Crypto World
Crypto exchange Backpack nears unicorn status as CEO lays out token strategy
Backpack Exchange, the crypto trading platform founded by former FTX and Alameda leaders, is reportedly in talks to raise around $50 million in new financing at a pre-money valuation above $1 billion.
Summary
- Backpack Exchange is reportedly in discussions to raise around $50 million at a valuation exceeding $1 billion, potentially elevating it to unicorn status.
- CEO Armani Ferrante outlined a tokenomics structure aimed at preventing early insider sell-offs and aligning incentives with long-term product growth.
- The company has also revealed plans for a 1 billion token supply, with 25% allocated at the token generation event, including community rewards.
If completed, the round would cement Backpack’s position in the crypto sector and potentially elevate it into unicorn status, a milestone for a firm still emerging from the post-FTX landscape.
The discussions come amid increased investor interest in fintech and crypto startups, and Backpack could parlay the fresh capital into expanding its exchange, wallet, and regulatory footprint globally.
The $50 million figure is a baseline, and reports suggest the eventual round size could grow larger.
Backpack CEO outlines tokenomics strategy
Meanwhile, Backpack CEO Armani Ferrante took to X to flesh out the company’s tokenomics framework ahead of a future token generation event.
Ferrante emphasized that the structure is designed to prevent early insiders from “dumping” tokens on retail investors, with no founders, executives, or venture backers receiving unlockable tokens until the product reaches significant traction, a concept he described as product “escape velocity.”
He also highlighted Backpack’s long-term goal of eventually going public in the U.S., signaling ambition beyond private fundraising and into regulated capital markets.
According to Ferrante, aligning token incentives with users, not short-term speculation, lays a foundation for sustainable growth and broader global adoption.
In a related post on the official Backpack account, the team confirmed elements of its upcoming token issuance plans. This includes a 1 billion token supply at launch and the allocation of 25 % of tokens at the Token Generation Event (TGE), with a portion earmarked for active community participants and points holders.
For the first time in nearly a month, U.S. bitcoin exchange-traded funds (ETFs) have recorded back-to-back net inflows, snapping a redemption streak that stretched back to mid-January.
According to SoSo value data, the consecutive inflows shift began on Friday with $471.1 million in fresh capital, followed by a $144.9 million on Monday. This comes as bitcoin bounced back from Thursday’s $60,000 low to around $70,000.
In mid-January, bitcoin peaked near $98,000 after a two week rally that started at $87,000. The subsequent sell-off to $60,000 saw investors yank millions of these spot ETFs.
Broadly speaking, investors still appear confidence about the cryptocurrency’s long-term prospects, as evident from the spot ETFs’ resilient asset under management (AUM).
According to Checkonchain, the cumulative AUM of the 11 funds has only decreased by about 7% since early October, sliding from 1.37 million BTC to 1.29 million BTC. Bitcoin, meanwhile, is down over 40% since hitting record highs above 126,000 in October.
Ethereum has hit a zone typically associated with mass selling, with an MVRV Z-Score returning a score of -0.42 — though analysts are split on whether the price of Ether is close to bottoming out.
The MVRV Z-Score is a metric used to assess whether a crypto asset is overvalued or undervalued by comparing its market value to its realized value, which reflects the total value of Ether based on the price at which it was last transacted.
The metric was created to identify periods of market euphoria or capitulation when market value was considerably higher or lower than realized value.
CryptoQuant analyst and Alphractal founder and CEO, Joao Wedson, said the score “shows that Ethereum is indeed going through a clear capitulation process.”
However, the analyst said the data “does not compare to the intensity” seen at the major bottoms of the 2018 and 2022 bear markets.
The lowest value in history was -0.76, recorded in December 2018, said Wedson.
Further downsides for ETH prices possible
The analyst cautioned that further downsides could be possible before any meaningful recovery.
“The market is already under stress, but historically, there is still room for further downside before a definitive structural bottom is formed,” he said.
The price of Ether has fallen 30% over the past fortnight, reaching a bear market low of $1,825 on Friday before a minor recovery to $2,100 on Monday.
Related: Tom Lee tips lack of leverage and gold ‘vortex’ for Ether’s 21% slump
HashKey Group senior researcher Tim Sun told Cointelegraph that historically, Ethereum’s MVRV Z-Score “has proven to be a highly reliable indicator for tracking subsequent market shifts, particularly in identifying bottoming zones across multiple cycles.”
“Judging by on-chain activity, protocol evolution, and long-term ecosystem structure, Ethereum’s fundamentals have not seen any substantive deterioration. On the contrary, they continue to improve across several key dimensions,” he said.
However, it is premature to conclude that Ether has finished its bottoming process as long as the primary drivers of the current decline persist, he added.
“Given the potential liquidity constraints associated with the upcoming April tax season, the probability of further price downside remains a significant factor.”
One of the best “buy fear” windows for Ether
Other market commentators, such as MN Fund founder Michaël van de Poppe, were a little more optimistic, stating, “I think that this is a tremendous opportunity to be looking at ETH.”
“The core reason for this is that there’s a massive gap to the ‘fair price,’” he said, referring to the MVRV ratio.
Ether is currently as undervalued as it was during the April 2025 crash, the June 2022 bottom after the Terra/Luna collapse, the March 2020 Covid crash, and the December 2018 bear market bottom.
“In all of those cases, this provided a tremendous buying opportunity for this particular asset.”
Andri Fauzan Adziima, research lead at crypto trading platform Bitrue, told Cointelegraph that negative MVRV zones “have repeatedly preceded explosive recoveries in past cycles.”
“With ETH’s network metrics holding strong, it feels like a prime long-term accumulation setup once the weak hands are fully flushed,” he said.
“Brutal capitulation now, but historically one of the best ‘buy fear’ windows for ETH.”
Magazine: Bitcoin difficulty plunges, Buterin sells off Ethereum: Hodler’s Digest
Bitcoin price slipped again on Feb. 10 after failing to stay above the $70,000 level, an area that had supported the market through much of the recent consolidation.
Summary
- Bitcoin is under pressure as capital inflows fail to translate into price expansion.
- On-chain data shows rising whale exchange deposits and steady ETF outflows.
- Technical structure continues to favor distribution over accumulation.
At press time, BTC was trading around $68,979, down 2% over the past 24 hours. The weakness extends across all major timeframes, with losses of 12% over the past week, 23% over the last month, and roughly 30% year-over-year.
The pullback has been sharp and persistent. Since reaching an all-time high of $126,080 in October 2025, Bitcoin (BTC) has fallen by nearly 45%. Rather than a single washout event, the decline has unfolded through steady selling.
At the same time, market activity has increased. Spot trading volume jumped 15.2% in the last 24 hours to $52 billion, pointing to active repositioning as traders reduce exposure or rotate capital.
Derivatives markets reflect a similar tone. CoinGlass data shows Bitcoin futures volume rising 4.97% to $70 billion, while open interest slipped 1.98% to $45 billion.
The combination suggests traders are closing positions faster than new leverage is being added, a pattern often seen during periods of distribution.
Selling pressure overwhelms inflows
Concerns around Bitcoin’s ability to stage a recovery were shared by CryptoQuant CEO Ki Young Ju. In a Feb. 9 post on X, Ju said Bitcoin is currently “not pumpable,” arguing that selling pressure is absorbing capital faster than it can translate into price gains.
Ju pointed to a sharp contrast between recent market cycles. In 2024, a $10 billion capital inflow expanded Bitcoin’s book value by $26 billion. In 2025, however, roughly $308 billion flowed into the market while total market capitalization fell by $98 billion. According to Ju, the usual multiplier effect has broken down under the weight of sustained selling.
On-chain data adds weight to that view. CryptoQuant contributor Amr Taha flagged two whale transfers of more than 5,000 BTC into Binance on Feb. 2 and Feb. 9, an uncommon event within a single week.
The first transfer aligned with Bitcoin’s slide from $77,000 to below $70,000 by Feb. 6, raising concerns that large holders may be using rallies to distribute into liquidity.
Institutional demand has also cooled. U.S. spot Bitcoin exchange-traded fund holdings peaked near 1.36 million BTC in mid-October 2025, alongside the market high. By Feb. 9, total holdings had fallen to roughly 1.27 million BTC, implying net outflows of around 90,000 BTC, or 6.6% of ETF reserves.
Bitcoin price technical analysis
From a technical perspective, losing $70,000 has altered the market structure. After several unsuccessful attempts to regain the $71,000–$73,000 range, the level now serves as resistance.
The price is still below the 50-day and 20-day moving averages, which are both limiting attempts at an upward trend. Momentum is still lacking. The relative strength index is in the 32–34 range, indicating an oversold situation without a definite bullish divergence.
After a period of compression, the price is clinging to the lower Bollinger Band as the bands begin to widen. In similar situations, failing to reclaim the mid-band often leads to further downside. Volume patterns reinforce this outlook, showing steady liquidation rather than panic selling, since sell-side spikes are not met with strong rebound activity.
A brief push toward $73,000–75,000 is feasible if Bitcoin can maintain above $68,000–69,000 and recover $71,000. A sustained close above the 50-day average near $79,000 would be needed to shift the trend.
On the downside, failure to defend $68,000 keeps pressure intact. A break below $62,800 opens the door to $60,000, with deeper liquidity waiting near $58,000.
A U.S. federal court has sentenced a key figure behind a global cryptocurrency investment scam to 20 years in prison, capping one of the largest crypto-fraud prosecutions tied to so-called “pig butchering” schemes.
Summary
- U.S. court sentenced a crypto scam mastermind to 20 years over a $73M global fraud
- Defendant fled U.S. supervision and was sentenced in absentia
- Scheme used fake crypto platforms and shell companies to launder funds
The operation defrauded victims of more than $73 million, largely through fake trading platforms and online deception.
Fugitive sentenced in Absentia
The defendant, Daren Li, was sentenced in the Central District of California despite being a fugitive at the time of sentencing. Li, a dual citizen of China and St. Kitts and Nevis, removed his electronic ankle monitor and fled U.S. supervision in late 2025.
U.S. authorities said efforts are ongoing to locate and return him to serve the sentence.
Li had pleaded guilty in November 2024 to conspiracy to commit money laundering, acknowledging his role in moving fraud proceeds generated by overseas scam centers operating primarily out of Cambodia.
Inside the $73 million crypto scam
According to prosecutors, the scam relied on unsolicited social media outreach, fake cryptocurrency investment platforms, and spoofed websites designed to mimic legitimate trading services.
Victims were gradually manipulated into sending funds after building trust through fabricated personal or professional relationships.
Once funds were obtained, Li and his co-conspirators funnelled the money through shell companies and U.S. bank accounts before converting it into cryptocurrency. At least $59.8 million in victim funds passed through U.S.-based accounts as part of the laundering operation.
Eight co-conspirators have already pleaded guilty in related cases. The Justice Department said Li is the first individual directly involved in receiving stolen proceeds to be sentenced, highlighting a broader push to dismantle international crypto fraud networks and hold organizers accountable.
Ethereum (CRYPTO: ETH) has slipped into a zone that market watchers associate with capitulation, as on-chain signals flash bearish, yet opt for caution on whether a definitive bottom is in place. The focal point is the MVRV Z-Score, a gauge that compares current market value to the realized value, effectively measuring how much investors are paying relative to the price at which Ether last moved. A reading around -0.42 indicates Ether is trading below its realized value, a sign historically linked to stress but not a sole predictor of a lasting bottom. While some analysts argue this signals a clear capitulation phase, others warn that the current slide may not reach the extremes observed in past bear markets.
The MVRV Z-Score was designed to flag phases of euphoria or capitulation by showing when market value diverges markedly from realized value. In practice, a notably negative score has preceded bottoming behavior in prior cycles, albeit without a guaranteed timetable. Joao Wedson, a crypto Quant analyst and founder of Alphractal, described the current reading as “showing that Ethereum is indeed going through a clear capitulation process.” Yet, he cautioned that today’s data do not match the intensity of the 2018 and 2022 bear-market lows. The record low for the metric sits at -0.76, observed in December 2018, underscoring the scale of the slide that would be needed for a historical parallel.
The near-term horizon, however, remains contested. Wedson noted that further downside is possible before any sustained recovery takes hold, citing continued market stress and the possibility of liquidity constraints during tax season. “The market is already under stress, but historically, there is still room for further downside before a definitive structural bottom is formed,” he said. Ether’s price action has been volatile, with a sharp decline followed by a tentative rebound, complicating the call on whether the capitulation phase is nearing its end.
The recent price action has been punishing: Ether has fallen about 30% over the past two weeks, sinking to a bear-market low near $1,825 on a Friday before a modest rebound to roughly $2,100 on the following Monday. The moves come amid broader macro fragility and shifting risk sentiment within crypto markets, prompting both caution and opportunism among analysts. Some traders and researchers see this as a rare “buy fear” window, while others warn that risk remains elevated until on-chain dynamics confirm a bottom.
HashKey Group senior researcher Tim Sun told Cointelegraph that historical performance has reinforced the view that Ethereum’s MVRV Z-Score can be a reliable indicator for identifying bottoming zones, particularly when combined with evolving on-chain activity and long-term ecosystem development. “Judging by on-chain activity, protocol evolution, and long-term ecosystem structure, Ethereum’s fundamentals have not seen any substantive deterioration. On the contrary, they continue to improve across several key dimensions,” he said. Still, Sun stressed that current trajectories could change if the primary drivers of decline persist, suggesting that a definitive bottom remains contingent on future liquidity and demand signals.
Meanwhile, other observers offered a more optimistic read. Michaël van de Poppe, founder of MN Fund, argued that the drawdown presents a rare opportunity to consider ETH as an investable bet, noting a substantial gap between the current price and the “fair price” implied by the MVRV ratio. “I think that this is a tremendous opportunity to be looking at ETH,” he tweeted, positing that negative deviations historically precede substantial recoveries when macro and on-chain conditions align. The narrative held that Ether’s network metrics and the broader ecosystem strength underpin a case for accumulation once the weak hands have been flushed out.
Other voices joined the chorus of potential catalysts for a rebound. Andri Fauzan Adziima, Bitrue’s research lead, suggested that persistent negative MVRV zones have historically preceded strong recoveries in subsequent cycles. He contended that ETH’s network fundamentals remained robust and that a long-term accumulation stance could emerge once price risk subsides. “Brutal capitulation now, but historically one of the best ‘buy fear’ windows for ETH,” Adziima said, underscoring the tension between near-term price action and longer-term structural factors.
Market participants acknowledged that the current pullback may be overshadowed by longer-term catalysts such as network upgrades and continued ecosystem maturation, even as price action remains sensitive to near-term liquidity and macro dynamics. The narrative that “buying fear” can yield outsized returns if followed by demand recovery continues to gain traction among several traders, though it remains balanced by caution regarding April liquidity and potential tax-related squeezes.
One of the best “buy fear” windows for Ether
Despite the caution, several observers argued that the current environment could present one of the more compelling entry points for ETH in recent memory. Van de Poppe’s commentary echoed a view shared by others that a sharp deviation below fair value can precede a robust rebound when demand returns and on-chain indicators resume strengthening. The notion is that ETH’s price could be primed for a longer-term recovery even if the immediate path remains choppy.
As the debate continues, sentiment remains nuanced. Some participants emphasize that negative MVRV conditions have historically aligned with durable recoveries once the weak hands capitulate, while others warn that liquidity constraints around the April tax season could delay any sustained recovery. The balance between on-chain fundamentals and macro stressors will likely shape Ether’s trajectory over the coming weeks and into the next quarter.
For investors watching the tape, the key takeaway is that volatility may persist even as underlying fundamentals show resilience. The combination of a negative MVRV reading and persistent price pressure suggests that any bottoming process will require a convergence of favorable liquidity and sustained demand, rather than a simple technical bounce.
Why it matters
The ongoing discussion around Ether’s valuation and bottoming prospects matters for multiple stakeholders. For traders, MVRV-based indicators provide a framework to interpret on-chain signals amid price volatility, while investors may view the current setup as an opportunity to accumulate at a discount relative to realized value. For developers and ecosystem participants, the narrative about Ethereum’s fundamentals—network activity, upgrade timelines, and long-term growth—matters for capital allocation, governance engagement, and potential product developments that could draw renewed user interest.
From a market-wide perspective, Ethereum’s fate remains a bellwether for risk appetite in crypto markets. A clear bottom in ETH could bolster sentiment across altcoins and contribute to a broader risk-on environment, while a protracted drawdown could reinforce caution and delay recovery for other assets. In either case, the episode underscores the importance of on-chain metrics as a corroborating lens for price action, beyond headlines and short-term moves.
What to watch next
- Monitor liquidity conditions around the April tax season for potential downside or relief catalysts.
- Track on-chain indicators related to MVRV Z-Score and general network activity to assess whether a structural bottom forms.
- Watch for sustained price stabilization above recent lows and any acceleration in demand signals that could precede a rebound.
- Observe broader macro factors and crypto market flows that could influence risk sentiment and capital allocation.
Sources & verification
- On-chain MVRV Z-Score interpretation and commentary by Joao Wedson of Alphractal (tweet/status referenced in the article).
- Cointelegraph reports on Ether’s 30% decline over a two-week period and the subsequent move to around $2,100.
- HashKey Group insights from Tim Sun regarding MVRV Z-Score reliability and Ethereum fundamentals.
- Industry commentary from Michaël van de Poppe and Bitrue’s Andri Fauzan Adziima on negative MVRV zones and potential buy opportunities.
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Bitcoin’s (BTC) latest price correction is reinforcing, rather than undermining, the long-standing 4-year halving cycle that has historically shaped the asset’s market behavior, according to a new report from Kaiko Research.
The debate carries significant implications for traders and investors navigating Bitcoin’s volatility in early 2026.
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Bitcoin Is Following Its 4-Year Cycle Amid Sharp Correction
Bitcoin fell from its cycle peak near $126,000 to the $60,000–$70,000 range in early February. This marked a drawdown of roughly 52%.
While the move rattled market sentiment, Kaiko argues the decline is fully consistent with previous post-halving bear markets and does not signal a structural break from historical patterns.
“Bitcoin’s decline from $126,000 to $60,000 confirms rather than contradicts the four-year halving cycle, which has consistently delivered 50-80% drawdowns following cycle peaks,” Kaiko’s data debrief read.
The report notes that the 2024 halving took place in April. Bitcoin topped out roughly 12–18 months later, aligning closely with prior cycles. In past instances, such peaks have typically been followed by extended bear markets lasting around a year before the next accumulation phase begins.
Kaiko says the current price action suggests Bitcoin has transitioned out of the euphoric post-halving phase and into that expected corrective period.
It is worth noting that many experts have previously challenged Bitcoin’s 4-year cycle. They argue that it no longer holds in today’s market. In October, Arthur Hayes said the 4-year Bitcoin cycle was over. He pointed instead to global liquidity as the dominant driver of price movements.
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Others have argued that Bitcoin now follows a 5-year cycle rather than a 4-year one. They cite the growing influence of global liquidity conditions, institutional participation, and broader macroeconomic policy shifts.
Kaiko acknowledged that structural changes, including spot Bitcoin exchange-traded fund (ETF) adoption, greater regulatory clarity, and a more mature DeFi ecosystem, have distinguished 2024-2025 from previous cycles. Nonetheless, it said these developments have not prevented the expected post-peak retracement.
Instead, they have changed how volatility manifests. Spot Bitcoin ETFs recorded more than $2.1 billion in outflows during the recent sell-off.
This amplified downside pressure and demonstrated that institutional access increases liquidity in both directions, not just on the way up. According to Kaiko,
“While DeFi infrastructure has shown relative resilience compared to 2022, TVL declines and slowing staking flows indicate no sector is immune to bear market dynamics. Regulatory clarity has proven insufficient to decouple crypto from broader macro risk factors, with Fed uncertainty and risk-asset weakness dominating market direction.”
Kaiko also raised the key question now dominating market discussions: where is the bottom? The report explained that Bitcoin’s intraday rebound from $60,000 to $70,000 suggests initial support may be forming.
However, historical precedent shows that bear markets typically take six to 12 months and involve multiple failed rallies before a sustainable bottom is established.
Kaiko noted that stablecoin dominance stands at 10.3%, while funding rates have fallen close to zero and futures open interest has dropped by about 55%, signaling significant deleveraging across the market. Still, the firm cautioned that it remains unclear whether current conditions represent early, mid, or late-stage capitulation.
“The four-year cycle framework predicts we should be at the 30% mark. Bitcoin is doing exactly what it has done in every previous cycle, but it seems many market participants convinced themselves this time would be different,” Kaiko wrote.
As February 2026 progresses, market participants must weigh both sides of this argument. Bitcoin’s next moves will reveal whether history continues to repeat or a new market regime is taking shape.
TLDR:
- Buterin proposes local LLM tooling and zero-knowledge payments to enable private AI interactions on-chain.
- Ethereum could serve as economic infrastructure for autonomous AI agents to coordinate and transact.
- AI models can revitalize prediction markets and quadratic voting by overcoming human attention limits.
- The framework enables cypherpunk vision where local AI verifies transactions without third-party trust.
Ethereum co-founder Vitalik Buterin has presented an updated perspective on integrating blockchain technology with artificial intelligence. The framework moves beyond abstract concepts toward practical implementations in the near term. Buterin’s approach centers on preserving human freedom while building decentralized systems that leverage AI capabilities. His vision encompasses four distinct areas where Ethereum can facilitate meaningful AI interactions without compromising security or privacy.
Privacy-Focused Infrastructure for AI Interactions
Buterin criticizes undifferentiated approaches to AI development, comparing vague directives to “work on AGI” with describing Ethereum as “working in finance” or “working on computing.” He argues such framing lacks the specificity needed for meaningful progress. Instead, his framework emphasizes choosing positive directions rather than embracing acceleration without purpose. The technical vision prioritizes human empowerment and avoiding scenarios where humans lose agency.
The proposal includes developing local large language model tooling that allows users to maintain control over their data. Zero-knowledge payment systems for API calls would prevent identity linking across different transactions. This approach addresses growing concerns about data privacy in AI applications. Additionally, ongoing cryptographic research aims to enhance AI privacy protections.
Client-side verification methods such as cryptographic proofs and trusted execution environment attestations form another component. These mechanisms mirror previous work on Ethereum privacy improvements but apply specifically to LLM interactions. The goal is creating infrastructure comparable to existing non-LLM compute privacy solutions. Buterin referenced his earlier work on Ethereum privacy roadmaps from 2024.
That foundation now extends to protecting AI-related computational processes. The technical approach maintains consistency with established blockchain privacy principles while adapting to AI-specific requirements. This continuity ensures compatibility with existing Ethereum infrastructure. The emphasis on local processing and cryptographic verification reflects broader cypherpunk values.
Economic Coordination and Enhanced Governance Systems
Ethereum can function as an economic layer facilitating AI-to-AI interactions, according to Buterin’s framework. This includes API payments, autonomous agents hiring other agents, and security deposit mechanisms. The economic infrastructure enables decentralized AI architectures rather than centralized organizational control. Smart contracts could eventually handle complex dispute resolution between AI entities.
The proposal mentions ERC-8004 and AI reputation systems as potential standards. These tools would create accountability frameworks for autonomous agents operating on-chain. Economic coordination becomes essential for scaling decentralized authority across AI systems. Without such mechanisms, AI collaboration would remain confined within single organizations.
Buterin’s vision includes revitalizing market and governance concepts previously limited by human constraints. Prediction markets, quadratic voting, combinatorial auctions, and decentralized governance structures gain new viability. Large language models can overcome the attention and decision-making bottlenecks that hampered these systems. AI assistance effectively scales human judgment across complex coordination problems.
The framework also addresses what Buterin describes as the cypherpunk “mountain man” vision of “don’t trust; verify everything.” Local AI models could propose and verify blockchain transactions without third-party interfaces. Smart contract auditing and formal verification interpretation become accessible through AI assistance. This enables the verify-everything approach that was previously impractical for individual users.
Buterin criticized modern DeFi as centralized in disguise, arguing USDC yield farming misses core principles.
Ethereum co-founder Vitalik Buterin has questioned the legitimacy of popular USDC yield strategies, arguing they don’t follow the principles of true decentralized finance (DeFi).
His critique was in response to crypto analyst C-node, who said that most modern DeFi focuses on speculative gains instead of building genuinely decentralized infrastructure.
Critique of Modern DeFi
C-node challenged the crypto industry on social media, saying there is little reason to use DeFi unless users hold long cryptocurrency positions and need financial services while keeping self-custody.
Buterin supported this perspective, arguing that depositing stablecoins such as USDC into lending protocols like Aave does not count as true DeFi. He dismissed such strategies, stating, “inb4 ‘muh USDC yield,’ that’s not DeFi.”
In his view, the underlying asset remains controlled by Circle, meaning the arrangement is fundamentally centralized even if the protocol itself is decentralized.
The Ethereum developer suggested two frameworks for evaluating what should qualify as real DeFi. The first, which he described as the “easy mode,” centers on ETH-backed algorithmic stablecoins. In this model, users can shift counterparty risk to market makers through collateralized debt positions (CDPs), where assets are locked to mint stablecoins.
He explained that even if 99% of the liquidity is backed by CDP holders who hold negative algorithmic dollars while holding positive ones elsewhere, the ability to offload counterparty risk to a market maker remains an important feature.
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The second, or “hard mode,” framework allows for real-world asset (RWA) backing, but only under strict conditions. Buterin said an algorithmic stablecoin backed by RWAs could still qualify as DeFi if it is sufficiently overcollateralized and diversified to survive the failure of any single backing asset.
Under this structure, the overcollateralization ratio must be more than the maximum share of any individual asset, ensuring the system remains solvent even if one part collapses. This means that it would act as a buffer that distributes risk instead of concentrating it within centralized entities.
“I feel like that sort of thing is what we should be aiming more towards,” Buterin said, adding that the long-term goal should be moving away from the dollar as the unit of account toward a more diversified index.
Crypto Community Response
The remarks were widely supported within the X crypto community, with one user calling it a “great take” and noting that ETH-backed algorithmic stablecoins offer real risk reduction, while RWA diversification spreads it instead of eliminating it. Another commented that “True DeFi needs real risk innovation, not just USDC parking.”
However, there were also some concerns. For instance, X user Kyle DH pointed out that algorithmic stablecoins have not updated their designs to address known issues, which makes them similar to money market funds that have the same “breaking the buck” risks seen before with TerraUSD and LUNA. They added that RWA backing requires careful diversification, warning that highly correlated assets or black swan events could still cause a stablecoin to fail.
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New data from Artemis shows that Hyperliquid, an on-chain derivatives platform, has overtaken Coinbase in notional trading volume. Notably, Coinbase is revered as the largest US-based exchange by trading volume.
Hyperliquid’s ascent is forcing the crypto industry to reassess long-held assumptions about where serious trading activity takes place.
Hyperliquid Surpasses Coinbase in Trading Volume
According to Artemis, Hyperliquid recorded roughly $2.6 trillion in notional trading volume, compared with $1.4 trillion for Coinbase, meaning nearly double the activity.
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The figures mark one of the clearest signals yet that high-performance on-chain platforms are capturing a growing share of global derivatives flows.
This milestone fuels debate over whether decentralized trading venues are beginning to rival centralized exchanges in scale and influence.
“Hyperliquid is quietly outgrowing Coinbase. Trading Volume (Notional): Coinbase: $1.4T Hyperliquid: $2.6T That’s nearly 2x Coinbase’s volume… from an on-chain exchange. And the market is noticing,” Artemis stated.
The gap is not limited to trading volumes. Year-to-date performance data shows a striking divergence between the two companies.
Hyperliquid is up 31.7%, while Coinbase is down 27.0%, creating a 58.7% performance gap in just a matter of weeks.
For analysts, this divergence reflects deeper structural shifts rather than short-term volatility. Anthony, a data analyst at Artemis, emphasized that underlying metrics are increasingly driving market sentiment.
The comment highlights a growing belief among market observers that liquidity, execution quality, and user activity are beginning to shape valuations and investor narratives. This is as opposed to brand recognition alone.
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One question raised by the data is why Binance, the world’s largest crypto derivatives exchange, was not included in the comparison.
The reason lies in what the figures are measuring and the narrative surrounding them. The Artemis analysis focused on Hyperliquid overtaking Coinbase, a major centralized exchange whose business is heavily weighted toward spot trading and regulated markets.
The milestone, therefore, highlights a shift in market structure rather than a direct challenge to the largest derivatives venue.
Binance remains the dominant player in perpetual futures trading by a wide margin. Coingecko data shows the exchange processing over $53 billion in daily derivatives volume. This exceeds Hyperliquid’s $6.4 billion.
Hyperliquid’s Surge Sparks a New Fight Over Who Controls Crypto Trading
The data has sparked strong reactions across the crypto community, highlighting long-standing tensions between centralized and decentralized trading models.
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To some, Hyperliquid’s rise is a validation of on-chain markets, while others used the moment to criticize centralized exchanges.
Such criticism reflects a broader sentiment among some traders who argue that transparent, on-chain systems reduce counterparty risk and improve market fairness.
However, defenders of centralized exchanges note that they still dominate in fiat on-ramps, regulatory integration, and retail accessibility.
Perhaps the most significant implication of Hyperliquid’s growth is how it is changing the competitive sector. Rather than being compared primarily with other perpetual DEXs, the platform is increasingly being measured against major centralized derivatives venues.
Hyperliquid Hub, a community account tracking the ecosystem, argued that the platform has already pulled ahead of most decentralized rivals.
“Hyperliquid is now absolutely dominating the on-chain derivatives sector. At this point, people are only comparing Hyperliquid with major centralized exchanges like Binance, OKX, and Bybit. Other perp DEXs have already been left far behind by Hyperliquid in terms of technology, liquidity depth, and overall performance,” they wrote.
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If this perception continues to gain traction, it could mark a turning point in how traders evaluate execution venues. It is less about whether they are centralized or decentralized and more about liquidity, speed, and reliability.
While the Coinbase exchange remains one of the largest and most regulated crypto platforms globally, Hyperliquid’s momentum highlights how quickly market structure can shift in the digital asset space.
Still, challenges exist, after Coinglass data showed major gaps between volume, open interest, and liquidations across perp DEXs.
As BeInCrypto reported, there remains disagreement about the lack of standards for defining “real” activity in decentralized derivatives markets.
Additionally, industry executives like Kyle Samani also bear reservations about the integrity of Hyperliquid, saying the DEX is in most respects, everything wrong with crypto.
Crypto market analysts have become increasingly bearish, with technical signals favoring further downside before any meaningful recovery.
More and more peak bear market signals are flashing up on the Bitcoin charts, leading analysts to believe that the pain is not over yet, but we may be nearing the bottom.
Bitcoin has now closed for a third week below the 100-week moving average and has been under this long-term trendline for 13 days, observed Coin Bureau CEO Nic Puckrin on Monday.
Historically, BTC has remained below this for an average of 267 days, with the shortest period at 34 days during the Covid flash crash in March 2020, he added, before predicting it could stay below this for longer.
“Therefore, historically, we are more likely to remain below for a longer period of time. A quick bounce back is still possible, but the longer we remain below, the less likely.”
Further Losses Make Accumulation Opportunities
Meanwhile, MN Fund founder Michaël van de Poppe said the “holder’s supply in profit/loss is rising,” which means more people aren’t profiting from Bitcoin, and the loss is growing significantly.
“This is something we’ve only been seeing during peak bear markets in 2015, 2018, and 2022,” he said, before adding that it should provide accumulation opportunities.
CryptoQuant founder Ki Young Ju was also bearish, stating, “Bitcoin is not pumpable right now.”
Selling pressure is too heavy for any multiplier effect, he said before adding that digital asset treasuries “won’t work until it becomes pumpable again.”
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Bitcoin is not pumpable right now.
In 2024, $10B in cash could create $26B in BTC book value. In 2025, $308B flowed in, yet the market cap fell $98B. Selling pressure is too heavy for any multiplier effect.
MSTR and DATs won’t work until it becomes pumpable again. pic.twitter.com/T8NZHio4H9
— Ki Young Ju (@ki_young_ju) February 9, 2026
Glasnode reported on Monday that the unrealized market loss of $70,000 is approximately 16% of the market cap.
“Current market pain echoes a similar structure seen in early May 2022.”
“Bitcoin volume is telling,” observed analyst ‘Sykodelic’. “On the nuke to $60k we hit the fourth largest volume period since the 2022 bottom,” he said.
However, the analyst also said that each period since then that has recorded volume to this degree “has marked a key pivot in price direction,” questioning whether $60,000 was the bottom.
Bitcoin Loses $70K Level Again
The bearish sentiment is for good reason. Bitcoin fell below $70,000 twice on Monday and traded around $69,000 on Tuesday morning in Asia.
The asset has been consolidating around this level since recovering from its crash to $60,000 on Friday. It remains down 44% from its peak and is in bear-market territory, with the path of least resistance downward.
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