Good Morning, Asia. Here’s what’s making news in the markets:

Welcome to Asia Morning Briefing, a daily summary of top stories during U.S. hours and an overview of market moves and analysis. For a detailed overview of U.S. markets, see CoinDesk’s Crypto Daybook Americas.

The market has been asking whether bitcoin is losing to gold. Darius Sit, co-founder and Managing Partner at QCP Capital, says the debate is often framed around price when liquidity realities matter more.

Singapore-based QCP is one of Asia’s largest trading desks, with over $60 billion in annual volume.

“If you’re comparing Bitcoin to gold, it’s not a like-for-like comparison… you’re talking about almost like a mouse versus an elephant kind of comparison,” Sit told CoinDesk. “You have two different sets of idiosyncratic market forces affecting market price in the short term, but on the longer-term narrative, I think, [they] remain quite similar.”

Gold’s dominance reflects sovereign demand, entrenched market structure, and sheer scale. Bitcoin’s lag owes more to position unwinds than thesis collapse. Gold’s market cap is so large that its daily swings can exceed bitcoin’s entire valuation, turning short-term divergence into a physics problem rather than a narrative verdict.

However, “in the longer term, narrative looks the same,” Sit said.

A bigger inflection point, in his view, isn’t bullion’s rally but crypto’s Oct. 10 (now called 10/10) deleveraging event. That episode drew a hard line between bitcoin and the rest of the digital asset complex, exposing how liquidity and credit mitigation diverge once leverage snaps.

“October 10 revealed that … there is a very clear line in terms of the liquidity between crypto, altcoins and bitcoin,” Sit said. The takeaway isn’t that crypto lost its appeal, but that much of the market discovered its true depth only after forced unwinds cleared the book. What remained was a thinner landscape where price moves sharply in either direction.

One of the most important lessons of “10/10” was how crypto venues handle credit when things break.

Sit drew a stark contrast with traditional markets, where layered broker and clearinghouse structures absorb shocks before losses reach end users.

Native crypto exchanges, by comparison, often operate as single points of failure, relying on shareholder equity, insurance funds, and, in extreme cases, socialized loss.

“The moment you trigger socialized loss, your platform will lose trust,” Sit said, describing what he views as the industry’s real institutional ceiling. Volatility isn’t the deterrent. The problem emerges when traders cannot predict how liquidations and counterparty risk will be managed in a stress event.

Socialized loss occurs when an exchange’s insurance fund cannot cover bankrupt positions, forcing the platform to close out profitable traders’ positions to cover the shortfall, effectively making winners pay for others’ losses. This happened on many major exchanges during the Oct. 10 market crash.

He added that participants perceived the rules as inconsistent, with some products or counterparties appearing insulated while others absorbed the hit.

That perception lingers longer than the price drawdown itself. Markets can rebuild leverage and volume, but trust in liquidation governance is slower to return.

The result is a divided landscape where bitcoin retains credibility due to deeper liquidity and clearer use as collateral, while the broader altcoin complex trades with a structural discount tied less to macro direction than to venue design and counterparty confidence.

In Sit’s view, bitcoin still behaves like a long-horizon inflation hedge and an increasingly legible form of collateral, whereas the broader altcoin universe is more directly subject to venue governance and order-book depth than to macro narratives alone.

“When something has poor liquidity, it can go down a lot. It can go up a lot,” Sit said.

Market Movement

BTC: Bitcoin swung violently but edged up about 5% in the last hour as extreme volatility followed a liquidation-driven plunge toward $60,000, with the RSI near 17 signaling historically oversold conditions that often precede sharp relief bounces even as price hovers near the $58,000 to $60,000 support zone.

ETH: Ether traded around $1,895, rebounding about 7% in the past hour after a liquidation-driven selloff, with volatility surging as deeply oversold momentum conditions triggered a short-term relief bounce despite double-digit losses over the past 24 hours.

Gold: Gold slipped about 3.7% to roughly $4,740 per ounce in a broad risk-asset pullback and profit-taking wave, but analysts argue the longer-term uptrend remains supported by persistent central-bank buying, debt and currency-confidence concerns, and forecasts that still see potential for prices to push toward $7,000 later in 2026 despite short-term volatility.

Nikkei 225: The Nikkei 225 slipped about 1% to extend a three-day losing streak as a Wall Street tech rout spilled into Asia, dragging South Korea’s Kospi down as much as 5%, pressuring Hong Kong and Australian equities, and reinforcing a broader risk-off tone that also weighed on silver and other volatile assets.

Elsewhere in Crypto

• U.S. Treasury’s Bessent calls out crypto ‘nihilists’ resisting market structure bill (CoinDesk)
• Tom Lee’s Bitmine now $8 billion underwater as ether tumbles below $2,000 (CoinDesk)

MicroStrategy (Strategy) released its Q4 2025 earnings report and, along with it, disclosed an extreme downside scenario that would begin to strain its Bitcoin treasury model.

The CEO’s remarks provided rare insight into how far the market could fall before the company’s capital structure comes under serious pressure.

MicroStrategy Finally Reveals What Would Be Its Breaking Point as Bitcoin Price Drops

During its latest earnings discussion, MicroStrategy CEO Phong Le said that a 90% decline in Bitcoin’s price to roughly $8,000 would mark the point where the firm’s Bitcoin reserves roughly equal its net debt.

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 At that level, the company would likely be unable to repay convertible debt using its BTC holdings alone. As a result, it may need to consider restructuring, issuing new equity, or raising additional debt over time.

Leadership emphasized that such a scenario is viewed as highly improbable and would unfold over several years, giving the firm time to respond if markets deteriorated significantly.

“In the extreme downside, if we were to have a 90% decline in Bitcoin price to $8,000, which is pretty hard to imagine, that is the point at which our BTC reserve equals our net debt and we’ll not be able to then pay off of our convertibles using our Bitcoin reserve and we’d either look at restructuring, issuing additional equity, issuing an additional debt. And let me remind you: this is over the next five years. Right, So I’m not really worried at this point in time, even with Bitcoin drops,” said Le.

Meanwhile, it is worth noting that Le’s remarks come only months after the Strategy executive admitted a situation that would compell the firm would sell Bitcoin. As BeInCrypto reported, Phong Le cited a Bitcoin sale trigger tied to mNAV and liquidity stress.

Speaking on What Bitcoin Did, CEO Phong Le outlined the precise trigger that would force a Bitcoin sale:

• First, the company’s stock must trade below 1x mNAV, meaning the market capitalization falls below the value of its Bitcoin holdings.
• Second, MicroStrategy must be unable to raise new capital through equity or debt issuance. This would mean capital markets are closed or too expensive to access.

Therefore, the latest statement does not contradict Phong Le’s earlier position but adds another layer of risk.

Previously, a Bitcoin sale depended on stock trading below mNAV and capital markets’ closing. Now, he clarifies that in an extreme 90% crash, the immediate issue would be debt servicing, likely addressed first through restructuring or new financing—not necessarily selling Bitcoin.

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Massive Bitcoin Exposure Comes with Large Losses

Strategy remains the world’s largest corporate holder of Bitcoin, reporting 713,502 BTC as of early February 2026. The company acquired the holdings at a total cost of about $54.26 billion, according to its fourth-quarter financial results.

However, Bitcoin’s decline during the final months of 2025 significantly impacted the balance sheet. The firm reported $17.4 billion in unrealized digital-asset losses for the quarter and a net loss of $12.4 billion. This highlights the sensitivity of its financial performance to market swings.

At the same time, Strategy continued to raise substantial capital. The company said it raised $25.3 billion in 2025, making it one of the largest equity issuers in the US.

Meanwhile, they also reportedly built a $2.25 billion USD reserve designed to cover roughly two and a half years of dividend and interest obligations.

Executives argue that these measures strengthen liquidity and provide flexibility, even during periods of market stress.

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Bitcoin Volatility Brings the Risk Into Focus

The disclosure comes amid heightened volatility in crypto markets. Bitcoin traded near $70,000 in early February before extending successive legs lower to an intraday low of $60,000 on February 6.  This shows how quickly price movements can reshape the outlook for highly leveraged treasury strategies.

Strategy’s capital structure relies heavily on debt, preferred equity, and convertible instruments used to accumulate Bitcoin over multiple years.

While this approach has amplified gains during bull markets, it also magnifies losses during downturns, drawing increasing scrutiny from investors and analysts.

However, the company’s leadership maintains that the long-dated nature of much of its debt provides time to manage through cycles. This, they say, reduces the risk of forced liquidations in the near term.

Saylor Doubles Down on Long-Term Thesis

Elsewhere, executive chair Michael Saylor reiterated his conviction in Bitcoin despite recent losses, describing it as the “digital transformation of capital” and urging investors to “HODL.”

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TLDR:

• Bitcoin slipping below $70K triggers renewed selling pressure as sentiment moves into extreme fear. 
• Crypto Fear & Greed Index drops near its lowest levels this year, reflecting intense market anxiety. 
• BTC hits a low near $67,000, the weakest level since late 2024, deepening the downtrend. 
• Broader risk asset sell‑offs contribute to crypto market losses and heightened caution.

Bitcoin slipping below $70K deepened the market’s downturn. The asset price has dropped to $67,000, a 15‑month low and about 46% below its all‑time high. 

Volatility surge has intensified selling pressure across crypto markets, pushing sentiment into Extreme Fear. The market reacted with broader risk asset sell‑offs, even as some long‑term models suggest potential recovery paths. 

Market Reaction and Oversold Conditions

Bitcoin slipping below $70K dropped nearly 8% on the day, positioning the cryptocurrency approximately 46% below its all-time high. The Fear & Greed Index currently reads Extreme Fear, reflecting widespread caution among traders.

Headlines have emphasized the bearish sentiment, but statistical models present a different narrative. Breaking below a round number like $70K often triggers emotional reactions. 

Psychological floors make declines feel more dramatic, creating heightened fear. Historically, similar breaches represent temporary overshoots rather than structural breakdowns.

 Volatility is a normal feature of Bitcoin’s late-cycle patterns, which test market conviction and penalize impatience.

Using a 15+ year Bitcoin power-law model with R² = 0.961, the current spot price of $67.7K is roughly 45% below the modeled fair value of ~$123K. This deviation indicates a historically large gap between price and trend. 

At 22 months post-halving, typical cycles show overbought conditions, yet Bitcoin is registering a Z-score of -0.85—the lowest recorded at this stage. Such readings signal statistical undervaluation rather than structural weakness.

Historically, oversold regimes have produced consistent forward returns. One-year forward performance was 100% positive, with average gains exceeding 100%. 

The correlation between 18-month Z-scores and future returns stands at -0.745, meaning the depth of undervaluation explains over half of forward return variance.

Patience and Recovery Potential

Mean reversion plays a key role in Bitcoin’s response to oversold conditions. The estimated half-life of deviation is approximately 133 days, suggesting that time could help align price with trend levels. 

Based on historical patterns, this positions Bitcoin for a gradual path toward ~$111K by mid-2026. Market sentiment is heavily influenced by short-term fear. 

Social media and headlines have amplified declines, but statistical evidence provides a clearer perspective. Past cycles demonstrate that patient positioning in oversold phases is historically rewarded. 

Temporary volatility and drawdowns are part of the market’s mechanism, allowing long-term value to compound quietly. Even with the current discomfort, these conditions represent an opportunity. 

Price reacts to leverage, flows, and sentiment, while value accumulates in the background. Historical data confirms that statistically cheap levels rarely remain undervalued for long, offering a disciplined path for market participants to navigate short-term fear.

TLDR:

• ASTER trades near $0.50, almost 80% below its all-time high within a defined descending channel. 
• MACD compression and RSI stability show weakening selling pressure and controlled price behavior. 
• The $0.35–$0.50 zone attracts long-term positioning as volatility remains low and structure holds. 
• A close above $0.72 could confirm a shift from accumulation into a new expansion phase.

ASTER currently trades around $0.49, down over 80% from its all-time high near $2.42. Price is showing a developing accumulation phase within the descending channel. 

Indicators are suggesting that selling pressure is fading. Traders are monitoring for a close above resistance to confirm a potential structural shift. 

Price Structure and Accumulation Zone

ASTER trades near $0.50 after declining from its all-time high of $2.43. This level places the asset close to 80% below peak value. 

Price has continued to respect both channel resistance and channel support, showing controlled movement rather than disorderly selling. A crypto market analyst reported that this pattern reflects a transition from distribution into accumulation.

Market participants’ attention is on the accumulation range between $0.35 and $0.50. This zone aligns with historical demand and the lower boundary of the channel. 

Traders are aware of downside risk within this range but are still maintaining exposure to long-term upside. The structure favors laddered entries instead of single large positions.

Volatility remains compressed, which reduces emotional trading behavior and supports gradual positioning.

Attention remains fixed on the $0.72 resistance level as the main structural trigger. A close above this area would break the descending channel from resistance to support. 

Such a move would signal the end of accumulation and the start of expansion. This would likely attract capital that waits for confirmed structural reversals.

Indicator Signals and Long-Term Price Framework

ASTER price continues hovering near $0.56 after several weeks of sideways movement. Such compression usually appears after extended bearish momentum has weakened. 

A market observer stated that slow price action often marks late-stage weakness rather than renewed selling cycles.

The MACD remains below the zero line, confirming that the broader trend has not turned bullish. However, the histogram has flattened, and the signal lines remain tightly compressed.

This configuration shows that selling strength is declining instead of increasing. RSI trades between 38 and 40 and forms higher lows while the price remains flat. 

Technical analysts have described this pattern as controlled weakness combined with gradual absorption of supply.

Long-term resistance levels provide a roadmap for future price movement. The first resistance zone stands near $1.38, followed by a potential all-time high retest around $2.41.

Extended targets near $5 and $10 correspond with macro expansion phases if structure shifts upward. ASTER long-term accumulation now depends on patience, defined support, and confirmation above $0.72. 

Current market conditions favor positioning during compression rather than chasing momentum during expansion.

A U.S. advisory urging American citizens to “leave Iran now” is circulating again online, adding another layer of headline risk to a crypto market already wobbling on high volatility and forced liquidations.

Officials have since clarified the warning itself is not new and was first issued in mid-January. Still, the timing matters. The advisory is resurfacing just as the U.S. and Iran prepare to hold nuclear talks in Oman on Friday, with President Donald Trump publicly warning Iran’s Supreme Leader Ayatollah Ali Khamenei and Tehran threatening retaliation if attacked.

For crypto traders, the immediate takeaway is not whether the advisory is fresh. It’s that the market is behaving like a fragile, leveraged macro trade. In this kind of environment, geopolitical headlines tend to hit bitcoin the same way they hit high-beta tech stocks, not the way they hit gold.

Bitcoin has already been swinging wildly after a week of liquidation-driven selling, and the market’s sensitivity is elevated. When positioning is stretched and liquidity is thin, even ambiguous news can trigger rapid deleveraging, especially in perpetual futures.

The asset has repeatedly sold off whenever geopolitical drama makes headlines, with investors preferring the perceived safety of gold or bonds against digital assets.

The Iran headlines may ultimately fade, especially if the Oman talks proceed smoothly. But in a market that is still digesting heavy losses and where sentiment is already brittle, traders are likely to treat geopolitics as a volatility accelerant rather than a directional catalyst.

Bitcoin’s plunge to nearly $60,000 on Thursday, a nearly 30% drop over 7 days, has got traders on X began floating theories that the selloff was not purely macro or risk-off, but various reasons that contributed to the asset’s worst single-day performance since FTX crashed in 2022.

Flood, a prominent crypto trader, called it in an X post the most vicious selling he’s seen in years and said it felt “forced” and “indiscriminate,” floating possibilities ranging from a sovereign dumping billions to an exchange balance sheet blowup.

Few theories: – Secret Sovereign dumping $10B+ (Saudi/UAE/Russia/China) – Exchange blowup, or Exchange that had tens of billions of dollars of Bitcoin on the balance sheet forced to sell for whatever reason.

Pantera Capital general partner Franklin Bi offered a more detailed theory. He suggested the seller could be a large Asia-based player with limited crypto-native counterparties, meaning the market would not “sniff them out” quickly.

My guess is that it’s not a crypto-focused trading firm but someone large outside of crypto, likely based in Asia, with very few crypto-native counterparties. hence why no one has sniffed them out on CT. comfortably leveraged & market-making on Binance –> JPY carry trade unwind –> 10/10 liquidity crisis –> ~90-day reprieve granted –> backfired attempt to recover on gold/silver trade –> desperate unwind this week.

In his view, the chain of events may have started with leverage on Binance, then worsened as carry trades unwound and liquidity evaporated, with a failed attempt to recover losses in gold and silver accelerating the forced unwind this week.

But the more unusual narrative emerging from the crash is not about leverage. It is about security.

Charles Edwards of Capriole argued that falling prices may finally force serious attention on bitcoin’s quantum security risks.

Edwards said he was “serious” when he warned last year that bitcoin might need to go lower to incentivize meaningful action, calling recent developments the first “promising progress” he has seen so far.

$50K not that far away now. I was serious when I said last year that price would need to go lower to incentivize proper attention to Bitcoin quantum security. This is the first promising progress we have seen to date. I genuinely hope Saylor is serious about establishing a well funded Bitcoin Security team.

He would have significant sway across the network in affecting change. I am concerned that his statement today is a false flag, to simply diminish mounting quantum fear without substantive action, but I would love for this to be wrong. We have a lot of work to do, and it needs to be done in 2026.

Parker White, COO and CIO at DeFi Development Corp., pointed to unusual activity in BlackRock’s spot bitcoin ETF (IBIT) as a possible culprit behind Thursday’s washout.

He noted IBIT posted its biggest-ever volume day at $10.7 billion, alongside a record $900 million in options premium, arguing the pattern fits a large options-driven liquidation rather than a typical crypto-native leverage unwind.

The last small piece of evidence I have is that I personally know a number of HK-based hedge funds that are holders of $DFDV, which had the worst single down day ever, with a meaningful mNAV decline. The mNAV had been holding steady surprisingly well throughout this pull back until today. One of these fund(s) could have been connected to the IBIT culprit, as I highly doubt a fund taking that large of a position in IBIT and using a single entity structure would only have the one fund.

Now, I could easily see how the fund(s) could have been running a levered options trade on IBIT (think way OTM calls = ultra high gamma) with borrowed capital in JPY. Oct 10th could very well have blown a hole in their balance sheet, that they tried to win back by adding leverage waiting for the “obvious” rebound. As that led to increased losses, coupled with increased funding costs in JPY, I could see how the fund(s) would have gotten more desperate and hopped on the Silver trade. When that blew up, things got dire and this last push in BTC finished them off.

“I have no hard evidence here, just some hunches and bread crumbs, but it does seem very plausible,” White wrote on X.

Bitcoin’s drop over the past week has been less about a slow grind lower and more about sudden air pockets, with sharp intraday swings replacing the orderly dip-buying seen earlier this year.

The move has dragged BTC back toward levels last traded in late 2024, while liquidity has looked thin across major venues. With altcoins under heavier pressure and sentiment collapsing to post-FTX style readings, traders are now treating each rebound as suspect until flows and positioning visibly reset.

Jefferies says the latest crypto selloff shows few signs of an imminent bottom, even as bitcoin and ether hover near levels that have historically drawn dip buyers.

In a research note this week, the bank described the downturn as a liquidity-driven correction rather than a collapse in blockchain activity, pointing instead to continued network usage and selective corporate bitcoin accumulation as evidence that the sector’s underlying infrastructure remains intact.

This comes as bitcoin trades near $64,800, roughly 47% below its October 2025 peak of about $123,500, while ether trades around $1,900, down nearly 60% from its prior cycle highs.

Jefferies wrote that sharp price declines have revived familiar “crypto winter” narratives, but argued that current weakness is more closely tied to broader risk-off sentiment in global markets and a rotation away from growth assets than to any deterioration in blockchain fundamentals. More than $2 billion in recent long liquidations has further amplified day-to-day volatility across major tokens.

The bank highlighted selling from large bitcoin holders and persistent spot ETF net outflows as key near-term headwinds, suggesting institutional portfolio rebalancing is exerting greater pressure on prices than retail behavior.

At the same time, Jefferies noted that smaller and mid-sized holders appear to be holding existing positions rather than aggressively exiting, while centralized exchange trading volumes and decentralized lending activity have begun to stabilize after recent spikes.

Despite its cautious tone, the report stops short of a fully bearish outlook. Jefferies said longer-term catalysts such as regulatory progress, infrastructure maturity, and greater participation by traditional finance could eventually drive renewed interest in tokens tied to revenue-generating blockchains, leading to wider performance divergence rather than a uniform rebound.

[PRESS RELEASE – San Francisco, CA, USA, February 6th, 2026]

DipCoin today announced the official launch of its Season 1: Horizon Points & Referral System, marking the activation of DipCoin’s long-term incentive framework designed to reward real trading participation, capital contribution, and community growth across its perpetual and Vault ecosystem.

Season 1: Horizon represents more than a limited-time promotion. It establishes the foundational scoring logic, risk controls, and reward architecture that will guide DipCoin’s incentive programs across future seasons. The system is built to align user rewards with meaningful platform activity (trading, liquidity commitment, position management, and referrals) while discouraging short-term manipulation and low-quality participation.

With Horizon, DipCoin takes a step toward transforming incentives from short-term marketing campaigns into a structured, sustainable ecosystem engine.

A New Chapter: Why “Horizon”

“Horizon” symbolizes the beginning of DipCoin’s transition from a standalone perpetual trading platform into a contribution-driven ecosystem. Rather than focusing only on trading volume, Season 1 expands reward eligibility to multiple forms of participation, recognizing that healthy markets are built on more than just transactions.

This season marks the first official deployment of DipCoin’s long-term points system, which will serve as a core reference for all future seasons and ecosystem benefit distribution.

Season 1 Schedule

All Season 1 calculations follow UTC time:

• Start: February 4, 2026 – 00:00 UTC
• End: March 20, 2026 – 23:59:59 UTC

The DipCoin interface automatically converts these times to each user’s local timezone for convenience.

What Users Can Earn Points For

Season 1: Horizon quantifies real participation through four core activity categories inside DipCoin’s Perp Accounts and Vault Accounts:

1. TVL Points (Deposit Contribution)
2. Generated from average daily deposited balances.
3. Trading Volume Points (Trading Activity)
4. Generated from executed perpetual trades and Vault strategy execution.
5. Position Holding Points (Position Size Contribution)
6. Generated from average daily effective position size.
7. Liquidation Points (Loss-Based Conversion Points)
8. Generated when forced liquidations occur and result in real losses.

Only Perp and Vault activity is included. Swap trades are excluded from Season 1 calculations.

This design ensures that rewards reflect real economic engagement rather than surface-level activity.

Early Bird Rewards: Honoring Early Supporters

To recognize users who traded on DipCoin before Season 1 officially begins, the platform includes historical data as Early Bird Rewards:

Included historical data:

• Trading volume points
• Liquidation loss points

These historical points receive a 3× multiplier and appear in the Early Bird Rewards section of each user’s dashboard.

TVL, position holding, team boosts, and referrals are not included in Early Bird calculations.

How Total Season Points Are Calculated

Season Points consist of four components:

• Base Points
• Boosted Points
• Referral Rewards
• Early Bird Rewards

Boosted Points are derived from team participation:

Boosted Points = Daily Base Points × (Team Multiplier − 1)

Final Season Points = Daily Base Points + Boosted Points + Referral Rewards + Early Bird Rewards (accumulated across the season)

Welcome Points for New Users

New users who bind a wallet using an invitation code receive a 3-day Welcome Bonus:

• All Base Points earn 2x during the first three natural days.

The bonus applies to:

• TVL Points
• Trading Volume Points
• Position Holding Points
• Liquidation Points

If a user invites others during the Welcome period, the 2× bonus still applies on that day. From the following day onward, the user transitions to standard inviter status and begins earning referral rewards instead.

Team Acceleration System

DipCoin introduces a team-based acceleration model that rewards collaborative growth.

Each user may:

• Create one team
• Join one team

Users can simultaneously hold inviter and invitee roles.

The system compares both team multipliers and applies the higher value as the user’s effective multiplier.

Team Participation Requirements

For a directly invited member to contribute toward team acceleration:

• Daily trading volume ≥ 2,000 USDC
• Daily average position size ≥ 500 USDC

This ensures that team growth is driven by real traders, not passive or shell wallets.

Inviters’ own points are not counted toward their team’s total.

Referral Rebate Rewards

Inviters receive:

• 10% of the Base Points generated by each qualified direct invitee.

Only invitees who accumulate at least 20 Base Points are eligible to generate referral rewards.

Referral rewards are additive and do not reduce the invitee’s own points.

Post-Season Settlement

After Season 1 concludes:

• Season data is frozen.
• Risk review and verification are completed within 7 business days.
• Final confirmed results are published and reflected in user dashboards.

Season 1 points will be archived for historical reference. New seasons will start with fresh accumulation.

Why This Matters

Many points programs reward raw volume alone. DipCoin’s Horizon system rewards capital commitment, position exposure, trading activity, and community building together.

This multi-dimensional design reflects how real markets function and encourages behavior that strengthens liquidity, depth, and long-term platform health.

Season 1: Horizon sets the baseline for how DipCoin plans to distribute ecosystem value going forward.

How to Participate

Season 1: Horizon began February 4, 2026 (00:00 UTC).

Users can start earning points by:

• Depositing into Perp or Vault accounts
• Trading perpetual contracts
• Holding positions
• Participating in Vault strategies
• Inviting qualified users

Users can learn more and get started at: https://dipcoin.io

About DipCoin

DipCoin is a decentralized perpetual trading protocol built on Sui, focused on delivering fully on-chain, non-custodial perpetual markets with professional-grade execution and transparent infrastructure. DipCoin is building trading primitives and strategy participation tools designed for long-term on-chain market participants.

TLDR:

• Ethereum state grows 100 GB yearly; 20x scaling would create 8 TB state in four years for builders. 
• Strong statelessness and state expiry solutions face backwards compatibility issues with existing apps. 
• New temporary storage resets monthly while UTXO systems enable zero-duration expiry for cost savings. 
• Developers can keep using permanent storage initially, then migrate to cheaper tiers over time gradually. 

Ethereum co-founder Vitalik Buterin has unveiled a comprehensive proposal to address state scaling challenges on the network.

The plan introduces new forms of state storage alongside existing mechanisms to achieve 1000x scalability. Posted on February 5, Buterin’s proposal acknowledges that while Ethereum has clear pathways for scaling execution and data, state scaling remains fundamentally different and requires innovative solutions.

Asymmetric Scaling Challenge Creates Need for Alternative Approach

Buterin outlined in his post on X that Ethereum faces different scaling realities across three critical resources. “We want 1000x scale on Ethereum L1. We roughly know how to do this for execution and data. But scaling state is fundamentally harder,” he stated.

Execution can achieve 1000x gains through ZK-EVMs, while data scaling reaches similar levels via PeerDAS technology. However, state scaling lacks such breakthrough solutions.

Current state grows at 100 GB annually, and a 20x increase would create 2 TB yearly growth. After four years, this results in 8 TB total state size that builders must maintain.

The proposal explains that database efficiency and syncing present major obstacles. Modern client databases struggle with multi-terabyte states because writes require logarithmic tree updates.

Buterin emphasized that state differs fundamentally from computation and data. Builders need complete state to construct any block, regardless of gas limits.

This reality demands conservative scaling approaches and eliminates many sharding techniques that work for other resources. The network cannot rely on professional builders alone, as permissionless block building requires reasonable setup costs.

Strong Statelessness and Expiry Mechanisms Face Compatibility Issues

The post analyzed why previously proposed solutions fall short of requirements. Strong statelessness would require users to specify accessed accounts and storage slots while providing Merkle proofs.

This approach creates three major problems: dependency on off-chain infrastructure, backwards incompatibility with dynamic storage access patterns, and increased bandwidth costs reaching 4 KB per simple ERC20 transfer.

State expiry designs also encounter fundamental obstacles. Creating new accounts requires proving nothing existed at that address throughout Ethereum’s entire history.

Repeated regenesis schemes demand N lookups for account creation in year N. Address period mechanisms attempt mitigation but break compatibility with existing ERC20 contracts that use opaque storage slot generation.

Buterin noted these explorations reveal important patterns. “Replacing all state accesses with Merkle branches is too much, replacing exceptional-case state accesses with Merkle branches is acceptable,” he explained.

The analysis points toward tiered state systems that distinguish high-value frequently accessed state from lower-value rarely accessed state. However, backwards compatibility proves extremely difficult since lower tiers cannot support dynamic synchronous calls at all.

New Storage Types Enable Developer Choice Between Cost and Flexibility

The proposal introduces temporary storage that resets monthly and UTXO-based systems as primary solutions. Buterin described his vision: “The most practical path for Ethereum may actually be to scale existing state only a medium amount, and at the same time introduce newer forms of state that would be extremely cheap but also more restrictive.”

Temporary storage suits throwaway state for auctions, governance votes, and game events. ERC20 balances could use resurrection mechanisms with bitfields tracking historical state usage.

This design would support 8 TB of temporary state monthly with only 16 GB permanent storage for tracking. UTXO systems take expiry to its logical extreme with zero-duration periods.

Buterin envisions user accounts and smart contract code remaining in permanent storage for accessibility. NFTs and token balances would migrate to UTXOs or temporary storage, while short-term event state uses temporary mechanisms.

Core DeFi contracts would stay permanent for composability, but individual positions like CDPs could move to cheaper tiers. Developers can initially use permanent storage exclusively, then optimize over time as the ecosystem adapts.