TL;DR

• Kevin Warsh has been nominated as a candidate for Federal Reserve Chair, shocking the market due to his previous hawkish stance and unique policy proposals.

• This week will release U.S. employment and job data, ISM manufacturing and services PMI, and the University of Michigan Consumer Sentiment Index.

• BTC down 8.7%, ETH down 19.4%. BTC ETF net outflows of $1.49 billion (second-largest weekly outflow in ETF history), ETH ETF net outflows of $326.9 million.

• MicroStrategy’s BTC cost basis ($76,037) is now in unrealized loss. On ETH, Bitmine ($3,849) and Trend Research ($3,180) face pressure, with Trend’s liquidation price on Aave near $1,880.

• HYPE performed strongly this week, up 45.8% week-over-week, driven by HIP-3 activity and commodity trading enthusiasm. trade.xyz daily trading volume reached $4.3 billion. Cathie Wood of Ark Invest mentioned Hyperliquid, further boosting market sentiment.

• Bybit partnered with Pave Bank to launch a new retail digital banking product, “MyBank.”

• Nubank received conditional approval in the U.S. to establish a nationwide bank.

• Mesh completed a $75 million Series C funding round, aiming to build a global universal crypto payment network.

Macro Overview

Kevin Warsh has been nominated as a candidate for Federal Reserve Chair, shocking the market due to his previous hawkish stance and unique policy proposals.

On January 30, Donald Trump officially confirmed his nomination of Kevin Warsh for Fed Chair via social media. Warsh, during his previous tenure, publicly expressed concerns about long-term quantitative easing (QE) and criticized the Fed for fueling large-scale government spending, claiming that the Fed’s expanding balance sheet effectively subsidized government borrowing costs. Initially, markets worried that the successor might be less dovish than expected, leading to a rebound in the dollar and U.S. Treasury yields. Meanwhile, gold, which had just recovered from overnight volatility, declined again under liquidity pressure.

Why did Warsh stand out? Although he still supports central bank independence, his views on balancing the Fed’s “dual mandate” are more aligned with Trump. His assessment of employment and inflation differs from the current Fed stance. He advocates shrinking the balance sheet to create room for rate cuts to stabilize credit markets. Warsh believes that the Fed’s disorderly balance sheet expansion after the subprime crisis was a key driver of inflation. Gradually reducing the balance sheet could control inflation and set the stage for future rate cuts. Warsh’s plan could stabilize credit in the short term while leaving room for rate cuts later this year.

This week will see the release of U.S. employment and job data, ISM manufacturing and services PMI, and the University of Michigan Consumer Sentiment Index. The manufacturing and services PMI surveys will provide insights into global growth, trade, inflation, and employment trends into early 2026. Friday’s non-farm payroll report will guide policymakers on key areas. The market generally believes that if the labor market shows more pronounced weakening, the Fed may further ease policy, making this week’s report crucial for interest rate expectations. (1, 2)

Number of Fed rate cuts in 2026, Polymarket

US Dollar Index (DXY)

Last Tuesday, Trump hinted at possible intervention to weaken the dollar, causing the dollar index to plummet. However, after the Fed Chair nomination news was announced, the dollar rebounded strongly on Friday. (3)

US 10-year and 30-year Treasury yields

Following Warsh’s official nomination as Fed Chair, market expectations of policy changes drove Treasury yields sharply higher, triggering profit-taking and short-covering. (4)

Gold

Last week, gold prices approached the historic high of $5,600 per ounce, but amid Warsh’s appointment as hawkish Fed Chair, gold prices fell sharply on Friday. (5)

Crypto Market Overview

Mainstream Assets

BTC Price

ETH Price

ETH/BTC Ratio

Last week, BTC fell 8.7%, ETH plunged 19.4%. BTC ETF net outflows of $1.49 billion, the second-largest weekly outflow in ETF history, ETH ETF net outflows of $326.9 million. (6)

ETH/BTC ratio dropped 9.9%, breaking below the key 0.03 level to around 0.029, indicating continued relative weakness of ETH. Market sentiment worsened further, with the Fear & Greed Index dropping to 14, in extreme fear territory. (7)

Position pressure is gradually emerging. MicroStrategy’s BTC average cost is $76,037, now in unrealized loss. On ETH, Bitmine’s average is $3,849, and Trend Research’s is $3,180. Notably, Trend Research’s ETH DeFi position liquidation price on Aave is about $1,880; continued selling pressure could increase downside risk. (8)

Total Market Cap

Total Cryptocurrency Market Cap

Total market cap excluding BTC and ETH

Total market cap excluding top ten assets

Crypto Total Market Cap this week decreased by 11.3%. Excluding BTC and ETH, the market declined by 8.1%; altcoins outside the top ten fell by 8.7%. This indicates that the declines of BTC and ETH are larger than the overall market.

In contrast, AI Agent tokens on Base chain are gaining popularity, mainly driven by the launch of Moltbook and Moltbot, with this AI social network attracting short-term speculative interest.

Top 30 Crypto Assets Performance

Data sources: CoinMarketCap and Gate Ventures, as of February 2, 2026

The top 30 cryptocurrencies by market cap declined an average of 8.5% this week, with only Hyperliquid and Canton Network posting gains.

HYPE surged 45.8% this week, mainly driven by strong activity on the HIP-3 protocol and trading related to commodities. On January 30, HIP-3 protocol’s trade.xyz single-day trading volume hit $4.3 billion, a new record. (9)

Additionally, Cathie Wood of Ark Invest publicly mentioned Hyperliquid as a high-quality investment, further boosting investor confidence. (10)

Token Launches

$BIRB (Moonbirds) is the official utility token of the Moonbirds ecosystem, marking its transition from NFTs to an on-chain tokenized economy. The token aims to support participation, rewards, and ecosystem growth in gaming, social, and creator applications.

$BIRB opened at $0.17 and is now around $0.22, with an estimated FDV of approximately $222 million. It is listed on major exchanges including Coinbase, Gate, and Binance.

Industry Highlights This Week

Hong Kong to Advance Comprehensive Cryptocurrency Regulatory Framework in 2026

Hong Kong regulators plan to submit a draft digital asset regulatory framework in 2026. Financial Secretary Paul Chan said the government is preparing a bill covering crypto advisory services, with public consultation launched last December. Meanwhile, the Hong Kong Monetary Authority has begun accepting stablecoin issuer license applications under the Stablecoin Regulation. So far, 11 crypto platforms, including Hashkey, OSL, and EX.IO, have been approved to operate in Hong Kong. (11)

Nubank Receives Conditional Approval to Build a Nationwide Bank in the U.S.

Nubank has received conditional approval from the Office of the Comptroller of the Currency (OCC) to establish a nationwide bank. This marks a new phase for the Latin American fintech in expanding into compliant U.S. banking and crypto services. Once approved, Nubank can offer deposits, loans, credit cards, and digital asset custody after meeting capital and regulatory requirements and obtaining further approval from FDIC and the Federal Reserve. This move continues Nubank’s expansion into crypto, including in-app trading, more tokens in the Brazilian market, and testing stablecoin payments integrated with traditional card products. (12)

Bybit’s New Digital Banking Plan Tests Crypto Exchange’s Entry into Banking

Bybit plans to launch “MyBank,” a new retail digital banking product, in February, further expanding into traditional finance. CEO Zhou Zhiping confirmed the project will partner with licensed lender Pave Bank, supported by Tether, and will not be operated with a Bybit banking license. Industry experts note that while “quasi-banking” functions like payments, cards, and fiat on/off ramps are common, operating as a full bank would entail capital, compliance, and liability pressures, possibly requiring stricter KYC, which could reduce the low barrier to entry that attracts retail users. (13)

Venture Capital Highlights This Week

Galaxy Digital Leads Tenbin, Promoting Tokenization of Yield-Generating Gold and Forex Markets

Galaxy Ventures led a $7 million seed round for New York-based Tenbin Labs, with participants including Wintermute Ventures, GSR, FalconX, and others. Tenbin focuses on institutional-grade tokenization of commodities and currencies, using CME Group futures-based pricing for fast settlement, low fees, and futures basis yield transfer. The company plans to launch gold tokens first, then high-yield forex tokens linked to emerging market currencies, targeting DeFi investors seeking dollar-stablecoin alternatives. (14)

Mesh Completes $75 Million Series C to Build a Global Universal Crypto Payment Network

San Francisco-based Mesh completed a $75 million Series C led by Dragonfly Capital, with participation from Paradigm, Coinbase Ventures, SBI Investment, and others. The company’s valuation reached $1 billion, with total funding exceeding $200 million. Mesh aims to be an asset-agnostic payment infrastructure, not issuing tokens, building a “any asset to any asset” crypto payment network supporting instant settlement in stablecoins or fiat. The funding will accelerate global expansion in Latin America, Asia, and Europe, and deepen partnerships with stablecoin and payment providers. (15)

Flying Tulip Re-Finances $75.5 Million, Valued at $1 Billion, to Build an Adaptive DeFi Exchange

Founded by Andre Cronje, Flying Tulip raised an additional $75.5 million through private and public token sales, maintaining a fully diluted valuation of $1 billion. The latest $25.5 million Series A private round was participated in by Amber Group, Fasanara Digital, Paper Ventures, and others, with $50 million raised via Impossible Finance Curated platform, and plans for a public sale on CoinList. All rounds priced tokens at $0.10, with on-chain “perpetual put” redemption rights providing downside protection. Flying Tulip is building an integrated on-chain exchange with spot, perpetual, lending, and native stablecoin (ftUSD), with capital used for yield strategies, ecosystem incentives, and buybacks, preparing for TGE launch. (16)

Venture Capital Market Data

Last week, 11 deals closed, with 5 in DeFi (46%), 4 in infrastructure (36%), 1 in social (9%), and 1 in data (9%).

Venture capital brief for this week, data sources: Cryptorank and Gate Ventures, as of February 2, 2026

Total disclosed funding last week was $188.5 million, with 3 deals undisclosed. DeFi received the highest funding at $124.5 million. The largest deal was Flying Tulip’s $75.5 million round.

Venture capital brief for this week, data sources: Cryptorank and Gate Ventures, as of February 2, 2026

In the first week of February 2026, total VC funding surged to $188.5 million, a 52% increase week-over-week.

About Gate Ventures

Gate Ventures is the venture capital arm of Gate.com, focusing on decentralized infrastructure, middleware, and Web 3.0 applications. Gate Ventures collaborates with global industry leaders to support innovative teams and startups, reshaping social and financial interactions.

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References:

1. S&P Weekly Economic Outlook,

2. Number of Fed rate cuts in 2026, Polymarket,

3. DXY Index, TradingView,

4. US 10-year and 30-year Treasury yields, TradingView,

5. Gold prices, TradingView,

6. BTC and ETH ETF fund flows,

7. Bitcoin Fear & Greed Index,

8. Average prices for MicroStrategy, Bitmine, Trend Research,

9. HIP-3 trading data,

10. Ark Invest mentions Hyperliquid,

11. Hong Kong to advance crypto regulation framework in 2026,

12. Nubank receives conditional approval to build a nationwide bank in the U.S.,

13. Bybit’s new digital banking plan tests crypto exchange’s entry into banking,

14. Galaxy Digital leads Tenbin, promoting tokenization of yield-generating gold and forex markets,

15. Mesh completes $75 million Series C, building a global crypto payment network,

16. Flying Tulip re-finances $75.5 million, valued at $1 billion, building an adaptive DeFi exchange,