GSG Weekly Recap (Mar 10, 2025)

Market Watch

Things to Watch This Week (Mar 10?- Mar 15)

• Mar 12: U.S. CPI

The CPI report, scheduled for release on March 12, precedes the FOMC’s rate decision on March 19, with February's nowcasts predicting a 0.23% and 0.27% monthly increase in CPI and core CPI, respectively. Despite these increases suggesting some cooling from January's 0.5% rise, annual inflation remains near 3%, still above the FOMC's 2% target.

Random Musing This Week?(Mar 10?- Mar 15)

Avalon: Bitcoin-Backed Stablecoin and DeFi

Introducing a pioneering project within the Bitcoin ecosystem, Avalon offers solutions like Bitcoin-collateralized loans, and Bitcoin-backed stablecoins, designed to create yield opportunities for Bitcoin

USDa Stablecoin: Avalon has introduced USDa, the Bitcoin-backed stablecoin, which is pegged 1:1 to USDT to offer liquidity and stability. To earn a yield, USDa holders can stake their assets in Avalon’s Yield-Generation Vault.

CeDeFi Lending: Avalon merges centralized finance liquidity with DeFi transparency through its CeDeFi Lending service. To access this service, users must deposit FBTC as collateral. Avalon then borrows USDT from centralized finance institutions, mints an equivalent amount of USDa, and credits it to the user’s account, with plans to support more assets in the future.

DeFi Lending Protocol: Avalon’s DeFi lending protocol operates across multiple chains and supports a variety of asset classes. It features isolated risk pools for enhanced security and liquidity, including dedicated markets for Bitcoin and Bitcoin-backed liquid staking assets, as well as a general lending market for major cryptocurrencies like BTC, ETH, and various stablecoins. The protocol is currently deployed on Ethereum, BSC, Bitlayer, and 19 other networks, emphasizing a multi-chain expansion strategy.

Tokenomics and TVL: Avalon is heavily focused on community engagement, allocating a substantial portion of its AVL tokens for incentives and airdrops. Of the 1 billion AVL tokens, 28% is dedicated to community incentives, while 20% is set aside for airdrop distributions. This strategy is designed to engage and align users as key stakeholders, facilitating the expansion of the CeDeFi model and the USDa stablecoin ecosystem.

Impressively, despite the Token Generation Event on February 12, Avalon’s total value locked (TVL) has remained stable at around the 1.5 billion level. This stability indicates that Avalon's multi-point farming structure successfully maintains user engagement and liquidity beyond the Token Generation Event (TGE). However, given that airdrop incentives have significantly contributed to Avalon's liquidity growth, there is a potential risk of a decrease in TVL once these initiatives conclude.

Beyond DeFi, Avalon plans to expand USDa’s real-world utility by making it a recognized payment method within the PayFi system, starting with the Avalon Credit Card. This move marks a significant step towards integrating USDa into everyday financial transactions, enhancing its utility and accessibility.

Recap of Top Stories (Mar 3 – Mar 7)

Interesting

• Crypto exchange Kraken gears up for IPO as soon as the first quarter of 2026 Commentary: Kraken is considering going public as soon as the first quarter of 2026, though the firm could still change course. The crypto exchange explored raising over $100 million in a pre-IPO funding round in mid-2024. Kraken joins Gemini, eToro and other crypto firms considering a public listing under a pro-crypto executive branch and crypto-friendly Securities and Exchange Commission.
• Michael Saylor pushes US gov’t to purchase up to 25% of Bitcoin supply Commentary: Strategy founder Michael Saylor has proposed that the United States government acquire up to 25% of Bitcoin’s total supply over the next decade for its Strategic Bitcoin Reserve. “Acquire 5-25% of the Bitcoin network in trust for the nation through consistent, programmatic daily purchases between 2025 and 2035, when 99% of all BTC will have been issued,” Saylor wrote in a document titled “A Digital Assets Strategy to Dominate the 21st Century Global Economy.”
• President Trump signs order to establish Strategic Bitcoin Reserve, will hold as store of value akin to Fort Knox Commentary: Less than a week after announcing his administration's push for a "crypto strategic reserve," U.S. President Donald Trump signed an executive order to establish a Strategic Bitcoin Reserve on Thursday night. "The Reserve will be capitalized with Bitcoin owned by the federal government that was forfeited as part of criminal or civil asset forfeiture proceedings," White House AI and Crypto Czar David Sacks wrote in a post on X. "This means it will not cost taxpayers a dime."
• Crypto czar David Sacks laments US government's previous management of bitcoin holdings Commentary: Ahead of Friday's crypto summit at the White House, newly-minted AI and crypto czar David Sacks took to social media to express his dismay with how the United States' government has handled its crypto holdings. "Over the past decade, the federal government sold approximately 195,000 bitcoin for proceeds of $366 million," Sacks wrote Thursday in a post on X. "If the government had held the bitcoin, it would be worth over $17 billion today. That’s how much it has cost American taxpayers not to have a long-term strategy."
• World Liberty Financial amasses millions in ETH, WBTC and MOVE ahead of White House Crypto Summit Commentary: Ahead of the White House Crypto Summit, World Liberty Financial — a decentralized finance venture associated with President Donald Trump and his family — increased its cryptocurrency holdings, according to onchain analysis. On Thursday, on-chain data revealed that World Liberty Financial made a substantial addition to its treasury, acquiring $10 million in ether, $10 million in Wrapped Bitcoin (WBTC), and $1.5 million worth of MOVE, the native token of the Movement Network blockchain ecosystem.
• Coinbase CEO Brian Armstrong, Chainlink co-founder Sergey Nazarov among other executives will attend Trump's inaugural crypto summit on Friday Commentary: Coinbase CEO Brian Armstrong, Kraken co-CEO Arjun Sethi among others are slated to attend a crypto summit hosted by President Donald Trump in Washington D.C. A Chainlink spokesperson confirmed that Chainlink co-founder Sergey Nazarov will also be going. Representatives for Coinbase and Kraken also confirmed Armstrong's and Sethi's attendance. Strategy founder Michael Saylor, Exodus CEO JP Richardson and Paradigm co-founder Matt Huang will also be going, according to posts on X on Tuesday.
• Ethereum devs activate Pectra upgrade on Sepolia testnet in last phase before mainnet rollout Commentary: Ethereum’s upcoming Pectra upgrade was activated on the Sepolia testnet today at around 2:30 am ET. Sepolia tests the upgrade’s features under simulated network conditions. The release is the final major rollout before the upgrade launches on the mainnet, expected to occur next month. Developers are expected to finalize a mainnet activation date during Thursday's All Core Developers (ACD) call. A potential mainnet fork on Ethereum is targeted for April.
• South Korea inches closer to Bitcoin ETF decision, looks to Japan as example Commentary: South Korea is growing closer to a decision on Bitcoin exchange-traded funds (ETFs), according to a report from local publication Maeil Business Newspaper (MK). In its report, MK says the South Korean government is looking to Japan as an example, as the island nation has been skeptical of digital assets in the past but may be changing its tone. The Financial Supervisory Service, South Korea’s financial regulator, reportedly examined the Japan Financial Services Agency’s legislative trend toward digital assets and shared it with related institutions in South Korea.
• SEC agrees to drop lawsuit against Cumberland DRW, says firm Commentary: The US Securities and Exchange Commission will dismiss its case against the Chicago-based Cumberland DRW, the crypto trading firm says. “Today we signed a joint filing to be made with the Securities and Exchange Commission (SEC) dismissing its case against Cumberland DRW,” Cumberland wrote in a March 4 X post. Cumberland said the filing was agreed in principle between Cumberland DRW and SEC staff on Feb. 20 and is currently awaiting the agency’s approval. It’s the latest crypto-related lawsuit the SEC has agreed to drop. It has previously dropped cases against crypto exchanges Coinbase and Kraken, along with crypto firm Consensys.

Upcoming Market Events

• March 12 - U.S. CPI (Feb)
• March 19 - U.S. FOMC Interest Rate Decision
• March 28 - BTC CME March (BTCH25) Options Expiry