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Market Overview
General Market Situation
This week, the cryptocurrency market has been on an upward trajectory, with the broader market and most altcoins showing upward trends. The recent slump in market sentiment has been considerably alleviated, with the market sentiment index rising from 55% to 79%, entering a bullish zone overall. The market value of stablecoins has continued to rise for a second week, with USDT reaching $145.7 billion and USDC at $61.9 billion, representing growth of 0.62% and 2.32%, respectively. This indicates that institutional funds have increased their entry into the market, particularly from the United States. This week's market rally has significantly boosted the sentiment of American investors, prompting accelerated entry into the market.
This week's market upswing was primarily driven by the easing of the U.S. stance on tariffs with China, Trump's announcement that he does not intend to fire Federal Reserve Chair Jerome Powell, and the appointment of the new SEC Chair Paul Atkins, who has shown a friendly attitude toward the crypto industry. These factors have fueled this week's substantial market rebound. However, the market still faces the uncertainties of potential U.S. economic recession and tariff policies. Therefore, this week's rally is seen as a correction to the previous oversold conditions and not yet a market reversal.
Next Week's Bullish Targets
SOL, SNX
SOL: A comprehensive rebound in the Solana ecosystem, driven by the rise of meme coins, stablecoins, and decentralized trading platforms.
Meme Coin Market Rebound
This week, with the market recovery, the trading volume of meme coins on the Solana blockchain has significantly increased. The number of meme coin purchases has consistently exceeded the number of sales, driving a rapid recovery of on-chain data for Solana. This indicates that despite the previous retreat of the meme coin wave causing losses for on-chain users, investor interest in meme coins remains strong. Furthermore, since Pump.fun launched PumpSwap, daily trading volumes of PumpSwap have gradually increased, maintaining between $300 million and $480 million, accounting for 9% to 19% of Solana's DEX trading volume. This shows that the meme coin market is gradually warming up. The activity in the meme coin market helps boost SOL's price in the short term.
Growth in Stablecoin Supply on Solana Chain
The supply of stablecoins on the Solana blockchain has continued to grow rapidly, surpassing $1.28 billion, setting a new historical record. This growth reflects investors' confidence in the Solana ecosystem and the demand for liquidity support on the chain. Adequate stablecoin supply provides crucial liquidity support for financial activities on the Solana chain, promoting the development of the ecosystem. This liquidity not only enhances the activity of on-chain transactions but also offers more trading and investment opportunities for investors.
Growth in Solana Chain DEX Trading Volume
Decentralized trading platforms (DEX) on the Solana blockchain have seen trading volumes exceed $3.5 billion over the past 24 hours, indicating a recovery of on-chain activity. The supply of stablecoins has also continued to grow, recently surpassing $1.82 billion. This reflects investors' confidence in the Solana ecosystem and provides more liquidity support for the chain.
Solana's Decentralization Policy
The Solana Foundation has introduced new policies to enhance decentralization. For validators newly added to its delegation program, if certain validators have been eligible for Solana Foundation delegation for at least 18 months on the mainnet and have less than 1,000 SOL staked outside of the foundation's delegation, three of them will be removed. This policy aims to reduce reliance on the foundation's delegation and encourage community-supported validators.
Institutional Companies Enter and Increase Holdings
Canadian publicly listed investment company SOL Strategies has issued $500 million in convertible bonds to purchase and stake SOL. Following this announcement, SOL Strategies' stock price rose by 23.5%. SOL Strategies intends to emulate Michael Saylor's MicroStrategy by continuously issuing convertible corporate bonds to increase BTC holdings, thereby driving up its stock price. If successful, this move will provide substantive support and benefits for SOL's price. Recently, there is a growing trend of traditional companies also acquiring SOL through various means.
Spot ETF News for SOL
The application for SOL's spot ETF has been delayed, but with the appointment of the new SEC Chair Paul Atkins, the situation may change. Paul Atkins holds a friendly attitude toward the crypto industry and prioritizes establishing a clear digital asset regulatory framework. This is favorable for the approval of SOL's spot ETF and may further drive SOL's price upward.
SNX: From Depeg Crisis to Recovery Hope, How Synthetix Rebuilds Market Confidence
Recently, the algorithmic stablecoin sUSD issued by Synthetix experienced a severe depeg event due to adjustments in the debt management mechanism under the SIP-420 proposal. The price of sUSD dropped as low as $0.68, with Synthetix's token SNX falling to a low of $0.55. Synthetix's total value locked (TVL) reached a low of $72.23 million. Market investors' confidence in Synthetix was shaken.
Remedial Measures
· Liquidity Incentives: Synthetix has pledged sUSD/sUSDe LP on Convex, increasing yields to 49.18% to attract more liquidity.
· Deposit Incentives: Through the Infinex project, Synthetix incentivizes users to deposit sUSD by distributing 16,000 OP rewards weekly to users depositing over 1,000 sUSD, with the incentive lasting six weeks.
· Staking Incentives: Users can stake sUSD into the 420 pool, receiving 5 million SNX as an incentive for a one-year stake.
· Negative Incentives and Staking Optimization: Stakers are required to deposit a certain proportion of sUSD. Those failing to meet the target will have debt relief suspended, with the proportion increased during depeg events. Additionally, SNX pool staking is implemented to expand sUSD supply, with Perps V4 supporting multi-collateral and off-chain order matching.
Market Reaction
Driven by these measures, the price of sUSD rebounded to a high of $0.88, and SNX's price rose to $0.74. Moreover, Synthetix's total value locked (TVL) increased from $72.23 million to $89.25 million, a growth of 23.56%.
Subsequent Impact
Although the depeg issue of sUSD has not been fully resolved, Synthetix's proactive measures have given the market hope for recovery. If the price of sUSD can return to $1, investor confidence in Synthetix may be restored, potentially driving further increases in SNX's price.
Bearish Targets Next Week
REZ: Amid Restaking sluggishness, 8.64% token unlock may trigger concentrated sell-offs by investment institutions and teams.
Renzo is a liquidity re-staking protocol based on the EigenLayer ecosystem, aiming to simplify complex staking mechanisms for end-users and enable rapid collaboration with EigenLayer node operators and Active Validator Services (AVS). Due to the recent poor performance of the Ethereum ecosystem and the continued low price of ETH, the staking rate for ETH has also declined, causing Restaking projects to lose market attention. On April 30th, 864 million REZ tokens will be unlocked, accounting for 8.64% of the total locked supply. Currently, the circulation rate is only 21%, and according to the linear unlocking schedule in its whitepaper, the primary recipients of this unlock are investment institutions and the project team. Given the low current interest in Restaking projects and the lackluster performance of the Ethereum ecosystem, this significant unlock may trigger substantial selling, impacting REZ's token price.
OMNI: Large token unlock approaching, market sell-off risk intensifies.
Omni is an interoperability layer for Ethereum, establishing low-latency communication across all Ethereum Rollups and enabling Ethereum to operate as a unified system in the modular era. Omni itself is also a public blockchain project. Due to the recent slump in the Ethereum ecosystem and the poor performance of various Layer-2 projects in this cycle, Omni, as a connecting project between Layer-2s, has also lost its value proposition. On May 2nd, 16.63 million OMNI tokens will be unlocked, representing 16.64% of the total locked supply. The current circulation rate is only 19%, effectively doubling the existing circulating supply. According to the linear unlocking schedule in its whitepaper, the primary recipients of this unlock are investment institutions and the project team. Given Omni's low current profile, this significant unlock may trigger substantial selling, affecting the price of OMNI tokens.
Market Sentiment Index Analysis
This week, the market sentiment index rose from last week's 55% to 79%, entering a bullish zone overall.
Hot Sectors
MCP: Can It Lead the Future Direction of CryptoAI?
MCP stands for Model Context Protocol, introduced by Anthropic on November 25, 2024. Initially, it did not garner market attention. After Deepseek challenged existing AI software, the market began to focus on optimizing algorithms and resource scheduling, shifting from the previous approach of AI development relying on cumulative computing power. Thus, MCP's standardization of how external data and applications interact with and provide context to large language models (LLMs) gradually gained market recognition.
Recently, following the listing of the MCP-related token Dark on Binance Alpha, which performed well, investors have shown increased interest in MCP-related tokens, making MCP one of the few concentrated hotspots in the market.
Concept of MCP
Model Context Protocol (MCP), an open-source standard launched by Anthropic, initially extended the Claude ecosystem. It aims to address the fragmented interaction between AI models and external tools and data. Now, MCP provides a secure and standardized way for AI agents driven by large language models to interact with external systems for real-time data access. In practice, MCP serves as a universal adapter, enabling AI to access content repositories, business tools, and development environments.
MCP's core goal is to enhance efficiency through standardized processes, enabling AI agents to transition from "understanding" to "action." It offers efficient tools for developers and allows businesses and non-technical users to easily customize their agents. In this way, MCP can bridge virtual intelligence and the real world, driving personalized innovation and development across industries.
Technology and Functionality of MCP
Technical Foundation of MCP
MCP is based on JSON-RPC 2.0, a lightweight and efficient communication standard supporting real-time two-way interaction, similar to WebSockets. It operates through a client-server architecture:
· MCP Host: The user-interfacing application, such as Claude Desktop, Cursor, or Windsurf, responsible for receiving requests and displaying results.
· MCP Client: Embedded within the host, it establishes a one-to-one connection with the server, managing protocol communication to ensure isolation and security.
· MCP Server: A lightweight program providing specific functions, connecting to local (e.g., desktop files) or remote (e.g., cloud APIs) data sources.
Transmission methods include:
· Stdio: Standard input/output, suitable for local rapid deployment, such as file management, with latency as low as milliseconds.
· HTTP SSE: Server-sent events, supporting remote real-time interaction, such as cloud API calls, suitable for distributed scenarios.
Working Principle
MCP employs a client-server architecture. In simple terms, when an MCP host needs to retrieve data or perform operations, it communicates and collaborates between the MCP client and MCP server. To ensure efficiency and security, MCP assigns a dedicated client to each server, forming a one-to-one isolated connection. Its core components include:
· Host: The user entry point, such as Claude Desktop, responsible for initiating requests and displaying results, serving as the "interface" for interaction.
· Client: The communication intermediary, interacting with the server using JSON-RPC 2.0, managing requests and responses, and ensuring isolation.
· Server: The function provider, connecting to external resources and executing tasks, such as reading files or invoking APIs.
Transmission methods are flexible and diverse:
· Stdio: Suitable for local deployment, enabling rapid access to desktop files or local databases with millisecond-level latency.
· HTTP SSE: Supports remote interaction, enabling cloud API calls with strong real-time capabilities.
Advantages of MCP
MCP addresses challenges faced by current AI applications through standardized interfaces:
· Real-time Access: AI can obtain the latest data in an extremely short time.
· Security and Control: Direct data access eliminates intermediate storage, with permission management reliability as high as 98%. Users can restrict AI access to specific files.
· Low Computational Load: No need for embedded vectors, reducing computational costs by approximately 70%.
· Flexibility and Scalability: Connections reduced from 100 million to 20,000, significantly simplifying the configuration process.
· Interoperability: A single MCP Server can be reused by multiple models.
· Vendor Flexibility: Switching LLMs does not require infrastructure restructuring, similar to USB-C compatibility.
· Autonomous Agent Support: Enables AI to dynamically access tools and execute complex tasks.
MCP Ecosystem Projects
Dark
Dark is an experimental MCP network based on Solana, focusing on trusted execution environments (TEE). By automatically integrating new tools and on-chain interactions, Dark aims to innovate in decentralized technology. However, most project functionalities are not yet launched and currently fall under the conceptual stage. It has issued its token, DARK.
SkyAI
SkyAI is a native AI infrastructure based on BNB Chain, offering multi-chain data access and AI agent deployment. The project is still in the conceptual stage, with no actual product launched yet. It has issued its token, SKYAI, with a market capitalization of $43 million, making it a leading project in the MCP sector.
Solix
Solix is a DePIN network adopting MCP, focusing on intelligent bandwidth sharing. Users can share bandwidth via browser extensions and receive rewards, covering 63 countries worldwide. The project has achieved relatively rapid technical implementation but requires validation of user engagement and the sustainability of its economic model. It has not yet issued a token.
HighKey
HighKey is a DeFAI project compatible with MCP and DARP protocols, focusing on DeFi arbitrage and professional analysis. It has issued its token, HIGHKEY, with a small market capitalization of $5.68 million. The project has a clear development focus but needs to enhance user experience and differentiation.
DeMCP
DeMCP is a decentralized MCP project focusing on trust and security, offering SSE proxy services. It has not yet issued a token and remains in the development stage, requiring the demonstration of actual products.
UnifAI
UnifAI is a DeFAI project providing on-chain and off-chain task execution capabilities. Its flagship product, UniQ, simplifies complex on-chain operations. Although it has not issued a token, it has launched an积分plan.
Future Development Directions
Currently, Web3 AI projects based on the MCP protocol are mostly in early development stages, with no substantive products launched yet. However, some have already issued tokens. Although MCP is currently an emerging hotspot in the AI niche sector, given the previous failures in the AI Agent sector, it is still necessary to approach MCP projects with caution—whether they are merely fleeting AI meme assets or can truly drive development in the AI sector remains to be seen. Therefore, the future development of MCP should primarily focus on the implementation and application of decentralized technologies. With the rapid development of AI and blockchain technologies, MCP will continue to optimize its technical architecture to support more efficient computation and data sharing. Additionally, MCP will strive to enhance interoperability, simplify developers' workflows, and promote the adoption of decentralized applications.
Market Sector Overview
Data source: SoSoValue
In terms of weekly return rates, the AI sector performed the best, while the CeFi sector performed the worst.
AI Sector: In the AI sector, TAO, RENDER, FET, WLD, and FARTCOIN hold significant proportions, totaling 86.32%. Their weekly increases were 50.96%, 18.93%, 53.36%, 33.58%, and 29.95%, respectively. The average growth rate exceeded that of projects in other sectors, making the AI sector the best-performing.
CeFi Sector: In the CeFi sector, BNB, BGB, and OKB hold significant proportions, totaling 89.97%. Their weekly increases were 2.35%, 2.51%, and 2.29%, respectively. The average growth rate was lower than that of projects in other sectors, resulting in the CeFi sector being the worst-performing.
Next Week's Crypto Major Events Preview
Wednesday (April 30th): U.S. Q1 Real GDP Annualized Quarterly Rate Revised; U.S. March Core PCE Price Index Yearly Rate; U.S. April ADP Employment.
Thursday (May 1st): U.S. April ISM Manufacturing PMI.
Friday (May 2nd): U.S. April Seasonally Adjusted Non-Farm Payrolls; U.S. April Unemployment Rate.
Summary
This week, the cryptocurrency market has witnessed a significant upward trend, with market sentiment shifting from depression to positivity. This change was primarily driven by U.S. policy easing and the friendly attitude of the new SEC Chair toward the crypto industry. As the policy environment evolves, investor confidence in the market gradually returns, leading to capital inflows into the crypto market and driving price increases. However, the market must remain vigilant about the uncertainties of potential U.S. economic recession and tariff policies, which may continue to impact market trends. While enjoying market growth, investors should also exercise caution to address potential volatility.
Projects like Solana and Synthetix demonstrate potential for recovery, particularly with positive progress in technology upgrades and community support. Solana's accelerated development and Synthetix's innovative initiatives have attracted more investor attention, and these projects are expected to expand their market influence in 2025. However, projects like Omni face selling pressure from token unlocks, which may negatively impact their prices. Investors should reasonably allocate their investments based on specific project circumstances and market conditions to mitigate potential risks.
Although the overall industry outlook is positive, market uncertainty persists due to potential U.S. economic recession and tariff policies. This week's rally is seen as a correction to the previous oversold conditions and not yet a market reversal. Next week will see the release of multiple macroeconomic data points, including:
· U.S. Q1 Real GDP Annualized Quarterly Rate Revised;
· U.S. March Core PCE Price Index Yearly Rate;
· U.S. April ADP Employment; U.S. April ISM Manufacturing PMI;
· U.S. April Seasonally Adjusted Non-Farm Payrolls; U.S. April Unemployment Rate.
These data points can influence future market trends. It is advisable for investors to maintain moderate positions, manage risks effectively, and await policy clarity as the optimal strategy for navigating the current market.
Market Overview
General Market Situation
This week, the cryptocurrency market has been on an upward trajectory, with the broader market and most altcoins showing upward trends. The recent slump in market sentiment has been considerably alleviated, with the market sentiment index rising from 55% to 79%, entering a bullish zone overall. The market value of stablecoins has continued to rise for a second week, with USDT reaching $145.7 billion and USDC at $61.9 billion, representing growth of 0.62% and 2.32%, respectively. This indicates that institutional funds have increased their entry into the market, particularly from the United States. This week's market rally has significantly boosted the sentiment of American investors, prompting accelerated entry into the market.
This week's market upswing was primarily driven by the easing of the U.S. stance on tariffs with China, Trump's announcement that he does not intend to fire Federal Reserve Chair Jerome Powell, and the appointment of the new SEC Chair Paul Atkins, who has shown a friendly attitude toward the crypto industry. These factors have fueled this week's substantial market rebound. However, the market still faces the uncertainties of potential U.S. economic recession and tariff policies. Therefore, this week's rally is seen as a correction to the previous oversold conditions and not yet a market reversal.
Next Week's Bullish Targets
SOL, SNX
SOL: A comprehensive rebound in the Solana ecosystem, driven by the rise of meme coins, stablecoins, and decentralized trading platforms.
Meme Coin Market Rebound
This week, with the market recovery, the trading volume of meme coins on the Solana blockchain has significantly increased. The number of meme coin purchases has consistently exceeded the number of sales, driving a rapid recovery of on-chain data for Solana. This indicates that despite the previous retreat of the meme coin wave causing losses for on-chain users, investor interest in meme coins remains strong. Furthermore, since Pump.fun launched PumpSwap, daily trading volumes of PumpSwap have gradually increased, maintaining between $300 million and $480 million, accounting for 9% to 19% of Solana's DEX trading volume. This shows that the meme coin market is gradually warming up. The activity in the meme coin market helps boost SOL's price in the short term.
Growth in Stablecoin Supply on Solana Chain
The supply of stablecoins on the Solana blockchain has continued to grow rapidly, surpassing $1.28 billion, setting a new historical record. This growth reflects investors' confidence in the Solana ecosystem and the demand for liquidity support on the chain. Adequate stablecoin supply provides crucial liquidity support for financial activities on the Solana chain, promoting the development of the ecosystem. This liquidity not only enhances the activity of on-chain transactions but also offers more trading and investment opportunities for investors.
Growth in Solana Chain DEX Trading Volume
Decentralized trading platforms (DEX) on the Solana blockchain have seen trading volumes exceed $3.5 billion over the past 24 hours, indicating a recovery of on-chain activity. The supply of stablecoins has also continued to grow, recently surpassing $1.82 billion. This reflects investors' confidence in the Solana ecosystem and provides more liquidity support for the chain.
Solana's Decentralization Policy
The Solana Foundation has introduced new policies to enhance decentralization. For validators newly added to its delegation program, if certain validators have been eligible for Solana Foundation delegation for at least 18 months on the mainnet and have less than 1,000 SOL staked outside of the foundation's delegation, three of them will be removed. This policy aims to reduce reliance on the foundation's delegation and encourage community-supported validators.
Institutional Companies Enter and Increase Holdings
Canadian publicly listed investment company SOL Strategies has issued $500 million in convertible bonds to purchase and stake SOL. Following this announcement, SOL Strategies' stock price rose by 23.5%. SOL Strategies intends to emulate Michael Saylor's MicroStrategy by continuously issuing convertible corporate bonds to increase BTC holdings, thereby driving up its stock price. If successful, this move will provide substantive support and benefits for SOL's price. Recently, there is a growing trend of traditional companies also acquiring SOL through various means.
Spot ETF News for SOL
The application for SOL's spot ETF has been delayed, but with the appointment of the new SEC Chair Paul Atkins, the situation may change. Paul Atkins holds a friendly attitude toward the crypto industry and prioritizes establishing a clear digital asset regulatory framework. This is favorable for the approval of SOL's spot ETF and may further drive SOL's price upward.
SNX: From Depeg Crisis to Recovery Hope, How Synthetix Rebuilds Market Confidence
Recently, the algorithmic stablecoin sUSD issued by Synthetix experienced a severe depeg event due to adjustments in the debt management mechanism under the SIP-420 proposal. The price of sUSD dropped as low as $0.68, with Synthetix's token SNX falling to a low of $0.55. Synthetix's total value locked (TVL) reached a low of $72.23 million. Market investors' confidence in Synthetix was shaken.
Remedial Measures
· Liquidity Incentives: Synthetix has pledged sUSD/sUSDe LP on Convex, increasing yields to 49.18% to attract more liquidity.
· Deposit Incentives: Through the Infinex project, Synthetix incentivizes users to deposit sUSD by distributing 16,000 OP rewards weekly to users depositing over 1,000 sUSD, with the incentive lasting six weeks.
· Staking Incentives: Users can stake sUSD into the 420 pool, receiving 5 million SNX as an incentive for a one-year stake.
· Negative Incentives and Staking Optimization: Stakers are required to deposit a certain proportion of sUSD. Those failing to meet the target will have debt relief suspended, with the proportion increased during depeg events. Additionally, SNX pool staking is implemented to expand sUSD supply, with Perps V4 supporting multi-collateral and off-chain order matching.
Market Reaction
Driven by these measures, the price of sUSD rebounded to a high of $0.88, and SNX's price rose to $0.74. Moreover, Synthetix's total value locked (TVL) increased from $72.23 million to $89.25 million, a growth of 23.56%.
Subsequent Impact
Although the depeg issue of sUSD has not been fully resolved, Synthetix's proactive measures have given the market hope for recovery. If the price of sUSD can return to $1, investor confidence in Synthetix may be restored, potentially driving further increases in SNX's price.
Bearish Targets Next Week
REZ: Amid Restaking sluggishness, 8.64% token unlock may trigger concentrated sell-offs by investment institutions and teams.
Renzo is a liquidity re-staking protocol based on the EigenLayer ecosystem, aiming to simplify complex staking mechanisms for end-users and enable rapid collaboration with EigenLayer node operators and Active Validator Services (AVS). Due to the recent poor performance of the Ethereum ecosystem and the continued low price of ETH, the staking rate for ETH has also declined, causing Restaking projects to lose market attention. On April 30th, 864 million REZ tokens will be unlocked, accounting for 8.64% of the total locked supply. Currently, the circulation rate is only 21%, and according to the linear unlocking schedule in its whitepaper, the primary recipients of this unlock are investment institutions and the project team. Given the low current interest in Restaking projects and the lackluster performance of the Ethereum ecosystem, this significant unlock may trigger substantial selling, impacting REZ's token price.
OMNI: Large token unlock approaching, market sell-off risk intensifies.
Omni is an interoperability layer for Ethereum, establishing low-latency communication across all Ethereum Rollups and enabling Ethereum to operate as a unified system in the modular era. Omni itself is also a public blockchain project. Due to the recent slump in the Ethereum ecosystem and the poor performance of various Layer-2 projects in this cycle, Omni, as a connecting project between Layer-2s, has also lost its value proposition. On May 2nd, 16.63 million OMNI tokens will be unlocked, representing 16.64% of the total locked supply. The current circulation rate is only 19%, effectively doubling the existing circulating supply. According to the linear unlocking schedule in its whitepaper, the primary recipients of this unlock are investment institutions and the project team. Given Omni's low current profile, this significant unlock may trigger substantial selling, affecting the price of OMNI tokens.
Market Sentiment Index Analysis
This week, the market sentiment index rose from last week's 55% to 79%, entering a bullish zone overall.
Hot Sectors
MCP: Can It Lead the Future Direction of CryptoAI?
MCP stands for Model Context Protocol, introduced by Anthropic on November 25, 2024. Initially, it did not garner market attention. After Deepseek challenged existing AI software, the market began to focus on optimizing algorithms and resource scheduling, shifting from the previous approach of AI development relying on cumulative computing power. Thus, MCP's standardization of how external data and applications interact with and provide context to large language models (LLMs) gradually gained market recognition.
Recently, following the listing of the MCP-related token Dark on Binance Alpha, which performed well, investors have shown increased interest in MCP-related tokens, making MCP one of the few concentrated hotspots in the market.
Concept of MCP
Model Context Protocol (MCP), an open-source standard launched by Anthropic, initially extended the Claude ecosystem. It aims to address the fragmented interaction between AI models and external tools and data. Now, MCP provides a secure and standardized way for AI agents driven by large language models to interact with external systems for real-time data access. In practice, MCP serves as a universal adapter, enabling AI to access content repositories, business tools, and development environments.
MCP's core goal is to enhance efficiency through standardized processes, enabling AI agents to transition from "understanding" to "action." It offers efficient tools for developers and allows businesses and non-technical users to easily customize their agents. In this way, MCP can bridge virtual intelligence and the real world, driving personalized innovation and development across industries.
Technology and Functionality of MCP
Technical Foundation of MCP
MCP is based on JSON-RPC 2.0, a lightweight and efficient communication standard supporting real-time two-way interaction, similar to WebSockets. It operates through a client-server architecture:
· MCP Host: The user-interfacing application, such as Claude Desktop, Cursor, or Windsurf, responsible for receiving requests and displaying results.
· MCP Client: Embedded within the host, it establishes a one-to-one connection with the server, managing protocol communication to ensure isolation and security.
· MCP Server: A lightweight program providing specific functions, connecting to local (e.g., desktop files) or remote (e.g., cloud APIs) data sources.
Transmission methods include:
· Stdio: Standard input/output, suitable for local rapid deployment, such as file management, with latency as low as milliseconds.
· HTTP SSE: Server-sent events, supporting remote real-time interaction, such as cloud API calls, suitable for distributed scenarios.
Working Principle
MCP employs a client-server architecture. In simple terms, when an MCP host needs to retrieve data or perform operations, it communicates and collaborates between the MCP client and MCP server. To ensure efficiency and security, MCP assigns a dedicated client to each server, forming a one-to-one isolated connection. Its core components include:
· Host: The user entry point, such as Claude Desktop, responsible for initiating requests and displaying results, serving as the "interface" for interaction.
· Client: The communication intermediary, interacting with the server using JSON-RPC 2.0, managing requests and responses, and ensuring isolation.
· Server: The function provider, connecting to external resources and executing tasks, such as reading files or invoking APIs.
Transmission methods are flexible and diverse:
· Stdio: Suitable for local deployment, enabling rapid access to desktop files or local databases with millisecond-level latency.
· HTTP SSE: Supports remote interaction, enabling cloud API calls with strong real-time capabilities.
Advantages of MCP
MCP addresses challenges faced by current AI applications through standardized interfaces:
· Real-time Access: AI can obtain the latest data in an extremely short time.
· Security and Control: Direct data access eliminates intermediate storage, with permission management reliability as high as 98%. Users can restrict AI access to specific files.
· Low Computational Load: No need for embedded vectors, reducing computational costs by approximately 70%.
· Flexibility and Scalability: Connections reduced from 100 million to 20,000, significantly simplifying the configuration process.
· Interoperability: A single MCP Server can be reused by multiple models.
· Vendor Flexibility: Switching LLMs does not require infrastructure restructuring, similar to USB-C compatibility.
· Autonomous Agent Support: Enables AI to dynamically access tools and execute complex tasks.
MCP Ecosystem Projects
Dark
Dark is an experimental MCP network based on Solana, focusing on trusted execution environments (TEE). By automatically integrating new tools and on-chain interactions, Dark aims to innovate in decentralized technology. However, most project functionalities are not yet launched and currently fall under the conceptual stage. It has issued its token, DARK.
SkyAI
SkyAI is a native AI infrastructure based on BNB Chain, offering multi-chain data access and AI agent deployment. The project is still in the conceptual stage, with no actual product launched yet. It has issued its token, SKYAI, with a market capitalization of $43 million, making it a leading project in the MCP sector.
Solix
Solix is a DePIN network adopting MCP, focusing on intelligent bandwidth sharing. Users can share bandwidth via browser extensions and receive rewards, covering 63 countries worldwide. The project has achieved relatively rapid technical implementation but requires validation of user engagement and the sustainability of its economic model. It has not yet issued a token.
HighKey
HighKey is a DeFAI project compatible with MCP and DARP protocols, focusing on DeFi arbitrage and professional analysis. It has issued its token, HIGHKEY, with a small market capitalization of $5.68 million. The project has a clear development focus but needs to enhance user experience and differentiation.
DeMCP
DeMCP is a decentralized MCP project focusing on trust and security, offering SSE proxy services. It has not yet issued a token and remains in the development stage, requiring the demonstration of actual products.
UnifAI
UnifAI is a DeFAI project providing on-chain and off-chain task execution capabilities. Its flagship product, UniQ, simplifies complex on-chain operations. Although it has not issued a token, it has launched an积分plan.
Future Development Directions
Currently, Web3 AI projects based on the MCP protocol are mostly in early development stages, with no substantive products launched yet. However, some have already issued tokens. Although MCP is currently an emerging hotspot in the AI niche sector, given the previous failures in the AI Agent sector, it is still necessary to approach MCP projects with caution—whether they are merely fleeting AI meme assets or can truly drive development in the AI sector remains to be seen. Therefore, the future development of MCP should primarily focus on the implementation and application of decentralized technologies. With the rapid development of AI and blockchain technologies, MCP will continue to optimize its technical architecture to support more efficient computation and data sharing. Additionally, MCP will strive to enhance interoperability, simplify developers' workflows, and promote the adoption of decentralized applications.
Market Sector Overview
Data source: SoSoValue
In terms of weekly return rates, the AI sector performed the best, while the CeFi sector performed the worst.
AI Sector: In the AI sector, TAO, RENDER, FET, WLD, and FARTCOIN hold significant proportions, totaling 86.32%. Their weekly increases were 50.96%, 18.93%, 53.36%, 33.58%, and 29.95%, respectively. The average growth rate exceeded that of projects in other sectors, making the AI sector the best-performing.
CeFi Sector: In the CeFi sector, BNB, BGB, and OKB hold significant proportions, totaling 89.97%. Their weekly increases were 2.35%, 2.51%, and 2.29%, respectively. The average growth rate was lower than that of projects in other sectors, resulting in the CeFi sector being the worst-performing.
Next Week's Crypto Major Events Preview
Wednesday (April 30th): U.S. Q1 Real GDP Annualized Quarterly Rate Revised; U.S. March Core PCE Price Index Yearly Rate; U.S. April ADP Employment.
Thursday (May 1st): U.S. April ISM Manufacturing PMI.
Friday (May 2nd): U.S. April Seasonally Adjusted Non-Farm Payrolls; U.S. April Unemployment Rate.
Summary
This week, the cryptocurrency market has witnessed a significant upward trend, with market sentiment shifting from depression to positivity. This change was primarily driven by U.S. policy easing and the friendly attitude of the new SEC Chair toward the crypto industry. As the policy environment evolves, investor confidence in the market gradually returns, leading to capital inflows into the crypto market and driving price increases. However, the market must remain vigilant about the uncertainties of potential U.S. economic recession and tariff policies, which may continue to impact market trends. While enjoying market growth, investors should also exercise caution to address potential volatility.
Projects like Solana and Synthetix demonstrate potential for recovery, particularly with positive progress in technology upgrades and community support. Solana's accelerated development and Synthetix's innovative initiatives have attracted more investor attention, and these projects are expected to expand their market influence in 2025. However, projects like Omni face selling pressure from token unlocks, which may negatively impact their prices. Investors should reasonably allocate their investments based on specific project circumstances and market conditions to mitigate potential risks.
Although the overall industry outlook is positive, market uncertainty persists due to potential U.S. economic recession and tariff policies. This week's rally is seen as a correction to the previous oversold conditions and not yet a market reversal. Next week will see the release of multiple macroeconomic data points, including:
· U.S. Q1 Real GDP Annualized Quarterly Rate Revised;
· U.S. March Core PCE Price Index Yearly Rate;
· U.S. April ADP Employment; U.S. April ISM Manufacturing PMI;
· U.S. April Seasonally Adjusted Non-Farm Payrolls; U.S. April Unemployment Rate.
These data points can influence future market trends. It is advisable for investors to maintain moderate positions, manage risks effectively, and await policy clarity as the optimal strategy for navigating the current market.
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