DQMonthly: February Edition

February: Regulations, Bitcoin NFTs, Coinbase L2 and more

Hello Questers,

It’s been a hot and spicy month in the crypto world! The regulators and lawyers have been on a roll, causing quite a stir. Kraken got cozy with the SEC, while the NY Department of Financial Services gave Paxos a stern talking to about issuing Binance USD. In other news, Logan Paul is getting dragged to court for his NFT Gaming project CryptoZoo — looks like he’s in for a wild ride! And if that wasn’t enough, Mason Rothschild, the creator of MetaBirkins, lost a big trademark battle over the luxury Birkin handbags made by French brand Hermès.

But wait, there’s more! Coinbase has launched its very own Layer-2 Chain, Base — looks like they’re building a strong foundation for some serious crypto action. And don’t forget the Bitcoin NFT Ordinals — there’s some serious trading going on for those digital collectibles. Keep an eye out for what’s next, because the crypto world is always full of surprises!

Kraken settles SEC charges over its staking program
Haters gonna hate, regulators gonna regulate — and it seems Gary Gensler did just that last week when the SEC charged Kraken for failing to register its staking-as-a-service program as a security.

• Kraken settled the charges, paying a $30 million fine and agreeing to shut down its staking offerings for U.S. clients.
• The decision has been criticized by much of the crypto community, as well as by fellow policy makers including SEC Commissioner Hester Pierce and House Majority Whip Tom Emmer.

What Happened

Top events of web3 which dominated the news in january

• LocalBitcoins shuts down after a decade in operation. Peer-to-peer bitcoin trading service LocalBitcoins is shutting down. The platform cited market conditions as the main reason.
• Uniswap Coming to BNB Chain? Governance Says Yes. Despite resistance from venture capitalist firms, Uniswap v3 will be deployed on Binance’s BNB Chain, using Wormhole as its cross-chain bridge
• Paris Hilton to Launch Metaverse Dating Experience ‘Parisland’ in The Sandbox
• Paxos, the leading regulated blockchain and tokenization infrastructure platform, announced it will end its relationship with Binance for the branded stablecoin BUSD. The SEC has sent Paxos a Wells Notice, a notification of the agency’s plans to bring an enforcement action against it.
• SEC Charges Do Kwon, Terraform Labs With Fraud. The SEC specifically cited Terra’s Anchor in its charges, saying the “yield-bearing” protocol “promised to pay 19–20% interest”

• Polygon’s zkEVM Beta Is Going Live on Ethereum Mainnet Next Month. Polygon’s zkEVM mainnet will be the first “fully EVM equivalent” zk rollup to reach Ethereum mainnet, Polygon says.
• Zuckerberg’s Metaverse Division Loses $13.72 Billion in 2022. Despite the numbers, Meta’s leadership insists that the metaverse is still a top priority.
• OpenSea’s current most formidable competitor Blur finally dropped its BLUR token
• Coinbase, the second largest crypto exchange by trading volume, has launched Base, an Ethereum-focused layer-2 (L2) blockchain
• BNB Chain Announces 2023 Roadmap. BNB Chain has announced their 2023 roadmap which includes a number of scalability and usability features which could propel new user growth.

Gaming World

Updates & Top News of Web3 Gaming

• Illuvium announced that Illuvium: Beyond, a customizable NFT adventure game, will kick off on March 7th.
• You Can Now Play DOOM Directly On Bitcoin. Ordinals’ Bitcoin NFTs are evolving, advancing from pixelated memes and pet rocks to a playable DOOM clone in a matter of days
• Mongraal, a Fortnite esports player, finished 1st in Yuga Labs’s Dookey Dash competition.
• Sports and fan token platform @Chiliz has launched its own blockchain, making its operation cheaper, faster and greener.
• Zilliqa’s Gaming Push Led by ‘Roll1ng Thund3rz’ Spin Out. Layer-1 blockchain Zilliqa’s gaming spin out is crucial to a broader new business model
• DeQuest Studio launches “The Omega” Game, offering unique gameplay mechanics and challenging puzzles in The Sandbox. The game is set on a distant planet where players take on the role of a stranded astronaut and navigate through a dangerous and mysterious world.

• Final Fantasy Maker Square Enix to Launch NFT Game on Polygon. Symbiogenesis, an original NFT-driven narrative game, will debut on the scaling network instead of on Ethereum’s mainnet.
• Sony Wants to Rent NFTs to Players and Stream Spectators. Sony’s latest patent hints at NFTs in the PlayStation ecosystem; patent describes an ‘interconnected system’ that gives users and spectators a chance to rent NFTs depicting artwork and assets from popular PS5 games
• Binance-backed web3 gaming startup Unagi gets funding to expand fantasy sports platform
• Yield Guild Games raising $75 million venture fund to double down on web3 gaming
• DraftKings tees up PGA Tour NFT fantasy Golf Game. Reignmakers PGA Tour will launch in March, letting users battle for millions of dollars in prize money via Polygon NFT player cards.
• Trip Hawkins, founder of Electronic Arts and a former Apple executive, joins web3 studio Games For A Living as its chief strategy officer. Hawkins will also join the board and is tasked with helping GFAL reach a mass market audience.

Calendar

Upcoming events of Web3 Gaming

6 March - Chainmonsters early access opens on IMX, items need to migrate from Flow.

7 March - Illuvitars mint date for the upcoming action battle RPG Illuvium.

15 March - Cradles open beta test will start, and will end on 29 March.

16 March - Elemental Raiders minting date for 3,333 NFTs.

24 March - Gran Saga Unlimited closed beta test opening soon on Aptos blockchain.

NFT Arena

Top News of NFT’s fast moving market

After months of wash trading airdrop farming, active traders were finally rewarded with $BLUR stimmies, which they immediately flipped into more JPEGs. The top dog made 3.2 mil $BLUR, but other folks also got huge bags, including this whale, who spent $39k to pocket a cool $1.6 mil.

Blur and OpenSea are currently having a tussle over creator royalties, with Blur suggesting creators block OpenSea for the time being. Meanwhile, traders should grab their popcorn and keep an eye on the drama, as Galaxy analysts predict that Blur might be the most successful OpenSea competitor to-date.

• BIGGEST NFT Sale: CryptoPunk #5066–857ETH
• Logan Paul Faces ‘Rug Pull’ Class-Action Lawsuit Over CryptoZoo NFTs The online influencer faces accusations that he helped to raise funds for an animal-themed NFT game that “never existed.”
• NFT Funded Film Calladita Wins Top Prize At Sundance
• Spotify pilots NFT playlists exclusively for Web3 communities, including gaming startup Overlord and Bored Ape band KINGSHIP, that can only be unlocked by holders of specific NFT tokens.
• Chainlink is launching ‘dynamic NFTs,’ which are encoded w/smart contracts enabling automatic metadata updates based on external conditions
• Cool Cats, the popular NFT collection, has released a new “Litepaper” detailing their plans for “Journeys,” an upcoming feature that will allow owners to send their Cool Cats on various adventures and earn rewards. Cool Cats holders were airdropped Fracture NFTs, which provide access to a gamified story-telling experience.
• Litecoin Network Gets Its First NFTs After Developer Forks Bitcoin Ordinals. A copy of the white paper of Litecoin’s mimblewimble upgrade was put on the Litecoin blockchain.

• Rarible launched a Tezos-based NFT marketplace aggregator
• Napster has acquired NFT music platform Mint Songs to bring the company into Web3. The brand first known for peer-to-peer music sharing from 1999–2001 announced its purchase of the music-focused NFT marketplace.
• Uniswap Traders Can Now Buy NFTs With UNI, SHIB or Any Ethereum Token. Uniswap NFT is looking to out-engineer the competition by allowing traders to buy NFTs using any Ethereum-based token.
• Yuga Labs Debuts First NFT Collection on Bitcoin. “F**k doing expected things,” Yuga Labs said of its debut of a generative art collection based on the Bitcoin blockchain.

Notable upcoming NFT sales-

1- Mayfair Witches Tokenized Pass by Orange Comet | March 07 — March 14

2- YSL Beauty Night Masters NFT Collection | March 06 — March 09

3- Kleks Academy General Sale | April 01— April 07 | 0.225 ETH

4- Coral Reefers | April 03, 2023 — April 10, 2023

Deep Dive

Submerge deeper into reports of the trending topics

• The Promises of Blockchain Gaming
• Bitcoin NFTs? Ordinals Inscriptions Explained (Finding, Buying, & More)
• The Investor’s Guide to the GameFi Market — What’s Next?
• The Top Two Problems the Appchain Thesis Is Solving for Game Developers
• 5 Promising NFTfi Opps — Bankless

Watch

Some of the podcasts

• Bankless dropped a meaty interview w/ Punk6529

• OIG AMA x DeQUEST

DeQuest Updates

Partnership Announcements

• DeQuest x Metarun
  DeQuest is partnering with Metarun, a free-to-play, character-based multiplayer runner game powered by NFTs, to create entertaining, educational and rewarding experiences for players.
• Announcing the DeQuest Carnival🎪
  The DeQuest Carnival is a month-long event that celebrates gaming, exploration, and community building in the blockchain space. Users can complete daily quests, earn points, climb up the leaderboard, and win prizes while connecting with a vibrant community and discovering new games.
• Realm Launch-
  - EV.IO
  - Cross The Ages
  - Alaska Gold Rush
  - Ambrus E4C: Final Salvation
  - DragonMaster
  - Wanaka Farm

About DeQuest

DeQuest is the first platform of its kind for Metaverse users who want to understand blockchain gaming concepts, through skill level progression and guided learning. It serves as a bridge to easily track users’ knowledge and skill levels across Metaverse ecosystems, as well as their ability to carry out different jobs in the Web3 world.

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The insights, views and outlooks presented in the report are not to be taken as financial advice. DeQuest Research Analysts are not registered broker/dealers or financial advisors. DeQuest Research Analysts may hold assets mentioned in this report.