TOKEN 2049 week is a wrap. Here are some spicey takeaways from our investment team:🤔
1⃣Shifted market focuses –— #AI, #Bitcoin, Real-world Assets (#RWA), and #TON and Solana-based projects were discussed more this year. Comparatively, sectors and narratives like #GameFi, #DeFi, #DAO, and #Layer2, which used to be hot topics in previous years, saw significantly fewer projects participating this year.
2⃣Ethereum's decreased dominance — Many investors used to invest and allocate alongside #Ethereum’s roadmap. With Ethereum’s dwindling dominance, investors are losing guidance.
3⃣Waned investor interests—Many venture capitalists and funds are halting investment in new projects because of this cycle's generally low ROI. Meanwhile, non-European and US VCs suffer from decreasing global influence and face difficulties securing investment in solid projects.
4⃣Positive macroeconomic catalysts expected for the near future — Investors have positive expectations for the remainder of this year, betting on potentially favorable macroeconomic events such as the US rate cuts and the US presidential election. As monetary policies ease, market liquidity will improve.
5⃣Cautious attitude on the economic outlook for the next three years — With US stocks standing at historical highs and rate cut expectations reflecting risks of economic recessions and potentially leading to decreased dominance, investors expect more money to flow into safe-haven assets. This will result in selloffs of risky assets like crypto, which may suffer huge volatility before they can enjoy recoveries and surges.
6⃣Increased market uncertainty — Many projects proliferated in the last two years, and institutional investors' participation has become increasingly prominent, especially in this cycle. The market will need to take at least two to three years to assimilate the projects accumulated. Given the lack of enthusiasm from retail investors, market uncertainty is increasing.
#TOKEN2049Week #TOKEN2049 #Token2049singapore

#ChartoftheDay According to data from Trader T, #Bitcoin spot ETFs have returned to a positive net inflow overall.
Impacted by the recent sluggishness in the crypto market and the volatility in US stocks, Bitcoin spot ETFs suffered over a week of negative net inflows before yesterday.
Nevertheless, in retrospect, the launch of $BTC spot ETFs was successful in many aspects.
According to Form 13F filings with the SEC, over 1,000 institutional investors are currently holding BTC spot ETFs. iShares Bitcoin Trust (#IBIT ) by BlackRock is the most popular one, with over 600 institutional holders. About 20% of IBIT’s shares are held by institutions and large advisors, and analysts project the figure to double next year.
Given the positive market reactions for BTC spot ETFs, Wall Street and financial institutions in other countries are reported to be considering including them as constituents in their asset management products. Initially, the allocation to BTC spot ETFs should not be high. Nevertheless, it signals more profound market acceptance and enhanced regulatory compliance.
Compared to BTC spot ETFs, Ethereum spot ETFs are underperforming the market expectations. For one reason, $ETH spot ETFs only allow for unstaked Ether holdings. For another reason, Ether’s price performance has been unsatisfactory this year.
All in all, spot ETFs are a necessary path for major cryptocurrencies to gain regulatory compliance.

#ChartoftheDay After a year of community-led discussions and consensus, MATIC has been upgraded to POL as the network token for Polygon. According to the official announcement, starting Sep 4, every transaction that takes place on Polygon PoS uses POL as the native gas token.
More about the POL upgrade:
- Backwards compatibility. This ensures that existing applications and users experience a seamless transition without disruption, facilitating a smoother upgrade process and preserving the stability of the Polygon network. Makes it easy for validators, delegates, apps, and users to transition smoothly from MATIC to POL.
- Native gas and staking token for Polygon PoS. POL now secures the Polygon PoS network—and every transaction on the network is fueled by POL.
- Future utility for an aggregated network subject to community consensus. With a staking hub planned for 2025, the current community consensus would see POL support broader roles in an aggregated network in the long term.
- Tokenomic Changes. The initial POL to MATIC upgrade ratio is 1:1, with a critical tokenomics change, subject to ongoing community consensus, that has a 2% emission over a decade to support network security and community development. Half goes to the Polygon PoS staking contract for validator rewards to secure the network, and the other half to a community treasury, supporting builders through a grant program overseen by an independent board accountable to the community. This emission model will continue for as long as needed, with the community holding the power to adjust or discontinue based on evolving needs.
This upgrade lays an essential foundation for Polygon's continued evolution into a multi-pronged, aggregated network. POL will be a crucial part of the massively used Polygon PoS network: It will be used as the native gas and staking token on Polygon PoS and, therefore, fundamental to Polygon network security. Polygon PoS will connect to the AggLayer if it reaches community consensus as part of its evolution into a ZK chain, thereby bringing POL into a broader aggregated network.

#ChartoftheDay In the last few months, #DEFİ project and the issuer of stablecoin DAI, MakerDAO, has been brewing some major changes to their protocol. Last week, MakerDAO announced it was rebranded to Sky. Along with it, it will upgrade and extend itself with two upgraded tokens and several new features, scheduled to go live on Sep 18.
#DAI will upgrade to a new stablecoin, USDS (Sky Dollar), at a 1:1 ratio, and MakerDAO’s governance token, MRK, will become upgradeable to SKY at a 1:24,000 ratio.
USDS holders will have access to SKY token rewards, built into the Sky Protocol, from the moment it launches. The SKY token rewards will be distributed at 600 million SKY annually, representing a 2.5% inflation to the current circulating supply, across participating USDS holders.
Maker’s Spark lending market subDAOs (now known as Stars) will airdrop 66.66M SPK to participants once the token goes live. Annual subsidies of 1B SPK will be distributed over the following four years to incentivize USDS and Maker token activation programs.
Other key elements of Sky include a new DeFi app, Sky.money, which will provides access to the key features of the Sky Protocol, and the multichain solution Skyline, which will launch and begin connecting USDS, SKY, and other Sky Ecosystem tokens from Ethereum Mainnet to major L2s.
Decentralized stablecoins are facing much regulatory pressure, especially in the US. Dai’s market cap kept declining after hitting an all-time high of around $9.87B in Feb 2022. Now, it stands at only 45.5% of this record. Despite ranking third among all stablecoins by market cap, DAI’s market cap is only 4.5% of USDT and 15.5% of #USDC.
Its founder, Rune Christensen, revealed the intention to upgrade DAI in May of this year. He indicated that there would be two stablecoins, one aimed at regulatory compliance and scale and the other at decentralization ideology. Judging by the announcement, USDS should be the first one. This means it will need to compete with its centralized competitors. PureDai, which should be the second one, will be launched after USDS.

#ChartoftheDay Solana-based memecoin launchpad Pump.Fun hit $100 million in revenue in a record time of merely 217 days since it debuted in January, according to data from Dune Analytics. This makes it the fastest-growing dapp by revenue growth in the crypto ecosystem.
Currently, over 1 million tokens are deployed on Pump.Fun. Despite the recent cooling of the market, Pump.Fun’s ecosystem and revenue have taken off since this May.
Amid retail traders’ dislikes for VC coins with high FDV and low float, memecoins that distribute the entire available supply at launch became favored. Against this backdrop, leveraging Solana’s high TPS and low fees, Pump.Fun quickly rose to prominence.
Although many copycat projects were churned out, Pump.Fun has always controlled the majority of market shares. Leading Solana DEX Raydium also benefited greatly from handling tokens migrated from Pump.Fun.
Recently, the rise of memecoins on the Tron ecosystem has partially directed away the attention and the associated liquidity, but Pump.Fun has maintained a positive daily revenue of over $300,000 every day.
Nevertheless, as Pump.Fun rose because of the meme coin fever, considering the short-lived nature of most meme coin projects, whether Pump.Fun’s success will be sustainable depends highly on overall market sentiments and opinions on meme coins.

🔥Top 10 #Crypto #Fundraising Events in the Last Two Weeks (Aug 17-30)
With 56 deals announced in the last two weeks, interest in the primary market is increasing.
1. Story Protocol, invested by a16z crypto, Polychain Capital, Cozomo de'Medici
2. Fabric Cryptography, invested by Blockchain Capital, 1kx network, Inflection.xyz
3. Edge Matrix Chain, invested by Amber Group, Polygon Labs Ventures, Candaq Fintech Group
4. Space and Time, invested by Framework Ventures, Faction VC, Arrington Capital
5. Solayer Labs, invested by Polychain Capital, Binance Labs, Hack VC
6. Gameplay Galaxy, invested by Blockchain Capital, Merit Circle
7. myco.io, invested by DAMANN INVEST, Aptos Labs, MOCHAVentures
8. double jump.tokyo, Inc., invested by SBI Investment, Sony, Bing Ventures
9. BIFinance, invested by Sunfund Fortuna Global Opportunities, Eternal Asia (S) Pte. Ltd., SDM Education Group
10. Skyfire, invested by Circle Ventures, Ripple, Gemini
#AiNarratives #InfrastructureCoins #GamingCoins

#ChartoftheDay PayPal’s US dollar-pegged stablecoin, PayPal USD, has surpassed $1 billion in total market capitalization, according to data from CoinMarketCap. PYUSD’s monthly supply has been growing at a high speed since the start of the third quarter. And its market cap more than doubled from around $423 million at the end of June.
The growth can be partially attributed to its May expansion to the Solana Network. Since then, its issuance on Solana quickly surpassed that on Ethereum.
Compliance with MiCA, the new European regulations regarding stablecoins that came into effect on June 30 with a 60-day compliance period, may also be critical.PYUSD, the 1:1 USD-backed stablecoin issued by PayPal and managed by Paxos Trust Company, is one of the few that has already obtained #MiCA approval, which enabled it to quickly start nibbling away at market share from those that have not yet received it.
While PayPal saw bringing PYUSD to Solana as a strategic move to boost its usage, the number one stablecoin on Solana right now is still USDC. USDC has twice the market cap of PYUSD, and like PYUSD, it is already compliant with MiCA.Nevertheless, #PYUSD is rising as a potential competitor to #USDC, with more projects in the #Solana ecosystem, such as Jupiter and Kamino, starting to integrate PUSD.

#ChartoftheDay According to data on Etherscan, Ethereum’s gas prices have fallen to the lowest level in five years, with the average gas price at 1 gwei for three consecutive days. Earlier this week, gas prices even fell to as low as 0.6 gwei. In response, Etherscan added three decimal points to the gas tracker to capture the current gas price levels accurately.

Since the #Ethereum Dencun update, users have been migrating to faster and cheaper blockchains, such as L2s and Solana, for more economical gas fees. Compared to March, when gas prices stayed at around 83.1 gwei, Ethereum gas prices dropped by over 95%. Lower transaction fees reduce Ether's consumption, resulting in Ether going back to inflation. The net supply increased by about 16,000 $ETH tokens in the past week. The current annual growth rate stands at 0.7%.

If we reference the past cycles, lower Ethereum gas fees typically mean lower user activity on-chain, which is a sign of the market bottoming and could signal ETH's bullish performance afterward. However, despite expectations of inflows from traditional financial institutions to BTC and ETH bitcoins and an upcoming easing cycle from the US Federal Reserve in September, #BTC☀ and #ETH prices are performing poorly, continuing to defy the bullish predictions.

$BTC

#ChartoftheDay According to Crypto.com's latest research, global crypto owners reached about 617 million as of the first half 2024, increasing 6.4% from the end of 2023. Of them, Bitcoin ( BTC$ ) owners and Ethereum ( ETH$ ) owners grew by 5.9% and 9.7% and reached 314 million and 136 million, respectively, with Bitcoin owners accounting for over 50% of the total number of crypto owners.
Despite the ups and downs the crypto market has experienced this year due to factors such as the approval of Bitcoin spot ETFs, uncertain macroeconomic conditions, overall liquidity crunch, and the lack of innovative new narratives, it’s good to see increases in BTC and ETH’s adoption. Although such an improvement didn’t bring about apparent price increases for ETH, the approval of ETH spot ETFs allows the cryptocurrency to become a part of traditional financial institutions' asset allocation and risk management.
Some traditional financial institutions, including VanEck, are also exploring the possibility of pushing for the approval of SOL$ spot ETFs. Although facing challenges, including the dispute on SOL’s nature as a security, some critics believe the result of the US presidential election may become a deciding factor.

Top #Crypto #fundraising Events in the Last Two Weeks (Aug 3 to Aug 16)

⚡️The number of deals dropped to 31 from around 50 in the previous periods.

1. Chaos Labs, invested by Haun Ventures, F-Prime Capital, Slow Ventures

2. Sahara Labs, invested by Pantera Capital, Binance Labs, Polychain Capital

3. Andrena, invested by Dragonfly, CMT Digital, Castle Island Ventures

4. Sling Money, invested by Union Square Ventures, Ribbit Capital, Slow Ventures

5. Essential, invested by Archetype, IOSG Ventures, The Spartan Group

6. Parfin, invested by ParaFi Capital, Framework Ventures, L4 Venture Builder

7. Vessel, invested by Sequoia Capital, Avalanche Foundation, Algorand Foundation

8. Rivalz Network, invested by Delphi Ventures, D1 Ventures, Gate Ventures

9. Satflow, invested by Variant, Nascent, UTXO Management

10. Cartridge, invested by BITKRAFT Ventures, Fabric Ventures, StarkWare

#ChartoftheDay Justin Sun posted on X yesterday that Tron's protocol revenue has exceeded the Ethereum network’s revenues by 50% over the past 90 days, according to data on Tokenterminal. Sun also offered guidance, saying, “If this trend continues, Tron’s protocol revenue could even surpass $2 billion this year, making it the most profitable blockchain on earth.”The outstanding performance can be credited to the network’s extensive stablecoin activity. It ranks second for the network with the most stablecoins behind Ethereum.
In June, USDT$ transactions on #TRON✅ surpassed Visa’s average daily trading volume in a single day. Lookonchain data revealed a staggering $53 billion in USDT transactions on Tron within a 24-hour period, exceeding Visa’s average daily volume of $42 billion for Q1, 2024. Significant use by those in developing countries such as Argentina, Turkey, and various African countries where high inflation remains a consistent issue is a driving key factor.
As for the protocol revenue over the last 12 months, #Ethereum still leads other blockchains, both L1 and L2 included, with a $2.18 billion revenue. Tron ranks second with a $1.45 billion revenue.

#ChartoftheDay Former President Donald #Trump and Tesla CEO and X owner Elon #Musk hosted a conversation Monday on X. Over one million listeners tuned in to the two-hour-plus X space.
Both have been vocal about their attitude towards cryptocurrency, so the conversation also gained special attention from the crypto world. Musk has been credited with raising the prices of cryptocurrencies, including #Bitcoin and Dogecoin, through his messages on X. Trump, as the presidential candidate, participated in the Bitcoin 2024 Conference held at the end of July in Nashville and spoke about the importance of Bitcoin to America’s development.
Events involving super influencers like them often give rise to meme coins. Before this talk, a community-driven meme coin, TrumpX, had already built up some traction with solid trading volume and price surges. During the two-hour-plus conversation, a meme coin named YEAH rose rapidly after deployment and soon plunged to as much as 90% of its highest level. The trading volume over the two hours surpassed $10 million.
Topics like Bitcoin and cryptocurrencies were not discussed in this conversation. As a result, most such meme coins went to zero soon after the talk ended, with a lifespan of less than a day.
This phenomenon shows that playful meme coins based on transient events have an increasingly shorter lifespan as the overall market liquidity is still low. Also, the celebrity effect seems to be waning.

#ChartoftheDay According to Ethena founder Guy Young, Ethena smoothly handled over $50 million of #USDe redemptions overnight earlier this week. This was the largest volume of redemptions on record for Ethena, triggered by the recent market turbulence. Young said USDe’s backing assets and reserve have always remained above 100% of its supply.
According to data on DefiLlama, Ethena’s ETH$ TVL has remained stable despite recent bullish market conditions. However, impacted by the sluggishness of the market, USDe supply dropped continuously, reflecting investors’ cautious sentiment.
Amid #ETH ’s underperformance, Ethena’s backing assets are gradually shifting to Bitcoin, reflecting the platform’s strategic decisions to shift to more resistant assets. Currently, 48% of USDe is backed by Bitcoin, 30% by Ether, 9% by Ether liquid staking tokens, and 13% by USDT.
Meanwhile, USDe’s price has dropped to as low as 0.997 dollars in the past month, and hundreds of millions of USDe tokens have been burned in exchange for backing assets.
In the last week alone, nearly $60 million of sUSDe was unstaked, reflecting significantly changing market dynamics.

#ChartoftheDay Following the recent great turbulence across global asset markets, the total #Bitcoin $BTC futures open interest across cryptocurrency exchanges has quickly fallen since August. According to data, total #BTC☀ futures open interest fell to $26.65 billion on Aug 6th from $36.94 billion on July 31st.
The combined effects of the conflict in the Middle East, the Japan Central Bank raising interest rates, and the latest US payroll data signaling a recession crashed global financial markets on August 5th, including Japanese, Korean, and European stocks, gold and silver, as well as cryptocurrency. This has led to the exiting of many leveraged long positions.
$ETH suffered a drop of over 20%, the steepest drawdown from the FTX incident. The high volatility also triggered on-chain liquidations on a lot of lending and borrowing protocols, driving up Ethereum gas fees and resulting in congestion along the way.
Meanwhile, the declines in #altcoins are more pronounced.
Although wild fluctuations have ceased right now, considering the macroeconomic environment's uncertainties continue, investors should remain vigilant in position management in the next few weeks.

🔥Top #Crypto #Fundraising Events in the Last Two Weeks (July 20 – Aug 2)
1. Morpho Labs, invested by Ribbit Capital, a16z crypto, Coinbase Ventures
2. NPC Labs, invested by Pantera Capital, Makers Fund, Hashed
3. Caldera, invested by Founders Fund, Dragonfly, Sequoia Capital
4. Bitlayer, invested by Franklin Templeton, ABCDE, Framework Ventures
5. Igloo, Inc. Inc, invested by Founders Fund, 1kx, Everest Ventures Group (EVG)
6. Layer2 Financial, invested by Galaxy, Accomplice VC, Sapphire Ventures
7. Daylight, invested by a16z crypto, Framework Ventures, Lattice Fund
8. aPriori, invested by Pantera Capital, Consensys, OKX Ventures
9. Mezo Network, invested by Cathay Ledger Fund, ArkStream Capital, Flowdesk
10. Hyperbolic, invested by Polychain Capital, Faction VC, Chapter One
#DefiMonеy #AiNarratives #L2s #DePIN #InfrastructureCoins

#ChartoftheDay On July 28, Compound unexpectedly passed a proposal to allocate a quarter of its treasury, or 499,000 COMP tokens valued at about $25 million, to a yield-bearing protocol called goldCOMP Vault.
The protocol was created by a group called Golden Boys, which is led by anonymous crypto whale Humpy. Humpy has been a major participant in several protocols. An often-used strategy of Humpy is to earn a large number of a DeFi protocol’s governance tokens by taking advantage of its incentive scheme, and then use the voting power accumulated to approve proposals that favor personal interests. A well-known case was how Humpy farmed and controlled Balancer in 2022. After accumulating enough of Balancer’s governance token veBAL, Humpy started using his massive voting power to boost token rewards for specific pools in which he was yield farming. Today, Humpy has become the second largest holder of BAL tokens, second only to the project team.
This time, Humpy cast his eyes on the many ideal $COMP lying in Compound’s treasury. He pushed the proposal through with a slim majority of 682,191-633,636 votes. This victory means he has hijacked Compound. Humpy’s current holding of $COMP, together with the 499,000 tokens to be allocated to the protocol, would imply that Golend Boys would have unprecedented control over Compound and could almost unilaterally pass any proposal they want.
Fortunately, Compound has reached a truce with Humpy and Golen Boys following intense discussions. According to the latest development, the proposal will be withdrawn, and a new staking product will be put in place instead, which will distribute 30% of the fresh token reserves generated annually to staked $COMP holders.

#ChartoftheDay As political events like the US election heat up, prediction platform Polymarket is receiving increasing attention.
Polymarket is an established prediction market that has existed for over four years. It was last buzzed about during the last US election.
There are many events happening around the world whose results can be traded right now, such as the US presidential election, the Olympics, and the war between Russia and Ukraine. As more users join in betting on such events, prediction market projects are gaining renewed interest.
Take Polymarket, for example. It is making record highs in several metrics, including trading volume, number of users, and market value of open positions. With topics that go beyond crypto to include politics, sports, entertainment, financial markets, and more, Polymarket is drawing the attention of not only speculative users in crypto but also sports bettors, experts, and political critics.
Previously, Polymarket has raised $70 million across two rounds, with the most recent Series-B round led by Founders Fund. Ethereum creator Vitalik Buterin is also among the platform’s backers.
#PredictionMarkets #uselections

#ChartoftheDay Ten years ago, on July 22, 2014, #Ethereum launched its initial coin offering. Now, on July 23, 2024, the US financial regulators gave final approval for spot #Ether ETFs.
On the first day of trading, nine spot Ether ETFs drew $107 million of net inflows and had over $1 billion in trading volume. However, starting from the second day of trading, the ETFs had started to record a streak of net outflows.
On July 24, the spot Ether ETFs had a net outflow of $133 million. Notably, Grayscale’s ETHE experienced a staggering outflow of $327 million. On July 25, the nine ETFs saw $152.3 million in outflows, with Grayscale recording an outflow of $346.22 million for the day. On July 26, the daily total net outflow increased to #249.89 million.
As of July 26, US spot $ETH ETFs had a total net asset of $9.13 billion, with a cumulative total net outflow of $428.57 million.
Spot ETH ETFs kicked off trading amid the continued sell pressure and dread in the market brought on by Mt. Gox’s payment process. We expect limited inflows into ETH ETFs from institutional investors before October, which means Ether's price will not be taken much higher. But as the US election concludes and Ethereum’s next upgrade, Pectra, draws near, Ether's price will gradually move close to its historical highs. After all, in Bitcoin’s case, it took #BTC two months to make new price records after the approval of spot $BTC ETFs.
#EthereumETF

#ChartoftheDay According to data from The Block, the number of active addresses on TON exceeded 400k and reached 495k at its highest point, representing over 5,000% year-on-year growth.
TON is no doubt one of the hottest ecosystems in crypto right now. Many projects in the ecosystem utilize bots, and TON’s surge in popularity at the beginning of the year was also driven by trading bots. Trading and gaming are two categories that TON-based projects concentrate on. Unlike previous GameFi projects that pursue 3A quality, high-end gaming engines, and massive scale, games on TON are often simple mini-games that are super easy to start but require time spent to get economic incentives by completing various tasks.
Despite the buzz and good numbers, no “killer apps” have emerged yet. Most venture capital firms also stay on the sidelines as they consider where to invest their money.
The #TON ecosystem benefits from the ease of tapping into #Telegram 's vast user base to achieve adoption. However, at the current stage, it seems that the conversion is far from enough or thorough, with a large portion of the active addresses belonging to bots instead of real users.
Overall, the sustainability of the current activity still needs to be watched.

🔥 Top 10 #Crypto #fundraising Events in the Last Two Weeks (July 6-19)
With a total of 43 deals, the enthusiasm in the primary market continues, albeit with a slight decline in the average size of the deals.
1. Partior, invested by Peak XV Partners, Valor Capital Group, Jump Trading Group
2. Allium, invested by Theory Ventures, Kleiner Perkins, Amplify Partners
3. Chainbase, invested by Tencent Global, Matrix Partners China, Folius Ventures
4. ZAP, invested by Rarestone Ventures, Cypher Capital Group, Sharding Capital
5. Rome Protocol, invested by Hack VC, P2 Ventures, HashKey Capital
6. Mira Network, invested by BITKRAFT Ventures, Framework Ventures, Accel
7. Caliza, invested by Initialized Capital, Abstract Ventures, Digital Currency Group
8. Zivoe, invested by Andrew Keys, ICEBERG Capital, Concave Ventures
9. Aidatify, invested by STIX, Alter Global, Spencer Ventures
10. Term Labs, Inc., invested by Electric Capital, Maelstrom, Ava Labs