Altcoin Season’s Here? AI Coins Surge, Worldcoin Leads Gains

2024/02/20 10:34:50

The previous week was an exciting one in the world of cryptocurrencies, with Bitcoin breaking above the $52,000 mark during the Lunar New Year holidays. As the total crypto market cap approaches the key $2 trillion mark, the Crypto Fear and Greed Index remains firmly in the Greed level at 72, supporting hopes for more uptrends in the entire market.

Crypto fear and greed index at 72 | Source: Alternative.me

The crypto market has captivated its audience again with significant movements and announcements over the past week. The spotlight was mainly on AI-related cryptocurrencies following a groundbreaking announcement from OpenAI regarding its new project, Sora - a text-to-video tool powered by artificial intelligence. This news has not only sparked interest but also led to substantial gains in the AI coin sector. Here's a look at the top headlines and market movers that have shaped the crypto landscape over the past week.

Top Crypto Headlines of the Week

Over the past week, the crypto market has been bustling with significant news stories that have the potential to influence investor sentiment and market trends. Here are the top 5 news stories from the crypto market:

1. Crypto Market and Ethereum Layer-2 Get Ready for Dencun Upgrade

Bitcoin crossed the $52,000 mark last week, but Ether has outperformed Bitcoin with a 10.5% rally in seven days, compared to Bitcoin's 3.8% rise. This has been attributed to its better fundamental supply outlook, suggesting that Ether could become the next 'institutional darling’ ahead of potential spot Ether ETF approvals by the US SEC latest by May 2024. Open interest in Ethereum futures contracts reached $10.6 billion, nearing November 2021 levels.

The next key milestone in the Ethereum 2.0 journey, the Dencun upgrade, will slash transaction costs by 50%-90% through a dedicated corridor and blockspace for rollups. Expected to launch on the Ethereum mainnet on March 13, the upgrade has sent the TVL on Ethereum Layer-2 networks to an ATH of $27 billion. These layer-2 networks processed 92 transactions per second, 6.8 times more than the Ethereum mainnet.

2. Bitcoin ETFs Witness Record Inflows

Bitcoin ETFs have seen a record $2.4 billion in weekly inflows, with BlackRock's IBIT ETF leading the charge. This surge indicates a growing demand for spot-based exchange-traded funds, highlighting increased institutional interest in the cryptocurrency market. Speaking of Bitcoin ETFs, BlackRock has continued its mature approach towards promoting its new spot Bitcoin ETF, labeling Bitcoin as "progress" in its latest advertisement. It reflects a significant endorsement of Bitcoin's role in the financial ecosystem from the world's largest asset manager. ARK Invest’s Cathie Wood maintains her Bitcoin price prediction, expecting the OG crypto to reach $2 million by 2023.

3. Airdrop Fever Continues to Grab Investor Attention

This week, the crypto community has been abuzz with discussions about two major airdrops: Pixels (PIXEL) and StarkNet (STRK). The Pixels airdrop has captured attention due to its innovative approach to integrating gaming and blockchain, promising to reward early supporters and active community members with PIXEL tokens. On the other hand, StarkNet's STRK airdrop is generating excitement for its potential to enhance Ethereum's scalability and efficiency, offering STRK tokens to users who participate in the network's early phases.

Here are the top crypto airdrops for February.

4. UK Aiming for New Crypto Regulations

The UK is working to pass new legislation regulating stablecoins and crypto staking within the next six months. Economic Secretary to the Treasury Bim Afolami emphasized the government's commitment to achieving this goal. Despite previous pledges by UK Prime Minister Rishi Sunak to establish the country as a global crypto hub, there has been limited progress on crypto regulation in the country.

Top Gainers in the Crypto Market This Week

Here are the five biggest performing cryptocurrencies that have posted the strongest gains in the past week:

Worldcoin (WLD)

WLD/USDT price chart | Source: KuCoin TradingView

Leading the pack with a staggering gain, Worldcoin has benefited immensely from the growing interest in digital identity solutions. The project's vision of creating a global identity system has captured the imagination of investors and users alike. Worldcoin (WLD) has posted significant gains of almost 160% in the past week to trade at above $7, driven by the text-to-video model debut of Sora and several key factors. The project celebrated a major milestone with its World App wallet surpassing 1 million subscribers, indicating a burgeoning adoption and community engagement. This leap in user base has directly contributed to the bullish momentum surrounding WLD. Additionally, a substantial accumulation of WLD tokens by a whale from Binance contributed to a 25% price pump, highlighting the influence of large-scale transactions on market dynamics.

Alameda Research's substantial holdings in WLD have also played a role in the token's price dynamics. Despite the firm's bankruptcy, its untouched stash of 25 million WLD tokens, representing a significant portion of the circulating supply, has sparked speculation among investors about potential market movements. Furthermore, Sam Altman's announcement of Sora, an AI-driven platform, has added to the optimism around Worldcoin, drawing parallels between the success of Altman's AI ventures and the potential for Worldcoin.

Learn more about Worldcoin and how to get it.

Arweave (AR)

Arweave (AR) has seen a significant increase of over 51% in its value over the past week to touch $14.72, propelled by a combination of strategic developments and broader market dynamics. Arweave's growing role in the non-fungible token (NFT) ecosystem is a key factor driving this surge, particularly through its integration with the Solana blockchain. The technology behind Arweave supports some of the most popular Solana-based NFTs, which has led to an uptick in activity on the Arweave network. This was particularly evident with the launch of Degen Ape Academy on Solana, which necessitated Arweave to increase its rate limit to accommodate the influx of users.

Moreover, a significant development contributing to Arweave's recent price rally is Meta's announcement that Instagram will utilize Arweave to store creators' NFTs. This move by Instagram to offer permanent storage solutions through Arweave for digital collectibles marks a major milestone for the protocol, highlighting its value proposition in providing permanent, decentralized data storage. This partnership not only emphasizes the utility and potential of Arweave's technology but also aligns with broader industry trends towards embracing Web3 technologies for creative and commercial applications.

Fetch.ai (FET)

The recent surge in Fetch.ai's value, which saw an impressive gain of over 45% in the past week, can be attributed to OpenAI’s Sore debut and several other supporting factors. The project's focus on leveraging artificial intelligence and machine learning technology has been a significant draw for investors, highlighting the growing intersection between AI and blockchain technology.

The partnership between Fetch.ai Foundation and Deutsche Telekom has also played a crucial role in bolstering the project's credibility and market position. As Deutsche Telekom's subsidiary MMS serves as a validator on the Fetch.ai blockchain, this collaboration emphasizes the project's commitment to security and integrity, further enhancing its appeal to the blockchain community.

The Graph (GRT)

The Graph (GRT) has experienced a significant rally, gaining over 43% in the past week, driven by a confluence of factors highlighting the project's growing utility and market sentiment. A key driver of this surge is the impressive growth in network usage, with The Graph reporting a 65% increase in queries processed in Q4 2023, reaching 958 million. This growth is supported by an expansive library of over 1,500 subgraphs and substantial adoption of Layer 2 (L2) solutions, which now account for 83% of staked tokens and 60% of queries and fees. The deployment of nearly 300 new subgraphs on L2 further underscores the robust demand for The Graph's services, indicating a strong trajectory for the project.

Furthermore, The Graph's performance has been buoyed by broader market dynamics, particularly the renewed interest in AI-related tokens following OpenAI's launch of its text-to-video generator, Sora. This innovation has reignited interest in the transformative capabilities of AI within the cryptocurrency market, leading to appreciable gains across several AI tokens. The Graph's native token, GRT, has maintained its upward momentum amidst this trend, contributing to its recent gains.

VeChain (VET)

VeChain (VET) has experienced a remarkable price surge of over 43% in the past week, largely influenced by several strategic developments and growing industry recognition. The significant uptick in transactional activities related to VET, as reported by Uphold's Head of Research, Martin Hiesboeck, underscores the heightened interest in VeChain, especially as the platform contemplates its integration.

This increased attention can be attributed to VeChain's efforts in aligning with global financial communication standards through the filing for trademark registration of V3TR, signaling its intent to integrate more closely with the traditional financial system. The move towards ISO 20022 compliance positions VeChain as a key player in the realm of digital currency transfers, potentially opening doors to the trillion-dollar payments market. Furthermore, VeChain's proactive infrastructure development for various sectors, including finance, healthcare, and supply chain, coupled with its competitive edge in securing partnerships with Central Banks, contributes to its positive market sentiment. Sunny Lu's insights on the crypto industry's outlook for 2024, emphasizing regulatory progress and the potential for mass adoption, further fuel optimism for VeChain's future prospects.

Conclusion

This past week in the crypto market has been nothing short of greedy, with AI-related coins stealing the show following OpenAI's announcement of Sora. As the market evolves, it remains crucial for investors to stay informed about technological advancements and regulatory changes that could impact their investment decisions. The surge in specific sectors, such as AI cryptocurrencies, underscores the dynamic nature of the crypto space and its susceptibility to rapid shifts based on innovation and investor sentiment. With several cryptocurrencies making significant gains, the market's future looks promising, driven by both technological advancements and several noteworthy events coming up, like the Bitcoin halving, Ethereum Dencun upgrade, and the US SEC’s decision on spot Ethereum ETFs.