Gate Research Institute: Crypto Market Risks Contract | SocialFi Narrative Enters a Downtrend

Cryptocurrency Asset Panorama

BTC (-1.69% | Current Price 87,655.4 USDT)

After a prolonged decline from previous highs, BTC experienced an emotional acceleration of decline on the 26th, with a low of approximately $86,100. Subsequently, driven by oversold conditions and short-term short covering, it showed a technical rebound, but the rebound was limited. The current price remains below medium-term moving averages such as MA30, and the overall structure remains in a bearish alignment. From macro and fundamental perspectives, there is no single major negative factor; ETF and long-term supply and demand logic have not been broken. In the short term, BTC is likely to oscillate within the $86,000–$88,500 range to digest selling pressure, with caution for repeated tests of support after rebound stalls. Over the medium term, as long as macro conditions do not significantly worsen and long-term capital flow remains unchanged, BTC is more likely to fluctuate at high levels rather than trend downward unilaterally, accumulating energy for the next cycle.

ETH (-2.35% | Current Price 2,881.78 USDT)

After a long period of sideways trading between $2,950 and $3,000, ETH’s bullish momentum gradually waned. On the 26th, amid a cooling of overall risk appetite, it first broke below the lower boundary of the range, with the price once falling below $2,800. The subsequent rebound was mainly driven by short-term capital replenishment and oversold correction. Compared to BTC, ETH’s decline this round was steeper with larger amplitude. In the short term, ETH may oscillate within the $2,780–$2,900 range to absorb the impact of the breakdown and emotional shocks; if it cannot quickly recover above $2,950, it may repeatedly test lower supports over time.

GT (-1.93% | Current Price 9.68 USDT)

After multiple failed attempts to rise above the $9.9–$10.0 level, GT’s trend gradually shifted into a slow decline, with the price quickly dropping to about $9.51 following a market-wide correction, effectively breaking below the previous oscillation zone. Structurally, GT’s decline was not caused by sudden volume spikes but was accompanied by persistent downward pressure on the medium-term moving averages and decreasing rebound heights, indicating active capital withdrawal. The current rebound is mainly a correction of excessive deviation from the moving average. Although the price has returned to around $9.6–$9.7, it remains below MA30 and has not re-entered the previous range. GT’s daily volatility is relatively smooth, but once key levels are broken, recovery tends to take longer. In the short term, GT may oscillate between $9.5–$9.8 to redistribute chips; if it cannot quickly reclaim above $9.9, it is more likely to operate in a sideways consolidation at low levels rather than a rapid rebound. The medium- to long-term direction still depends on overall market risk appetite and the continued flow of platform token funds.

Daily Gainers and Losers Tokens

In the past 24 hours, the market has been in a risk contraction phase dominated by a synchronized correction of mainstream assets. High market cap assets such as BTC, ETH, BNB, SOL are almost all declining, with the extent of decline increasing with risk level: BTC’s decline is relatively controlled, while ETH, SOL, and other assets retraced more sharply.

Meanwhile, the Fear & Greed Index stands at 20, in extreme fear territory. Whether yesterday, last week, or last month, market sentiment has remained in fear or extreme fear for a long time. Historically, extreme fear often correlates with increased volatility rather than trend confirmation, and prices may repeatedly test lows in the short term.

TAIKO TAIKO (+51.16%, Circulating Market Cap $50.51 million)

According to Gate data, TAIKO is currently priced at $0.2649, up over 50% in 24 hours. Taiko (TAIKO) is an Ethereum-based Layer 2 scaling solution using Type-1 zkEVM, employing a zkRollup architecture fully compatible with Ethereum, aiming to achieve “Ethereum-native” equivalence while maintaining high decentralization.

The recent surge in TAIKO may be driven by strong buying in the Korean market, combined with ongoing technical upgrades, leading to a short-term breakout. Recently, Taiko announced the Shasta protocol upgrade, reducing block proposal costs by about 22 times and proof generation costs by about 8 times, significantly enhancing its economic competitiveness as a ZK L2. Meanwhile, the Korean crypto market sentiment remains hot, and altcoins often experience such short-term rallies during market rotations.

AUCTION BounceAuction (+32.19%, Circulating Market Cap $47.2 million)

According to Gate data, AUCTION is currently priced at $6.72, up over 30% in 24 hours. BounceAuction (AUCTION) is a decentralized auction platform supporting multiple auction mechanisms, allowing users to create and participate in auctions for tokens, NFTs, or other digital assets on the blockchain.

There is no specific explosive news behind this rise; the price increase is mainly due to a sharp increase in trading volume and technical breakout, creating a short-term FOMO effect. Trading volume over the past 24 hours has significantly increased compared to the previous day, driven by large buy orders or algorithmic trading on major exchanges. Additionally, after a long period of low prices, AUCTION broke through key resistance levels, forming a strong rebound pattern.

BOB BOB (+17.65%, Circulating Market Cap $23.26 million)

According to Gate data, BOB is currently priced at $0.01044, up over 15% in 24 hours. Build on Bitcoin (BOB) aims to serve as an entry point for Bitcoin DeFi, combining Bitcoin’s security with Ethereum’s flexibility to build a platform for Bitcoin liquidity, applications, and institutional funds.

The recent price increase of BOB may be mainly driven by staking-related supply constraints and technical exhaustion rebounds, forming short-term upward momentum. Increased staking activity has relatively tightened circulating supply, providing a basis for a rebound from long-term lows. This alleviates the technical exhaustion after steep declines and attracts some investors to re-enter.

Hotspot Analysis

SocialFi Bubble Bursts, Social Tokens Drop Over 90%

In early 2026, the SocialFi sector experienced a brutal cleansing: most platforms were either abandoned, quietly acquired, or turned into functionless shells. Typical social tokens like FRIEND, DEGEN, CYBER, RLY, DESO, etc., saw prices plummet 90%–99%. The boom built on massive VC funding, airdrops, and speculative narratives suddenly collapsed. Farcaster’s acquisition by Neynar is a typical case. Once valued at nearly $200 million and with nearly $200 million in funding, the decentralized social protocol’s founders chose to exit, with Merkle Manufactory returning $180 million to investors and transferring the infrastructure to Neynar, which continues to operate the protocol but abandons the social ambitions, focusing instead on developer tools.

This orderly exit highlights the core pain point of SocialFi: user growth heavily depends on subsidies and bot farming. Once incentives dry up, genuine communities quickly evaporate, leaving only speculative funds and short-term flip players. Essentially, this marks the end of the crypto social narrative bubble. Over the past few years, many projects claimed to be “decentralized Twitter” or “user data ownership” but could not escape the network effects and user habits of centralized platforms. Truly sticky social behaviors are hard to develop amid high gas fees, wallet barriers, and fragmented experiences.

Bitcoin Payments in Las Vegas Become a Regular Offline Practice, Reshaping Payment Costs

As cryptocurrencies gradually mainstream, more offline merchants in Las Vegas now accept BTC payments, including chain brands like Steak ’n Shake, juice bars, medical institutions, and small to medium-sized merchants. For merchants, BTC’s appeal is not just a “tech label” but the ability to attract new customer groups, especially young users and high-frequency tourists who prefer crypto assets, making “accepting BTC” a marketing and differentiation tool.

More critically, the cost structure is changing. Reports indicate that Square, a payment company, opened a feature last November allowing about 4 million US merchants to accept BTC payments fee-free before 2026, avoiding the traditional 2.5%–3.5% credit card fees. For offline merchants with limited profit margins, this is a real upgrade in payment tools. As crypto payments improve in compliance and user experience, they are moving from niche experiments to scalable mainstream payment options.

Stablecoin Settlement Volume Is Large, But Actual Payments Are Small; Real Payment Share Less Than 0.02%

According to joint research by McKinsey and Artemis Analytics, last year, on-chain settlement volume of stablecoins reached $35 trillion, but only about 1% involved real-world payments. The report estimates that actual payment-related stablecoin transactions amount to approximately $380 billion, mainly in B2B settlements ($226 billion), cross-border payroll and remittances ($90 billion), and capital market settlements ($8 billion). This shows stablecoins have found clear use cases in enterprise, cross-border, and settlement scenarios, but are still far from everyday consumer payments.

Furthermore, most stablecoin transactions currently stem from crypto exchange matching, internal transfers, or protocol-layer operations, rather than real goods and services payments. In the global $2,000 trillion+ payment market, stablecoin real payments account for less than 0.02%. This indicates that the core value of stablecoins at this stage is not replacing bank cards or cash but serving as a more efficient settlement and cross-border transfer tool. For industry evolution, breaking into the mainstream depends less on on-chain volume and more on compliance integration, merchant networks, and user experience.

**References:** - Gate, [https://www.gate.com/trade/BTC_USDT](https://www.gate.com/trade/BTC_USDT) - Farside Investors, [https://farside.co.uk/btc/](https://farside.co.uk/btc/) - Gate, [https://www.gate.com/trade/ETH_USDT](https://www.gate.com/trade/ETH_USDT) - Farside Investors, [https://farside.co.uk/eth/](https://farside.co.uk/eth/) - Gate, [https://www.gate.com/crypto-market-data](https://www.gate.com/crypto-market-data) - Investing, [https://investing.com/indices/usa-indices](https://investing.com/indices/usa-indices) - Investing, [https://investing.com/currencies/xau-usd](https://investing.com/currencies/xau-usd) - CoinGecko, [https://www.coingecko.com/en/cryptocurrency-heatmap](https://www.coingecko.com/en/cryptocurrency-heatmap) - CoinDesk, [https://www.coindesk.com/business/2026/01/23/stablecoins-moved-usd35-trillion-last-year-but-only-1-of-it-was-for-real-world-payments](https://www.coindesk.com/business/2026/01/23/stablecoins-moved-usd35-trillion-last-year-but-only-1-of-it-was-for-real-world-payments) - FOX5, [https://www.fox5vegas.com/2026/01/23/las-vegas-businesses-accept-bitcoin-payments-cryptocurrency-gains-mainstream-adoption](https://www.fox5vegas.com/2026/01/23/las-vegas-businesses-accept-bitcoin-payments-cryptocurrency-gains-mainstream-adoption)
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