Welcome to our August 2024 monthly crypto market recap!

In the past month, Crypto markets have experienced significant volatility following a sharper-than-expected slowdown in U.S. job growth. This has intensified criticism of the Federal Reserve’s decision to maintain interest rates at a 23-year high. Economists and politicians are warning that the delay in rate cuts could lead to the very recession the Fed aims to avoid.

Specifically, on the macroeconomics front, the U.S. economy continued to show resilience, with GDP growth in the second quarter exceeding expectations at an annualized 2.8%, driven by strong consumer spending and non-residential fixed investment. Despite this growth, inflation remains above the Federal Reserve’s 2% target, although it has begun to ease, with the core PCE Price Index falling from 3.7% in the first quarter to 2.9% in the second quarter.

Financial markets also experienced increased volatility, largely due to the unwinding of the Yen Carry Trade from major financial institutions across the globe, as the Bank of Japan raised interest rates again at the end of July. On Monday, August 5th, the major equity indices all experienced significant losses, with the TOPIX falling by 20% in three days, the biggest wipeout in history.

Meanwhile, there were also concerns over the Federal Reserve potentially being behind the curve in its monetary policy. Speculation about upcoming interest rate cuts, driven by moderating job growth and inflation, has also influenced market sentiment. Federal Reserve Chair Jay Powell signaled a readiness to cut U.S. interest rates in September, citing increased “downside risks” to the labor market and emphasizing that the timing of rate cuts will depend on incoming economic data and evolving risks.

In crypto, the ongoing repayments from the Mt. Gox rehabilitation trustees continued, with BTC and BCH distributed to over 17,000 creditors by the end of July 2024. A U.S. District Judge ruled that Ripple violated securities laws in certain institutional sales but did not in programmatic sales to retail investors. The fine imposed was $125.035 million, significantly less than what the SEC initially sought. Telegram founder and CEO Pavel Durov was arrested in France by the National Anti-Fraud Office at Le Bourget airport, with reports suggesting he may face charges for a range of alleged offenses, including terrorism, fraud, and money laundering.

Join us as we delve into the crypto market of August and uncover the stories that fueled the month’s leading performers. Stay ahead with our comprehensive monthly market recaps at TRHX Research and receive real-time updates with TRHX Pulse. Stay informed and adept at navigating the ever-evolving crypto landscape!

Helium (HNT) ⏶37.48%

Helium is a decentralized network that leverages blockchain technology to create a wide-reaching, low-cost wireless infrastructure. The Helium Network, also known as “The People’s Network,” provides wireless coverage for Internet of Things (IoT) devices using a unique incentivized model. Participants can earn HNT tokens by deploying Hotspots, which create a network coverage area and validate network data.

This month, a significant milestone was achieved with the community’s approval of Helium Improvement Proposal (HIP) 128. This proposal formally establishes the ENERGY Subnetwork within the Helium Network, setting the economic framework for integrating decentralized energy resources, such as solar power and battery storage, into the network. The passage of HIP 128 not only broadens the Helium Network’s addressable market but also paves the way for new utilities for Hotspots and enhances the overall utility of the HNT token. Similar to the process seen with HIP 77, an additional implementation of HIP will be required to bring the ENERGY Subnetwork to full operational status, marking a promising future catalyst for the network.

Building on July’s successful transition of roaming users to a more interoperable and self-managed infrastructure, Helium also continues to solidify its position as a leader in decentralized wireless networks. The completion of this transition has significantly improved the network’s scalability and reliability, allowing users to create and manage custom routes with their own Organizationally Unique Identifiers (OUI).

Looking ahead, the upcoming launch of the ENERGY Subnetwork, following the passage of HIP 128, is poised to further expand Helium’s reach into other industries, particularly in decentralized energy, which continues to position Helium at the forefront of the DePIN space.

Tron (TRX) ⏶22.48%

The Tron network is a decentralized blockchain platform designed to build and support a global digital content and entertainment ecosystem. Launched in 2017 by Justin Sun, Tron aims to provide a high-performance, scalable, and cost-effective infrastructure for decentralized applications and smart contracts. Tron’s native cryptocurrency, TRX, powers the network and is used for transactions, staking, and participating in the governance of the ecosystem.

In August, the price of TRX increased by up to 23%. The Tron network saw greater adoption across several metrics, including protocol revenue, USDT supply, USDT holders, and USDT transfer volume. This surge can be linked to the launch of its memecoin platform, SunPump, along with incentive programs for traders and partnerships with projects that add utility to the native TRX token. According to TokenTerminal, in mid-August, Tron’s protocol revenue experienced significant growth, partly due to the deployment of SunPump, surpassing Ethereum’s protocol revenue by 50% and setting the stage to exceed $2 billion this year. TRX token holders are the direct beneficiaries of this, driving its value up and leading to price appreciation. Additionally, Tron and SunPump are jointly investing $10 million into the Meme Ecosystem Boost Incentive Program to encourage further activity on the Tron blockchain by supporting the development of community-driven projects like SunPump.

These developments not only highlight the rising influence of meme coins but also emphasize the appeal of Tron’s native token and the strength of Tron’s network, solidifying its position as a major player in the crypto landscape.

Sui (SUI) ⏶20.18%

Sui is a layer-1 blockchain designed for low-latency transfers, emphasizing instant transaction finality and high-speed throughput, making it ideal for real-time applications like games and finance. Its smart contracts use Move, a Rust-based language optimized for speed and security. Sui achieves “horizontal scaling” through “transaction parallelization,” which allows simultaneous processing of independent transactions. This approach, combined with its Byzantine fault-tolerant proof-of-stake (PoS) consensus mechanism, ensures efficient validation of transactions by Sui nodes.

In August, apart from Sui’s beta effect with the overall crypto market as one of the biggest L1s, the token saw a significant boost due to the launch of Grayscale’s new Sui Trust. Grayscale, renowned for its successful cryptocurrency investment products, introduced the Grayscale Sui Trust as part of its new crypto funds lineup. This fund, dedicated exclusively to Sui’s token, complements the firm’s broader strategy of incorporating emerging technologies into its offerings. The launch follows Grayscale’s recent move to upscale its Ethereum Trust to an ETF structure and to introduce a decentralized AI-focused fund, which includes Bittensor’s TAO, among other assets. 

Although the Grayscale Sui Trust is available only through private placements, where investments are limited to accredited institutional investors, it is expected to enhance Sui’s market visibility. Grayscale’s endorsement is likely to attract both individual and institutional investors, increasing interest in Sui and its native token.

SATS (SATS) ⏶18.45%

SATS is a BRC-20 token that pays homage to Satoshi Nakamoto. SATS is the abbreviation for satoshi, the smallest unit of Bitcoin. 

The recent surge in the price of SATS can be attributed to its close relationship with Bitcoin, often referred to as a “BTC beta.” As Bitcoin’s price pumped up to $61K, SATS, which is intrinsically tied to Bitcoin’s performance, benefitted significantly from this upward momentum. Furthermore, the positive impact of the Ordinals protocol cannot be overlooked. During the Ordinals Asia event, Casey Rodarmor, the founder of the protocol, emphasized the simplicity and inclusivity of Ordinals, inscriptions, and runes as key to their success. This focus on simplicity resonates with many in the Bitcoin community, driving increased adoption and, consequently, boosting the value of SATS​.

In August 2024, SATS experienced a notable price increase driven by multiple factors. One key catalyst was the growing recognition of Satoshi Nakamoto’s decision to remain anonymous, which gained renewed attention following the arrest of TON’s founder, Pavel Durov. The arrest led to a significant drop in TON’s price, highlighting the risks associated with high-profile leadership in the crypto space. In contrast, the community’s appreciation for Satoshi’s anonymity, which has shielded Bitcoin from similar risks, played a role in boosting confidence in SATS. This event, coupled with Bitcoin’s price surge to $61K, reinforced SATS as an innovative investment, leading to its appreciation​.

Artificial Superintelligence Alliance (FET) ⏶11.70%

The Artificial Superintelligence Alliance is the byproduct of the unification of Fetch.AI, Ocean Protocol, and SingularityNET, through a token merger, with the current native token being FET. As the largest open-sourced, independent entity in AI research and development, this alliance aims to accelerate the advancement of decentralized Artificial General Intelligence (AGI) and, ultimately, Artificial Superintelligence (ASI).

The price appreciation of FET in August by approximately 75% was driven by both the traditional market and the digital asset market factors. A key catalyst was the anticipation of Nvidia’s highly anticipated Q2 earnings report, which significantly boosted AI-related assets. The positive market sentiment around AI technologies, coupled with Nvidia’s dominant position in the AI industry, created a ripple effect that benefited AI-centric tokens like FET. Furthermore, the exchange rate for the ASI token after the merger was the highest for the FET token among the other 2 tokens: Ocean Protocol and SingularityNET. This exchange rate and the burning of the existing tokens after exchanging potentially drove the value of FET tokens up for some time.

Fetch.ai is also launching an Innovation Lab in San Francisco to support early-stage startups developing AI agent solutions, with $10 million in annual funding available. With up to $1 million per project, the milestone-based funding aims to bridge the gap between research and market applications. The lab will focus on startups with a working prototype or MVP and a scalable business model.

Aave (AAVE) ⏶11.28%

Aave (AAVE) is a leading decentralized finance (DeFi) protocol that facilitates non-custodial lending and borrowing of assets. Users can earn interest on their deposited cryptocurrencies or use them as collateral to borrow a range of supported altcoins and stablecoins. AAVE, the protocol’s native token, enables holders to participate in governance decisions and earn staking rewards. Aave was developed to meet the growing demand for decentralized financial markets and is one of the largest platforms of its kind in the DeFi space.

One catalyst for Aave this month is the development of the “Umbrella Proposal” which aims to reform Aave’s loan liquidation process to mitigate negative impacts on the AAVE token’s price. It suggests replacing the current “seize and sell” method, which involves selling AAVE tokens to cover bad debt, with a “seize and burn” approach that permanently removes AAVE tokens or other assets from circulation. This change intends to reduce market pressure on the AAVE token by using a broader range of assets to cover bad debt and decreasing the overall token supply. As a result, his proposal has garnered significant investor interest as it demonstrated the DAO’s active stance in risk management and strategic pivots to adapt to market conditions.

In addition, a proposal from Aave-Chan Initiative founder Marc Zeller in late July has sparked speculation around Aave’s fee switch. The proposed change suggests redistributing excess revenue generated by the platform to AAVE stakers and minters of its stablecoin, GHO. The plan involves using a portion of the platform’s net revenue to buy back AAVE tokens from the market, which could reduce sell-side pressure and create new incentives for holding and staking the token. This proposal has boosted investor interest and market sentiment, as it could increase the value of AAVE by providing additional benefits to ecosystem participants.

Closing Remarks

As August comes to a close, the cryptocurrency market shows signs of recovery following the turbulence caused by the yen carry trade unwind. Despite the initial volatility, the market has demonstrated resilience, and there is a renewed sense of optimism as we move into September.

September is shaping up to be a pivotal month, with the potential Federal Reserve rate cut on the horizon, which could inject fresh momentum into the markets. Additionally, the upcoming Token2049 event in Singapore will be a major highlight, bringing together industry leaders, investors, and innovators to discuss the latest trends and developments in the crypto space. 

Another critical event to watch is the expected release of Binance CEO CZ at the end of September, which could have significant implications for Binance and the broader market overall.

Lastly, Treehouse Labs is set to launch a groundbreaking initiative to lay the foundations for the fixed-income layer in digital assets. For more information, check out the Treehouse Protocol here.

As we head into September, we are closely monitoring these developments and their potential impact on the market.  Stay tuned for our ongoing in-depth explorations of the crypto sphere through TRHX Research and the TRHX Pulse Newsletter, where we will deliver the latest updates.

Disclaimer

This publication is provided for informational and entertainment purposes only. Nothing contained in this publication constitutes financial advice, trading advice, or any other advice, nor does it constitute an offer to buy or sell securities or any other assets or participate in any particular trading strategy. This publication does not take into account your personal investment objectives, financial situation, or needs. TRHX does not warrant that the information provided in this publication is up-to-date or accurate.

Hyperion by TRHX reimagines workflows for digital asset traders and investors looking for actionable market and portfolio data. Contact us if you are interested! Otherwise, check out TRHX Research and TRHX Pulse for in-depth research.