TheBRRR’s Thoughts 

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Happy New Year!

Follwing major weakness in Chinese stock indexes overnight (-3%), US equities are mildly lower to start the new year while the dollar index rises.

Crypto markets are not paying attention and are making an uncorrelated move higher today.

In our last newsletter, we took a deep dive into the AI x Crypto space.

We mentioned the following assets as ones to watch on December 18th. Here are the insane price changes since then:

With thousands of AI agents launching on Coinbase’s Base chain generating over $15m in revenue for the Virtuals Protocol, AI16Z’s Eliza autonomous agent framework surging to #1 on Github and Zerebro announcing its own creative AI platform with revenue accrual, a lot has happened over the holidays in this exploding space.

The trading volume and valuations are reflecting it today.

We’re putting the microscope on AI16Z’s recent surge in today’s lead story.

We’re also covering a survey out of Deutche Bank, highlighting the biggest risks to markets in 2025.

The AI16Z Surge – A New Leader in AI-Powered Tokens

Synopsis: AI16Z, a decentralized autonomous organization (DAO) leveraging AI on the Solana blockchain, has hit a $2.581 billion market cap, surpassing competitors like BONK and Pudgy Penguins.

The token is riding a wave of momentum fueled by investor enthusiasm, strategic whale activity, and ambitious development plans, including a potential Layer 1 blockchain. With a 580% monthly surge and growing open interest, AI16Z is emerging as the definitive leader in the AI-crypto space.

AI16Z's GitHub activity under the elizaOS organization highlights its dominance in developer attention, with over 8,200 stars, 2,200 forks, and 237 contributors on its flagship repository. Recent activity includes 3,887 commits, showcasing rapid innovation and collaboration, particularly in autonomous agent development. The ecosystem's tools, such as the agent-twitter-client and agentmemory repositories, further reflect its growing utility and influence in AI infrastructure.

The Details:

• Market Milestones:

  • Price surged by 27% in 24 hours, reaching $2.32.

  • Weekly gain: 170%; Monthly gain: 580%.

  • Trading volume spiked by 60%, hitting $292 million.

• Tokenomics Overhaul & Ecosystem Expansion:

  • Phase 1 (Q1 2025):

    • Launch of a dedicated token launchpad using Eliza framework.

    • Launchpad mechanisms include:

      • Launch fees and $ai16z staking for access.

      • Pairing new tokens with $ai16z in liquidity pools.

      • A curation process ensuring high-quality projects.

  • Phase 2:

    • Ecosystem growth with $ai16z as the base currency for AI agent interactions, mimicking the foundational role of $ETH and $SOL in their respective ecosystems.

    • Treasury strategies include selective diversification and buyback mechanisms.

• Future Vision:

  • Plans to develop a dedicated Layer 1 blockchain for agent-to-agent interactions.

  • Introduction of sustainable use cases like staking and liquidity mining to drive long-term value.

  • Reinforcing AI16Z’s role as a hub for AI-crypto innovation by positioning the token as a utility across decentralized applications.

WHY IT MATTERS: AI16Z's unprecedented growth reflects a broader market trend where AI-powered tokens are rapidly replacing traditional memecoins as the preferred speculative assets. Its ambitious roadmap of becoming an L1 blockchain and launching a curated ecosystem underscores its potential to dominate the decentralized AI economy. For traders, this represents both a unique investment opportunity and a glimpse into the future of blockchain innovation.

Key Takeaways:

• Market Cap: Now $2.581 billion, the first Solana-based AI token to reach this milestone.

• Momentum: Over 135% increase in open interest, reflecting strong investor enthusiasm.

• Roadmap Highlights:

  • Tokenomics overhaul and Eliza-based launchpad in Q1 2025.

  • Plans for a dedicated Layer 1 blockchain to cement AI16Z as a foundational asset.

• Whale Activity: Major moves by whales signal increasing confidence in the token's potential.

China’s Troubling 2025 Start - Worst Since ‘16

Synopsis:
Chinese stocks have suffered their worst start to a year since 2016, as the CSI 300 Index fell 2.9% and the Hang Seng China Enterprises Index dropped 3.1% on the first trading day of 2025. Concerns over weakening export demand, fragile economic momentum, and looming external pressures—dubbed the "Trump Effect"—are shaking investor confidence. While Beijing signals possible fiscal stimulus, skepticism remains over the health of Chinese banks and the broader financial system.

Key Highlights:

1. Economic Data Weakness:

   • Caixin Manufacturing PMI: Dropped to 50.5 in December from 51.5 in November, below forecasts of 51.7.

   • Exports continue to struggle amid global trade uncertainties.

2. Market Performance:

   • CSI 300 Index: Down 2.9%, its steepest annual opening decline since 2016.

   • Hang Seng China Enterprises Index: Fell 3.1%, with financials leading the losses.

3. Banking Sector Concerns:

   • Despite officially low non-performing loan (NPL) levels, Beijing’s $415 billion in bank recapitalizations over three months suggests deeper systemic risks.

   • Local and regional banks are under pressure, with larger institutions absorbing weaker ones to stabilize the system.

4. Stimulus Skepticism:

   • Beijing’s potential fiscal stimulus for 2025 might aim to buoy growth, but analysts question its efficacy, given below-trend bank lending in late 2024.

WHY IT MATTERS:
China’s financial fragility poses risks not just for domestic investors but also for global markets tied to its $18 trillion economy. With trade uncertainties and internal financial strain, Beijing’s capacity to stabilize markets could determine whether 2025 sees a recovery or deeper economic challenges. For traders, this is a key inflection point—expect volatility and opportunities in both Asian equities and commodities influenced by Chinese demand.

Key Takeaways for Traders:

• Caution on Chinese Financials: Systemic risks may undermine near-term performance.

• Watch for Stimulus: Any major announcements could drive a temporary rally but may lack sustainability.

• Global Impacts: Weakening Chinese demand could ripple through commodities and trade-sensitive equities.

VaultCraft launches V2, TVL skyrockets above $100M

VaultCraft launches V2, partners with Safe, and secures $100M+ in Bitcoin

• Matrixport, Asia’s leading crypto providers, commits $100M+ in Bitcoin

• OKX Web3 to launch Safe Smart Vaults with $250K+ in rewards

Earn Now

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The BRRR is meant for informational purposes only. It is not investment advice. Please consult with your investment, tax, or legal advisor before making any investment decisions.ll