.40, with an all-time high of $1.44.
CZ-Related Concepts
On September 17, He Yi published a lengthy post addressing community anxiety about listing rumors, highlighting the subdued market sentiment. However, a week later, as market conditions improved, CZ’s release from prison became a major focus in the crypto community. According to U.S. Federal Bureau of Prisons data, CZ is scheduled for release on September 29, a news event that recently trended on social media.
Discussions have centered on CZ’s potential moves post-release and the performance of Binance Launchpool tokens. Binance’s ecosystem and its new token offerings have seen a wave of gains.
On September 23, IO from Launchpool rose by 8.8%, ALT surged 17.48% in a single day, AI gained 15.89%, NTRN increased by 11.75%, and ARKM jumped 22.16%. SEI climbed from a recent low of $0.26 to a high of $0.47.
Notable Projects
ENA
As a stablecoin project in Launchpool, its second-quarter airdrop distribution coincides with the day after CZ’s release. This timing helps offset selling pressure amid favorable market trends. Additionally, Ethena introduced sENA, a liquidity receipt token for locked ENA, enhancing its composability and utility with other projects, which may positively impact its price. The current token price is around $0.33, with an all-time high of $1.50.
EDU
Open Campus is a Binance-supported decentralized education platform addressing key challenges in the education industry. The current token price is $0.69, with an all-time high of $1.34. It is widely known that after stepping down as Binance CEO, CZ announced his focus on education. While it remains uncertain whether CZ will make related announcements post-release, market interest could attract capital inflow.
HOOK
Hooked Protocol provides learn-and-earn infrastructure for businesses and users, operating in the education-related niche. Its all-time high is $4.10, with a current price of $0.49. However, token liquidity remains relatively low.
AI Sector
The AI sector had been quiet for some time, but recent moves by OpenAI have reignited interest in AI-related crypto tokens. OpenAI is not only negotiating a $7 billion funding round but has also introduced o1, an AI model with reasoning capabilities, internally codenamed "Strawberry." OpenAI o1 can tackle complex tasks and solve problems beyond the reach of previous scientific, coding, and mathematical models. In tests, it performed at a level comparable to PhD students in challenging benchmarks like physics, chemistry, and biology, excelling in math and coding.
The AI sector, with its high valuation potential and relevance to current trends, often performs well during market upswings. ARKM surged from around $1.00 to break above $1.50. NEAR recorded three consecutive days of gains, rising from $4.50 to $5.46. TAO罕见ly posted an eight-day winning streak, climbing from around $280 to above $599.
Notable Projects
WLD
WLD has faced significant monthly selling pressure, limiting price appreciation. In July, the Worldcoin Foundation announced that WLD tokens allocated to Tools for Humanity (TFH) contributors, originally set for linear daily unlocks starting July 24, 2024, would see 80% of team and investor holdings extended from three to five years. Additionally, Worldcoin announced the upcoming launch of World Chain earlier this year, with Q4 approaching, suggesting a major catalyst may be near.
Historically, from October last year to the first half of this year, WLD was highly influenced by Sam Altman and OpenAI, with every move by its CEO or company causing significant price volatility. Although categorized as an identity project, WLD now carries strong AI attributes, making it a key proxy for OpenAI in the crypto space. The current price is $1.88, with an all-time high of $11.97.
Modular Blockchains Led by TIA
After listing on exchanges, TIA soared from $2.00 to over $20.00, a gain of more than 10x. However, it later experienced a prolonged decline, falling to around $3.70 due to broader market conditions.
Chris Burniske, a staunch TIA bull and Placeholder investor, recently advocated buying TIA below $5.00. Notably, he also publicly supported SOL during the last cycle when it was below $10.00. Chris argued that TIA skeptics overlook several key points:
- The Celestia ecosystem is fully operational, with a diverse and passionate group of developers actively experimenting.
- "Villain VCs" granted liquidity are unlikely to sell in October as expected, given the ecosystem’s progress and the team’s vision.
- Many major TIA supporters are not as short-term focused as portrayed.
- Buyers hesitant due to unlock concerns may be encouraged by positive price action and reduced uncertainty.
TIA is set to unlock approximately 175.74 million tokens on October 31, causing concern among some investors. However, with a month remaining, market sentiment remains optimistic. Recently, the Celestia Foundation completed a $100 million funding round led by Bain Capital Crypto, with participation from Syncracy Capital, 1kx, Robot Ventures, and Placeholder, bringing total funding to $155 million.
TIA has been climbing steadily from a low of $3.70, surging 24.19% on September 23 to approach $7.00. SAGA recorded five consecutive days of gains, rising from around $1.40 to above $2.70. DYM also saw two days of gains exceeding 20%, briefly breaking above $2.00.
Notable Projects
Avail
Avail is a modular blockchain project that raised tens of millions of dollars from a prestigious roster of venture investors. After launching its mainnet, it faced significant controversy and negative feedback due to airdrop details. The current token price is $0.15, with an all-time high of $0.246 and a total market cap of $288 million. Compared to TIA, SAGA, and DYM, AVAIL has not yet seen significant gains.
Market Outlook
Currently, sectors like gaming and social, which have faced skepticism, generally remain stagnant without major improvements, and new meme coins have not sparked significant speculative activity. A considerable portion of capital has already flowed into the sectors discussed above.
On the macroeconomic front, following the Fed’s rate cut this month, the market widely anticipates further cuts in November and December, with an estimated 70 basis points of reductions remaining this year. The published dot plot suggests an additional 50 basis points cut within the year. Continued rate cuts by the Fed are expected to inject liquidity into the crypto market, providing sustained positive momentum. Additionally, after the U.S. presidential election results are announced in early November, some hesitant capital may flow into the crypto market.
Historically, October has been a strongly bullish month for crypto. Market performance often improves significantly toward year-end and early the following year, while summer months tend to be weaker.
Regarding Bitcoin spot ETFs, total net inflows since launch have reached $17.7 billion. Since September 9, only two days saw minor outflows, with all other days recording positive inflows. The largest single-day net inflow was $263 million, indicating optimistic data and strong confidence among off-exchange buyers.
TOKEN 2049 in 2023 marked the dawn of the pre-bull market toward the end of the year. Whether the recent TOKEN 2049 will serve as the bottom for a new bull cycle remains to be seen.
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Frequently Asked Questions
What triggered the recent crypto market recovery?
The recovery was largely driven by the Federal Reserve’s interest rate cut, which boosted market liquidity and confidence. Positive developments in major cryptocurrencies like Bitcoin and Ethereum, along with supportive statements from public figures, also contributed.
Which sectors are leading the current market rebound?
Sui-based projects, CZ-related concepts, AI tokens, and modular blockchains like Celestia are among the top performers. These sectors benefit from strong fundamentals, recent news, and growing investor interest.
How does the Federal Reserve’s policy affect crypto markets?
Interest rate cuts increase liquidity in financial markets, making riskier assets like cryptocurrencies more attractive. Lower rates reduce the opportunity cost of holding non-yielding assets, potentially driving capital into crypto.
What are the risks associated with investing in emerging crypto sectors?
Emerging sectors often experience high volatility, regulatory uncertainty, and project-specific risks. Investors should conduct thorough research, diversify their portfolios, and only invest what they can afford to lose.
How can investors identify promising projects during a market recovery?
Look for projects with strong fundamentals, active development, community support, and clear use cases. Monitoring on-chain metrics, partnership announcements, and market sentiment can also provide valuable insights.
What role do ETFs play in the crypto market’s growth?
ETFs provide easier access to cryptocurrencies for traditional investors, increasing demand and liquidity. Their inflows often signal growing institutional confidence and can positively impact market trends.