Disclaimer: This article is made for educational purposes. Hopefully, people find these updates helpful in keeping up with the breakneck pace of progress happening in crypto these days.
This is not financial advice; always do you own due diligence on coins :)
This past week shall know forever be known as Coinbase Week, the week when the crypto markets absolutely ripped in anticipation from the Coinbase public listing — whether from the mainstream press coverage of the event, the positive sentiment of crypto adoption broadly, or the hope that newly-minted Coinbase millionaires will cash out on their equity and reposition themselves further in cryptocurrencies.
Bitcoin and Ether ripped to new ATHs, $65K and $2.5K respectively. We also saw Dogecoin go on an absolute tear from 6 cents to nearly 40 cents at the peak in the span of 14 days — sparking a lot of controversy in the crypto community around the merit of the coin.
And while the talk of the town revolved around Coinbase and the market prices, projects are quietly BUIDLing away — undistracted from the noise of speculators and investors. These are the projects that I’m most excited about.
With further adieu, here is this week’s update.
Top Projects of the Week
There’s so much to look forward to for the Ethereum platform. Literally so much.
Yes, Ether is hitting all time highs at a relatively sustainable clip (compared to some other altcoins), but that should be a function of its incredibly high quality roadmap thats coming out in the next few months.
This week alone, Ethereum managed to:
- Maintain relatively low gas fees even during ATH prices and heightened transaction volumes (see chart below) — partially due to the Flashbots initiative being implemented in mining pools that constitute 58% of the Ethereum network hashrate
- Ship the Ethereum Berlin hard fork, which had a number of improvements for gas cost. This is the largest update since Muir Glacier in Jan 2020
- Announce that a Layer 2 solution, zkSync, will be able to achieve a network throughout of 20K TPS (transactions per second) — rivaling the throughput of centralized networks like Visa
- Broke the threshold of $60B in TVL (total value locked) in Ethereum smart contracts
And that’s just this week alone.
There’s so much more on the horizon for Ethereum — with ETH2 on track, Layer 2 solutions being production ready in a Summer 2021 timeframe, and with EIP 1559 to make Ether a deflationary asset — that the deep dive on those alone will warrant a separate, much longer post :)
Polygon / Matic
As the Ethereum Layer 2 turf wars heat up, I’ve been increasingly impressed with Polygon / Matic as a leading solution.
For context, the main gripe with Ethereum is the high gas fees (in concert with a low network throughput that results in the high fees).
Layer 2 solutions like Polygon (formerly known as Matic) are trying to solve this issue by building platforms and networks “on top” of Ethereum (hence the phrase Layer 2, whereas Ethereum is known as a Layer 1).
Why do I love Polygon in particular?
The Layer 2 will partially be a GTM (go to market) battle of user adoption. What that means currently is: the Layer 2 solution with the most popular dapps will ultimately attract the most users.
Since Layer 2 solutions are technically a separate blockchain that communicates with the Ethereum network, users have to “bridge” (i.e., transfer) their assets from Ethereum onto the Layer 2s — which, depending on the solution, can be time-consuming and a huge friction point for users.
Aave, one of the largest dapps by TVL, is currently exclusively live on Polygon — bringing all its users with. And this week, Polygon announced a $40M liquidity mining program in order to attract more liquidity and users onto their network.
Moreover, Polygon is integrated with Zapper — a comprehensive DeFi dashboard that recently launched it’s Bridge product to easily onboard onto Layer 2s. Currently, Polygon is the first and only Layer 2 to be live on Zapper’s Bridge product.
On Monday Pacific Time, Ribbon Finance launched its Theta Vault product, an automated options strategy that runs a covered call strategy—where the protocol holds underlying assets while also writing (i.e., sells) options in order to generate yield for DeFi users.
The project got a lot of love from Crypto Twitter and DeFi degens — hitting its 1000 ETH deposit cap in mere hours after its launch.
I love Ribbon Finance because they’re interested in creating predictable, sustainable yield for investors — versus the status quo of insane 100%+ APY that garners headlines. Predictable yield will lead to the next wave of investors getting involved DeFi in less risky fashion.
“At Ribbon, we are focused on building a protocol that supports the creation of financial products that generate sustainable yield through financial engineering, not unicorn bucks. Using smart contracts, anyone can combine any derivative contract under the sun into a structured product for anyone else to consume.”
A bit of a belated shoutout to Enjin — especially after the coin went on a tear over the past few weeks, nearly doubling from $2 to $3.90 at its peak (now trading at $2.67).
Two weeks ago, Enjin announced its launching two flagship products in the upcoming months: Efinity and JumpNet.
Efinity is a Polkadot-run blockchain network that is optimized for NFTs — focusing on performance so that it can be embedded into gaming, which is Enjin’s core strategy.
In a world where Ethereum gas fees, while lower, are still several hundred dollars to mint and transact NFTs, another blockchain that can severely reduced costs is sorely welcome.
This can catapult NFTs from a hobbyist technology into a full-blown foundational technology for gaming, social media, and other content.
JumpNet is a “Layer 2” scaling solution for Enjin — allowing gamers to use Enjin for faster and more inexpensive transactions
Bottom Projects of the Week
If I were measuring top vs. bottom projects solely by financial performance, Dogecoin would be the absolute top — beating out all major cryptocurrencies with a 114% return last week.
With that said, it’s hard for me to condone this coin based on its technological merit. And its financial performance has sparked a lot of controversial on Twitter — mainly around the confusion of why Doge is doing so well, accusations at Elon for luring retail investors into a coin with no intrinsic value, and frankly saltiness from crypto native folks who didn’t invest in Doge.
Here are the only compelling reasons I heard for holding Doge:
- Don’t deny the power of memes (and then they cite GameStop but GME has a legitimate play in eCommerce with Ryan Cohen and his storied, demonstrable record as its backer)
- It’s fun to hold Doge because of the memes and the community— whereas its not fun to hold other coins
Honestly, mark me as one of those salty people because I cannot — with a sound mind — conclude that meme energy is enough to get me to buy literally any financial instrument.
I’m likely going to need a dedicated post on why I dislike Doge.
Until then :)
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