Buybacks get pushback, and markets rebound

Markets rebounded yesterday after a series of losses, with optimism surrounding the potential rollback of Trump-era tariffs. Major indices saw gains, with Bitcoin rising 2.36% and the tech-heavy Nasdaq up 1.15%. Sectors like DePIN and DeFi led the recovery, with notable performances from tokens such as HNT and Render. The AI sector experienced a decline, possibly due to a rotation towards previously oversold sectors. Following the October 10 crypto crash, the AI sector emerged as a standout, increasing 7.3%, primarily driven by ICP and VIRTUALS. Meanwhile, subnet tokens from Bittensor are still trading above pre-crash levels, indicating strong demand and interest. The HIP-5 proposal has sparked a debate as it suggests diverting a portion of Hyperliquid fees into a buyback fund for certain tokens, aiming to bootstrap ecosystem projects. While this could provide immediate price boosts, concerns exist regarding the sustainability and quality of projects benefitting from such measures. Overall, while the proposed strategy could enhance short-term recovery for specific tokens, it raises questions about the long-term value proposition of the Hyperliquid ecosystem.

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