JZL Capital Blockchain Industry Weekly Report No. 40
1. Industry dynamics last week
First of all, I wish you all a happy National Day!
This week, the crypto market continued its independent trend with the U.S. stock market. While the U.S. stock market was hit hard, the crypto market held its support this week. The current major players in the crypto market may be gradually distinguishing themselves from the major players in the U.S. stock market, or the market is gradually facing The properties of cryptocurrencies are re-evaluated. Bitcoin was basically in a sideways market this week. As of writing, it closed at 19139.6, up 0.76% during the week. It even tried to test the $20,000 mark on Tuesday and Wednesday, and returned to a volatile market after reaching 20,400. Ethereum is similar to Bitcoin as a whole, but its performance is slightly worse. It closed at 1290.45 during the week, a decrease of 1.57% during the week. The current market is in a period of extremely insufficient volume, and the market participation sentiment is extremely weak. For Bitcoin, the trading volume this week has been the lowest in the past eleven weeks, and Ethereum is in the past 15 weeks. At the lowest point, the more likely to maintain the trading volume is the market makers and arbitrageurs in the market. Such a market is very likely to pull or plummet under an opportunity. In addition, a grand Web 3.0 conference - Token 2049 was held in Singapore last week. More than 7,000 participants gathered in Singapore to discuss various encryption-related issues. In the past conferences, project tokens were generally promoted, so in the current bear market stage, this kind of crypto event will also have a certain boost to the market.
The U.S. stock market performed poorly this week. The S&P index has clearly broken its position. The low of 3636 points for the year has been refreshed, and it crashed again at the end of Friday. It did not even hold the 3600 integer level. It is easy to take advantage of the trend and plummet. However, the Nasdaq is still lingering above the yearly low of 10,565 points. There should be a nine out of ten breakouts at this position. The Nasdaq may see an integer close of 10,000 points.
2. Macro and technical analysis:
2. Macro and technical analysis:
After raising interest rates, the capital market ushered in PCE and non-agricultural employment that exceeded expectations. The market is currently in a weak shock range. We judge that the market will still be dominated by weak shocks in the short term. Currently, BTC is trading sideways at 19,000 USDT, and it may rise in the short term. Next, we expect October to be a news window period, and we need to wait for the market to choose a direction.
ETH has the same trend as BTC, but it is likely to be weaker than BTC.
ETH has the same trend as BTC, but it is likely to be weaker than BTC.
The two-year U.S. debt is still high, and the possibility of raising interest rates by 75bp in November has exceeded 50%.
The Nasdaq is currently trading at its 60-month line.
Arh999: 0.33, the cost performance is already in a relatively good position, and regular investment can be made.
MVRV: 0.9083, relatively high cost performance
Number of BTC addresses: The number of addresses holding more than 10 coins continued to decline.
3. Summary of investment and financing:
3. Summary of investment and financing:
1. Investment and financing review
During the reporting period, the number of financing and projects were relatively sluggish. 21 investment and financing events were disclosed (the same as the previous month), and the financing was about 9.1 billion US dollars (down 15.65% from the previous month);
In terms of specific tracks, Infrastructure ranked first in terms of the number of financing projects and total scale with 9 projects totaling US$8.4 billion, followed closely by the Web 3.0 & NFTs track;
During the reporting period, there was no project that raised more than 100 million yuan. Among them, led by Ten31, Washington University St. Louis Endowment Foundation, University of Wyoming Endowment Foundation, and Susquehanna participated in the investment. Strike, an encrypted payment application built on the Lightning Network, raised US$80 million in financing, becoming the largest project in the reporting period. The second round of financing was conducted after Strike publicly released its flagship API, using the Bitcoin Lightning Network as the underlying technology to achieve instant, global, cash settlement, effectively avoiding the settlement issues involved in traditional payments, existing partners include some of the world's largest sales point and e-commerce platforms such as Blackhawk, NCR and Shopify etc. The financing will be used to drive Strike to revolutionize the payment methods of global merchants, consumers and financial institutions, promote the company's growth and continue to expand partnerships, and challenge credit card giants Visa and MasterCard in daily payments.
4. Encrypted ecological tracking:
4. Encrypted ecological tracking:
1.NFTs
1. Market overview
This week's NFT blue chip index was slightly stable at the beginning, but showed a slow downward trend in the middle of the week. As of 12 o'clock on October 2, the blue chip index ushered in a sharp drop on October 1, which may be caused by OpenSea's sudden delisting of all Azuki NFTs due to privacy and security reasons.
This week, the total market value of the NFT market increased by 1.07% year-on-year, and the total transaction volume increased by 7.99% year-on-year. NFT transactions are still in a cold state, and the activity has not increased significantly compared to the previous value.
This week, the number of holders in the NFT market has increased and traders have decreased, but the overall number is still at the lowest point in nearly half a year.
The top three NFTs with the highest trading volume in the market this week are ENS, CrytoPunk, and QQL Mint Pass.
2. Dynamic focus
This week Meta announced that on its Facebook, Instagram social media can be connected to Meta's social software through the user's cryptocurrency wallet, and users can share the NFT they own on Instagram and Facebook. Meta has been developing the feasibility of this feature since May 2022. After continuous testing, Meta social media users can connect to Instagram through Coinbase, Dapper Labs, MetaMask, Rainbow, and Trust wallets to share their assets. This development has also been questioned: due to the limited business growth of the company, Meta began to lay off employees, and the development of the Metaverse has also slowed down, making the public have greater doubts about the future of Meta; Meta is also subject to NFT privacy protection. Challenge, some netizens expressed doubts on Twitter that sharing NFT online will bring risks to the privacy of the owner, but it is reported that Meta will gradually strengthen the privacy protection of NFT.
New NFT games on the Epic store, NFT Game mode has been displayed on a larger platform
Blankos Block Party is available on the Epic store. This game is similar to Roblox. It is an open game that focuses on collecting and breaking through levels. The multiplayer game mode has created a high level of activity in the overall community. Blankos Block Party opened the market on OpenSea to sell skin NFT, which is an incentive for players and collectors.
Although the overall trading volume of the NFT market was cold this week, it also produced many large transactions. Mutant Ape Yacht Club completed a $1.3 million pledge rental agreement this week, and CryptoPunk also completed the highest transaction in history this week. CryptoPunks #2924 was sold for 3,300 ETH, becoming the highest transaction record for CryptoPunk in history.
3. Key projects
This week, the QQL Mint Pass was successfully sold on its website. A total of 900 QQL mint passes were sold this time. In the future, users who have Mint Pass can make NFT on the QQL website and are eligible for sale. This sale is based in the Netherlands By way of auction, the total sales reached 17 million US dollars.
Project overview: The QQL Mint Pass project is an NFT project jointly developed by Tyler Hobbs and Archielago co-founder Dandelion Wist. The QQL project is an innovation of NFT. QQL uses data algorithms to randomly create different NFTs. With its unpredictability, randomness and high sense of participation of users, it brings a different gameplay to the creation of NFTs. (QQL randomly generates panels)
Tyler Hobbs: Fidenza achievements brought about by visual art Innovative gameplay
The QQL project is led by Tyler Hobbs as the chief designer. The beginning of this project is the extension of FIdenza founded by Tyler Hobbs before. Fidenza is a unique project in NFT. Its randomly generated by algorithm but not lacking in beautiful line sense has occupied an indelible brilliance in the NFT market.
overall review
overall review
Item of the Week –
Item of the Week –FITCHIN
The Web3 game community and e-sports platform FITCHIN officially launched Solana. Previously, the project had completed a seed round of financing of US$3.5 million in July, and the specific investors were not disclosed.
The FITCHIN platform aims to connect esports teams with fan bases, while also providing Web3 tools to help teams create new revenue streams. In addition, users can also participate in e-sports events organized by the platform to earn bonuses, purchase limited NFTs, join game communities, and participate in special events, etc. Users can log in through the decentralized wallet, or use web2's social media account to log in, and the threshold is low.
To put it simply, FITCHIN is an e-sports fan economy and online event platform (similar to the e-sports version of the fan token platform Chiliz). Previously, the platform has reached a partnership with KRU Esports (Argentine team, including LOL, FIFA and other projects, with 260,000 Twitter followers) and Furious Gaming (Argentine team, including LOL, CS:GO and other projects, with 54,000 Twitter followers).
According to the project roadmap, FITCHIN will issue its community token $CHIN, which can be used for event tickets, NFT purchases, competition bonuses, etc.
In addition to the player community, the value of such an e-sports platform depends more on the cooperation of star e-sports teams and the fan effect. It is currently during the 2022 League of Legends Global Finals (LOL S12). The cooperation may bring a wave of enthusiasm and build momentum for its upcoming token.
3. Infrastructure construction
1. Market overview
As of October 1, the overall lock-up volume (including staking) of each public chain was 69.7 billion US dollars, an increase of 0.2% compared to last weekend, and there was no major change in the chain as a whole. The top five public chain rankings were Ethereum, BSC , Tron, Avalanche, Polygon.
2. Key ecology
As can be seen from the TVL changes in the last month, Avalanche has decreased by 17% in the past month, but increased by 11.83% in the past day. In terms of currency prices, the change is not big, and avalanche is still hovering around 17.5. So the change in TVL is more likely to be caused by on-chain activities. Most likely because it was just announced this week that Robinhood launched the Avalanche external transfer function, which also means that Robinhood will support Avalanche transactions on the platform in the future. Robinhood's commission-free trading model is believed to attract more investors.
Another reason may be due to the AvalancheGo upgrade Banff launched by Avalanche. This launch means that anyone can become a validator of the subnet by simply putting their tokens on the P-Chain, which is also a factor leading to the TVL recovery.
The Avalanche main network consists of C chain, P chain and X chain. Currently, the vast majority of Avalanche applications are deployed on the contract chain (C chain), Avalanche's EVM-compatible smart contract platform. However, although the Avalanche consensus brings high speed and low rates, it does not provide a long-term expansion solution. To this end, Avalanche launched subnet technology to support projects to create custom blockchain networks (subnets) using platform chains (P chains). Finally, the transaction chain (X chain) provides the creation and movement of Avalanche's native digital smart assets.
Cosmos 2.0
From September 26th to 28th, the Cosmoverse conference was held in the Colombian city of Medellin as scheduled. The Cosmos 2.0 white paper was released at the conference. The Cosmos ecology will usher in a major update, including the highly anticipated inter-chain security and ATOM token economy renew. We summarize its main content.
Previously, Cosmos Hub, as the core of the ecology, assumed the role of IBC relay. However, due to security considerations, its own lack of development, the token ATOM has also been criticized for lack of value capture. In order to improve this situation, the new white paper positions Cosmos Hub as an "infrastructure service provider", and its structure is divided into three layers:
Bottom layer: Cosmos technology stack, including general consensus layer Tendermint, inter-chain communication IBC, development tool Cosmos SDK
Middle layer: Security economy scale, including interchain security (Internchain Security), liquidity staking
Upper layer: Hub-specific functions, including Interchain Scheduler and Interchain Allocator, new modules proposed for this update.
Interchain Scheduler: This module will generate income based on cross-chain MEV (Maximal extractable value, the maximum extractable value refers to the value that verifiers/miners obtain by changing the transaction order of a block that exceeds the block generation reward ). Specifically, Tendermint can separate the ordering right of a transaction from the block, and the blockchain in Cosmos can auction its future block transaction ordering right in the form of NFT, which can be circulated in the secondary market. The generated revenue will flow back to the Cosmos Hub and the original chain. To put it simply, due to the existence of IBC, cross-chains within the ecosystem are very common, which also creates arbitrage opportunities. Cosmos officially released a MEV arbitrage market. Its transactions can be executed in the expected order.
Interchain Allocator: The income obtained will be used to stimulate the development of application chains within the ecology, and the Cosmos Hub will be transformed into an ecological fund managed by DAO, supporting the ecology through ATOM token swaps and liquidity incentives The development of internal projects reduces the difficulty of starting, and ATOM will become a reserve currency.
ATOM token economy: ATOM’s previous inflation rate was about 7%~20% (determined by the pledge rate, currently around 13%), the updated ATOM 2.0 model will be modified to a decreasing inflation model, and the first 36 months will be a transition During the period, 10 million ATOMs will be issued in the first month, and will decrease by 12% every month thereafter until reaching a fixed number of 30,000 ATOMs per month. According to the new model estimates, its inflation will start to be smaller than the current stage in about the 10th month. The selling pressure brought about by high inflation is not conducive to the short-term price of ATOM, but its long-term supply will be greatly reduced.
Summary: In addition to the above updates, the inter-chain security and liquidity staking functions we introduced before will also be updated. From the perspective of token economy, on the one hand, the use and value capture of ATOM has been greatly improved (increased demand), on the other hand, the declining inflation model has reduced the supply of ATOM. In the long run, the investment value of ATOM is higher.
3. Key investments
Strike completed an $80 million Series B round of financing on September 27, led by Ten31. Strike is a payment tool based on the Lightning Network. Users can pay, receive or buy Bitcoin through Strike instant transfer.
The Lightning Network is a second-layer payment protocol on Bitcoin designed to enable fast transactions between participating nodes and has been proposed as a solution to Bitcoin's scalability problem. The scheme uses a peer-to-peer system to make small payments in cryptocurrencies through a two-way payment channel network without entrusting custody of funds. Simply put, the Lightning Network supports small, fast transactions directly between two users.
In principle, when a user initiates a transaction to another user, first, the Lightning Network opens a channel between the two parties, where they can submit funds; then, they can use this channel to send BTC instantly, and the transfer fee is almost Zero, without broadcasting every transaction to the base layer of the Bitcoin blockchain. Either party can settle on the Bitcoin blockchain and close the channel at any time.
At present, Strike is focusing on the US market, and its application is only available in the US (except Hawaii, New York, and South Dakota), El Salvador, and Argentina. If the IP of the user when registering is outside the above-mentioned regions, the account cannot be created. Strike is also cooperating with Amazon, Nike, Uber, Shopify and other companies with large user groups to carry out cash rebate activities. Users can get cash rebates when paying with Strike to expand the use of Strike. In addition to launching consumer rebates with multiple companies, Strike is also launching a credit card.
In general, Strike does not position itself as a Web3 product, but as a payment tool to help merchants and users make faster, cheaper, and support more payment methods for payment activities.
4.DAO Decentralized Autonomous Organization
Governor DAO is a decentralized governance community established in the United States in 2020. It is the first DAO to propose the concept of "Gass" (governance and service). governance threshold. The services currently provided mainly include governance-related services (airdrops, liquidity mining, fundraising services), POE services (can prove unique users), etc.
GDAO issued ERC20 GDAO tokens with a hard cap (total supply of 3,000,000) and burnable (the contract has a built-in burn function), which is a deflationary economic model as a whole. The distribution is mainly:
5% to provide initial liquidity, of which 150,000 GDAO was issued to raise 300ETH as initial liquidity at the end of 2020 according to the ratio of 1ETH=500GDAO;
40% is used as a reward for liquidity mining. There are several pools such as AAVE, SNX, UNI, and YFI. Among them, the GDAO-ETH pool has 4 times the income, and the liquidity of all pools needs to be delivered to the GDAO treasury for a fee of 2%. Starting from December 22, 2020, tokens will be mined at a rate of slightly more than 6,500 GDAO per day until all 1,200,000 GDAO are fully mined;
41% is used as an airdrop, providing different multiples of airdrops for different contributors;
14% will be retained as the DAO treasury;
Users who hold GDAO have the voting rights to participate in community governance and the power to increase the value of GDAO (the treasury will regularly repurchase GDAO with income.)
At present, the currency price has dropped by more than 95% from the high point, and the overall market cap is only 410,000 US dollars.
5. JZL team news:
5. JZL team news:
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about Us
JZL Capital is a professional organization registered overseas, focusing on blockchain ecological research and investment. The founder has rich experience in the industry. He has served as the CEO and executive director of many overseas listed companies, and has led and participated in eToro's global investment.
The team members are from top universities such as University of Chicago, Columbia University, University of Washington, Carnegie Mellon University, University of Illinois at Urbana-Champaign and Nanyang Technological University, and have served Morgan Stanley, Barclays Bank, Ernst & Young, KPMG, HNA Group , Bank of America and other well-known international companies.
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