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After a short hiatus, the Internet Capital Newsletter is BACK!

Stay tuned for Monday’s newsletter where we’re exploring our 2025 crypto price predictions, key themes to watch, and product launches.

P.S. Check out our recent interview with the founder of Crypto x AI project Olas Network, David Minarsch

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News Stories

Markets & Macro

• Arthur Hayes: Crypto Market Will Peak 'In Mid to Late March' [Decrypt] Arthur Hayes, former CEO of BitMEX, now forecasts that crypto markets will peak in mid-to-late March 2025 before experiencing a significant correction. He attributes this revised timeline to increasing dollar liquidity in early 2025, which could temporarily boost market momentum despite earlier concerns about unmet pro-crypto promises from the Trump administration. Hayes suggests traders prepare to exit in late March, leveraging the liquidity-driven rally, and highlights decentralized science (DeSci) tokens as potential high-risk opportunities.
  

  

  BTC Price & 10-Year US Treasury Yield

• Crypto Prices Under Pressure From Global Rise in Yields [CoinDesk] Crypto markets are feeling the impact of surging global government bond yields, with Bitcoin down over 10% from its December high of $108,000. The U.S. 10-year Treasury yield, a global benchmark, has climbed to

  over 4.70%, a multi-year high, while the U.K.'s 30-year Gilt yield hit its highest level since 1998 at 5.35%. Rising yields in Germany, Italy, and Japan reflect a broader trend, while China is the exception, grappling with deflation and falling yields. After a strong Q4 bull run, crypto markets now appear increasingly sensitive to tightening financial conditions.

Crypto Products & Onchain Events

• DeFAI and the Dawn of AI-Powered DAOs [Daniel Sesta] DeFAI, a term coined by Daniel Sesta in a recent blog post, is an emerging crypto sector that combines AI and DeFi and could potentially lower participation barriers to DeFi protocols, automate complex on-chain interactions, and enable novel forms of autonomous wealth management. Additionally, the sector may help to enhance decentralized autonomous organizations (DAOs) by automating data-driven decisions and complex on-chain operations. In theory, AI-powered DAOs enable token holders to set high-level strategies, while AI agents handle governance, research, and execution tasks, such as bridging, staking, and yield optimization, in real time. The sector is quickly gaining mindshare on crypto twitter and already has a dedicated page on Coingecko.

  

• Berachain’s Boyco Pre-Deposit Vaults Top $950k in Deposits [Berachain Blog] Berachain’s Boyco program has already secured over $950,000 in pre-deposits, aiming to address longstanding liquidity challenges for decentralized applications (dApps). Boyco enables dApps to create transparent liquidity markets, allowing liquidity providers to negotiate directly with protocols for clear incentives, such as token rewards, while eliminating inefficiencies like double incentivization. Boyco aims to streamline liquidity bootstrapping for new protocols on Berachain, ensuring dApps have guaranteed Day 1 liquidity and LPs gain transparency and accessibility. Berachain is expected to launch in Q1 of 2025

• Hyperliquid Addresses Validator Setup Transparency and Decentralization Concerns [BeIn Crypto] Hyperliquid, a decentralized perpetual futures exchange operating its own blockchain network, has faced criticism over its validator setup, with accusations of centralization and lack of transparency. Community concerns center around the closed-source node cod and allegations of selling validator seats. Hyperliquid has denied the claims, stating that validators were selected based on testnet performance and introducing a Foundation Delegation Program to decentralize the network further. The platform plans to open-source its code once stable and expand its validator set over time.

• Backpack Exchange acquires FTX EU, plans Q1 2025 launch [CoinTelegraph] Backpack Exchange, a crypto wallet and exchange platform founded by former Alameda Research and FTX employees, has acquired FTX EU, the defunct exchange's European branch, with approval from the FTX bankruptcy court and Cyprus Securities and Exchange Commission (CySEC). The acquisition enables Backpack to expand its presence in the EU, offering crypto derivative services such as perpetual futures starting in the first quarter of 2025. Backpack EU will also manage fund distributions to FTX EU customers as part of the bankruptcy claims process.

Institutions, Regulation, & Politics

• US Government can now sell $6.5 billion Silk Road Bitcoin before Trump enters office [CryptoSlate] A federal judge has authorized the U.S. government to sell 69,370 BTC, worth approximately $6.5 billion, seized from the Silk Road marketplace, just days before President-elect Donald Trump—who campaigned on retaining confiscated Bitcoin as a strategic reserve—takes office. The Department of Justice (DOJ) cited market volatility as a key reason for expediting the sale, despite opposition from Battle Born Investments, which argued against the constitutionality of civil asset forfeiture. This development has sparked debate about its potential market impact, with Bitcoin currently trading between $92,000 and $100,000. Market participants are now watching for any short-term disruptions or strategic shifts in federal Bitcoin policy under Trump’s presidency.

• New ETFs that combine bitcoin exposure and options are coming in 2025 [CNBC] Asset managers, led by Calamos, are introducing ETFs that combine bitcoin exposure with options strategies, aiming to provide investors with structured risk management. Calamos' new ETF, trading under the ticker CBOJ, offers 100% downside protection while capturing some upside, blending bitcoin options with Treasury holdings in a 12-month product. Similar funds from Innovator and First Trust, as well as covered-call strategies from Grayscale and Roundhill, are also in development, signaling a growing trend of crypto-linked, risk-managed ETFs amid expectations of a more crypto-friendly SEC.
  

  

  Source

• Winklevoss Twins’ Gemini to Pay $5 Million to End CFTC Case [Yahoo Finance] Gemini Trust Co., founded by Cameron and Tyler Winklevoss, agreed to pay $5 million to settle a CFTC lawsuit alleging it provided misleading information while seeking approval for the first U.S.-regulated Bitcoin futures contract. The settlement, disclosed Monday, avoids a trial scheduled for Jan. 21 and does not include an admission of liability. Gemini still faces SEC allegations and a separate suit related to its Gemini Earn program.

• MicroStrategy Buys 1,070 BTC, Plans to Raise Up to $2B Through Preferred Stock Offering [CoinDesk] MicroStrategy increased its BTC holdings for the ninth straight week, purchasing 1,070 BTC for $101 million, raising its total to 447,470 BTC at an average price of $62,503. The company also announced plans to raise up to $2 billion through a preferred stock offering in Q1 2025 to fund further bitcoin acquisitions.

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