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

Weekly Highlight — Markets Snap Five-Day Loss Streak 

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

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

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

Weekly Crypto Highlight — AI Agent Spring Coming

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

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

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

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

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

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

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

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

Advanced

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

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

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

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

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

Please check out the report’s highlights.

Open Interest Solid Amid Year-End Options Expiration

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

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

BTC Option Curve Remains Steep During Call-Put Parity

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

Huge ETH Option Expiring Doesn’t Cause Volatility

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

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

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

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

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

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

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

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

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

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

What sets FLock apart is its integration of 

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

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

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

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

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

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

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

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

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

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

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

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

 begins with a blockchain and an AI layer.

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

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

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

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

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

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

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

Intermediate

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FLock AI: Decentralized AI Training

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

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

: Navigate to the campaign page and click on the 

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

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

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

 and choose your operating system to download the Network3 app.

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

: Keep running the node until the timer reaches 

Beginner

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How to Complete Network3 Tasks for Bybit Web3 Airdrop Arcade

Bybit Learn

Altcoins

The Neon EVM is an Ethereum virtual machine (EVM) built on the Solana blockchain. Learn more about how it works in this article.

, Neon EVM emerges as a trailblazer, ingeniously integrating the scalability and liquidity of Solana with the robust infrastructure of Ethereum. This article will delve into the intricacies of Neon EVM, a platform that has revolutionized the deployment of Ethereum decentralized applications (

) by offering a seamless scaling solution on the Solana blockchain.

The platform's compatibility extends to popular Ethereum-based tools like 

, making the transition to Neon EVM even smoother for Ethereum developers.

The benefits of Neon EVM are manifold. It offers the ease of smart contract adaptation, the opportunity to be a first-mover on Solana and the scalability advantages of Solana's low gas fees and high transaction speeds. Moreover, it opens up access to Solana's burgeoning ecosystem, which includes SOL, native Solana assets (

But Neon EVM isn't solely about technical prowess; it also places a strong emphasis on governance. The platform operates on a fee-based economy, with its utility token, NEON, playing a pivotal role in governance. Upon its mainnet launch, governance will be managed by a decentralized protocol known as 

, providing a transparent and user-friendly process for proposing and voting on protocol improvements.

 in Q2 2021. The primary objective of NeonLabs is to merge the scalability and cost-efficiency and high throughput of Solana with the expansive ecosystem of Ethereum DApps, developers and end users. This initiative is driven by the core values of NeonLabs, which include openness, transparency, innovation and diversity.

Neon EVM aims to bridge the gap between the Ethereum and Solana ecosystems, leveraging the strengths of both to create a more efficient and scalable blockchain environment.

At its core, Neon EVM seeks to achieve its primary objective (described above) by providing a fully Ethereum-compatible environment on Solana, allowing Ethereum DApps to run seamlessly on the Solana blockchain without any need for reconfiguration.

Furthermore, Neon EVM aims to foster innovation and diversity in the blockchain space. By supporting familiar smart contract languages like Solidity and Vyper, as well as popular Ethereum-based tools like MetaMask and Truffle, Neon EVM makes it easier for Ethereum developers to transition to the Solana ecosystem — thus encouraging the development of new and innovative DApps.

Neon EVM uniquely brings the high throughput, rapid block speeds and cost-effective gas prices of Solana to Ethereum contracts. It communicates directly with Solana nodes to execute transactions on the Solana blockchain. The service comprises three primary components: Neon EVM, Neon Proxy and Neon DAO, each of which play a crucial role within the Neon Ecosystem.

The Neon EVM program is a smart contract deployed on the Solana blockchain. It receives Ethereum-style transactions and processes them on Solana, adhering to Ethereum's rules. These Ethereum transactions, directed toward the Neon EVM, are referred to as Neon Transactions, a subset of Ethereum's 

 serving as inputs for targeted Neon clients.

Neon Proxy is a key component that enables the porting of Ethereum DApps to Neon with minimal reconfiguration. It packages a Neon transaction into a Solana transaction. Neon operators run these Neon Proxy servers, facilitating the smooth execution of Ethereum-like transactions on Solana. The operators accept payments in NEON and make payments within the Solana Ecosystem in SOL.

 by providing custodial services and guiding future research and development. It operates as a series of contracts deployed on Solana, offering a governance layer to control the functionality of Neon EVM. 

 participants use a web interface to allow the community (i.e., NEON token holders) to suggest and vote on proposals that will affect the functioning of the Neon EVM.

Neon EVM provides several tools and integrations, including NeonScan, NeonPass and Neon Faucet. 

 serves as a block explorer and analytics platform for the Neon EVM ecosystem. It allows users to examine and analyze Neon transactions within the Solana blockchain.

NeonScan users can track and investigate mainnet transactions, blocks and tokens associated with the Neon EVM. It provides a transparent view of the network's activity to verify transactions, monitor token movements and understand block information.

 is a tool that facilitates the transfer of 

 tokens between Solana and Neon EVM. It's important to note that each transaction results in a gas fee, payable in either NEON or SOL tokens (depending upon the originating network). For instance, if you're transferring tokens from Neon EVM to Solana, you'll need to execute two transactions — one on the Neon EVM network (incurring a fee in NEON) and another on the Solana network (incurring a fee in SOL).

To successfully transfer ERC-20 tokens, the following steps must be taken.

Ensure you have an account on the network from which you're transferring, with a sufficient balance of the token you wish to move. More specifically,

Utilize noncustodial browser-based wallet applications, such as MetaMask and Phantom, which are currently compatible with NeonPass.

Access the NeonPass page via a browser that has your wallet applications installed.

 is a service designed to assist users in obtaining NEON or other ERC-20 test tokens. These tokens are primarily used for testing applications on the 

By providing test tokens, Neon Faucet enables developers to test their applications in a risk-free environment before deploying them on the main network. This helps ensure the functionality and security of applications, contributing to a more robust and reliable Neon EVM ecosystem.

To use Neon Faucet, users need to connect their wallet to the service.

Neon EVM first debuted in Q2 2021. It launched its pre-alpha Solana DevNet, which introduced Neon EVM proof-of-concept as well as Neon EVM stabilization. A year later, Neon EVM entered its alpha stage, in which it tested key DApps, passed a security audit and offered ERC-20 support. It was also during this stage that NeonPass and NeonScan were launched.

In Q2 2023, Neon EVM was production-ready with early DApps deployment. The Neon EVM team launched a closed beta, 

, on Jun 22, 2023. Neon EVMβ functions just like Neon EVM but with one key difference: the support for fee-free transactions. It rolled out its governance feature with the establishment of Neon DAO and integrated with 

, Pyth Network and Chainlink. In addition, it also whitelisted operators.

Moving forward, Neon EVM intends to grow the Neon ecosystem, introduce interoperability with Solana smart contracts, launch the Grants program and have a decentralized operators’ network in place by the end of 2023. Neon EVM then aims to feature full compatibility by 2024 and become one of the top industry ecosystem tools and services. 

NEON is the native token of Neon EVM. It primarily serves dual purposes, functioning as a 

As a utility token, NEON is used to facilitate transactions on Neon’s platform. This includes transfers, DApp deployment and interaction with DApps, mirroring the role ETH plays in the Ethereum ecosystem. 

When a user wishes to execute a transaction, they engage a Neon operator. This operator's role is twofold: they encapsulate the Neon transaction into a Solana transaction for iterative execution on a Solana cluster, and they bear the cost of each iteration of the Neon transaction. This system is designed with the user experience in mind, aiming to streamline the payment process for Neon transactions. 

For each iteration of a Neon transaction, the operator disburses SOL tokens to both the Solana validator and the Neon DAO Treasury. The payment made to the Neon DAO Treasury is recognized as the Neon EVM platform fee. Then, in order to compensate the operator for these costs, the Neon user remits payment in NEON tokens. This payment is comprehensive, encompassing the Solana validation fee, the Neon EVM platform fee and a commission for the operator's services.

As a governance token, NEON empowers its holders to participate in the decentralized community governance of the Neon DAO. NEON holders can propose changes to the Neon protocol and cast votes on proposals that impact the Neon protocol.

The NEON token made its debut on Jul 18, 2023, with an initial price of $0.180649. On the day it launched, it soared to its highest recorded value of $0.244256, only to experience a sharp decline to its lowest point of $0.118762 the following day (Jul 19, 2023).

 for the NEON token. They forecast that the token's value will ascend to $0.27 by the close of 2023. Further growth is anticipated, with its price expected to double to $0.44 in 2025 and rise to $0.65 in 2028. By 2030, their analysts predict that the NEON token will surpass the $1 threshold, reaching a value of $1.29.

While these predictions paint an optimistic picture for the future of the NEON token, it's crucial to remember the inherently volatile nature of cryptocurrencies. This volatility can make it challenging to fully trust such forecasts. Therefore, potential investors are always advised to approach with caution, conducting 

 and considering their financial situation and risk tolerance before making any investment decisions in the cryptocurrency market.

Looking to trade NEON tokens? Look no further — as Bybit has recently listed the NEON/USDT Spot trading pair on its platform. To get started, you’ll need to first create a Bybit account, fund it with cryptocurrency and navigate to the 

To celebrate this listing, Bybit is also holding 

 that give both new and existing users the opportunity to earn more NEON tokens.

The first event is exclusively for new users, who can deposit and share a 50,000 USDT prize pool. In order to be eligible, you’ll need to complete the following two steps, from now through Jul 31, 2023:

The first 1,000 new users to complete these two steps will each receive 50 USDT.

The second event is for existing users, who can deposit and share a 25,000 USDT prize pool. 

If you’re already an existing Bybit user before Jul 17, 2023, 10:00AM UTC, you can earn 10 USDT by depositing a minimum of 1,500 NEON, or depositing 100 USDT and buying NEON using your Bybit account.

Please note that rewards will be distributed on a first come, first served basis to 2,500 users.

Neon EVM is a unique project that aims to bring the scalability and low transaction costs of Solana to the Ethereum ecosystem. It has a clear use case and solves a real problem in the blockchain space, which is a positive contribution. 

Furthermore, NEON, the native token of Neon EVM, serves as both a utility and governance token. It's used to pay for transactions and allows holders to participate in the governance of the platform. Price predictions also show that NEON’s value is likely to grow in the long term. 

However, the price of cryptocurrencies can be highly volatile and often be influenced by broader market conditions. Investors are advised to look at the overall trend in the cryptocurrency market when making investment decisions. 

Neon EVM represents a significant advancement in the blockchain space, bringing together the strengths of two prominent ecosystems — Ethereum and Solana. By providing a fully Ethereum-compatible environment on Solana, Neon EVM allows Ethereum DApps to leverage the scalability, high throughput and low transaction costs of Solana, thereby creating a more efficient and user-friendly blockchain experience.

The project's commitment to openness, transparency, innovation and diversity — as well as its support for popular Ethereum-based tools and languages — positions it as a promising platform for developers and end users alike. With its utility and governance token, NEON, playing a pivotal role in the platform's operations and governance, Neon EVM also offers potential opportunities for investors.

However, as with any venture in the rapidly evolving and inherently volatile world of blockchain and cryptocurrencies, it's crucial to conduct thorough research and consider the associated risks. The future of Neon EVM, while promising, is subject to the broader trends and developments in the blockchain space.

Neon EVM (NEON): Scaling Ethereum DApps on Solana

Grab Up to 5,000 USDT in Rewards

Grab Up to 5,000 USDT in Rewards