Weekly Market Highlights Review: ALPACA Manipulation and US Encryption Policy - Market Maker Games and Mainstreaming Wave

This week, the cryptocurrency market is showing a high-level fluctuation, with Bitcoin's price oscillating in the range of 93,500 to 95,500 USD. Some altcoins have performed well, such as those in the SUI ecosystem, Virtual ecosystem, and several AI-related tokens, which have seen significant gains. The overall market is still waiting for key economic data this week, such as the unemployment rate and non-farm payroll data, to determine the future direction.

The cryptocurrency market has recently shown a complex pattern amid the intertwining of regulation and market manipulation. The ALPACA incident revealed that some institutions manipulate low market cap token contracts, leveraging short squeezes and funding rates to harvest retail investors, highlighting the speculative risks present in the market. Meanwhile, the policy stance in some U.S. states supports crypto assets, such as the "Strategic Bitcoin Reserve Act" passed in one state, marking the acceleration of the mainstreaming process of cryptocurrencies.

The ALPACA incident reflects some manipulative behaviors present in the encryption market. Institutions accumulate a large amount of chips before a currency is about to be delisted, profiting by driving up prices and collecting funding fees. They leverage negative funding rates and short squeeze effects to push prices significantly higher, ultimately cashing out at high levels for profit. This operational method highlights the risks in the low market cap token contract market.

Investors can pay attention to low market cap ( altcoins, such as those below 100 million USD ), and observe the open interest ( OI ) and funding rate changes in their contract markets. A significant increase in OI and a shift to a positive funding rate may indicate that large funds are entering to go long; conversely, caution is needed. Combining other technical indicators can provide a more accurate judgment of market trends.

In terms of policy regulation, the U.S. Securities and Exchange Commission has recently approved the listing of several XRP futures ETFs but has delayed the approval decisions for several spot encryption currency ETFs, including SOL and XRP. The market generally expects a high possibility that most spot ETFs will eventually be approved. At the same time, a state legislature has passed a Bitcoin reserve bill that allows state finances and pension systems to invest in Bitcoin, reflecting that encryption currency is gradually gaining mainstream recognition.