"Weekly Editor's Picks" is a "functional" column of Odaily Planet Daily. In addition to covering a large amount of real-time information every week, Planet Daily also publishes a lot of high-quality in-depth analysis content, but they may be hidden in the information flow and hot news, and pass you by.
Therefore, every Saturday, our editorial department will select some high-quality articles that are worth spending time reading and collecting from the content published in the past 7 days, and bring new inspiration to you in the crypto world from the perspectives of data analysis, industry judgment, and opinion output.
Now, come and read with us:
invest
VC Cost Bargain Hunting Guide: Finding Investment Opportunities from the Perspective of "Market Value-Valuation"
If it can’t bring more than 2 times of returns, VCs would rather buy BTC directly. There is no need to look at the seed round valuation.
Most blockchain projects find it difficult to operate continuously for more than 2 years, while FDV takes at least 5 years, so market value is the priority.
It is important to note that the yellow part in the table below refers to the coins to be unlocked in May and June, which will bring additional selling pressure to the market.
Looking for "potential stocks" and taking stock of "small and medium-sized" crypto projects that have not yet issued coins
The article introduces GoPlus security, LayerZero, Puffer Finance, Myshell, Ultiverse, Thruster, Analog, and NGRAVE.
Also recommended: "Cobie: When low-circulation and high-FDV tokens are rampant, the rising profits have long been privately divided up" "VC perspective: What is the cause of the decline of "high FDV, low circulation" tokens? ""Data speaks: Does the crypto investment theory of "buy new, not old" still work? ".
Entrepreneurship
2023 Crypto Industry Salary Report: Salary Secrets of Web3 Developers, Product Managers, Designers, and Market Operations Revealed
Exhibited by Dragonfly Capital.
US companies offer higher compensation than non-US companies: about 13% higher in salary and about 30% higher in equity and tokens;
Among companies that raised Seed and Series A funding, US founders had slightly higher salaries and significantly more equity/token ownership; in most cases, companies paid employees in fiat; international companies were more likely to issue tokens than US companies;
Infrastructure companies are most likely to issue tokens;
Nearly half of the companies pay only equity;
About a third of the companies offer both equity and tokens;
Most companies use the “percent of token” method to calculate token quotes.
Exploring the Korean crypto market: Young people are more enthusiastic about cryptocurrencies than stocks
South Korea occupies a very important position in the global cryptocurrency market, and it seems natural that many global Web3 projects consider entering the Korean market.
However, successful market entry requires a deep understanding of the characteristics and needs of local communities. Telegram, KakaoTalk, and other messaging-based communities are very active and speculative, and very sensitive to short-term price movements. On the other hand, Twitter has a lower usage rate and less interest in on-chain activities such as NFTs and DeFi than other countries.
In the initial process of building the community, it is crucial to win the trust of local investors, and how to use professional managers who speak Korean to achieve effective results will be the key to success. In the long run, it is necessary to get rid of the speculative community that wants short-term profits through the dissemination of information about technology and vision. Having a way to raise the intrinsic value and growth potential of the project to the local community will be an important factor in success or failure.
a16z: Porter's Five Forces Framework and Competitive Strategy in the Context of Web3
The key components of Porter’s Five Forces Framework remain the same in Web3, just as they do in Web2 and the offline world. But the path to value creation in Web3 is not a zero-sum game, but more of a network model driven by collaboration.
Behind the decline of high FDV tokens: false prosperity brought by excessive point mining
Over the past few years, top exchanges have begun to strictly require projects to have a large number of users (such as more than 500,000 monthly active users) or a high TVL (Total Value Locked, which must reach more than $1 billion) before listing their tokens. These projects will only be listed on the TGE, so they only have one chance to go public. For top projects such as Arbitrum and Optimism, these requirements are not a problem because the speculation of token airdrops alone can attract a large number of users to participate. But for projects that do not have similar venture capital backing or well-known founders, how to meet these requirements becomes a big problem.
To address this, projects have begun to launch points programs based on on-chain activity, TVL, or NFT holdings, which almost guarantee that there will be token airdrops at some point in the future to reward users. However, the points issued by the project have been hyped before the tokens are circulated, resulting in retail investors participating with high FDV and limited returns. The expectation of market participants has become that all projects must pay for all the efforts of users before the TGE, and also get a very generous return. If a project fails to airdrop (price drop or the proportion allocated to farmers is very low), it will be difficult for them to obtain high-quality user retention in the second quarter after the TGE.
This vicious cycle leads to more and more people selling the airdropped tokens on the first day of the token listing, further deteriorating the market performance of the new token, destroying any natural demand that might have existed, and affecting other projects that planned to airdrop.
policy
Has the policy direction changed? In addition to ETFs, these two major events reveal a new attitude towards crypto regulation
This article introduces the impact, approval possibility and key nodes of SAB 121 (Staff Accounting Bulletin No. 121) and FIT 21 (Financial Innovation and Technology for the 21st Century Act).
a16z: Detailed explanation of the FIT 21 bill, what impact will it have on the crypto industry?
The FIT 21 bill is a joint effort of the House Financial Services Committee (which oversees the Securities and Exchange Commission) and the House Agriculture Committee (which oversees the Commodity Futures Trading Commission), with industry support. A vote on the bill will take place in the coming weeks, and it will be a referendum on cryptocurrency in the United States.
It is therefore critical to ensure that the bill passes with strong bipartisan support. After that, it will also need to pass the Senate and be signed into law by the President.
Once passed, the FIT 21 bill will bring more clarity to U.S. cryptocurrency regulation, which will benefit everyone in the industry. It will:
Providing a safe and efficient way for blockchain projects to launch in the United States;
Clarifying the lines between the U.S. Securities and Exchange Commission (SEC) and the U.S. Commodity Futures Trading Commission (CFTC) regarding who regulates what in cryptocurrencies and whether digital assets are securities or commodities;
Ensure oversight of cryptocurrency exchanges and further protect American consumers by enforcing rules governing cryptocurrency transactions.
Also recommended: "Interpreting the FIT 21 Act: A new driver of US crypto market regulation and political power changes."
airdrop
Data review: Was Starknet’s airdrop a success?
Official chart of how the airdrop will be distributed
Overall, the airdrop did not achieve a very good effect: the retention rate of 13.5% is close to the industry average (which is not high). However, considering that the average GitHub user received 1,800 STRKs, a deeper look shows that the airdrop was much less effective than we expected. Only 1.1% of users who received token allocations eventually retained them.
About $3 of STRK tokens can buy $1 of TVL. This works out to about $200 per user acquisition. If we recalculate using retained users (those holding > 101 tokens), the cost per retained user is $1,341.
Starknet has been relatively thoughtful in how it distributes a large number of tokens to different groups, and the data clearly shows that they have ensured diversity in distribution.
Analysis report of 2 million airdrop addresses: only 25% of tokens rose after airdrop
Airdrop size has no significant impact on price performance or volatility, and “low liquidity” may not be the primary driver of price volatility.
Airdrops to core users show higher prices within two months after the airdrop; the number of buyers in the small airdrop + core user group increased by 4-8 times (increasing holdings).
Meme
Tracking 5 MEME coin smart money addresses on the chain: How to create a hundredfold return?
Rushing to get in on the opening is not the choice of smart money; following orders is not wise; smart money is boosting the price of coins; for most 10 U warriors, opportunities seem to always exist, but whether or not they can really hold on to them is the main reason that prevents them from becoming smart money.
Bitcoin Ecosystem
Infrastructure is in the ascendant, a panoramic interpretation of the Bitcoin L2 ecosystem
Bitcoin’s design limitations are particularly evident in ensuring withdrawal security in Layer 2 solutions. Its limited scripting language and lack of Turing completeness limit its ability to perform complex calculations and support advanced features. This design choice prioritizes Bitcoin’s security and efficiency, but limits its programmability relative to more flexible blockchain platforms such as Ethereum. And probabilistic finality may also weaken the reliability and speed required for Layer 2 solutions, potentially leading to issues such as chain reorganizations that affect the permanence of transactions. Although Bitcoin’s design principles make it reliable and secure, these factors make it difficult for its Layer 2 system to quickly adapt to new changes.
Segregated Witness (SegWit) and Taproot are transformative for Bitcoin.
By technical classification, Bitcoin L2 is divided into side chains using a two-way anchoring protocol, Rollups, and payment channel networks.
After introducing representative projects, the author concluded that the advantages of Bitcoin L2 are: unlocking the DeFi market and expanding usage scenarios; the disadvantages are: centralization risk, increased transaction fees and blockchain expansion, user experience and technical complexity. In addition, inscriptions and non-financial data will bring regulatory and ethical issues and substitutability impacts to the Bitcoin network.
HashKey Capital Research Report: Covenants, the Programmability of Bitcoin
Covenants, translated into Chinese as "restrictive clauses" and sometimes translated as "contracts", are a mechanism that can set conditions for future Bitcoin transactions.
The current Bitcoin script also contains restrictive conditions, such as entering a legal signature and entering a matching script when spending. However, as long as the user can unlock it, he can spend the UTXO wherever he wants. The restrictive clause is to make more restrictions on how to unlock it, such as limiting the subsequent spending of the UTXO, that is, to achieve a similar effect of "special funds for special purposes"; or other input conditions sent in a transaction, etc.
To be more precise, current Bitcoin scripts also have certain restrictions, such as opcode-based time locks, which implement time limits before transactions are spent by introspecting the nLock or nSequence fields of transactions, but they are basically limited to time limits.
Its application scenarios include: ensuring staking penalties, congestion control, vaults, and more robust and flexible state channels. Restrictions can be directly implemented in Bitcoin scripts to limit further transaction costs, thereby implementing transaction rules similar to smart contract effects. Compared with off-chain methods such as BitVM, this programming method can be verified more natively on Bitcoin, and can also improve applications on the main chain (congestion control), off-chain applications (state channels), and other new application directions (staking penalties, etc.).
If the implementation technology of the restriction clauses can be combined with some underlying upgrades, it will further unleash the potential of programmability. However, the restriction clauses may also lead to some unplanned abuse or loopholes, so the community is also cautious about this. In addition, the upgrade of the restriction clauses also requires a soft fork upgrade of the consensus rules.
Ethereum and Scaling
Millions of dollars in EIGEN tokens? Ethereum researchers are “restaking” themselves
Recently, several researchers from the Ethereum Foundation have disclosed to the public that they have accepted "consultant" positions with the Eigen Foundation, the entity behind the re-staking protocol EigenLayer, and will receive valuable EIGEN tokens.
This caused great controversy and heated discussions in the community. The community was dissatisfied that EigenLayer used tokens to exchange for allies, which might have put powerful EF members in a bad position.
Looking back at the incident, the individuals and organizations of the Ethereum Foundation essentially suffered a crisis of trust. Community members doubted their neutrality and feared that they would lead Ethereum in the wrong direction for their own benefit. An Ethereum that advances in debate will obviously be more decentralized at the social consensus level than an Ethereum that is "closely united" around the Ethereum Foundation. Doubts lead to reflection and progress.
List of EigenLayer's top ten node operators and their asset size
Operators with high TVL generally register more AVS, among which the total ETH delegation is nearly 854,000, accounting for nearly 17.1% of EigenLayer's ETH TVL; the number of EIGEN delegations exceeds 34.3 million, accounting for 63.5% of the overall staking scale of the token.
In terms of the number of stakers, the top ten operators have more than 82,000 participants, of which InfStones, AltLayer and EigenYields account for more than 70%; in terms of asset custody scale, P2P.org, EigenYields and Eigenpie are the "big players" in ETH staking, accounting for more than 70.9% of the top ten operators, mainly from Beacon chain, Lido and Swell.
EigenYields, P2P.org, AltLayer and Black Sand are the main contributors to EIGEN custody, accounting for 71%. However, in terms of per capita pledged assets, Black Sand, Galaxy, Staked and CoinSummer Labs are mostly participated by large investors.
Trustless Labs: Understanding Eigenlayer AVS and its 20 ecological projects
On EigenLayer, after the re-stakeholder delegates his assets to the Operator, the Operator will provide verification services for AVS (Actively Validated Services). Operators participate in the AVS verification process by installing the necessary software to ensure the correct and secure operation of AVS. In return, Operators receive verification rewards provided by AVS and return them to the re-stakeholder.
LRP (Liquid Restaking Protocol) is based on the principle of restaking. It participates in Eigenlayer on behalf of users (for example, users do not need to participate in the subsequent selection of Operators), and at the same time issues a layer of LRT (Liquid Restaking Token) of the same value to users.
For investors, opportunities to participate include: Operators with coin issuance expectations, obtaining AVS project tokens, and paying attention to projects with overlapping investors.
The article further inventories the AVS ecosystem projects: EigenDA, AltLayer, Brevis, Eoracle, Lagrange, Witness Chain, AETHOS, Blockless Network, Drosera, Espresso, Ethos, Hyperlane, Near, Omni, Silence Laboratories, Xterio, Aligned Layer, Automata Network 2.0, Openlayer, and Dodo.
EigenLayer staking: potential wealth code or hidden risk?
The staking mechanism of EigenLayer is quite different from the staking mechanism of PoS of ETH mainnet, and is more like the staking logic of the Cosmos community.
EigenLayer innovatively designed the concept of dual staking: the "re-staking" service of ETH series tokens and the "staking" service of Eigen series tokens are responsible for maintaining the security of EigenLayer as a whole. This mechanism denies the sovereignty of project tokens to a certain extent and weakens the value and use of the original tokens of the network, so more empowerment may be needed to offset the negative impact of losing sovereignty. In addition, this staking mechanism that increases flexibility also introduces certain centralization risks, especially the quorum modification decision may not be completely transparent or widely participated by the community, and may involve centralized decision-making. Setting a mechanism with an extremely long unlocking time when the mechanism is opaque will undoubtedly bring huge risks to EIGEN stakers.
Any link that introduces off-chain mechanisms requires users to pay special attention.
EigenLayer's design favors economic efficiency over technology, and if technical problems can be solved, projects that specialize in economic efficiency are bound to bring significant returns.
In general, EigenLayer has shown great market potential and room for growth in the wave of re-staking. Although it currently faces some technical and standardization challenges, these are stepping stones on the road to growth.
Multi-ecology
TrendX Research Institute: Learn about the hot traffic games jointly created by Telegram and TON in one article
The article introduces the click-to-mine coin game NOTCOIN and the virtual pet GameFi Catizen.
The cooperation of Telegram x TON has achieved outstanding results. Telegram provides a large number of users and markets, and the TON chain provides strong support in infrastructure and fund funds. The track chosen is also smart. Accessing mini-program games through Telegram is easy to reach and fun, which is also a project choice that fits the user profile of Telegram. Against this powerful background, NOTCOIN and Catizen have also gained recognition from players and market attention with their own high-quality and unique projects.
SocialFi
friend.tech is so unpopular, why is there still a need to promote FRIEND?
Judging from the data alone, friend.tech is indeed dead. But what’s interesting is that compared to the bleak points market, FRIEND achieved a breakthrough of 100 million US dollars in one week.
FRIEND is known as the most “Base” token: Since Base claims that they will not launch a token, this may leave room for FRIEND’s status to grow.
Providing FRIEND/ETH liquidity on friend.tech can earn three benefits, including 1.5% exchange fee (current APY is 194.15%), 1.5% Club Key transaction fee (current APY is 21.63%), and sharing 12 million FRIEND incentives (current APY is 66.39%). On the other hand, as the first coin to be issued, SocialFi is also the first project to airdrop 100% to users, which obviously gives friend.tech more confidence to motivate users.
Club gives FRIEND functionality, and “Club+meme” may be a bullish catalyst, but FRIEND itself has limited room for growth.
a16z has previously published a series of articles on whether or not to issue tokens. The article believes that tokens are one of the most powerful tools, but also one of the products with the greatest risk to market. However, launching tokens too early is also the most common mistake made by projects in Web3. friend.tech changed the airdrop information several times before issuing the tokens, and after issuing the tokens, the backend was overloaded due to technical failures. From the current social projects, friend.tech is definitely one of the most noteworthy projects. But whether FRIEND can continue to be hyped depends on how friend.tech ensures that users are motivated and are more willing to choose their applications instead of other applications such as Twitter, Farcaster, Lens, etc.
Safety
8 Ways to Check if a Token is a Scam
Search for basic information using Google and X, verify the code on Etherscan, check the Etherscan comments section, check the DappRadar blacklist, check token details in the Token Index, check how many exchanges have listed the token, check liquidity in the token balance pool, use third-party analysis tools.
We also recommend "Coin theft incidents occur frequently, what do we need to know about the protection of encrypted assets?" and "OKX Web3 CertiK: MEME "Big Adventure" and security "truth"".
Hot Topics of the Week
In the past week, the SEC asked exchanges to speed up the update of 19 B-4 documents on spot Ethereum ETFs; Van Buren Capital partner: The U.S. SEC will abandon the argument that ETH is a security; The U.S. SEC asked Nasdaq and the Chicago Board Options Exchange to adjust the filing of spot Ethereum ETFs; On May 22, ETH set the largest single-day volatility record in history; Bloomberg analysts: The demand for SOL ETFs may be huge, but the SEC's tough attitude will be a huge obstacle; Bernstein: If the Ethereum spot ETF is approved, it will increase expectations that SOL will be classified as a commodity; U.S. House of Representatives members: Ethereum ETFs provide investors with transparent and secure cryptocurrency access opportunities; Ethereum spot ETFs are finally approved (views from senior people);
In addition, in terms of policy and macro market, Politico reporter: The leader of the Democratic Party of the United States House of Representatives said that he would not force other members to oppose the crypto bill FIT 21; Gary Gensler opposed the crypto regulatory bill FIT 21 before the House of Representatives voted; US SEC Chairman: It is not assumed that all crypto tokens are securities; Trump's campaign team officially announced that it would accept cryptocurrency donations; Coinbase CLO: Gary Gensler has informed the US Congress that securities laws apply to crypto assets involved in investment contracts; Biden announced that if the FIT 21 crypto bill is passed by the House of Representatives, he will not veto it; Biden's campaign team plans to hire a meme manager to try to win the support of young voters; Biden's deadline for making a decision on the "Repeal SAB 121" resolution has been extended to June 3; The US House of Representatives passed a bill prohibiting the Federal Reserve from creating a CBDC; Bloomberg: The Hong Kong Securities and Futures Commission is considering allowing Ethereum spot ETF issuers to add pledge services; The Hong Kong Privacy Commissioner ruled that Worldcoin violated the privacy ordinance and required it to stop collecting iris and facial images;
In terms of opinions and voices, Arthur Hayes: The monetary policy game between China, the United States and Japan has pressed the start button of the crypto bull market; Matrixport: Bitcoin prices may return to historical highs in a few days; Bitwise Chief Investment Officer Matt Hougan: Whether the ETF is passed or not, new highs will surely come; Ambient founder: Denominated in ETH, the FDV of newly issued tokens is not much different from the past; Vitalik: Personally, I think all Rollups will be ZK in 10 years, and ENS is the most successful non-financial application in the Ethereum ecosystem; X platform plans to hide user "like" information, Vitalik suggests Farcaster to learn from Zupoll technology to realize ZK likes; Justin Sun: I don't think I hold more Ethereum than the Ethereum Foundation, Ethereum is completely decentralized; Uniswap Labs responded to the SEC Wells notice: It is ready for battle and will continue to build; Ordinals founder responded to the rune market value not reaching $1 billion: Please pay attention to the next issue of Hell Money podcast; Yuga Labs Lianchuang: CryptoPunks will be fully decentralized and stored on the chain;
In terms of institutions, large companies and top projects, Reuters: Genesis has been approved to repay $3 billion to customers; Gemini Earn will begin to return cryptocurrencies to customers in kind by the end of May; Grayscale appoints Goldman Sachs' Peter Mintzberg as CEO, and the new CEO appointment will take effect on August 15; Binance launches an open recruitment plan for coin listing projects; Telegram will launch in-app currency Telegram Stars to cope with Apple's App Store payment restrictions; People familiar with the matter: zkSync plans to launch TGE this week and airdrop in mid-June; zkSync issued a statement suggesting that it may not conduct witch report review; LayerZero co-founder: The witch reporting process will be reopened soon, and it plans to change the submission method and introduce "bond"; deBridge will launch the governance token DBR; Fred Wilson, an early investor in X, announced that he has left the platform and turned to Farcaster;
In the field of NFT and GameFi, STEPN will launch a new social fitness application STEPN GO and a new token GGT;
In terms of security, Gala officially confirmed that it had been attacked, resulting in the unauthorized sale of 600 million GALA and the destruction of 4.4 billion GALA... Well, it was another week of ups and downs.
Attached is a portal to the “Weekly Editor’s Picks” series.
Reunion in the second half~
