Crypto Market Outlook: Waiting for Macro Catalysts, Aave Plans Future Development

Recently, the crypto market has lacked a clear direction, with Bitcoin continuing to decline and altcoins generally performing poorly. This highlights that macroeconomic factors remain key drivers of the market. Although the strong momentum of the dollar has stalled, the upcoming PPI and CPI data could become important indicators in determining the future trend of the dollar.

Although changes in the unemployment rate have sparked speculation in the market about adjustments to Federal Reserve policy, we believe that the Fed will still prioritize controlling inflation. Supported by technological advancements and government spending, the U.S. economy is unlikely to fall into recession in the short term. Therefore, the upcoming inflation data will be the focus of market attention.

In the DeFi space, Aave recently announced its plans for the fourth version (V4) of its protocol as part of its long-term development strategy for 2030. The V4 version includes several architectural improvements, such as a unified liquidity layer, variable interest rates, and liquidity premiums. These updates aim to enhance Aave's GHO stablecoin functionality and improve the risk management system.

Aave's move reflects the trend of mature DeFi protocols continuously innovating and improving core functionalities while maintaining market dominance. However, the adoption of the new version may take some time, highlighting users' emphasis on long-term stability in the DeFi market.

The Aave 2030 roadmap seems to be in competition with Maker's Endgame plan, especially in the decentralized stablecoin space. Although both protocols have put forward ambitious development blueprints, the market may still focus more on the macroeconomic environment in the short term.

Overall, the crypto market is looking for the next significant catalyst. The U.S. inflation data and the speech by the Federal Reserve Chairman in the coming week may affect the market direction. Unless there are significant surprises, market volatility may continue to narrow, and the correlation between crypto assets and traditional markets may increase.

Regarding institutional trends, global encryption companies are seeking new development opportunities in Hong Kong. In terms of regulation, the U.S. Securities and Exchange Commission has issued a Wells notice to Robinhood Crypto, accusing it of possibly violating securities regulations. In terms of technological development, the Bitcoin network has surpassed 1 billion on-chain transactions, and Ethereum founder Vitalik Buterin has proposed the EIP-7702 proposal aimed at improving account abstraction.

On the international front, Europe and Asia have made new progress in the regulation and application of cryptocurrencies. Countries like the UK and Germany are strengthening their regulation and research of the crypto industry, while Hong Kong has launched the first spot Bitcoin and Ethereum ETFs. These developments demonstrate the ongoing evolution and maturation of the global crypto ecosystem.

In the coming week, the market will closely watch the US inflation data, speeches by the Federal Reserve Chairman, and various regulatory trends. These factors may have a significant impact on the crypto market, and investors should remain vigilant and closely monitor market changes.