Web3 Industry Trends and Market Analysis

1. Market Highlights

1. Macroeconomic Environment

Goldman Sachs recently adjusted its forecast for the Federal Reserve's interest rate cuts, lowering this year's rate cut expectation from 100 basis points to 75 basis points. The report pointed out that claims regarding the rebound in core inflation have been exaggerated. Data shows that the annualized increase in core personal consumption expenditures inflation was 2.5% from September to November last year, slightly higher than the 2.3% in the previous three months, but still lower than the year-on-year increase of 2.8%, indicating a continued decline in inflation.

The revised data from the Dallas Fed shows that the annualized PCE inflation from September to November last year was 2.4%, and the inflation rate dropped to 1.8% in November. The labor market is gradually tightening, and the annual wage growth rate has slowed to 3.9%. If productivity growth remains between 1.5% and 2% in the coming years, this will align with the 2% inflation target.

2. Web3 field

The IRS announced that the implementation of cryptocurrency tax reporting rules will be postponed until December 31, 2025. This decision aims to give brokers more time to address legal and regulatory challenges. At the same time, the IRS has issued a temporary relief measure that is expected to benefit cryptocurrency holders on centralized finance trading platforms in 2025.

The new regulations require the use of the first-in, first-out accounting method for crypto assets starting from January 1, 2025, unless other methods such as highest-in, first-out or specific identification are chosen. This postponement will provide the industry with more preparation time to adapt to the new tax policies.

2. Hot Topics

1. New Ideas for Economic Reconstruction in Syria

A Syrian non-governmental organization has put forward an innovative proposal calling for the new government to consider establishing a banking system based on the Bitcoin network and related technologies. The organization believes that such a system is crucial for accelerating national reconstruction and protecting the public from the effects of inflation and currency devaluation.

This proposal, known as the "Syrian Bitcoin Policy", aims to provide new solutions for countries facing economic difficulties. The proposal suggests that the government establish a comprehensive regulatory framework to legalize the trading and mining of Bitcoin and other digital assets, thereby promoting the recovery of the Syrian economy. Additionally, it proposes to digitize the Syrian pound and consider backing it with assets including the US dollar and Bitcoin.

2. Ethereum News Weekly Ceases Operations

Evan Van Ness, the founder of the Ethereum Weekly, announced that the platform will officially cease operations on January 1, 2025. This decision stems from communications with the leadership of the Ethereum Foundation, which indicates that the foundation's perception of the platform's value has significantly decreased, providing only symbolic financial support in 2024.

Van Ness stated that, despite the opportunity to continue operations through fundraising, he prefers to focus on other meaningful projects. He pointed out that the platform failed to find a sustainable business model and that advertising and sponsorship revenue were difficult to maintain operations. Additionally, he emphasized the issues within the Ethereum ecosystem, namely being too focused on code development and research while neglecting other important contributions.

3. Elon Musk's name change triggers market volatility

Recently, Elon Musk temporarily changed his account name on social media to "Kekius Maximus" and used a PEPE frog as his avatar, causing significant fluctuations in the cryptocurrency market. Although Musk has restored his original account name and avatar, this brief change had a notable impact on the market.

Especially the KEKIUS token, which shares the same name as its new designation, experienced a dramatic rise and fall in price in a short period of time. Although Musk did not directly mention his relationship with the token, his activity on social media once again demonstrated a strong influence on the cryptocurrency market. This incident has reignited discussions about the impact of social media celebrities on the crypto market.

3. Hot Projects

T3AI - AI-driven DeFi network protocol

T3AI is a decentralized financial network protocol that integrates artificial intelligence, aimed at addressing the issues of excessive collateral leading to leveraged investments and low asset utilization within the DeFi ecosystem. The project introduces dedicated AI agents as trusted intermediaries, ensuring loan repayability through dynamic risk management algorithms.

Project Features:

• Allow users to freely invest, trade, or stake on-chain, enhancing capital returns.
• Token Distribution: 90.5% for free circulation, 9.5% for development rewards and community activities
• Loan income distribution: 0.3% as project income, of which 80% is used for repurchase.
• Loan payment method: 10% paid in T3AI tokens, 90% paid in SOL or USDC

It is worth noting that the project experienced a price surge in a short period, and the development team subsequently conducted a partial sell-off of their holdings for infrastructure development. This move sparked discussions in the market about the project's future prospects.