Ethereum ETF approved, four major sectors usher in new opportunities: a comprehensive analysis of Arbitrum, Lido, Uniswap and other star projects
Recently, the U.S. Securities and Exchange Commission (SEC) officially approved eight Ethereum spot ETFs. Although the actual trading of these ETFs will take some time, this news has undoubtedly given a shot in the arm to Ethereum and its ecosystem. As the preferred platform for smart contracts and decentralized applications (DApps), Ethereum's ecosystem has flourished, and a number of high-quality projects have emerged. With the favorable stimulus of the approval of ETFs, these projects are expected to usher in a new round of growth opportunities.
Layer2: A pioneer in expansion with broad prospects
Layer2, the second-layer expansion solution, is an important infrastructure of the Ethereum ecosystem. It effectively alleviates the congestion problem of the Ethereum main network and reduces user transaction costs by transferring some transactions to off-chain processing.
Among many Layer2 projects, Arbitrum is undoubtedly the undisputed number one player. As a representative of optimistic rollup, Arbitrum's locked-in volume (TVL) is as high as 19 billion US dollars, far exceeding its competitor Optimism's 7.59 billion US dollars. The total market value of Arbitrum's native token ARB remains above 3.3 billion US dollars. Recently, the Arbitrum community is carrying out a "200 million ARB game catalyst plan" proposal to further stimulate ecological prosperity.
In addition to optimistic rollup, zk rollup is another major development direction of Layer2. StarkNet is one of the best, using zero-knowledge proof technology (ZK) to improve Ethereum transaction throughput. StarkNet's native token STRK currently has a market value of approximately US$1.47 billion, and the project has just launched an ecological incentive plan for 5 million STRK. Projects such as Metis and Polygon also have their own highlights and are working hard on the Layer2 track. With the advancement of the Ethereum mainnet upgrade, the importance of Layer2 will become increasingly prominent, and related projects will usher in new development opportunities.
Re-staking: High returns are tempting, but risks cannot be ignored
Staking is an important topic in the cryptocurrency circle, and re-staking is a new trend in the staking field. Re-staking means that users pledge the token income obtained from staking again to obtain higher comprehensive income.
In the Ethereum ecosystem, Lido is a leader in the staking field. Lido allows users to participate in staking with any amount of ETH and obtain freely circulated stETH tokens. Data shows that Lido's current staking market share is as high as 28.54%, and its native token LDO once broke through the $4 mark.
In contrast, Ether.Fi and Renzo are more focused on the re-staking track. Ether.Fi allows users to retain control of the pledged assets while entrusting them to pledge, and achieves automatic re-staking with the Eigenlayer protocol. Renzo builds a liquidity re-staking platform on top of Eigenlayer to provide users with higher staking returns. The token prices of Ether.Fi and Renzo have both hit new highs this year, with total market capitalizations of $610 million and $186 million, respectively.
Although the re-pledge field has great potential, the risks cannot be ignored. While enjoying high returns, investors also need to carefully assess risks and make rational decisions.
DeFi: A hundred flowers bloom, and opportunities remain
Decentralized finance (DeFi) is an important application scenario of the Ethereum ecosystem. Despite the industry's cold winter, innovation in the DeFi field has never stopped. As the largest decentralized exchange (DEX) on Ethereum, Uniswap's daily trading volume once exceeded US$1 billion. Although the UNI token has recently fallen back due to the SEC investigation, it still remains above US$10, with a market value of more than US$6 billion.
Aave, a decentralized lending protocol, and Synthetix, a derivatives trading platform, are the leaders in the DeFi segment, with their token market capitalizations exceeding $500 million. Curve, Balancer and other projects have emerged as a new force in the DEX market, providing users with more professional asset trading services.
New projects such as Pendle, a multi-chain interest rate derivatives protocol, have recently exceeded $6 billion in locked-in volume, setting a record high through an innovative “coupon stripping” mechanism.
Innovative applications: a unique approach with promising prospects
In addition to Layer2 and DeFi, some innovative applications that are unique in their own way are also emerging and may become the next hot spot. ENS (Ethereum Name Service) is a decentralized domain name system based on Ethereum, which allows users to map Ethereum addresses to easy-to-read domain names, greatly reducing the user threshold. ENS currently has more than 500,000 registered domain names, and the market value of its token ENS is stable at more than US$800 million.
Another phenomenon is the rise of meme coins in the Ethereum ecosystem. Thanks to the enthusiastic support of the community, meme coins such as PEPE and PEOPLE often see jaw-dropping price increases. Although meme coins are extremely risky to invest in, the group identity and community culture they reflect are worthy of attention and study.
Summary: Grasp the general trend and diversify appropriately
The approval of the Ethereum ETF brings new growth momentum to the entire Ethereum ecosystem. Layer2, re-staking, DeFi, innovative applications and other fields are pregnant with many investment opportunities. Investors should grasp the general trend of Ethereum ecosystem development, conduct in-depth research on sub-sectors, appropriately diversify investments and control risks.
The cryptocurrency market is changing rapidly, and projects are booming. Arbitrum and Lido's glory today may be mediocre tomorrow; and the seemingly insignificant rise of ENS and PEPE may herald the birth of a new trend. Only by assessing the situation and keeping pace with the times can we ride the waves and stand at the forefront of this turbulent wave.
Reminder: Invest rationally and be cautious
No matter which project you are optimistic about, investors should be rational and cautious. There is no eternal winner in the field of cryptocurrency, only participants who are constantly learning and evolving. I hope we can all find our own place in this market full of opportunities and challenges.