Market Overview
General Market Conditions
The cryptocurrency market saw a broad-based rally this week, with Bitcoin showing a clear upward trend and altcoins following suit. The market sentiment index surged significantly from last week’s 34% to 71.85%, indicating a strong shift into bullish territory.
Stablecoin Market Trends
The stablecoin market continued last week’s upward momentum, with both USDT and USDC exhibiting growth:
- USDT: Market cap reached $158.3 billion, up 0.63% week-over-week. Although net inflows declined from $1.6 billion last week to $1 billion this week, the pace remains robust, signaling sustained institutional demand, especially from non-U.S. regions.
- USDC: Market cap stood at $61.8 billion, flat compared to last week. Despite a $500 million drop earlier in the week, the capital was replenished by week’s end.
This trend is noteworthy: While USDT’s growth has slightly decelerated, its strength remains intact — suggesting increasing institutional participation from non-U.S. entities. On the other hand, USDC’s week-long stagnation, characterized by a dip and subsequent rebound, reflects growing divergence in U.S.-based investor sentiment.
Political Risk Impact
- Trump-Musk Tensions Reignite: A renewed public dispute between two influential political figures sparked investor anxiety, leading to two consecutive days of market decline.
- Unresolved Tariff Policy: With only one week left before U.S. tariff suspensions expire, most countries have yet to finalize trade agreements with the U.S., heightening fears of tariffs reverting to April 2 levels.
Volatile Monetary Policy Expectations
- Clarity from the Fed: Jerome Powell’s recent statement ruled out a July rate cut while opening the door for cuts starting in September, anchoring market expectations with a clearer policy trajectory.
- Data-Driven Repricing:
- ADP jobs report: A surprising 33,000 job increase — far below the 98,000 forecast — initially fueled hopes of a July rate cut.
- Non-farm payrolls: Stronger-than-expected data reversed sentiment, leading markets to fully price out a July cut and shift expectations to September.
- Bipolar Liquidity Outlook: The sharp contrast in economic data triggered major swings in rate-cut expectations, causing high volatility in risk asset pricing.
Legislative Developments
- “America Beautiful Act” Advances: The bill passed the House and awaits presidential signature, representing a potential policy tailwind for the crypto sector.
Investment Strategy: Remain Cautious
- Compounded Risks: Ongoing uncertainty surrounding tariff policy is likely to dominate market sentiment in the coming week, with the risk of “black swan” events increasing.
- Rising Sensitivity to Data: The market’s heightened responsiveness to macroeconomic data means any upside or downside surprise may cause substantial volatility.
- Defensive Posture Recommended: Investors should tightly manage exposure, stay focused on trade policy outcomes, and be prepared for sudden market shocks.
Market Outlook
In the coming week, the crypto market will continue to be influenced by policy uncertainty and macroeconomic data volatility. The final decision on U.S. tariff policy will serve as a key catalyst. As the Fed’s policy path becomes more transparent, attention will shift to the specifics and timing of implementation. Given the intersection of multiple uncertain factors, market volatility is expected to remain elevated. Investors should stay highly vigilant, adopt flexible risk management strategies, and closely monitor policy updates and critical economic data to guard against potential chain reactions or liquidity crises.
Bullish Target for Next Week: AAVE
AAVE: V4 Upgrade Overview — Unified Liquidity & Smart Interest Rate Management Enhance Lending Experience
Although the Aave V4 upgrade was first proposed in 2024, no clear implementation timeline was provided by the Aave team until recently. On June 30, 2025, at the ETHCC conference, Aave founder Stani officially announced the upcoming launch of Aave V4. Compared to V3, this version introduces major architectural and functional enhancements.
Key Upgrades in Aave V4
1. Core Technical Enhancements
- Unified Liquidity Layer The most significant infrastructure upgrade in V4 is the introduction of a unified liquidity layer — an abstract, chain-agnostic system that centralizes liquidity management. This design eliminates the fragmentation present in earlier versions and enables a modular architecture for seamless upgrades and expansions.
- Intelligent Interest Rate Management V4 implements a market-driven fuzzy control interest rate mechanism that can automatically adjust rate curves and inflection points, reducing reliance on governance votes. The newly introduced liquidity premium system allows borrowing costs to more accurately reflect token-specific liquidity conditions.
- Upgraded Risk Management System A dynamic risk configuration mechanism ties collateral rates to the moment of position creation, insulating users from subsequent market volatility and improving position stability. The V4 liquidation engine introduces variable liquidation thresholds, incentive mechanisms, and batch liquidation capabilities, significantly boosting efficiency.
2. GHO Stablecoin Enhancements — Soft Liquidation Mechanism
Inspired by the crvUSD model, V4 brings a soft liquidation mechanism to GHO via a Lending-Liquidation AMM (LLAMM), streamlining and optimizing the liquidation process.
Implications of Aave V4 on the Protocol
Strategic Value of the Unified Liquidity Layer
- Seamless Upgrades: Eliminates the need for liquidity migration, reducing costs and risks associated with protocol upgrades.
- Modular Scalability: Enables rapid integration of new features (e.g., isolated pools, RWA modules, CDPs) without disrupting the core system.
- Consolidated Liquidity: Solves fragmentation issues, improves capital efficiency, and strengthens the protocol’s competitive edge.
Growth Potential via Cross-Chain Ecosystem Expansion
- Enhanced User Experience: The ability to deposit on one chain and borrow on another significantly boosts user convenience and platform stickiness.
- Liquidity Network Effect: Cross-chain capital flows expand market scale and revenue streams, enhancing the protocol’s long-term value.
Systematic Improvement in Risk Management Capabilities
- Fuzzy Rate Control: Dynamic adjustment based on real-time market conditions increases efficiency and reduces governance dependency.
- Liquidity Premium Pricing: A more precise risk-based pricing model improves the risk-reward balance for users.
- Dynamic Risk Configuration: Provides greater position stability and mitigates systemic risk.
Ecosystem Value of the GHO Stablecoin
- Soft Liquidation: Modeled after the success of crvUSD, it delivers a smoother, user-friendly liquidation experience.
- Interest Payment Innovation: GHO interest-bearing supply expansion enhances the stablecoin’s competitiveness.
- Emergency Redemption Guarantees: Built-in safeguards against systemic risk improve market trust in GHO.
Operational Efficiency and Profitability Enhancements
- Gas Optimization: Lowers user transaction costs and encourages more frequent use.
- V4 Liquidation Engine: Variable factors and batch processing enhance operational efficiency.
- Automated Asset Management: Reduces operational overhead and improves capital utilization.
On-Chain Data Analysis
Total Value Locked (TVL)
As shown in the chart, Aave’s TVL previously reached an all-time high. Although it has slightly declined since then, it remains at a historically elevated level of $25.623 billion, representing a 343.61% increase year-over-year.
Daily New Users
Aave continues to onboard new users at a stable pace, averaging around 120 new users per day over the past three months. The platform has consistently shown daily user growth without interruption.
AAVE Token Buybacks
Aave’s buyback program operates at a fixed rate of $107,142 per day, roughly 40% of the protocol’s daily revenue. While the buyback amount is relatively small compared to AAVE’s daily trading volume, its consistency reflects strong commitment from the Aave team. On an annualized basis, the total buyback amount is projected to reach $39.1 million, which provides meaningful support for the token’s price.
Aave Treasury
Despite a slight decline, Aave’s treasury balance remains above $100 million, indicating that the project has substantial financial reserves to sustain its buyback program in the near term.
GHO Stablecoin Borrowing Rate
GHO’s borrowing rate currently sits around the median level compared to other stablecoins, meaning it does not hold a significant interest rate advantage in the market.
Number of GHO Holders
The number of GHO holders has shown steady and continuous growth, reflecting increasing user adoption of the stablecoin.
GHO Market Capitalization
GHO’s market cap has been steadily rising, reaching a historical high of $226 million, despite some recent pullbacks. This indicates growing market confidence in the stablecoin.
Valuation Metrics Comparison
Summary
The launch of Aave V4 marks a significant advancement in decentralized lending protocols. With innovations such as a unified liquidity layer, cross-chain borrowing, intelligent interest rate mechanisms, and deep integration of GHO, Aave has laid a strong foundation for long-term protocol growth.
On-chain data further affirms Aave’s leading market position:
- $25.623 billion in TVL, near all-time highs
- Over $83 million in annualized revenue
- A 51.27x market cap-to-revenue ratio, far outperforming competitors
These indicators highlight Aave’s superior profitability and investment value. As V4’s technical advantages continue to unfold and GHO’s ecosystem matures, Aave is well-positioned to lead the next wave of DeFi innovation, further solidifying its dominance in decentralized lending.
Bearish Target: TNSR
TNSR: Systemic Risk from Sector Decline and Token Unlock Pressure in the NFT Aggregator Space
Project Fundamentals and Positioning
Tensor is an NFT aggregator built on the Solana blockchain, offering advanced trading functionalities such as real-time data, comprehensive historical pricing, and NFT AMM pools. It supports batch sweeping, bidding, listing, and delisting of NFTs.
Deteriorating Market Environment
- Sector-Wide Downtrend: Since the end of the previous bull cycle, the NFT sector has been in a prolonged slump. In the current market, attention has shifted overwhelmingly toward meme coins, leaving NFT-related projects largely ignored.
- Lack of Investor Attention: Without the “get-rich-quick” appeal, NFT projects have struggled to attract interest. Investor confidence in the NFT sector has collapsed, with both capital and attention flowing out rapidly.
Severe Decline in Fundamental Metrics
- Sharp Drop in Market Share: Tensor has lost nearly all of its market share in the NFT trading space to competitors like OpenSea, Blur, and Magic Eden.
- Cliff-Like Collapse in Trading Volume: As a trading aggregator, volume is the project’s most critical metric. Tensor’s weekly trading volume has plummeted from nearly $10 million to just $50,000 — a decline of over 99%.
- Overall NFT Market Contraction: The total NFT market volume has dropped from $330 million per week to approximately $30 million, representing a >90% decline and illustrating the broader market stagnation.
- Extremely Low Revenue: A project’s sustainability largely depends on its income. Tensor’s daily revenue is now only around $300, suggesting a near-total collapse in user engagement. If this trend persists, the project may not remain viable.
Token Unlock Risk Assessment
- Unlock Scale and Structure: On July 8, 17.69 million TNSR tokens (1.87% of total locked supply) will be unlocked. Given the current thin market liquidity, this unlock could significantly disrupt the supply-demand balance.
- Risk from Unlock Recipients: According to the token’s linear vesting plan, this tranche primarily unlocks for institutional investors and the project team. In light of deteriorating fundamentals, these holders are highly incentivized to exit their positions, increasing selling pressure.
- Insufficient Market Absorption Capacity: TNSR’s daily spot trading volume on Binance is only around $1.7 million, which is insufficient to absorb the large inflow of unlocked tokens. This sharp imbalance between token supply and market liquidity creates substantial downward pressure.
Conclusion
Tensor is facing compounded systemic risks across multiple dimensions. At the sector level, the NFT market has been largely replaced by the meme coin narrative, with overall trading volume collapsing by over 90%. Competitively, Tensor’s market share has been eroded by rivals such as OpenSea, Blur, and Magic Eden, while its own trading volume has plummeted by 99% to just $50,000 per week. Fundamentally, the protocol’s daily revenue has dwindled to merely $300, raising serious concerns about its sustainability. On the technical front, the upcoming July 8 unlock of 17.69 million TNSR tokens — 1.87% of the total supply — poses significant sell pressure against a backdrop of thin liquidity, with daily spot volume on Binance averaging only $1.7 million. These overlapping negative factors are expected to continue exerting sustained downward pressure on the TNSR token.
GMT: Sustained Token Price Decline Driven by a Negative Feedback Loop
Project Fundamentals and Positioning
STEPN is a Move-to-Earn NFT game on mobile devices. Players must wear “NFT sneakers” and walk, jog, or run outdoors to earn rewards. STEPN operates a dual-token system: the utility token GST and the governance token GMT. GST is used for various in-game activities such as minting new sneakers, upgrading sneakers, and upgrading gems. GMT is used for profit distribution and high-level in-game features like sneaker branding and premium upgrades.
Severe Deterioration in Fundamentals
- Low User Activity Core data from the STEPN project indicates it has fallen into operational distress. Over the past 7 days, there were only 11 active users, and in the past 3 months, only 27 new users have joined. Additionally, there have been no new NFT minting activities.
- Unidirectional Capital Outflows At the same time, project fund flows show a one-way outflow pattern (all withdrawals, no deposits). These indicators collectively suggest that the project’s user base has collapsed, core business functions have largely stalled, and user confidence has been completely lost.
Severe Supply-Demand Imbalance
- Continuous Supply Increase: GMT tokens are facing a classic oversupply situation. On one hand, the longer the project persists, the more GMT is released. In particular, on July 9, 85.96 million GMT tokens (1.43% of total supply) will be unlocked, further increasing market supply pressure.
- Demand Collapse: On the other hand, due to near-zero user engagement, there is virtually no actual demand for GMT. The project’s inability to acquire new users has caused continuous demand shrinkage. The supply-demand imbalance has already formed and is continuing to worsen. The oversupply situation has led to continuous token price declines.
Token Unlock Risk Assessment
- Unlock Scale and Structure: On July 9, 85.96 million GMT tokens will be unlocked, accounting for 1.43% of the total locked supply. Considering the current limited market liquidity, this unlock will significantly impact the supply-demand balance.
- Unlock Recipient Risk: According to the whitepaper’s linear vesting plan, this unlock mainly involves institutional investors and the project team. These holders, under deteriorating fundamentals, have strong motivations to cash out and sell.
- Severe Lack of Market Absorption Capacity: GMT’s average daily trading volume is only about $2.8 million. Compared to the unlock scale, market liquidity is extremely limited and insufficient to absorb the large increase in token supply and related selling pressure.
Negative Feedback Loop Has Taken Hold
The STEPN project has fallen into a typical “death spiral”: GMT’s price decline eliminates the earning incentive for users, which leads to massive user attrition. The loss of users further reduces demand for GMT, and the reduced demand drives the price even lower. This downward price pressure causes even more users to exit. This negative feedback loop has already formed and continues to self-reinforce. In the short term, there is a lack of effective external catalysts to break this vicious cycle.
Summary
The GMT token is facing systemic bearish pressures stemming from fundamentals, supply-demand imbalance, market liquidity, and investor behavior. In particular, the upcoming large-scale unlock combined with extremely limited market absorption capacity presents a sharp contrast and is expected to exert significant negative impact on GMT’s price. The project has entered a classic “death spiral,” resulting in sustained negative pressure on GMT token value.
Token Unlocks Next Week (Unlock Value Over $1 Million)
Market Sentiment Index Analysis
The market sentiment index surged significantly from 34% to 71.85%. BTC rose 2.72% this week, ETH increased 8.19%, and TOTAL3 rose 3.73%, indicating that the overall Altcoin market has entered a bullish zone.
Overall Market Theme Overview
According to weekly return statistics, the NFT sector performed the best, while the SocialFi sector performed the worst.
- NFT Sector: Within the NFT sector, PENGU, APE, NFT, and SUPER account for a combined weight of 91%. Their weekly performances were +62.61%, +7.72%, +1.61%, and +14.29%, respectively. It is evident that the NFT sector saw relatively large gains, all outperforming tokens from other sectors, making it the best-performing sector of the week.
- SocialFi Sector: In the SocialFi sector, TON and CHZ make up a combined weight of 95.47%. Their weekly changes were +2.41% and +4.73%, respectively. The average gains were lower than those in other sectors, making SocialFi the worst-performing sector of the week.
Upcoming Major Crypto Events Next Week
- Wednesday (July 9): Final deadline for U.S.–EU tariff negotiations
- Thursday (July 10): U.S. Initial Jobless Claims (week ending July 5); Federal Reserve to release minutes from the FOMC meeting
Summary
This week, the cryptocurrency market demonstrated a broad-based rally, with both major assets like Bitcoin and the altcoin market showing strong performance. The market sentiment index surged from 34% to 71.85%, signaling a transition into a bullish zone. The stablecoin market remained robust — USDT’s market cap grew by 0.63% to $158.3 billion, and USDC maintained its $61.8 billion level — indicating that long-term investor confidence in the crypto market remains fundamentally intact. The easing of political risks, growing clarity around Fed policy expectations, and the successful passage of the “Beautiful Act” all provided meaningful policy support and positive growth outlooks for the market.
In the current market environment, fundamentals-driven investment logic is becoming increasingly important. AAVE, as a leading DeFi protocol, is laying a solid foundation for long-term development through key innovations in its V4 upgrade — such as a unified liquidity layer, cross-chain lending, and intelligent interest rate management. With a record-high TVL of $25.623 billion, annual revenue exceeding $83 million, and a market cap-to-revenue ratio of just 51.27x, AAVE’s investment value is well-validated by on-chain data.
Looking ahead to the coming week, the final deadline for U.S.–EU tariff talks and the release of the Fed’s meeting minutes will serve as key catalysts that could influence market direction. Investors should strike a balance between seizing opportunities and controlling risks. It is recommended to focus on high-quality projects with real value creation and sustainable innovation — especially within DeFi and infrastructure sectors that show long-term growth potential. At the same time, it is essential to manage position sizing carefully, set proper stop-loss mechanisms, and stay alert to macro policy changes and unforeseen risks.
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