The crypto landscape continues to evolve at breakneck speed, delivering major developments across markets, regulation, and technology. This week alone brought high-impact predictions from industry veterans, new exchange-traded fund (ETF) filings, a massive token exploit, and market turbulence sparked by artificial intelligence innovation. Let’s break down the most significant stories shaping the future of digital assets.
Arthur Hayes Warns of Bitcoin Correction to $70,000
Arthur Hayes, former CEO of BitMEX and a respected voice in crypto circles, has issued a revised short-term outlook for Bitcoin. Once bullish on a March peak, Hayes now believes BTC is already entering a correction phase — one he describes as a “mini financial crisis.”
“I am calling for a $70,000 to $75,000 correction in BTC, a mini financial crisis, and a resumption of money printing that will send us to $250,000 by the end of the year,” Hayes stated.
This bearish pivot stems from tightening global liquidity conditions. Rising U.S. 10-year Treasury yields, a hawkish Federal Reserve, and reduced monetary stimulus in key economies like the U.S., China, and Japan are creating headwinds for risk assets — including Bitcoin.
Hayes emphasizes that Bitcoin behaves like a liquidity-driven asset, making it highly sensitive to macroeconomic shifts. While long-term fundamentals remain strong due to anticipated future monetary easing, the short-term path may be rocky.
At the time of writing, Bitcoin was trading around $104,709, reflecting a slight 0.3% dip over the past 24 hours. Whether Hayes’ $70K prediction unfolds will depend heavily on central bank policy shifts in the coming months.
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Grayscale Files for Litecoin and Solana ETFs
In a move signaling growing institutional interest, Grayscale has submitted applications to the U.S. Securities and Exchange Commission (SEC) for spot ETFs tied to Litecoin (LTC) and Solana (SOL). As one of the largest digital asset managers, Grayscale’s filings carry significant weight in the ongoing push for broader crypto adoption.
The proposed Litecoin ETF is only the second of its kind, following Canary Capital’s earlier submission. Analysts believe Litecoin stands a better chance of early approval because it is widely viewed as a Bitcoin fork — and thus more likely to be classified as a commodity rather than a security.
Eric Balchunas and James Seyffart, veteran ETF analysts, suggest a likely approval sequence:
“We expect a wave of cryptocurrency ETFs next year… First out is likely the BTC + ETH combo ETFs, then probably Litecoin (because it’s a fork of BTC), then HBAR… then XRP/Solana (which have been labeled securities).”
This forecast gains credibility given the SEC’s recent green light for combined Bitcoin and Ethereum ETFs.
Despite the news, Litecoin’s price showed modest movement — up 1.2% to $131.60 — suggesting markets had already priced in some optimism. Solana’s regulatory status remains uncertain due to ongoing litigation classifying it as a potential security, which could delay its ETF approval.
$29 Million SUI Exploit Uncovered by ZachXBT
Blockchain investigator ZachXBT has revealed details of a major security breach involving the Sui (SUI) network. In December 2024, an attacker stole approximately 6.27 million SUI tokens — valued at $29 million — from a large holder.
The theft was executed through compromised credentials or phishing tactics. The hacker then used cross-chain bridging tools to transfer the stolen assets from Sui to Ethereum before laundering them via Tornado Cash in smaller transactions to obscure the trail.
“The victim transferred their .sui domains to a new uncompromised address shortly after the theft. Current limitations with Sui block explorers and analytics tools make the theft difficult to trace,” ZachXBT noted.
This case highlights persistent vulnerabilities in decentralized ecosystems, especially when user-side security lags behind technological advancement. It also underscores the importance of robust on-chain monitoring tools — many of which are still underdeveloped for newer blockchains like Sui.
ZachXBT recently made headlines for assisting U.S. authorities in recovering $20 million from another high-profile hack, reinforcing his role as a key figure in crypto forensics.
DeepSeek AI Sparks $800 Million Crypto Liquidation Event
A surprising catalyst behind this week’s market downturn? The emergence of DeepSeek, a Chinese AI startup gaining traction as a low-cost alternative to giants like OpenAI and Nvidia.
Founded less than two years ago with under $10 million in development costs, DeepSeek has disrupted expectations about AI scalability and cost-efficiency. Its rapid rise triggered broader tech sector volatility — particularly in overvalued AI-related stocks — which spilled over into crypto markets.
On January 27, Bitcoin dropped more than 5%, while major altcoins fell between 8% and 10%. According to Coinglass data, over $800 million in leveraged positions were liquidated that day, affecting more than 315,000 traders.
Industry expert Ash Crypto attributes the sell-off not to crypto-specific issues but to macro-level recalibrations:
“This has nothing to do with the crypto market and everything to do with the US stock market.”
As investors reassess valuations in AI-driven tech sectors, crypto — especially AI-themed tokens — faced cascading sell-offs. The total market cap of AI-related cryptocurrencies declined sharply, reinforcing correlations between traditional tech trends and digital asset performance.
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Ripple vs. SEC: Is the Legal Battle Finally Over?
Rumors are swirling that the long-running legal battle between Ripple Labs and the SEC may have quietly concluded. Observers noticed that the SEC removed all public references to the case from its official litigation page — while other actions against firms like Kraken and Coinbase remain listed.
On social media, influencer John Squire voiced widespread speculation:
“Is Ripple Free from the SEC? Searched for ‘Ripple’ in the SEC’s litigation section and… No results! Did the legal battle just end?”
While this sparked excitement among XRP supporters, legal experts caution against premature conclusions. One attorney confirmed that the case is still active in PACER, the federal court records system:
“The appeal is still open… The last entry is Ripple’s request for a time extension to file its Brief. The case status is still shown as active.”
Until an official dismissal or settlement is filed, the Ripple vs. SEC saga remains legally unresolved — though its removal from the SEC website may signal behind-the-scenes developments.
Frequently Asked Questions (FAQ)
Q: Why did Arthur Hayes turn bearish on Bitcoin?
A: Hayes cites tightening global liquidity — driven by rising Treasury yields and reduced money printing — as key factors making Bitcoin vulnerable to a short-term correction toward $70,000.
Q: What are the chances of a Litecoin ETF being approved?
A: Analysts believe Litecoin has a higher approval likelihood than Solana or XRP because it’s considered a commodity (as a Bitcoin fork), reducing regulatory risk.
Q: How did the DeepSeek AI launch affect crypto markets?
A: DeepSeek’s rise triggered fears of disruption in the tech sector, leading to a broad sell-off in overvalued tech stocks and spilling over into crypto — resulting in $800 million in liquidations.
Q: Was the Ripple lawsuit actually dropped by the SEC?
A: While the SEC removed public references from its website, court records on PACER show the case is still active. No official dismissal has been filed.
Q: Who is ZachXBT and why does he matter?
A: ZachXBT is a renowned blockchain investigator known for exposing hacks and aiding law enforcement recoveries — including helping recover $20 million in stolen funds.
Q: Are AI-related crypto tokens at risk during tech corrections?
A: Yes. AI crypto tokens are highly speculative and closely tied to sentiment in traditional tech markets. Events like DeepSeek’s rise can trigger sharp corrections.
As regulatory clarity inches forward and macro forces reshape investor behavior, staying informed is critical. From ETF momentum to AI-driven volatility, this week underscored how interconnected — and unpredictable — the digital asset ecosystem has become.
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