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Bitcoin's Fall Is an Opportunity |
Crypto assets saw a panicky decline overnight alongside a Nvidia-led tech stock plunge on DeepSeek's more efficient artificial intelligence model. With bitcoin (BTC) at one point sliding from a Sunday high of $105,000 to below $98,000 before bouncing back to its current level just below $100,000, some analysts warned this could be the start of an even deeper pullback.
Among those taking the other side of that trade is Geoffrey Kendrick, global head of digital asset research at Standard Chartered Bank.
"Buy the dip," he said in a Monday morning report.
Kendrick one week ago warned of a potential 10%-20% correction thanks to markets having priced in overzealous expectations of Trump's crypto executive order and strategic reserve. The overnight selloff, he argued, likely took care of much of this.
While there might be some more pain ahead this week with U.S. big tech companies reporting earnings this week and the Federal Reserve's January meeting results Wednesday, Kendrick took note of the rapid decline in U.S. Treasury yields — the 10-year note yield now nearing 4.5% — as signaling much of the downward move is done.
Despite there not being much near-term price boost from the Trump administration's digital asset actions, the benefits should ripple through the sector over the next weeks and months through boosted institutional asset flows.
LondonCryptoClub analysts hit a similar note, seeing the crypto selloff as a knee-jerk reaction to a headline event.
"The Deepseek FUD [fear, uncertainty, doubt] is a classic shoot first, ask questions later," LondonCryptoClub analysts said. "Flushes like these amidst a still constructive fundamental macro story that typically mark local lows in a bull trend."
"Be careful today as a broad derisking can be very mechanical and indiscriminate," they added. "But this is very much a BTFD [buy the **** dip] market still."
Bitcoin at press time was trading down more than 4% over the past 24 hours at $99,800. The tech-heavy Nasdaq 100 was lower by 3%, led by 15% decline for Nvidia (NVDA).
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Travala in Takeover Talks |
Travala.com, the holiday website that allows users to pay with cryptocurrency, is in talks with potential buyers after receiving an unsolicited takeover approach late last year, according to two people with knowledge of the matter.
The Binance-backed company received an inquiry, triggering outreach by Travala's advisers to major online travel agencies such as Booking.com, one of the world's largest online travel companies Booking.com "kicked the tires" before deciding to pass on a potential acquisition, said the people, who spoke on condition of anonymity because the matter is private. Talks, however, are in progress with other potential buyers, but there is no certainty a deal will be done and the company may choose to remain independent, the people said.
Travala declined to comment. A spokesperson from Booking.com confirmed that Travala had reached out, that there had been a couple of calls where more information was shared and ultimately Booking.com decided not to progress.
The company could be valued at in excess of $100 million, the sources said. It had more than $100 million in revenue last year and that number is expected to grow exponentially in 2025. |
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MicroStrategy Keeps Buying BTC |
MicroStrategy (MSTR) brought its bitcoin holdings to 471,107 following another week of accumulating tokens. Alongside, the company announced a preferred share offering of roughly $250 million as it opened up a new front to raise money to purchase even more BTC. The firm led by Executive Chairman Michael Saylor said that the Series A Perpetual Preferred Stock (STRK) will have a $100 liquidation preference. Each share of STRK is initially convertible into one-tenth of one share of Class A common stock at a conversion price of $1,000 per share of Class A common stock. In addition to an 8% cumulative preferred dividend, according to Saylor.
The announcement came after MicroStrategy increased its bitcoin holdings for the 12th straight week.
In the week ended Jan. 26, the company bought 10,107 BTC, taking its total stack to 471,107 BTC, Saylor wrote in a post on X. The purchase, at an average price of $105,596 per bitcoin, raised MicroStrategy's overall average purchase price to $64,511.
Saylor teased the announcement on Sunday, as he has done in recent weeks, posting: "Don't stop thinking about tomorrow." On Jan. 21, MicroStrategy shareholders approved increasing the authorized number of Class A common shares to 10.3 billion from 330 million shares.
MicroStrategy also filed a mixed securities shelf registration that now includes: debt securities, preferred stock, warrants and depository shares in addition to Class A common stock. |
Bitpanda, OKX Get European MiCA Licenses |
Crypto exchange Bitpanda said it secured a Markets in Crypto Assets (MiCA) license from the German Federal Financial Supervisory Authority (BaFin) and rivals OKX and Crypto.com said they received accreditation from Malta as the European Union's licensing regime opens the doors to the 30 nations that compose the European Economic Area (EEA).
The MiCA regulations kicked in at the end of last year and allow license holders to operate across the EEA without needing to secure approval from every country. The area includes the 27 EU nations with Iceland, Liechtenstein and Norway.
Austria-based Bitpanda had 6 million users in December and will use the license to accelerate its growth, it said.
"This milestone enables us to bring easy and safe investing to over 450 million people, unlocking unparalleled growth potential in a market we're ready to fully conquer," Eric Demuth, CEO and co-founder of Bitpanda, said in a statement.
The companies join Boerse Stuttgart Digital, which was awarded the first license by the German regulator. MoonPay, BitStaete, ZBD and prime brokerage and clearing company Hidden Road, have also received MiCA licenses. The approval means "we can streamline operations to ensure both compliance and seamless cross- border activity," Crypto.com COO Eric Anziani said in an emailed statement. |
The Takeaway: AI Tokens Down on DeepSeek |
By Sam Reynolds, senior reporter:
Artificial Intelligence (AI) tokens are in the red during the Asia morning trading hours on Monday, with the AI category on CoinGecko down 9%, registering bigger losses than the CoinDesk 20 – a broader crypto index – which is down 5%.
Crypto investors, like their traditional finance counterparts, are likely digesting the impact of DeepSeek, a new AI model, on the industry. Data from DeepSeek posted on Hugging Face, a forum of the AI industry, shows that its model outperforms OpenAI, all while being built on a budget of $6 million and a fraction of the Graphics Processing Units (GPUs) that OpenAI uses – which recently closed a $6.6 billion round with a valuation of over $157 billion.
Perhaps most concerning to the perpetual GPU bulls is that DeepSeek is so efficient that a version of it can be run on your phone. So you can have a model that outperforms GPT-4o and Claude 3.5 Sonnet on math in your pocket. Naturally, some of the worst-performing AI tokens are ones with the most exposure to GPUs. Small-cap Nodes.AI, which facilitates access to GPUs, is down nearly 20%, according to CoinGecko data, although Aethir, which does the same (albeit at a much higher market cap) is only down 6%, just slightly more than the CoinDesk 20 benchmark. While DeepSeek will make for a stressful week at OpenAI, Nvidia, and other tech giants that have pivoted to AI, it's also a more pressing lesson for crypto projects – one that might be familiar to those with crypto's foray into gaming years ago.
Despite the pools of capital available to crypto AI projects, they just haven't been able to make something as revolutionary or interesting as what DeepSeek did.
Data from CoinGecko pegs the value of the crypto gaming sector (GameFi) at $19 billion. If the largest entries on this list, like Sandbox, GALA, or Decentraland, were entries on the top-30 largest gaming companies by marketcap they would hold respectable positions alongside household names responsible for recognizable franchises. But despite these projects just haven't had the same success as their traditional counterparts. Last year, blockchain gaming received lowest investment since 2020, according to data source DappRadar. Just $1.8 billion were invested in blockchain gaming and metaverse projects, representing a 38% slide from 2023. And while the daily unique active wallets in blockchain gaming surged 421% last year, the sector's dominance within the industry fluctuated between 26-29%, with DeFi taking the lead. Still, the tally is lower than games on Steam.
Besides, some older and less popular games on Steam, from companies with market caps a fraction of GameFi giants, have a larger following. Over the years, many crypto games have struggled to build a sustainable user base.
So, for now, one might say that crypto faces challenges in catering to use cases beyond finance. |
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