10102 Quarterly #9
Bitcoin may have been relatively stagnant this quarter, but we have been on fire since we ended our on-chain vault experiment. Aiming to provide valuable resources for those new to the world of cryptocurrency, we have launched new educational sections on our website, 10102, offering comprehensive guides on wallets, investments, and earn strategies. This content is designed to help our friends and readers navigate the complexities of the crypto landscape and make informed decisions. We will continue to expand these sections with more content in the coming weeks, so be sure to keep an eye on our website.
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Ethereum Brief
Ethereum has experienced a resurgence of activity in the first part of the second quarter, driven by the anticipated approval of ETFs and the continued expansion of Layer 2 technology. Vitalik describes these Layer 2 solutions as culture extensions of Ethereum itself.
One fundamental metric we track is the Ethereum mainnet's supply, resulting from factors such as the issuance of new blocks and the burning of fees by transactions. In the past 3 months more than 50k ETH entered in circulation, as opposed to being negative in the few quarters prior.
While the community expects the overall supply to diminish over time as usage increases, there is no cause for concern. Historically, this phenomenon has occurred before, as evidenced by the graph below showing the supply variation since the merge.
The deflationary trend of Ethereum remains intact, and this temporary setback highlights the lack of retail user participation in the ecosystem. In contrast, institutional adoption continues to grow. Additionally, many NFT traders have either departed or migrated to the Bitcoin ecosystem via the ordinals, contributing to the recent decrease in usage and therefore the observed increase of supply.
Ultimately Ethereum (Layer 1) is evolving from a retail-focused platform to a broader infrastructure serving numerous layers, offering high security and flexibility at a high cost. Layer 2 technology then splits this high cost into more affordable transactions for retail users, with Base, Arbitrum, Optimism, and ZK layers being prime examples. As more Layer 2 solutions emerge, they will eventually fully occupy the Layer 1’s block space once dominated by retail users, closing the loop on the ongoing paradigm shift.
DeFi Brief
The DeFi sector has experienced mixed signals and developments this last quarter. While the market has seen some fluctuations, with prices trading in the red for most assets, there are signs of growth and innovation in the ecosystem. This could mean the fundamentals are oversold, but there is currently no indication that the market has reached a bottom either.
For those who have maintained their conviction in the DeFi ecosystem, there is potential for significant rewards in the future. However, it's essential to recognize that this journey may require a considerable amount of patience.
Besides the prevailing trends already described in our previous quarterly #8, here are a few updates:
Layerzero, a cross-chain interoperability protocol, released its native token, ZRO, to the market. This token enables users to participate in the protocol's governance and stake for rewards, further incentivizing the development of the network.
zkSync, a zero-knowledge proof technology, distributed its native token, ZKS, to eligible users. This airdrop aimed to reward early adopters and contributors to the protocol, while also promoting its adoption and growth.
Curve Finance, a major DeFi platform, recently announced that it has successfully recovered a significant portion of the funds stolen during a security breach earlier this year. This recovery effort highlights the resilience and cooperation within the DeFi community, as well as the ongoing improvements in security measures.
While the DeFi market may be experiencing some turbulence, there are exciting developments and trends to keep an eye on.
TON Mass Adoption
The Telegram Open Network (TON) is a blockchain project created by Telegram, the popular messaging app, to enable fast, secure, and scalable digital payments, file storage, and other services. One of the key goals of TON is to achieve mass adoption by making blockchain technology accessible to a broader audience. To achieve this, TON has been focusing on several strategies, including integrating with popular platforms and services, such as Telegram Gaming mini-apps which have been gaining significant traction in recent months.
This success can be attributed to the large Telegram user base, which provides a ready-made audience for these mini-apps. By leveraging this user base, TON is able to onboard the masses to web3, the decentralized web, and introduce them to the benefits of blockchain technology.
Data and Examples:
TON's blockchain network has the potential to process up to 1,000 transactions per second, making it one of the fastest blockchain networks in the world.
The Telegram messaging app has over 400 million active users, providing a vast potential audience for TON-based services.
Notcoin, a popular Telegram Gaming mini-app, has attracted over 30 million users in just a few months, demonstrating the potential for TON to achieve mass adoption.
TON has been developing a number of other services and applications, including the TON Messenger, which aims to provide a secure and private messaging experience, and the TON File System, which will enable decentralized file storage and sharing.
Overall, TON's mass adoption strategy is centered around leveraging Telegram's vast user base and creating user-friendly blockchain-based services and applications. By providing a seamless and accessible experience for users, TON aims to onboard millions of people to web3 and bring the benefits of blockchain technology to a wider audience.