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Crypto Market Declines as DeepSeek AI Disrupts Tech and FOMC Meeting Looms

Bitcoin fell below $100,000 for the first time since Jan. 16, mirroring broader risk-off sentiment across equities ahead of Wednesday’s FOMC meeting and China’s DeepSeek AI breakthrough. The cryptocurrency dropped 5% in 24 hours, triggering long liquidations in the derivatives market. Nasdaq futures declined 3%, reflecting growing concerns over DeepSeek’s low-cost, open-source AI model, which challenges U.S. tech giants. Meanwhile, gold hit a record high, indicating increased demand for safe-haven assets. Options market activity suggests bearish sentiment in the near term, with traders expecting potential upside movement in March. See similar: Bitcoin spiked to $106,000 before hopes for Sen. Cynthia Lummis' teased announcement fell short

New Studies Show Crypto Investing is Becoming More Mainstream

A series of new studies highlight the growing mainstream adoption of cryptocurrency investing, with retail investors leading the charge. A survey by ChainPlay and Storible found that 68% of U.S. respondents own crypto, and over 75% plan to increase their holdings this year. The election of Donald Trump influenced 38% of respondents to boost their crypto investments, with 52% reportedly selling gold to buy Bitcoin. Research from the University of Georgia indicates that social media users—especially those active on YouTube, Reddit, Twitter, and Clubhouse—are significantly more likely to invest in crypto, while only 10% of non-social media users hold digital assets. A global CryptoQuant study reveals that over 60% of crypto investors are between 25 and 44 years old, nearly half have a bachelor’s degree, and 89% are male. Additionally, a Bitget Research report found that one in five Gen Z and Gen Alpha investors are open to receiving pensions in crypto, with pension funds in Wisconsin, Michigan, the UK, and Australia already integrating crypto ETFs into portfolios.

Source: CryptoQuant

GMCI's USA Select Index Surges 183%, Reflecting Renewed US Crypto Focus

GMCI's newly launched USA Select Index, which tracks US-based crypto protocols, has surged 183%, climbing from $95 to $269.04 since November. The index, composed of 13 assets, serves as a benchmark for US-focused crypto investment strategies, with XRP, SOL, and DOGE making up 66% of its weight. Other constituents include LINK, AVAX, SUI, ADA, and LTC. The index’s rapid growth aligns with President Trump's executive order supporting US cryptocurrency leadership, bolstering investor confidence in domestic digital assets. Institutional interest is rising, with Bitcoin and Ethereum ETFs seeing elevated volumes, and retail adoption surging, as crypto apps climb app store rankings. As the US repositions itself as a crypto hub, this index could serve as a key indicator of whether more crypto projects prioritize US-based growth, reversing past trends of geoblocking and airdrop exclusions for American users.

Source: GMCI / The Block

Ethereum Network Activity Surges 37% Amid Institutional Interest and DeFi Growth

Ethereum's active addresses have surged 37% from November’s low, reaching 575,000, with daily transactions climbing to 1.3 million. Uniswap remains Ethereum's top decentralized exchange (DEX), holding a 22% market share and processing nearly $1 billion daily, while also being the largest gas consumer. Institutional activity is playing a role in Ethereum’s momentum, highlighted by World Liberty Financial’s recent $47 million ETH purchase alongside acquisitions of AAVE, LINK, and ENA. Meanwhile, VC firm Paradigm has called for faster development from the Ethereum Foundation, signaling increasing institutional focus on Ethereum's technical progress. While Solana dominates memecoin trading, Ethereum’s fundamentals remain strong, though transaction fees have declined, with $2.22 million generated in 24 hours, down from $4 million in December. As layer-1 competition intensifies, Ethereum’s development pace and institutional engagement will shape its evolving role in the crypto landscape.

Source: The Block

Regulation

Trump’s Crypto Executive Order Establishes Working Group, Blocks CBDCs, but Omits Bitcoin

President Donald Trump signed his first crypto-related executive order, establishing a Presidential Working Group on Digital Asset Markets led by AI and crypto czar David Sacks. The order directs federal agencies to explore a potential "strategic national digital assets stockpile," though it does not explicitly mention Bitcoin. Additionally, it blocks the launch of central bank digital currencies (CBDCs) and affirms Americans’ rights to self-custody, transact, mine, and develop blockchain technologies. The executive order is expected to be the first of several, with anticipated follow-ups including the repeal of SEC rule SAB 121. See similar: Senate Banking Committee Names Sen. Cynthia Lummis Chair of Digital Assets Subcommittee

U.S. House Committee Probes Alleged Crypto Debanking Amid ‘Operation Choke Point 2.0’ Concerns

The U.S. House Committee on Oversight and Government Reform is investigating allegations of systematic debanking within the crypto industry, reaching out to executives from Coinbase, Kraken, and Uniswap Labs for insights. Led by Rep. James Comer (R-Ky.), the committee aims to determine whether banking restrictions stem from financial institutions' risk policies or direct government influence. Crypto firms have struggled with banking access, particularly after regulatory warnings and the 2022 collapse of FTX. Allegations of a coordinated crackdown, dubbed "Operation Choke Point 2.0," have sparked concerns of targeted financial exclusion, reminiscent of an Obama-era initiative against high-risk industries. In response, the Senate Banking Committee also plans to hold hearings to further investigate the issue. See similar: SEC Launches Crypto Task Force Led By Commissioner Peirce

Trump Pardons Ross Ulbricht, A Key Campaign Promise to Crypto

President Donald Trump has granted a full and unconditional pardon to Ross Ulbricht, the founder of Silk Road, marking a major moment for Bitcoin advocates who long viewed his sentencing as excessive. Announcing the pardon via Truth Social, Trump cited support from the Libertarian movement and personally informed Ulbricht’s mother, Lyn, who had led a decade-long campaign for his release. The news was met with widespread celebration across the crypto community, with figures like Tether CEO Paolo Ardoino and Bitcoin historian Pete Rizzo hailing the decision. Ulbricht, sentenced to two life terms plus 40 years for running Silk Road, has been a symbol of early Bitcoin adoption and government overreach in digital markets. Meanwhile, Coinbase’s Conor Grogan identified 430 BTC ($47 million) linked to Ulbricht that had remained untouched for over a decade, though it remains unclear whether he still controls the private keys.

Binance Faces New French Probe Amid Money Laundering and Tax Fraud Allegations

French authorities have launched a new judicial investigation into Binance over allegations of money laundering, tax fraud, and drug trafficking, expanding on earlier probes into KYC compliance failures and illegal client solicitation from 2022 and 2023. JUNALCO, a division of France's Public Prosecutor's Office, is leading the case, which Binance has vowed to fight, calling the allegations "several years old" and "unfounded." The crypto giant has faced similar legal scrutiny globally, including a $4 billion settlement in the U.S. for money laundering violations in 2023. Despite these legal challenges, Binance remains the largest crypto exchange by spot volume, processing $1 trillion in trades in December.

SEC Repeals SAB 121, Allowing Banks to Custody Crypto

The Securities and Exchange Commission (SEC) has repealed Staff Accounting Bulletin (SAB) 121, effectively removing a key restriction that prevented banks from custodying cryptocurrency for customers. The rule had required banks to record customer-held crypto as liabilities, tying up their assets and making custody services impractical. The decision marks a major shift in regulatory policy under the newly Republican-controlled SEC. Crypto-friendly officials, including SEC Commissioner Hester Peirce and Sen. Cynthia Lummis, praised the repeal, calling it a victory for financial innovation. The American Bankers Association also welcomed the move, emphasizing that regulated banks can now provide safer custody options for digital assets.

Other Domestic Regulation Updates

• Ripple grows its US domestic footprint
• Trump EOs drive $1.9 billion in crypto fund flows
• Senate confirms pro-crypto Scott Bessent as Treasury Secretary
• Another Court Orders Treasury to Lift Tornado Cash Sanctions
• Trump’s crypto executive orders drive $1.9B in digital asset fund flows
• Trump’s Crypto Czar Calls NFTs ‘Collectibles,’ Compares Memecoins to Baseball Cards

Other International Regulation Updates

• CZ returns to Binance-related role
• ECB pushes for digital euro in response to Trump's crypto executive order
• KuCoin Co-Founders Step Down Amid $300M Settlement Over US Charges
• South Korea Suspends UpBit Exchange for AML Violations
• Canary Funds Amends Litecoin ETF Filing 

Pain & Gain

Pain

• Trump memecoin's 'horrendous' tokenomics
• Ledger co-founder freed after kidnapping
• Dogecoin Dumps as Elon Musk's DOGE Agency Website Removes Meme Imagery
• DeFi Network Thorchain Faces $200 Million in Toxic Debt—Here's What's Going On

Gain

• Jupiter distributes over $600 million in 'Jupuary' airdrop
• BlackRock CEO Larry Fink sees a world where bitcoin hits $700,000
• Telegram partners with TON for mini apps, serving 950 million users via TON Connect
• Tether Launches New Cross Chain Token
• Circle Acquires Tokenization Platform Hashnote 
• CoinDesk Rolls Out Deeper, More Diversified Crypto Index