On-chain coins are rising in popularity, can exchange tokens benefit?

Recently, the cryptocurrency market has shown a trend of diversification, with Bitcoin’s market share dropping from 60% to 55%, indicating the arrival of the altcoin season. Market hotspots are emerging frequently, showcasing a variety of opportunities: AI-related projects have performed outstandingly, with a certain protocol’s market capitalization once exceeding $300 million; an AI project within a certain public chain ecosystem reached a maximum market cap of $1 billion; another exchange’s ecological coin saw a rise of over 10 times. In terms of products, the exchange’s open interest has repeatedly set new highs, surpassing $4.3 billion. Even the previously quiet NFT sector has shown activity, with several well-known projects issuing tokens one after another, driving up many blue-chip NFT projects within the Ethereum and Solana ecosystems.

From these hotspots, it can be seen that market attention is mainly focused on on-chain projects. So, have the tokens of centralized exchanges really been forgotten by the market?

This is not the case. There is another potential factor in this round of the bull market that cannot be ignored: Trump may be elected. This means that cryptocurrencies will further enter the public eye. The improvement of regulations and the relaxation of supervision both contribute to the influx of external funds into the crypto market. This trend can be seen from the continuous net inflow of funds into Bitcoin and Ethereum spot ETFs. The Trump family’s cryptocurrency project has also made large purchases of DeFi-related tokens within a month, including ETH, CBBTC, AAVE, LINK, ENA, and ONDO.

So, how are the purchased Tokens performing? What common characteristics do they share? What other related concept coins are worth paying attention to? Let’s analyze them together.

Purchase Record Overview

Starting from November 30, a total of approximately $44.75 million was invested in cryptocurrency for Trump-related projects. As of December 18, all held coins are in a profitable state.

Interestingly, unlike traditional institutions that focus more on Bitcoin, the amount of ETH held by this project far exceeds that of Bitcoin, which may indicate their more optimistic view on the future price trend of Ethereum.

AAVE, as the leader in the lending market, ranks first in TVL among all protocols, with a deposit size approaching $40 billion, setting a historical high. The coin price has risen by 35% in the past seven days. The community related to the Trump project has passed a proposal to collaborate with AAVE and is currently undergoing further discussions at AaveDAO. If the proposal is eventually approved, it will bring new users and more tangible benefits to AAVE.

LINK is a well-known oracle project. The Trump-related project previously announced that it will use its technology as the standard for on-chain data and cross-chain connectivity to promote the large-scale adoption of DeFi.

The development of ENA is closely related to the current bull market. As its profits come from arbitrage between futures and spot markets, the more positive the market sentiment and the higher the Ethereum funding rate, the more Ethena can benefit from it. Recently, its TVL has surpassed 6 billion USD, setting a new historical high. In terms of products, they have also collaborated with a major asset management giant to launch a RWA stablecoin based on treasury bond yields, which has alleviated concerns about the potential difficulties the protocol could face if the funding rate turns negative.

ONDO is currently the leading project in the RWA sector. After a major asset management giant announced the launch of related funds, Ondo Finance invested over $95 million, becoming the largest holder. In terms of compliance, legitimacy, capital scale, and market recognition, ONDO is the best choice in the current RWA sector.

It is worth mentioning COW. The Trump-related project only used a certain protocol for trading when purchasing the aforementioned Token, so COW is also regarded as a related concept coin.

Tokens to Watch in the Future

Based on the investment logic of Trump’s related projects, we can speculate on the targets they may focus on in the future.

First of all, the ideal situation is to have tokens that have a partnership with the project. Secondly, they value “clear business models” and “stable real returns”. AAVE, LINK, ENA, ONDO, and others have clear product positioning, a large ecosystem of users, and actual revenue models. This indicates that they will not blindly pursue “novelty” or “purely conceptual” tokens, but are more inclined to invest in protocols that can bring long-term value.

LDO: Given that Trump’s related projects hold significantly more ETH than BTC, it is evident that they are very optimistic about Ethereum’s long-term potential. As the Ethereum staking mechanism matures, coupled with the possibility of ETFs introducing Ethereum staking yields, a leading protocol has become the current favorite. It is the largest liquid staking protocol in the Ethereum ecosystem, with a TVL of up to $37 billion, accounting for 30% of the entire Ethereum staking market.

Pendle: Primarily focused on the yield splitting market, allowing users to trade future yield rights. As the Ethereum staking rates and the yield rates of certain protocols rise, the demand for yield trading markets continues to increase, making Pendle highly regarded in this bull market. Recently, Pendle’s TVL has surpassed $5 billion and has established partnerships with several mainstream DeFi protocols.

UNI: A well-known DEX is a pioneer of DeFi Summer and is currently the most commonly used decentralized exchange by users, leading the sector. Recently, they also launched new products, although the market response has been lukewarm, it does not affect users’ reliance on their products.

Summary: Blue-chip projects become the focus

Regarding Trump’s large-scale purchase of cryptocurrency related projects, an analyst from a certain analysis platform stated to the media: “This purchasing behavior may be aimed at gaining more trust or promoting the development of its own projects by attracting attention to these assets. Because if these assets perform well, the project may also benefit from it.”

Trump-related projects are actively laying out blue-chip projects, which not only enhances the market’s confidence in mainstream DeFi protocols but also injects more institutional funds into the crypto market. Such a flow of funds further stabilizes the market and drives mainstream projects towards higher market value and development potential.