Jan 6, 2025: Our weekly Institutional Insights explores the latest market developments — market performance, industry news, exchange-traded fund (ETF) flows, trending topics, upcoming events and token unlocks — to help you supercharge your crypto trading.

Weekly Highlight — Markets Snap Five-Day Loss Streak 

Investors are now seizing the opportunity to buy the dip in U.S. stocks after a five-day decline that erased over $1 trillion in market value. Wall Street has broken its longest losing streak since April, with the Nasdaq-100 rebounding 1.7% and the S&P 500 rising 1.3% on Friday, January 3. These gains slightly offset the week's sell-off, which had continued into the new year following a tough December.

Despite concerns about slowing earnings growth among tech giants like the Magnificent Seven, traders remain optimistic, especially regarding AI leader NVIDIA Corporation. The market believes that, as long as retail investors keep investing in AI, the associated stock market boom is expected to persist. 

Stocks reached their session highs in the afternoon after Mike Johnson was reelected as speaker of the U.S. House of Representatives, indicating potential support for a business-friendly agenda. Meanwhile, bond yields rose, with the 10-year hitting 4.6% following comments from Richmond Fed President Tom Barkin about maintaining restrictive rates. U.S. manufacturing showed modest growth, with new orders at their highest since early last year, while investors assessed economic strength against the possibility of slower interest-rate cuts.

Weekly Crypto Highlight — AI Agent Spring Coming

Many investors are eagerly anticipating an Alt Season, a period when altcoins typically surge in value. However, current market dynamics suggest we may not see a widespread altcoin rally. The sheer number of tokens, combined with limited liquidity, has led to what's known as altcoin dispersion, making it crucial to select the right sectors and tokens.

, which are thriving even as the broader market declines. This nascent sector is experiencing rapid advancements, and its associated tokens face less pressure from venture capital unlocks. Many of its top protocols lack centralized exchange listings, indicating more buyers may enter the market.

Those investors who missed previous opportunities, such as the DeFi summer of 2020 and the Alt Layer 1 trade, now have another chance. Instead of targeting individual AI agents, the best risk/reward strategy lies in investing in infrastructure plays, which serve as the foundational tools for the sector.

The leading AI agent player is Virtuals Protocol, a platform for launching tokenized AI agents on the Base network. By purchasing tokens like Luna by Virtuals (LUNA) and VaderAI (VADER), users gain governance rights over specific agents, which allows them to both influence development and share in profits. 

Recently, daily protocol fee revenues dropped significantly in mid-December 2024 as activity slowed for the holidays. However, speculation around agent-associated tokens surged as the new year approached. Currently, Virtuals Protocol generates over $1 million in daily fees, though this is 50% less than figures for early December. Despite these challenges, the VIRTUAL token has more than doubled in value, reaching a market capitalization of $4.6 billion.

Other highlighted opportunities include Zerebro, which is pivoting to a full-stack framework for AI agents; ARC, with its Rust-based framework; and 

 (GRIFFAIN), a natural language on-chain search tool. These projects are well-positioned for future growth in the evolving landscape of AI technology.

 as we delve into leading AI agent tokens and the past week’s market movements. 

Advanced

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Weekly Institutional Insights: Market Snaps Five-Day Loss Streak; AI Agent Spring Coming

Our weekly crypto derivatives analytics report delves into macro events, the current state of crypto and trading signals from spot trading volume, and futures, options and perpetual contracts.

December's end-of-year options expiration brought an unexpected drop as realized volatility fell to the lowest levels of the month. Perpetual swap open interest remained stable, indicating these markets weren't heavily used for hedging against expired options, likely contributing to the muted volatility. 

While most expired open interest in Bitcoin (BTC) and Ethereum (ETH) hasn't been reinvested, the balance of calls and puts remains consistent. Notably, ETH options are pricing in higher implied volatility as compared to BTC, particularly for shorter expirations, leading to a flat term structure for ETH, while BTC is offering cheaper options exposure.

In the perpetual markets, low volatility and minimal spot movements have led funding rates for nearly all tokens to mirror broader market sentiment throughout the holiday season. On the options side, BTC's term structure is noticeably lower and steeper than ETH's, with realized volatility now dipping below implied volatility levels, highlighting an intriguing shift in market dynamics.

Please check out the report’s highlights.

Open Interest Solid Amid Year-End Options Expiration

Although open interest for both BTC and ETH perpetual swaps hasn’t returned to early December 2024 highs, it remained robust throughout the significant end-of-year options expiration event. This suggests that these markets weren’t heavily utilized to 

 of the expiring options contracts, likely contributing to the lack of volatility observed during this period. Instead, trading volumes have dipped noticeably during the winter holiday season, coinciding with a collapse in realized volatility back to December 2024’s lowest levels.

BTC Option Curve Remains Steep During Call-Put Parity

The expiration of December's end-of-year options didn’t trigger the anticipated surge in volatility; instead, realized volatility has plummeted to the lower end of its recent range. The implied volatility term structure remains steep compared to both its recent behavior and ETH's, with longer-dated implied volatility around 57%, and 1-week at-the-money options trading about five points lower. Much of the expired open interest hasn’t yet been rolled into new positions, maintaining a neutral balance between puts and calls. Consequently, BTC's options market positioning is relatively neutral, lacking the leverage it had at the start of December 2024.

Huge ETH Option Expiring Doesn’t Cause Volatility

A late December spike in realized volatility didn’t carry into the new year, with ETH’s spot price currently exhibiting volatility below that of short-tenor implied volatility. Interestingly, the implied volatility term structure has undergone a steepening and re-flattening over the past week, contrasting with BTC’s slightly steeper profile. This suggests that ETH’s options market is anticipating higher short-term volatility in spot price movements. 

Despite the significant expiration of options open interest at the end of December 2024, which didn’t lead to a rollover into later expirations, call options continue to dominate the market and have increased at the start of 2025.

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Bybit X Block Scholes Crypto Derivatives Analytics Report (Jan 2, 2025): BTC Options Continue to See Call-Put Parity, With Lower Short-Term Volatility Expected

Dive into FLock, a decentralized platform that revolutionizes the way AI models are developed, trained and deployed.

Artificial intelligence (AI) is poised to transform countless industries, but its development often raises questions about privacy, control and inclusivity. 

 is a unique decentralized platform that democratizes AI training, fine-tuning and inferencing. With its blockchain-powered infrastructure, FLock ensures transparency, security and community-driven decision-making, paving the way for AI models that align with established societal values. 

In this article, we’ll explore how FLock decentralizes AI training, its key features and its potential impact on developers, communities and users.

 platform that revolutionizes the way AI models are developed, trained and deployed. By leveraging blockchain technology and a novel approach called 

, FLock addresses critical issues in AI development, such as centralized control, lack of transparency and privacy concerns.

At its core, FLock’s mission is to democratize AI by enabling communities to participate directly in the creation and refinement of AI models. Through federated learning, FLock trains AI models across multiple decentralized devices or servers. This method ensures that data remains local, eliminating the need for raw data exchange while still enabling robust model training. By decentralizing the training process, FLock not only protects individual privacy, but also fosters a more inclusive ecosystem in which diverse contributors can collaborate.

What sets FLock apart is its integration of 

. This ensures that all contributions — whether data, compute power or feedback — are transparently recorded and fairly rewarded. Blockchain tech’s immutable ledger enhances trust among participants and safeguards the process against manipulation. Additionally, the platform’s on-chain incentive mechanisms encourage participation from a wide range of contributors, ensuring that rewards are distributed equitably.

Ultimately, FLock empowers communities to develop bespoke AI models tailored to their specific needs. By decentralizing the process and prioritizing transparency and collaboration, FLock breaks the monopoly of large corporations, creating an AI ecosystem that aligns with public ethics and societal values.

, an Oxford alumnus with a robust background in AI and blockchain technology. Sun, who serves as FLock's CEO, has an impressive career trajectory, having worked as the Director of AI for the Royal Bank of Canada and as an AI Research Fellow at Imperial College London. His vision for FLock stems from a deep understanding of both the technical and ethical challenges of AI development.

The founding team also includes other Oxford alumni, boasting over a decade of combined experience in AI research and the cryptocurrency industry. This team brings a collective blend of academic excellence and practical expertise that positions FLock to lead the decentralized AI movement.

FLock has successfully raised $11 million in funding across two rounds, reflecting strong investor confidence in its vision. In May 2024, FLock secured a $6 million seed round co-led by Lightspeed Faction and Tagus Capital, with additional backing from Digital Currency Group (DCG), Volt Capital, OKX Ventures and Inception Capital.

Later, in December 2024, FLock announced a $3 million successful funding round led by DCG and joined by prominent names like Animoca Brands, Fenbushi Capital, GnosisVC and GSR. These investments are being channelled into enhancing the platform’s testnet and federated learning client, accelerating FLock’s mission of enabling secure, collaborative AI development.

With this funding and over 1,500 nodes contributing from platforms like Numerai and Kaggle, FLock is rapidly scaling its impact on decentralized AI training.

FLock AI revolutionizes AI development through its decentralized training framework. This approach allows participants to contribute to AI model training without ever sharing their personal data. Instead, models are trained locally across devices using federated learning, which ensures that data remains with its owners while still enhancing the accuracy of the model overall. 

FLock’s reward system is designed to incentivize active participation. Contributors who provide data, computational power and/or feedback are compensated with FLOCK tokens, ensuring a fair distribution of rewards. 

FLock empowers its community through a robust governance framework. Decisions regarding AI model development, deployment and ethical considerations are driven by the community, ensuring alignment with established societal values. Through blockchain-based voting mechanisms, contributors can influence the direction of AI projects, fostering transparency and public accountability. 

FLock’s modular architecture allows contributors to participate in specific aspects of AI model development. Whether providing raw data or computational power or even refining algorithms, the platform enables a collaborative and scalable development process. 

At the core of FLock’s philosophy is its commitment to privacy and security. By leveraging blockchain technology, the platform ensures that no single entity controls the AI development process. Data remains local and protected by cryptographic measures, while the immutability of blockchain guarantees transparency in every transaction and model update. 

 begins with a blockchain and an AI layer.

The blockchain layer underpins FLock’s incentivization and security mechanisms.

The AI layer facilitates model training, refinement and deployment, leveraging both centralized and federated approaches.

Let’s have a look at the supply and demand for the FLOCK token.

FLock adopts a 1:2 ratio model between team/investors (33.3%) and community (66.7%), prioritizing community-driven growth and ecosystem expansion. The majority of tokens are allocated to incentivize user participation and long-term ecosystem success.

FLock aims to improve the future of AI development by decentralizing the training process and ensuring transparency, privacy and inclusivity. By leveraging blockchain and federated learning, FLock empowers communities to contribute to AI creation without compromising on privacy. Its innovative reward system and community-driven governance foster a fair and collaborative ecosystem. 

With significant backing and a growing network of contributors, FLock is positioning itself as a leader in decentralized AI, offering a more ethical and secure alternative to traditional AI development models. As it continues to scale, FLock is set to transform the way AI models are built and deployed.

 — and earn a share of a 10 million FLOCK prize pool. For more details, visit 

Intermediate

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FLock AI: Decentralized AI Training

In this tutorial, we’ll explore how you can complete a series of tasks in Network3 for Bybit Web3 Airdrop Arcade.

Task 1: Register for a Network3 Account and Connect Your Bybit Wallet 

: Navigate to the campaign page and click on the 

task. Click on the task, and Galxe will ask to redirect you to the Network3 register page.

: Register for a Network3 account using your email address. You may indicate a 

Task 2: Download the Network3 App and Run a Node for One Hour

 and choose your operating system to download the Network3 app.

 or powerbutton, depending upon which operating system you’re using. For ease of reference, we’ve used macOS and iOS as examples below.

: Keep running the node until the timer reaches 

Beginner

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How to Complete Network3 Tasks for Bybit Web3 Airdrop Arcade

Bybit Learn

Crypto

SafePal is a developer of crypto wallet products and accessories that provide exceptional security at affordable prices. Find out more about it here.

When it comes to managing your cryptocurrency with confidence, SafePal’s excellent hardware wallet, the S1, is a great choice. This top-tier piece of crypto tech is completely detached from the web, so it maximizes your crypto security. SafePal's hardware wallet is fully portable, too. You can take it anywhere you travel; just pitch it in your pocket. For its price, this crypto tech product is hard to beat. Interested to find out more? Read on as we discover the features of the SafePal S1, as well as other SafePal products you shouldn’t miss out on.

SafePal’s story begins in 2018. Before the year’s end, Binance, the world's largest crypto exchange, had strategically invested in the newest security company in the crypto space. Subsequently, in May 2019, SafePal launched the S1, its hardware wallet. At the end of the year, the expanding company implemented its fiat on-ramping services.

Five months later, in May 2020, SafePal launched its software wallet online. In August, the company implemented trading services and a DApp store through Binance. As 2021 dawned, SafePal issued its new utility token, SFP.

The new year featured several brand milestones. In February, SafePal became Binance's first launchpad project. A month later, SafePal began its 

, a hit with loyal users. In October, the company's popular crypto yield aggregator, SafePal Earn, became available, and then the new Giftbox Program closed out the year.

In 2022, this leading protector of crypto assets kept improving its value. The brand added 25 blockchain platforms to its wallets' supported platforms. Additionally, SafePal launched its Extension Wallet for browsers in July. Finally, the crypto tech company raised its user base to 7.5 million.

The SafePal hardware wallet is a highly secure way to store your private keys for 

 or any other crypto assets. With no connection between the device and the web, your SafePal wallet creates an 

 that helps you squirrel away your investments from nefarious actors.

The SafePal S1 Hardware Wallet protects your crypto assets with:

Additionally, this excellent crypto wallet:

Resembling a thick credit card with a screen on it, SafePal's S1 Hardware Wallet is an excellent alternative to software wallets.

For a rich understanding of what SafePal offers, take a moment to learn about the growing company's full product line.

SafePal further established its brand with this excellent product — the 

. You download it onto your phone to protect your digital assets. You can manage your SafePal Software Wallet on an Android or iOS device, and just like the SafePal S1 Hardware Wallet, it supports 54 blockchains. It also has seed phrase support for an extra layer of security.

 from SafePal provides maximum security. You can lock it in a safe for cold storage or conveniently bring it with you, though we’d recommend against this, as you might lose it.

More importantly, the S1 competes quite nicely with 

 crypto wallets, which many consider top-notch. You can confidently choose the S1 and feel quite secure about the state of your digital currency and assets.

 to your Chrome, Firefox or Edge browser. It gives you a full SafePal experience within your web browser, so you can check on your preferred assets' prices without opening SafePal's app. This is a convenient way to access 

 during your workday. Just put the extension on your work browser. (You don't have to tell the boss — keep active in your DeFi life, and you'll be the boss soon enough.)

Buy this crypto wallet accessory to protect your mnemonic seed phrases with ultrahigh security. Seed phrases are essential in cases where hardware wallets become misplaced, for example. This important accessory enables the recovery of your digital assets. 

 features support for 12-, 18- and 24-word phrase strings.

If extreme confidence in your life's diverse security products matters to you, Cypher's build will impress you. The crypto-tech company engineered this phrase-protecting device to withstand fires exceeding 2,500°F. Its 304-grade stainless steel resists water, acid and salt, too.

Within SafePal's exceptional crypto ecosystem, you’ll notice valuable features.

 services in the crypto industry. You can access it through the company's software wallets.

SafePal Swap lets you conveniently swap crypto tokens across different blockchains. Compared to other alternatives, the service is fast and cheap. You’ll enjoy limited slippage, too. On the SafePal App, swap orders are usually completed within 30 minutes.

 lets you do this in a native decentralized finance environment, giving you the simplest DeFi experience available.

You access Earn within the smooth-running SafePal App. The feature lets you aggregate yield by staking crypto without a third-party DApp. With Earn, you also don't have to store your gas fee tokens for pool compounding.

Every SafePal Earn protocol operates around SFP, the company's popular utility token. Auto-compounding plays an important role in easily creating gains through Earn. A nominal percentage of the pool's profits creates revenue for the platform.

When you choose SafePal's S1 Hardware Wallet, you gain important advantages over other forms of storing your vital crypto data.

Possessing a top-quality hardware wallet lets you opt for the cold storage of your cryptographic keys. By comparison, you might envision a software wallet, which is connected to the web's infrastructure, as 

Clearly, by comparison, hot storage is problematic. Cold storage maximizes your security. The SafePal S1 gives you that maximum security. You can lock the S1 in a home safe and protect your irreplaceable crypto assets.

Placing this hardware wallet in your safe is the most convenient form of cold storage.

Throughout your investing life, sound monetary decisions are essential. The S1 Hardware Wallet saves you money. Commonly, hardware wallets are priced beyond $100. Of course, features vary, but you don't need bells and whistles with a hardware wallet. You simply need cold storage for your crypto keys.

The S1 Hardware Wallet gives you exactly that — as well as a convenient UI/UX setup. You’ll enjoy the SafePal App's user experience, and you can apply your savings toward SFP tokens, which can yield gains through SafePal Earn. Soon, you’ll be happily immersed in SafePal's superb crypto ecosystem.

When you look at any crypto item's advantages, you must also consider its disadvantages.

When you need to upgrade your SafePal S1 Hardware Wallet's firmware, your 

 become momentarily vulnerable. Firmware upgrades require connecting the S1 to a computer or smartphone by USB cable.

You’ll need to decide how important this issue is for you. In fact, any hardware wallet needs USB connectivity to periodically upgrade its firmware. While this need creates a temporary weakness when your hardware wallet is connected to another device, remember that your S1 will still be much more secure than a software wallet.

If You Pocket It, You Might Lose It and That's a Hassle

Suppose you lost your SafePal S1, which would be unfortunate. For a moment, you might think you’ve lost all of your digital assets. Fortunately, that’s not the case. If you ever lose an S1, don't worry. It's not a total loss, but it is a bit of a hassle.

Since your S1 only holds cryptographic keys, losing it isn’t the same as losing a leather wallet full of fiat currency. Losing your SafePal S1 — or any hardware wallet, actually — simply means losing your keys, not your coins.

Your crypto coins physically exist on the blockchain. To recover them, you simply need to supply your mnemonic seed phrase via the SafePal App.

Of course, you don't ever want to lose both your hardware wallet and your seed phrase. Losing both items would likely make your crypto assets extremely hard to recover. To ward against this possibility, it's a wise idea to protect your seed phrase with SafePal Cypher.

As a younger, growing player in the marketplace, SafePal creates a remarkable challenge to Ledger, makers of the popular Nano line of hardware wallets. Now, consider what’s similar and different about these brands to help you decide how much value the SafePal S1 Hardware Wallet would bring to your crypto life.

Both Brands Offer Crypto Storage Consumers Trust

In many ways, SafePal and Ledger do the same thing: both companies deliver reliable hardware wallets. Since a hardware wallet enables cold storage of cryptographic keys, this type of product has also been called a 

. Ledger launched the crypto space's first cold wallet in 2014.

Still, cold wallets aren’t always air-gapped. In fact, Ledger places consumer convenience over premium security. For example, the brand's Nano hardware wallets can conduct transactions via USB. Further, the Nano X has Bluetooth connectivity for smartphone transactions. Those aren’t the features of an air-gapped hardware wallet.

Alternatively, the SafePal S1 is a truly air-gapped device. The device's USB cable only exists for charging and firmware updates. When you place transactions with the S1, you use QR codes on the SafePal App and the hardware wallet's camera.

You can interface with either of these hardware wallets through a built-in screen. As you evaluate your options, keep in mind that these aren’t touchscreens; their hardware wallets offer you buttons for navigation. On the SafePal S1, four directional buttons sit beneath the screen, and they surround a selector button. These buttons give you quick navigation of the S1's 

Ledger wallets feature a less convenient navigation method. You’ll find two multifunction buttons on Ledger's Nano wallets, which manage the Nano line's text-based interface. Though Ledger's hardware wallets are durable and built to protect 21st-century assets, this style of interface navigation feels like visiting a bygone era. It's rather similar to playing an electronic football game from the 1980s.

Also, keep in mind that Ledger's wallets feature smaller screens than the screen found on the S1. SafePal gives the S1 Hardware Wallet a 1.3-inch color screen. By contrast, the largest Ledger Nano, the Nano X, features a 0.3-inch monochrome screen.

Very likely, you’ll engage more easily with the SafePal S1 Hardware Wallet.

SafePal's Hardware Wallet Saves You Money

Ledger offers multiple hardware wallets at different price points, but they all cost more than the excellent, trusted SafePal S1. Currently, the S1 retails for $49.99. Ledger's lowest price for a Nano hardware wallet is $10 higher than that figure, and the two products give you comparable features.

In several categories, the SafePal S1 is clearly the better hardware wallet, especially since it saves you money. Even if you pay for Ledger's premium hardware wallet — the Nano X, whose price tag is triple that of SafePal's S1 — you may end up with a diminished user experience.

After all, the S1 supports more currencies, has a bigger screen and its interface is much easier to navigate.

Due to their build quality, Ledger hardware wallets feel more substantial. But in a conceptual sense, you actually get more with the S1 because of the value it delivers.

The SafePal S1 Supports Unlimited Currencies and Tokens

On a Ledger Nano hardware wallet, you can protect the keys for more than 5,000 cryptocurrencies and tokens. Using the 

 chain, Ledger wallets also store NFT keys. However, 

, Ledger's wallets support a narrow band of the crypto space's available investments.

The SafePal S1 Hardware Wallet lets you choose from a broad spectrum of currencies and tokens. In addition to storage of NFT assets on the ERC-20 chain, the S1 lets you manage unlimited tokens on 54 supported blockchains. This increasingly popular wallet also gives you unlimited currency storage.

You can see why traders from more than 200 countries and territories have chosen SafePal hardware wallets.

At the start of 2021, SafePal launched its own token, SFP. This is a utility token that helps fund the company. If you buy into it, you can:

SafePal’s token supply is capped at 500 million.

As 2023 began, SafePal had 7.5 million users. Clearly, this is an established crypto-security brand. SafePal's stated plans include further hardware wallet advancements, with an eye on the eventually emerging 

The current price of SFP is $0.51 (as of Feb 28, 2023). Price analysts at 

 price will break the $1 mark by 2024 and hit $1.89 by 2025. SFP’s price is then predicted to reach $6 by 2028, and $12.18 by 2030. While sharing the same positive outlook, DigitalCoinPrice is slightly less bullish, forecasting that SFP will break the $1 mark in 2023 and reach $1.96 by 2025. It predicts SFP’s price will then hit $3.02 in 2028 and $5.72 in 2030.

. Bybit’s unique marketplace offers you next-level opportunities and reliability in trading crypto assets.

The company funded by the SFP token is clearly a good business. SafePal develops stellar products, and helps their users keep their crypto extremely safe. Furthermore, they offer an exceptional value proposition, both as a brand and an investment token. Nobody knows the future, but SFP certainly seems to be a good investment from a HODL perspective. With that in mind, the future looks bright if you HODL. Naturally, practicing

That said, it’s always recommended that you 

 before choosing to invest in any cryptocurrency, including SFP.

SafePal's S1 Hardware Wallet gives you elite-level security for your crypto assets, and it has an attractive price tag. With the SafePal App and the SFP token matching the company's leadership, SafePal provides attractive opportunities. Whether you’re a beginner or a veteran trader, it's worthwhile investing in SafePal and using its products.

SafePal (SFP): The Hardware Wallet on Par With Ledger

Grab Up to 5,000 USDT in Rewards

Grab Up to 5,000 USDT in Rewards