Token Chronicle - Week 4 January 2025

Top cryptos

Meme of the week

Market update: A sharp volatility linked to announcements about Chinese AI (a correction in US tech markets in general, followed by a return to normal) led us to end January with BTC at $101K. However, there has been a very sharp correction over the past two days (especially today), affecting all financial markets due to the start of a tariff war under the Trump administration: the implementation of trade barriers with Canada and Mexico, and China's announcement that it will also impose barriers if the U.S. continues its protectionist measures. As a result, BTC has dropped to $94K and ETH to around $2.5K. However, I believe these declines will only be temporary and will be quickly offset in February, given the overall climate and the very bullish announcements from the U.S. administration and the governments/companies following suit.

Main points this week:

International News:

1. Chinese AI Startup DeepSeek Unveils High-Performance Model – Global Stock Markets React
   While AI models like Google's Gemini, xAI's Grok, and OpenAI's ChatGPT have dominated the generative AI space, a new Chinese startup may disrupt this dominance. Financial markets took note, reacting to this potential shake-up in the AI market. Founded in 2023, DeepSeek was established to help China compete with the U.S. in AI. Its first major language model, DeepSeek-R1, serves as a large-scale test and stands out due to its lower development and usage costs compared to ChatGPT, Gemini, or Claude. Despite being cost-efficient, DeepSeek's AI remains effective and offers similar functionalities to its American counterparts. This development has raised questions about the future of American AI dominance. With significantly lower costs than U.S.-based models, DeepSeek has demonstrated that high-performing LLMs can be built with minimal expenses. Global stock markets reacted differently to the news—Nasdaq 100 futures dropped 3.2%, while S&P 500 futures fell 1.9%.

2. At Davos, Trump Attacks European Regulators for Targeting Apple, Google, and Meta
   At the World Economic Forum, Donald Trump accused the European Union of imposing a "disguised tax" on American tech giants. This accusation comes amid increasing tensions between the EU and the U.S. over tech regulations. Trump specifically mentioned the Apple case, where the company was ordered to pay back €13 billion to Ireland for illegal tax benefits—a ruling upheld by the European Court of Justice. Trump argues that the EU is deliberately targeting American companies to protect its own economic interests. Staying true to his "America First" stance, the former president reaffirmed his opposition to regulations and international agreements that he believes put the U.S. at a disadvantage.

3. No Taxes on U.S. Cryptocurrencies? Eric Trump Confirms
   In the U.S., cryptocurrency projects like Ripple (XRP) and Hedera (HBAR) could be exempt from capital gains taxes.

4. Czech Republic: Central Bank Governor Pushes for Bitcoin Reserves
   While the U.S. is on the verge of establishing a strategic cryptocurrency reserve, other countries are also exploring similar options. The Czech National Bank (CNB) governor, who previously discussed the possibility, now firmly supports the idea for the Czech Republic. Beyond the U.S., Switzerland, Russia, and Hong Kong are also considering the creation of Bitcoin reserves. Currently, El Salvador remains one of the few countries that have adopted Bitcoin as a reserve asset, holding 6,048 BTC valued at over $620 million based on current prices.

5. Christine Lagarde: Bitcoin Won't Be Part of EU Reserves
   Donald Trump has been elected as the U.S. president again, showing more determination than ever to position the country as a leader in AI and crypto innovation. Meanwhile, China’s economic recovery is gaining momentum. However, within the European Union, central bank leaders appear to be lagging behind. "Reserves must be liquid, secure, and safe, without any suspicion of money laundering or other criminal activities. Therefore, I am convinced that Bitcoin will not be included in any of the EU central banks' reserves," Christine Lagarde stated.

6. BRICS+: Trump Threatens 100% Tariffs Over De-dollarization
   U.S. President Donald Trump once again expressed strong opposition to de-dollarization, warning BRICS+ nations that they could face 100% tariffs if they continue moving away from the U.S. dollar.

7. Andreessen Horowitz (a16z) is closing its London office to refocus efforts on the U.S. amidst crypto-friendly advancements under the Trump administration. While the UK has enacted supportive crypto policies, its stringent regulatory stance has prompted some firms to leave. A16z says it remains committed to global investments, including in the UK, which boasts the world's second-largest tech sector after the U.S.

8. In a surprising move, China's government quietly sold its entire stash of 194,000 BTC (worth around $19.7 billion) that was seized during the 2019 PlusToken Ponzi scheme crackdown. The Bitcoin was offloaded through exchanges like Huobi, yet remarkably, the price of Bitcoin barely reacted to the sale. CryptoQuant's CEO, Ki Young Ju, shared the news, highlighting the resilience of the market despite the massive supply dump.

9. Metaplanet, a Tokyo-listed investment firm, completed Asia’s largest bitcoin-focused capital raise, issuing 21 million shares to secure $745 million for BTC purchases as part of its "Bitcoin-first, Bitcoin-only" strategy amid the yen’s devaluation. With 1,762 BTC, the company ranks as the 15th-largest corporate bitcoin holder, and its shares closed 3% higher, up 16% year-to-date.

10. The U.S. Senate confirmed crypto-friendly Scott Bessent as Treasury Secretary in a 68-29 vote, replacing Janet Yellen. Bessent will help shape federal crypto regulations, including a potential national digital assets stockpile. A former hedge fund manager, he previously held bitcoin via an ETF before liquidating it post-nomination. He opposes a central bank digital currency and views crypto as a vehicle for financial freedom.

11. Coinbase received regulatory approval to operate in Argentina, securing a Virtual Asset Service Provider (VASP) registration from the country’s National Securities Commission (CNV). This marks its latest expansion in Latin America after launching in Brazil in 2023. With around 5 million Argentinians using crypto daily and 76% viewing it as a solution to financial challenges, Coinbase aims to boost economic freedom. Operations will be led by Matías Alberti, formerly of Buenbit and Clara.

Compliance/Regulation/Justice:

1. David Sacks, White House Crypto Chief, Clarifies NFT Status
   Recently appointed by Donald Trump as head of AI and crypto policy, David Sacks was called to clarify the regulatory status of NFTs in the U.S. For months, industry players have urged the Securities and Exchange Commission (SEC) to take a stance. According to Sacks, NFTs—like memecoins—are neither securities nor commodities but rather "collectibles."

2. "Billions in Suspicious Transactions" – KuCoin Pleads Guilty and Exits the U.S. Market
   KuCoin’s legal troubles in the U.S. have culminated in a sudden exit. The exchange pleaded guilty to facilitating billions of dollars in suspicious transactions. Along with leaving the U.S. market, KuCoin must pay a hefty fine. Despite being a major exchange in the country, KuCoin only implemented KYC measures in mid-2023—six years after its launch. This intentional delay caught the attention of U.S. regulators. The exchange is now facing a $297 million fine, after already paying $22 million to New York State in December 2023.

3. MiCA: Bitpanda, OKX, and Crypto.com Secure First Licenses
   On Monday, cryptocurrency exchanges Bitpanda, OKX, and Crypto.com announced that they had obtained their MiCA licenses, becoming the first platforms to do so.

4. France: Binance Under Criminal Investigation
   After a period of relative calm following Changpeng Zhao’s guilty plea in 2022 and Richard Teng's takeover as CEO, Binance is once again facing legal scrutiny. According to Reuters, French authorities are investigating the world's largest crypto exchange for suspected money laundering. The alleged offenses include aggravated money laundering, tax fraud laundering, drug trafficking-related laundering, and illegal operation of a digital asset service provider (PSAN). The investigation covers the period from 2019 to 2024 and spans across France and other EU countries. Authorities are scrutinizing Binance’s alleged failure to comply with anti-money laundering and counter-terrorism financing regulations, particularly deficiencies in its KYC procedures. These shortcomings suggest the platform may have facilitated laundering of funds linked to drug trafficking and tax fraud. Additionally, authorities are probing Binance’s promotional campaigns through influencers and social media ads before it was officially registered as a PSAN with the AMF, which could constitute a legal violation.

5. Changpeng Zhao, Former Binance CEO, Makes a Comeback in Crypto
   After spending a few months in prison in 2024, Changpeng Zhao wasted no time re-entering the industry. With support from Yi He, his co-founder at Binance, Zhao is now leading a new venture focused on venture capital. Binance Labs previously invested in numerous crypto startups, such as Dune Analytics and the blockchain ecosystem Polygon. “The rebranding to YZi Labs is more than a name change—it reflects an expanded vision as we enter innovative sectors like AI and biotechnology,” Zhao stated. Over the next year, YZi Labs aims to identify promising biotech, AI, and Web3 startups and invest in their growth.

6. Bitwise Bitcoin & Ethereum ETF Approved by the SEC
   Following the launch of spot Bitcoin ETFs in January 2024 and spot Ethereum ETFs in July, the SEC has now signaled approval for an ETF combining both cryptocurrencies. The Bitwise Bitcoin and Ethereum ETF would provide exposure to the spot prices of both assets within a single fund, weighted according to their market capitalizations. At the time of filing, the split was 83% Bitcoin and 17% Ethereum.

7. Did DeepSeek Illegally Acquire Nvidia Chips? U.S. Investigates
   Did DeepSeek bypass restrictions to obtain Nvidia chips? The U.S. is investigating allegations that the Chinese AI company acquired Nvidia chips illegally by circumventing trade restrictions. Reports suggest that DeepSeek used Singapore as an intermediary to make these purchases undetected. The FBI is currently investigating the matter.

Traditional Finance

1. BlackRock bought $1 billion worth of Bitcoin last week
   The international financial giant BlackRock now holds nearly 3% of Bitcoin's supply, continuing to purchase it on behalf of its clients in multi-billion-dollar transactions. It is important to clarify that BlackRock does not buy Bitcoins for itself but rather for its clients, who hold shares in IBIT. These BTC are then stored in cold wallets managed by Coinbase, which handles the custody aspect of the ETF.

2. Tuttle Capital submits application for 10 crypto ETFs, including TRUMP and MELANIA
   At the start of 2025, asset managers are rushing to the doors of the Securities and Exchange Commission (SEC) to submit applications for cryptocurrency-based ETFs. Analysts suggest this may be a way to test the limits of the new administration at the government agency. In addition to these memecoins, the asset manager has also applied to issue ETFs based on Solana (SOL), XRP, Cardano (ADA), Chainlink (LINK), Polkadot’s DOT, BNP, BONK, and Litecoin (LTC). Tuttle Capital has not submitted any applications for spot Bitcoin ETFs or spot Ethereum ETFs.

3. Spot Solana (SOL) ETFs coming soon? New applications submitted to the SEC
   With Donald Trump now inaugurated as the President of the United States, the Securities and Exchange Commission's administration is expected to evolve, along with its regulatory approach toward the crypto market. Asset managers are taking note and submitting multiple applications to issue ETFs focused on various cryptocurrencies, such as Solana (SOL). The asset managers involved in these applications include Canary Capital, VanEck, Bitwise, and 21Shares. Except for Canary Capital, all have already been offering spot Bitcoin and Ethereum ETFs in the U.S. since last year, with varying degrees of success.

4. "Banks are perfectly capable of serving crypto clients," says Jerome Powell
   Speaking on Wednesday evening, Federal Reserve Chairman Jerome Powell made particularly positive remarks about cryptocurrencies. He went on to call on Congress to adopt cryptocurrency regulations. This aligns with the working group recently established by the SEC to advance discussions on the subject.

5. A Ripple (XRP) ETF coming soon from Grayscale?
   Ripple aims to convert its XRP Trust into an ETF, just as it did with Bitcoin (BTC) and Ether (ETH). This request follows an earlier filing for a Solana (SOL) ETF.

6. Robinhood teased the launch of bitcoin, ether, oil, gold, and major index futures trading, facilitated by the CME Group. The platform, known for its retail-friendly interface, also recently expanded its spot crypto offerings, adding TRUMP and PEPE memecoins while relisting SOL, ADA, and XRP. Robinhood had previously delisted those assets in 2023 amid SEC scrutiny but reversed course following President Trump’s pro-crypto election victory.

Adoption

1. DOGE: Elon Musk wants to use blockchain to reduce government spending
   Elon Musk has been leading the Department of Government Efficiency since January 20, and he is already making headlines. He is currently exploring blockchain technology as a means to reduce U.S. government spending, which amounted to $6.27 trillion in 2022. Blockchain technology allows for the transparent and tamper-proof tracking of all expenditures and financial flows while reducing audit costs. This pioneering initiative could inspire other countries, such as France. According to sources, agents affiliated with the DOGE department have organized meetings with representatives of different blockchain networks to evaluate the technology and identify the most suitable solution.

2. MicroStrategy buys 10,000 Bitcoins, bringing its investment to $20 billion in 3 months
   Michael Saylor and MicroStrategy have taken another bold step with the purchase of 10,107 BTC at an average cost of $105,000 each. With a total investment reaching $20 billion in three months, the company’s aggressive strategy continues to influence the Bitcoin market. In addition, MicroStrategy announced a public offering of 2.5 million shares of its new "Series A Perpetual Strike Preferred Stock," with a liquidation preference of $100 per share. This initiative aims to raise $250 million, which will be used to buy more BTC.

3. Russia: Largest electricity operator set to adopt Bitcoin mining to optimize infrastructure
   In Russia, the electricity operator Rosseti is considering utilizing Bitcoin mining to optimize the use of its underutilized energy infrastructure. This project could not only improve the network’s energy efficiency but also contribute to Bitcoin’s decentralization.

4. Illinois proposes a strategic Bitcoin (BTC) reserve
   Illinois has joined the growing list of U.S. states proposing to establish a Bitcoin (BTC) reserve. This reserve could be subject to a minimum holding period of five years. However, the proposal must first be approved by Illinois lawmakers before being implemented. If successful, the state would become the first in the country to use cryptocurrency in this way.

Tech Developments

1. Charles Hoskinson unites Bitcoin and Cardano to dethrone Ethereum
   Charles Hoskinson, the founder of Cardano, has unveiled an ambitious plan to surpass Ethereum. He aims to integrate Bitcoin strategically and leverage other innovations to enhance the scalability of Cardano’s blockchain. His strategy revolves around three key challenges: developing Bitcoin-focused decentralized finance (DeFi) on Cardano, improving blockchain scalability, and advancing strategic partnerships. This integration relies on interoperable technologies that facilitate transactions between different blockchains. By enabling seamless Bitcoin transactions within the Cardano ecosystem, this approach could enhance the liquidity and adoption of both networks.

2. OpenAI commits to extending human lifespan with its new GPT-4b micro model
   OpenAI has announced the development of the GPT-4b micro model in collaboration with Retro Biosciences, aiming to push the boundaries of biology and cellular reprogramming. While promising, this model still requires scientific validation to confirm its effectiveness and impact on human longevity.

3. Microsoft reportedly in talks to acquire TikTok, according to Donald Trump
   Another twist in the TikTok saga. While rumors previously suggested Elon Musk’s interest in the social network, it is now Microsoft that could become the buyer, according to Donald Trump. Back in 2020, Microsoft had already attempted to acquire TikTok. At the time, during Trump’s first presidency, the social network was pressured to sever ties with its parent company, ByteDance, due to national security concerns. However, the negotiations fell through, and Trump left office before the deal could materialize.

4. Elon Musk and Visa partner to transform X into a financial "super app"
   Elon Musk continues his transformation of X into a "super app." In partnership with Visa, the platform is preparing to launch X Money, a digital wallet enabling money transfers and peer-to-peer payments. The launch of X Money, scheduled for the first quarter of 2024, could also pave the way for more advanced features, such as cryptocurrency management. Musk, known for his affinity for the crypto world—especially Dogecoin—has never hidden his interest in digital assets.

5. Trump Media launches a new FinTech and crypto venture
   Donald Trump has been actively expanding his initiatives since his inauguration. His company, Trump Media, has just announced a move into the FinTech and cryptocurrency investment sector. Trump Media is managed by Devin Nunes on behalf of Trump, who holds a 65% stake in the company. The firm went public in March 2024 with an initial valuation of $9.5 billion. However, it reported significant losses in Q3 2024, primarily due to legal costs. In addition to its microblogging service, Trump Media has also ventured into video streaming.

6. Tether announces the return of USDT on Bitcoin and Lightning – Here’s why this could change everything
   Tether has announced the return of USDT on Bitcoin and the Lightning Network via the Taproot Assets protocol. This development could revolutionize the use of stablecoins by combining Bitcoin’s security and decentralization with Lightning’s speed and efficiency. Tether’s arrival on Bitcoin and Lightning could weaken Solana’s appeal, which surged in 2024 due to the ease of creating and trading memecoins at low cost. Taproot Assets simplifies the creation of fungible tokens, including memecoins. However, it requires an initial transaction on Bitcoin’s blockchain to issue a token, followed by additional transactions to establish Lightning channels for broader accessibility. The introduction of Tether and the liquidity generated from on-chain BTC-USDT exchanges could also spark new momentum for memecoins on Bitcoin.

7. Movement Labs has launched a developer mainnet to integrate Facebook's Move Virtual Machine (MoveVM) with Ethereum, setting the stage for decentralized finance (DeFi) adoption. This follows Movement’s initial mainnet launch in December and precedes a public mainnet beta next month. Originally developed for Facebook’s shelved Diem project, Move has since powered Sui and Aptos layer-1 networks. Backed by a $38 million Series A led by Polychain Capital, Movement Labs is bringing Move to Ethereum layer 2 for the first time, alongside a multi-asset liquidity program to support DeFi applications.

8. The SSV DAO has introduced “SSV 2.0,” a new framework enabling applications to leverage Ethereum validators through “based” technology. This initiative aims to bring "based applications" (bApps) to Ethereum, addressing network fragmentation and improving interoperability. A key focus is on “based rollups,” which rely on Ethereum’s layer-1 validator set rather than centralized sequencers, enhancing security and decentralization. The Ethereum community sees based rollups as a breakthrough for improving network efficiency, and SSV Network’s move marks a significant step toward solving scalability and interoperability challenges.

9. An informal vote among Ethereum supporters shows overwhelming backing for Danny Ryan as the next Ethereum Foundation leader, with 99% of 300 wallets—holding over 50,000 ETH ($160 million)—in favor. Developer Fabrice Cheng launched the vote to give the community a way to express their preference, though it carries no official weight. Cheng emphasized Ethereum’s strong social layer and the importance of community input. Meanwhile, Vitalik Buterin reaffirmed his authority over EF leadership decisions until governance reforms are in place, while Ryan has expressed interest in the role.

Disclaimer: The information disclosed here does not constitute an investment advice ; it is for informational purposes only and does not constitute investment advice. You should do your own research while investing in crypto and only invest money you are ready to lose.