Hey, it's Alex with the Token Metrics daily pulls from May nineteenth, twenty twenty six. We've got a lot to unpack today, from a massive exploit on monad to some heavy selling in the bitcoin funds. It's a bit of a rough one, so let's get into it. But first a quick word from our sponsor. Okay, So here's what's happening. The big headline today is seventy six million dollars vanishing from Echo protocol. Someone found a way to trick the system into printing fake bitcoin out of thin air and
then swapped it for the real thing. This matters because it brings the total loss to hacks this year to over three hundred million dollars. At the same time, the big bitcoin funds saw over six hundred million dollars walk out the door in a single day. People are feeling very nervous. The Fear and Greed Index is down to twenty five, which is deep into extreme fear territory. To top it off, a new law called the Clarity Act just got a last minute update that can make life
very difficult for decentralized finance apps in the US. Looking at the numbers, bitcoin is holding steady around seventy seven thousand. It's not really moving much, but Ethereum and Salona are feeling more of the heat. Total market cap is sitting at two and a half trillion dollars. Bitcoin dominance is up at fifty eight percent, which means people are hiding in the big coin rather than taking risks on smaller ones. Total value locked in DeFi is around eighty three billion.
One interesting thing is that stable coins supply has it changed. This tells us that even though people are scared, they aren't necessarily cashing out to the bank. They're just sitting on the sidelines waiting for a sign over. On the prediction markets, most people are betting that Ethereum stays above twenty one hundred for the day, but nobody is exactly betting on a big rally. Even with all this fear,
some corners of the market are still moving. Analytics tokens jumped over one hundred percent this week, led by a project called super Fortune. Politify tokens are also up significantly. These are small categories, so a little bit of money makes a big splash. More importantly, the d pen sector, which is basically using crypto to build real world infrastructure is up twenty percent. AI tokens are also holding on to a sixteen percent gain. The takeaway here is that
investors are getting much more picky. They're moving away from general hype and looking for specific themes that have a clear purpose. For today's Alpha spotlight, we're looking at gold. It's down about four percent this week. Usually when crypto investors get scared, they look at gold as a safe harbor, but right even gold is being sold off. This suggests we're in a risk off environment across the board, which means big investors are pulling back from everything, not just crypto.
The full macro regime walk through and what it means for your crypto allocation is in the monthly playbook Alpha Trial at tokenmetrics dot com. Let's dive deeper into that Echo protocol hack. The attacker broke the mechanism that creates EBTC on the monod network. In plain English, they found a loophole to print money without putting up any collateral. This is a huge blow because it happened just as
Congress is debating the Clarity Act. There's a new clause in that bill that could treat these protocols like traditional stockbrokers. If that sticks, many decentralized projects might have to block US users or shut down entirely because they aren't built to handle that kind of red tape. On the flip side, the SEC is actually softening its stance on tokenized stocks. This could eventually let you trade Apple or Tesla shares on a blockchain. Twenty four to seven bitgit wallet is
already jumping on this for their ninety million users. Even Wall Street analysts are starting to change how they value crypto companies. TD Cowen recently raised their outlook for micro Strategy, not just because of bitcoin, but because they see the company as a new kind of financial platform. Finally, keep an eye on the Ethereum Foundation. Two more senior people just left, which is part of a larger wave of resignations. It's making people wonder if there's a shift happening in
how Ethereum is managed behind the scenes. All right, before we get into the risks, quick word from our sponsor. Okay, we're back. Let's talk about what to watch for. We've got three main risks to watch. First. That fear and greed score of twenty five. When it stays this low for a while, it usually means buyers are too scared to step in, which can lead to a slow bleeding prices. Second, the Echo hack is the perfect excuse for regulators to get tough on DeFi. If we see more hacks, the
chance of getting crypto friendly laws past this year drops fast. Third, there's a race happening with token ied stocks. If the US takes too long to set the rules, all that innovation and money will just move to offshore platforms. The big picture, we're waiting to see if the big bitcoin funds start buying again. If they do, and if that DeFi log gets fixed, the mood could flip very quickly. Looking ahead to the next week, keep your eyes peel for more details from the SEC on those token I
stock rules. The specific fine print will decide which companies get to lead this new market. Also, watch for a post mortem report from the Echo protocol team. If they stay silent after losing seventy six million, it's a major red flag for the whole monad ecosystem. One quick update from our side, the hidden gems feature is now live on token Metrics. It's designed to help you find those low capped tokens that have strong data signals before they
hit the mainstream. You can find that at tokenmetrics dot com. If you're not subscribed to the podcast yet, hit that subscribe button. It takes two seconds. This is educational content, not investment advice. Always do your own research. I'm Alex, See you next time.