6.16 AI Daily Report Crypto Assets Market Changes: Tension Rises, Regulation Advances, AI Integration

1. Headlines

1. The conflict between Israel and Iran escalates, Trump calls for a ceasefire from both sides.

Tensions between Israel and Iran have continued to escalate in recent days. Israeli intelligence has learned of Iran's plan to assassinate President Trump in retaliation for Israel's previous attacks on Iranian nuclear facilities. Alarms sounded across Israel, and both sides exchanged missile fire.

Trump called for both sides to cease fire immediately on social media, stating that there is a "great likelihood" of an agreement between Israel and Iran. He emphasized that the Middle East should become great again, rather than falling into endless conflict. However, Israeli officials have announced the cessation of any peace negotiations with Iran.

Analysts pointed out that the conflict not only exacerbated regional tensions, but also highlighted the safe-haven demand for crypto assets such as bitcoin in turbulent times. Bitcoin's swift rebound after a brief 4% drop shows that investors see it as a hedge against geopolitical risk. As long as the situation in the Middle East continues, the demand for safe-haven assets such as bitcoin may increase further.

2. Adjust the Alpha points rules, triggering a flash crash in altcoins.

Announce the adjustment of Alpha points rules. The trading volume of trading pairs between Alpha tokens will no longer be counted in the points calculation. This move aims to curb fund hedging and fake trading volume behavior, but it has also triggered a sharp decline of over 80% in the tokens ZKJ and KOGE.

Analysis shows that the sharp decline of ZKJ and KOGE may be a premeditated "harvesting" action. There were abnormal signals beforehand, such as liquidity pool withdrawals, a sharp drop in annual yield, and a decline in trading volume. Additionally, ZKJ will unlock over 15 million tokens on June 19, further intensifying the bearish pressure.

Insiders point out that this flash crash has exposed issues of false liquidity and lack of transparency in governance within the Alpha ecosystem. In the short term, investors should avoid participating in trading altcoins that rely on Alpha points, and be wary of tokens with high FDV and abnormal pricing. Returning to fundamentals and risk control is the long-term strategy.

3. Hong Kong accelerates the advancement of stablecoin regulation to attract the development of digital assets.

The Hong Kong SAR Government is accelerating the regulation of stablecoins to provide a legal and compliant issuance environment for local and global issuers. The Secretary of the Hong Kong Monetary Authority, Norman Chan, expects that the demand for stablecoins will continue to increase in the future, which is conducive to promoting the development of the local economy.

Hong Kong will launch a stablecoin sandbox project in 2024 and has officially established a licensing system for stablecoin issuance through a bill passed in May this year. Whether issuing fiat stablecoins within Hong Kong or issuing stablecoins pegged to the Hong Kong dollar overseas, a license is required.

Analysts believe that Hong Kong's regulatory measures will bring greater certainty to the digital asset industry. On one hand, it provides a compliant path for stablecoin issuers; on the other hand, it offers users more trustworthy options. Against the backdrop of an unclear global cryptocurrency regulatory landscape, Hong Kong's pioneering actions may attract more digital asset companies to settle locally.

4. Consensys Founder: Linea Achieves 100% EVM Verification Breakthrough

The Ethereum Layer 2 scaling solution Linea has made significant breakthroughs, becoming the first zkEVM to directly verify 100% Ethereum Virtual Machine (EVM) activities through zero-knowledge proofs. This achievement stems from six years of research and development, enhancing security and performance while eliminating the need for "fake layers."

Joseph Lubin, the founder of Consensys, stated that traditional companies are massively adopting DeFi, and Wall Street will be motivated to delve into the details of Bitcoin and Ethereum. Linea's breakthroughs will further drive the development of the Ethereum ecosystem, providing more secure and efficient infrastructure for enterprise-level applications.

Industry analysts pointed out that Linea's innovation not only improves the scalability of Ethereum, but more importantly, provides reliable underlying technical support for enterprise-level applications. As more companies and institutions join, the Ethereum ecosystem may usher in a new wave of development.

5. Cryptocurrency millionaires optimistic about the future integration of AI and Crypto

At the Singapore TOKEN2049 Conference, a number of crypto millionaires expressed optimistic expectations for the future convergence of AI and Crypto. Romeo, a first-level investor, said bluntly, "I am very optimistic about the future of AI and Crypto, and I think that there will definitely be an AI project comparable to the existence of Ethereum in the future, but the current AI projects are all Memes." "

Participants generally believe that, although most AI+Web3 applications have been debunked at present, this field is still full of opportunities. Traditional AI companies are rushing into Web3 entrepreneurship, such as Gensyn and Hyperbolic representing the Computing track, while Schelling AI represents the Web2 type.

Analysts point out that AI+Consumer+DeFi is becoming a new track for industry funds to actively layout. As long as continuous innovation is maintained, outstanding projects that truly integrate AI with Crypto and change the future will surely emerge. Industry practitioners should support long-term entrepreneurs and promote technological innovation and application implementation.

2. Industry News

1. Bitcoin maintains a range-bound fluctuation in the short term, with institutional buying continuing to enter the market.

The price of bitcoin has remained in the range of $105,000 to $107,000 over the past 24 hours. Analysts pointed out that the uncertainty of geopolitical tensions and the expectation of the Federal Reserve's interest rate decision this week kept the market sentiment cautious. But at the same time, institutional buyers continue to enter the market, providing strong support for bitcoin.

According to on-chain data, the Bitcoin spot ETF recorded a net inflow of over $1 billion in the past week, setting a new historical high. This indicates that institutional investors are gradually building positions at the current price range and remain optimistic about Bitcoin's long-term prospects.

However, analysts also warned that bitcoin could face retracement pressure if the geopolitical situation escalates further or the Fed sends hawkish signals. Bitcoin is expected to remain range-bound in the short term, and investors need to pay close attention to the development of risk events.

2. Ethereum leads mainstream cryptocurrencies, with increased activity in the DeFi and NFT sectors.

Ethereum has performed strongly in the past 24 hours, with its price briefly breaking the $2,600 mark, showing an intraday increase of 2.59%. Analysts believe that Ethereum's recent strength is mainly driven by the increased activity in the DeFi and NFT ecosystems.

Data shows that the total locked value of DeFi on Ethereum has surged to a historical high of over $60 billion. Meanwhile, the trading volume and floor prices in the NFT market have also shown a noticeable recovery. This reflects an increase in investor confidence in the Ethereum ecosystem.

However, some analysts have also warned that Ethereum's current valuation is quite high, and if the macro environment changes, the upward momentum may be difficult to sustain. Investors need to closely monitor the developments in the Ethereum ecosystem and carefully seize investment opportunities.

3. The performance of altcoins is diverging, and the Solana ecosystem continues to strengthen.

Among mainstream cryptocurrencies, the Solana ecosystem stands out the most. Popular public chain tokens like Solana and Aptos have recorded an increase of over 5% in the past 24 hours. Meanwhile, Solana ecosystem tokens such as BONK and CNDL have also seen varying degrees of increase.

Analysts pointed out that the continuous strengthening of the Solana ecosystem is mainly due to its high performance and low transaction fees. As more and more DeFi and NFT projects settle on Solana, the activity level of the ecosystem continues to rise, driving up the token prices.

However, some investors are concerned that the current valuation of the Solana ecosystem is already high and may pose a bubble risk. If the macro environment changes, it could trigger capital outflows and exacerbate volatility. Investors need to maintain a cautiously optimistic attitude towards the development prospects of the Solana ecosystem.

4. Regulatory policies continue to be introduced, and the long-term development prospects of the industry are promising.

Recently, several countries and regions around the world have successively introduced cryptocurrency regulatory policies, laying a foundation for the long-term healthy development of the industry. Among them, the EU's MiCA regulatory framework has officially come into effect, providing guidance for the legalization of crypto assets in Europe.

At the same time, Vietnam has also passed its first law specifically targeting digital assets, bringing cryptocurrencies into the scope of regulation. Analysts believe that this move will help attract more institutional funds into the Vietnamese crypto market.

Overall, the introduction of regulatory policies is conducive to improving the transparency and compliance of the industry, creating a favorable environment for institutional investors to participate. However, it is also necessary to be wary of the negative effects that excessive regulation may bring. Investors need to closely monitor changes in regulatory policies and prudently assess their impact on the market.

3. Project News

1. ALLINDOGE is about to launch the MCP protocol, bringing executable AI assistants to the Web.

ALLINDOGE is a company focused on Web artificial intelligence infrastructure. The company will launch its core technology MCP(Model Conte Protocol) this month, aimed at addressing many bottleneck issues of AI applications on the blockchain.

MCP is an innovative ReAct framework designed for large models, emphasizing an "Inference-Action-Observation" intelligent closed loop. As a universal context protocol, MCP enables AI assistants to not only read local environments, on-chain and off-chain multi-chain wallet statuses, and external API responses, but also to invoke on-chain and off-chain protocols and initiate various operation requests, achieving advanced reasoning and supporting a complete closed loop of the ReAct process.

The launch of the protocol will bring executable AI assistants to the web, which is expected to promote the deep integration of blockchain and artificial intelligence. Industry insiders believe that MCP is expected to become a key infrastructure to promote the Web into the Agent era, and ALLINDOGE is one of the first projects to be realized, and has successfully built the AgentOS operating system that links on-chain and off-chain.

2. The Sui ecosystem continues to expand, and Move projects are attracting attention.

Sui is a Layer 1 public chain based on the Move language, created by former Meta( Facebook) employees. Recently, the Sui ecosystem has been continuously expanding, and Move-based projects have attracted widespread attention.

The Sui ecosystem currently has star projects like Cetus, Navi, and Scallop, but there are still relatively few tradable assets. However, the incubation plan in collaboration with Cetus is expected to hatch more high-quality projects. In addition, the support from Grayscale Trust and Native USDC on Sui will also promote further development of the Sui ecosystem.

Apart from Sui, Aptos and Movement are also representative projects of the Move ecosystem. Aptos has launched its token on the mainnet, but users are still observing its development direction; Movement is currently the only Move project that has not yet launched a token, and it is receiving a lot of attention.

Analysts believe that the correlation between the Move language and Rust allows projects within the Solana ecosystem to transition smoothly into the Move system. In the previous cycle, there were Polygon, Avalanche, etc., and this round the Move system is expected to become the next Alpha.

3. Web3 social may become the next trend

During the TOKEN2049 conference, Web3 social became a hot topic. Many project teams have deeply contemplated whether Web3 social can achieve mass adoption of blockchain products.

Founder Yawn mentioned Friend Tech and shared thoughts on Web3 social. He believes that how to make Connect to Earn interesting through map-based social interactions, while not disrupting the entire ecosystem's economy, is a topic that requires further consideration and validation.

Korean entrepreneur Taki from the Warpcast ecosystem is also exploring Web3 social. Although the Web3 social track has failed multiple times, new participants continue to join in the innovation.

Analysts say that Web3 social is still an imaginative market. Although it is difficult to see a blockbuster in the short term, with the continuous evolution of technology and concepts, it may become the next trend in the future.

4. The AI + Web3 sector is highly favored by capital.

At the TOKEN2049 conference, the AI + Web3 track has become a new direction eagerly pursued by capital. More and more founders are transitioning from the traditional AI field to Web3 entrepreneurship.

Representing the Computing track are Gensyn, Hyperbolic, etc., while Schelling AI represents the Web2 type all-in players. There’s also Title.xyz, which is dedicated to creating images/videos in the Midjourney art style.

AI+Consumer+DePIN is becoming a new track for industry funds to actively invest in. Analysts believe that although most AI+Web3 applications are currently being debunked, there will surely emerge an AI project that rivals Ethereum in the future.

They call on the exchange's Listing team to pay more attention to long-term entrepreneurs, as supporting these talents will surely bring better use cases and growth to the industry.

4. Economic Dynamics

1. The Federal Reserve remains on hold, keeping interest rates unchanged.

Economic Background: The U.S. economy has maintained relatively stable growth over the past year. The latest data showed that GDP grew at an annualized rate of 2.4% in the first quarter of 2025, slightly lower than the previous quarter's 2.6%. Inflation hovers around 2%, in line with the Fed's target range. The job market remains strong, with the unemployment rate remaining low at 3.5%. Overall, the U.S. economy is running smoothly, but there are still some uncertainties.

Important Event: The Federal Reserve decided to maintain the target range for the federal funds rate at 4.25%-4.5% during its rate decision meeting on June 18. This decision aligns with market expectations and reflects the Federal Reserve's cautious assessment of the current economic situation. Federal Reserve Chairman Powell stated at the press conference that, although inflationary pressures have eased, patience is still required, and close attention must be paid to changes in data to determine the appropriate policy path moving forward.

Market reaction: U.S. stocks rose slightly after the interest rate decision was announced, with investors welcoming the Federal Reserve's decision. The dollar index edged higher, reflecting market expectations of the Federal Reserve's hawkish stance. The bond yield curve flattened, indicating concerns about the economic growth outlook. Overall, the market's reaction to the Federal Reserve's decision has been muted, with expectations that interest rates will remain unchanged in the short term.

Expert Opinion: Jan Hatzius, Chief Economist at Goldman Sachs, stated that the Federal Reserve's decision to pause interest rate hikes is a wise move that will help assess whether inflationary pressures have truly eased. However, he also warned that if inflation rises again, the Fed may have to raise rates again. Meanwhile, JPMorgan economist Michael Feroli believes that the Federal Reserve may begin to slightly cut rates later this year to support economic growth.

2. China's May economic data is a mix of good and bad.

Economic Background: The Chinese economy showed signs of recovery in early 2025, but the pace of recovery remains weak. In the first quarter, GDP grew by 4.5% year-on-year, below the annual target of 6%. The main economic data for May presented a mixed picture, reflecting the challenges facing the economy.

Important events: In May, China's industrial production grew by 5.6% year-on-year, exceeding market expectations and indicating a recovery in the manufacturing sector. However, during the same period, the total retail sales of consumer goods only grew by 2.8% year-on-year, falling short of expectations and reflecting weak domestic demand. Fixed asset investment increased by 4.7% year-on-year, slightly below expectations. The import and export data were also disappointing, with May exports declining by 7.5% year-on-year and imports decreasing by 8.5% year-on-year.

Market reaction: After the release of May economic data, the RMB exchange rate against the US dollar slightly declined. The A-share market experienced fluctuations downward, reflecting investors' concerns about the economic outlook. Bond yields rose slightly, indicating an increase in expectations for inflationary pressures. Overall, the market expressed disappointment over the weak pace of China's economic recovery.

Expert Opinion: Liu Yuanchun, Director of the Chongyang Institute for Financial Studies at Renmin University of China, stated that the May data reflects the downward pressure facing the Chinese economy. The government needs to further strengthen policy measures, expand domestic demand, and promote investment to solidify the economic foundation. Goldman Sachs Asian economist Su Wei believes that the recovery of the Chinese economy will still be a long process, and expects economic growth to slow down in the second half of the year.

3. Inflation in the Eurozone continues to rise, increasing pressure on the ECB to raise interest rates.

Economic Background: The Eurozone economy showed signs of recovery in early 2025, but inflationary pressures continued to rise, becoming a major challenge for the European Central Bank. The latest data shows that the Eurozone's GDP grew by 1.1% year-on-year in the first quarter, and the employment market remained stable. However, the inflation rate surged to 8.1% in May, far exceeding the ECB's target of 2%.

Important event: On June 15, the European Central Bank raised its three key interest rates by 25 basis points during its rate decision meeting, marking the ninth consecutive rate hike by the ECB. ECB President Lagarde stated at a press conference that inflation pressures remain severe, and the ECB will continue to take decisive action until the inflation rate returns to the target range of 2%.

Market reaction: The euro to US dollar exchange rate rose slightly after the interest rate decision announcement, reflecting market expectations of a hawkish stance from the ECB. European stocks fell slightly, indicating investors' concerns about the impact of interest rate hikes on the economy. The yield curve of Eurozone government bonds further inverted, signaling an increased risk of economic recession.

Expert Opinion: Mark Wall, chief eurozone economist at Deutsche Bank, stated that the ECB's interest rate hike this time was in line with expectations, but future rate hikes may slow down to assess economic trends. Goldman Sachs European economist Sven Jari Stehn believes that the ECB may end its rate hike cycle by the end of this year, at which point the benchmark interest rate will reach around 4%.

5. Regulation & Policy

1. The Hong Kong Monetary Authority will process stablecoin license applications as soon as possible.

Policy Background: The Financial Secretary of the Hong Kong SAR Government, Paul Chan, recently wrote that with the vigorous development of the digital asset market, the demand for stablecoins is expected to further increase. The Hong Kong Monetary Authority (HKMA), as the regulatory authority for Hong Kong's foreign exchange fund and reserve banking system, will be responsible for approving and regulating stablecoin issuers.

Policy Content: Chen Maobo said that stablecoins can not only be used as a medium of exchange without traditional payment time and geographical restrictions, but also develop diversified innovative solutions with their programmable characteristics to automate and intelligentize financial service processes. Noting that there is a lot of interest from market participants, the HKMA will process the licence applications received as soon as possible after the Stablecoin Ordinance comes into effect so that eligible applicants can commence their business.

Market reaction: This move is seen as an important step in further expanding the scope of digital asset regulation in Hong Kong, which is expected to enhance Hong Kong's status as a global virtual asset hub. Stablecoin issuers and crypto companies generally welcomed this, believing that it would bring new development opportunities to Hong Kong's digital asset ecosystem.

Expert Opinion: Hong Kong financial legal advisor Zhang Jialang stated that the introduction of a regulatory framework for stablecoins will bring greater certainty and transparency to Hong Kong's digital asset industry, which is beneficial for attracting more international institutions and capital to Hong Kong. He believes that the Monetary Authority needs to balance innovation and risk management during the approval process to ensure that stablecoin issuers have sound reserve management and investor protection measures.

2. Vietnam officially incorporates regulation of cryptocurrency assets and other digital technologies.

Policy Background: The National Assembly of Vietnam recently passed the "Digital Technology Industry Law", officially bringing cryptocurrencies and other digital technologies under regulatory oversight. The legislation aims to curb fraud, improve international credit ratings, and promote development in areas such as artificial intelligence, blockchain, and semiconductors, and will take effect on January 1, 2026.

Policy Content: The "Digital Technology Industry Law" clearly defines virtual assets and crypto assets, and establishes a licensing system for related businesses. At the same time, the bill also formulates a series of tax incentives to attract foreign investment into Vietnam's digital technology industry. Specifically, it includes preferential tax rates and tax exemption periods for digital technology companies.

Market Reaction: Vietnamese cryptocurrency companies welcome this policy, believing it will provide clearer legal guidance for industry development. However, some industry insiders are concerned that overly strict regulations could hinder innovation. Foreign enterprises generally show strong interest in Vietnam's tax incentive policies.

Expert Opinion: Chen Guangyong, Chairman of the Vietnam Fintech Association, stated that the introduction of the "Digital Technology Industry Law" marks the official recognition of the legal status of crypto assets by the Vietnamese government, which will help attract more international capital and advanced technology into the Vietnamese market. He also pointed out that regulatory authorities need to maintain good communication with the industry and develop practical regulatory guidelines.

3. The EU MiCA regulatory details have entered a substantive implementation phase.

Policy Background: The EU Crypto Assets Market Regulation (MiCA) was passed in 2022, aiming to provide a unified regulatory framework for crypto assets among EU member states. After a two-year transition period, the MiCA regulatory rules have recently officially entered the substantive implementation phase.

Policy Content: The MiCA regulatory guidelines impose a series of compliance requirements on institutions such as crypto asset issuers, exchanges, and wallet service providers, including anti-money laundering, consumer protection, and information disclosure. At the same time, the guidelines also stipulate the entry thresholds and reserve management requirements for stablecoin issuers.

Market Reaction: Compliant cryptocurrency companies generally welcome the MiCA regulatory guidelines, believing that this will help the long-term healthy development of the industry. However, some companies are concerned about the high compliance costs. Countries like Malta have already begun approving applications from cryptocurrency companies that meet MiCA standards.

Expert opinion: EU regulatory expert Martin Molsky said that the introduction of the MiCA regulatory rules marks a new phase in the EU's cryptoasset regulation. He believes that a unified regulatory framework will bring greater transparency and certainty to the EU cryptoasset market, but it will also require regulators to maintain good communication with the industry to ensure the feasibility of regulatory measures.