Overview
Promising start for these blockchains.
Bitcoin: Looking back a year.
Gemini’s double trouble.
Promising start: The rise of Layer-2s.
An interesting narrative continues to develop after the launch of the Optimism (OP) token this week. L2s have stormed out of the gate and are showcasing impressive numbers in the face of competition.
Optimism and Arbitrum are outcompeting many L1 blockchains early on in revenue generation. For example, optimism alone generated more revenue than Fantom (FTM), Avalanche (AVAX), Cardano (ADA), and Near Protocol (NEAR) combined in the previous week despite its low fees.
Source: cryptofee.info
One stat doesn't paint the whole story, but the revenue generated indicates how much users are willing to transact on a chain despite fees. Of course, there is a lot to consider as the L2s begin to expand, but early stats show much promise for the next iteration of Ethereum.
The primary beneficiaries of L2s, for the moment, are Ether holders, since both Arbitrum and Optimism utilize the ETH token for gas fees.
Market update 🌍
Let's zoom out and look at the larger picture. Bitcoin (BTC) has experienced its worst nine week streak in history. If the price doesn't climb this weekend, we’re looking at ten red consecutive weeks - quite unprecedented. The markets are in partial turmoil, and sentiment has gone to crap. Terra collapse, inflation, war, and future food crisis are all weighing down assets. Yet, despite the doomsday that played out, BTC is hovering at levels from one year ago. One year! That's pretty incredible for a $600m "speculative asset."
BTC continues to test the all-important 30k support. With the Stochastic RSI showing BTC at an oversold level and RSI appearing to turn upwards, the weekend may be prime for an uptick. BTC completed the US session at $30,400 up 2.20%.
Source: Trading View
Key Market Events today
Existing home sales: 1000 EST
Fed Evans/Waller/William Speeches: 1015 EST
Fed Brainard Speech: 1330 EST
Newswatch 📰
CFTC accuses Gemini. The Commodity Future Trading Commission has charged crypto exchange Gemini with "making false or misleading statements of material facts or omitting to state material facts to the CFTC in connection with the self-certification of a bitcoin futures product." The lawsuit concerns Gemini's cash-settled bitcoin futures that may have utilized exchange data feed to price the derivative in 2017.
News tidbits:
White House investigating Crypto Energy Consumption.
US Senate Candidate wants to make DogeCoin (DOGE) legal tender.
US labor market recovery picks up, adding 559k jobs.
Gemini exchange cuts 10% of its workforce.
At the protocol level ⛓
Protocol level tidbits:
Ethereum L2 Boba Network (BOBA) integrates Moonbeam (GLMR) and Fantom (FTM) to go multi-chain.
stDOT + xcDOT pool is now live on Curve Protocol (CRV) through Moonbeam (GLMR)
Writer’s take
Narratives and token supply are two of the top price drivers in crypto. While 2021 was for competing Ethereum competitors to take the stage and eat away at its dominance, Ethereum may be striking back with the help of Layer-two solutions. Will the L2 narrative play out, or will it burn bright and fizzle out?
It's still early, and there's a lack of actionable methods to take advantage of a possible shift but monitoring the current situation never hurts. The future may hold some juicy opportunities for those who stay in tune with the next chapter in crypto.
Thanks for reading, and enjoy your weekend, fam! Catch you Monday.
Gabri
Disclaimer: I am not a financial advisor. Everything on this report is financial opinion. Please consult your financial advisor before participating in crypto.