🚀Weekly Recap: Ethereum Layer 2 TVL Surges To All-time High
Weekly Recap
Happy New Year Defiers!
In this final bumper recap of 2023, we look at everything that went down in crypto over the holiday season.
The total value locked in Ethereum Layer 2s has crossed $20B for the first time following explosive growth from networks within the Optimism ecosystem.
Ethereum founder Vitalik Buterin is proposing to reduce the network’s load associated with its high validator count of roughly 895,000. This high figure supports decentralization but strains the network due to the huge number of signatures it has to process.
As 2023 draws to a close, crypto analysts are looking ahead to the new year with renewed optimism. Real-world assets, AI and modular blockchain designs are popular themes that are expected to build on their momentum, while Bitcoin's dominance could continue to rise on institutional flows.
Inscriptions continue to proliferate across Ethereum Layer 2s and EVM-compatible networks, inadvertently causing major stress-tests for multiple chains.
Price action is picking up in the crypto markets after Bitcoin’s volatility index fell to a four-and-a-half year low in late October. The market movements follow institutional crypto products posting their first outflow in 11 weeks as large traders took profits after a multi-month digital asset rally.
Solana continues to attract projects from Ethereum’s ecosystem following its recent bullish comeback. Render Network, a marketplace for idle GPU computation, jumped ship and migrated its token over to Solana. The move was welcomed by investors, with Render’s token gaining 17% in seven days.
Ondo Finance also brought its U.S. Treasury-backed stablecoins OUSG and USDY over to Solana. In other real-world asset news, Frax’s community voted to deploy $20M into tokenized U.S. treasuries via the Centrifuge Prime platform.
Web3 industry leaders raised $78M to fund pro-crypto lobbying efforts in the United States. The funds will support pro-crypto House and Senate representatives ahead of the 2024 congressional elections regardless of political affiliation.
LinkedIn data shows the number of crypto jobs on offer plummeted by more than 80% in 2023. Web3 positions crashed by 84% in the United States and 92% in Germany, signaling many crypto companies capitulated in response to the extended bear market.
In NFT news, Yuga Labs launched an ERC-721-style wrapper to bolster the utility and composability of the veteran CryptoPunks collection. Boring Security, an ApeCoin DAO-funded security company, recovered 38 Bored Apes and 18 Mutant Apes recently stolen from an NFT trading platform after paying a 10% bounty to the hacker.
Frame, a forthcoming NFT-focused blockchain, also announced an airdrop for NFT traders on Ethereum after closing a funding round led by Electric Capital.
Plus, in this week’s podcast, Tegan Kline chats with Jameson Lopp, the CTO of CasaHODL, a company specializing in Bitcoin security solutions.
And in case you missed it, Cami Russo spoke with Chris Bradbury, the CEO of leading DeFi protocol and MakerDAO front-end interface, Summer.Fi.
The Defiant founder also gives a quick recap of the week's events and shares her hot take on the ongoing points meta in Crypto With Cami.
Enjoy!
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Meet The Capital of Crypto
Türkiye sits in a vital geopolitical location straddling both Europe and Asia. Yet, beyond its G20 membership and a growing economy, Türkiye also grapples with significant headwinds.
Soaring inflation, drastic devaluation of the Lira, growing debts, natural disasters like the recent earthquakes, and the rising cost of living due to global energy prices. These all contribute to the current reality on the ground, which some have argued could risk reversing the significant poverty reduction they’ve achieved in recent years. So what drives crypto adoption in Türkiye?
The Painful Reality of DeFi Yields
⚠️ Inscriptions Are Breaking Crypto
High Yield with Mantle's Liquid Staking Protocol | mETH Tutorial
We walk you through how to earn yield via the new Liquid Staking Protocol (LSP) from Mantle, a Layer-2 birthed from a merge with BitDAO. Mantle LSP features mETH, a liquid staking token, designed to offer high yields and efficient staking for users.
Podcast & Interviews
Deep Dive into Bitcoin with GOAT Jameson Lopp
Jameson Lopp is the CTO of CasaHODL, a company specializing in Bitcoin security solutions. He has played a pivotal role in developing products and services that empower individuals to safeguard their digital assets.
Jameson is a globally recognized voice from his written work on cybersecurity, privacy and the social implementations of Bitcoin. Trigger warning for those in the Ethereum community and beyond as this is a spicy episode that gets gritty with the importance of individual privacy and protecting personal info in the digital age.
Becoming the Front Page of Finance: The Summer.fi Vision
Cami Russo was joined by Chris Bradbury, the CEO of Summer.fi, the MakerDAO front-end formerly called Oasis.app.
Summer.fi is the sixth-largest DeFi protocol that enables users to borrow, lend, and multiply assets across multiple DeFi protocols. In our conversation, we dive into the basics of Summer.fi, the advanced trading strategies enabled by the protocol, and the current state of the competitive DeFi landscape.
Holiday Week
- Surging Optimism Ecosystem Drives Layer 2 TVL To New Heights The milestone was driven by rising adoption of chains building on Optimism’s OP Stack, with Manta Pacific rocketing 173% in seven days to tag $363M, Metis Andromeda surging 146% to $632M, and OP Mainnet gaining 22% to $6.07B.
- Crypto Leaders Outline Predictions For 2024 Real-world assets, AI and modular blockchain designs are popular themes that are expected to build on their momentum, while Bitcoin's dominance could continue to rise on institutional flows.
- Vitalik Buterin Wants to Modify Ethereum's Proof-of-Stake Model Buterin reckons that the current signature aggregation system–which processes roughly 28,000 signatures per slot–breeds systemic complexity and doesn’t reach the end goal of allowing anybody to stake.
- Lido Dominance Recedes Despite Blast TVL Climbing To New Highs Lido’s diminishing command over the supply of staked Ether follows renewed scrutiny from Ethereum decentralization advocates who feared that the rising value of assets locked in Blast, a forthcoming Layer 2 network, could push Lido’s dominance above one-third.
- PancakeSwap To Reduce Maximum Token Supply by 40% The proposal said the measure will facilitate PancakeSwap's CAKE token becoming deflationary - meaning more tokens are removed from supply through PancakeSwap's burn mechanism than enter circulation as newly minted rewards for users.
- DeFi Wrap for 2023: Time For Bears to Go Into Hibernation DeFi TVL and the number of protocols at scale grew this year, signaling the ecosystem's increased maturity.
- Blockchain Sleuth ZachXBT’s X Profile Goes Back to Offline After Briefly Flipping On The on-chain investigator said he was stepping away for an indefinite amount of time.
Friday 12/22
- Mantle’s Throughput Peaks At 200 TPS As Inscriptions Expand Across Layer 2s Inscriptions continue to stress-test Ethereum’s Layer 2 ecosystem, with Mantle becoming the latest chain to post record throughput amid a flurry of inscription activity. Mantle processed an all-time daily high of 14 transactions per second on Thursday.
Thursday 12/21
- Ethereum Developers Target January for Testnet Launch of Major Dencun Upgrade Ethereum developers are targeting January to launch the testnet of the blockchain's next major update, signaling the distributed team is getting closer to deploying key scalability improvements on mainnet.
- Yuga Labs Releases New Wrapper Contract For CryptoPunks Yuga Labs has released a new wrapper contract for CryptoPunks, enabling the seminal Ethereum-based collection to benefit from the same trading capabilities as more recently created NFTs. The new wrapper, called "CryptoPunks721," transforms a CryptoPunk into an ERC-721 token.
- PancakeSwap's CAKE Token Jumps After Proposal to Reduce Supply PancakeSwap's CAKE token is rallying after the team proposed to reduce the token's maximum supply by 40%. CAKE jumped by as much as 20% on Thursday, the highest since May.
- Activity On Linea Slumps After Voyage Campaign Concludes Activity on Linea, the Ethereum Layer 2 network from Consensys, is slowing down after explosive growth amid its multi-week promotional campaign, Voyage. Daily throughput is down 67% from its record high on Dec. 10.
- EigenLayer Unveils ‘Restaked Rollups’ In Collaboration With AltLayer EigenLayer has teamed up with AltLayer to enable the launch of appchains secured by its restaking service. The news comes as an increasing number of Ethereum scaling teams are launching tech stacks to facilitate appchain deployment.
Wednesday 12/20
- Celestia Rival Avail Partners With StarkWare For Blockchain Data StarkWare has tapped Avail for data availability services. Avail will service Starknet-based appchains via the Madara sequencer. The partnership is estimated to reduce data publishing expenses by 90%.
- Crypto Jobs Plunged +80% to a Near Death in 2023 Crypto-related jobs plunged this year amid volatile market conditions and regulatory uncertainty. Crypto positions dropped by 90% while blockchain jobs slumped 50% year-to-date.
- Render is Switching to Solana After 10x-ing This Year The Render Network Foundation migrated its tokens onto Solana, changing the coin's ticker from RNDR to RENDER. The move was approved by community governance with 54% support.
- SEI Surges To All-time High As ‘Parallelized’ Layer 1s Rally Sei, a Layer 1 blockchain optimized for high-speed trading applications, rallied more than 60% over the past two days to new all-time highs. The move follows impressive gains from other projects working on parallelized execution including Solana and Sui.
- EthereumPoW Core Team To Disband and Usher Decentralized Governance The core development team behind EthereumPoW, the roughly one-year-old Proof of Work fork of Ethereum, is disbanding and transitioning the project to community governance. The news follows the core team's wallet balance dropping to just $30.
- Inscriptions Dominate Volume On EVM Chains Inscriptions continue to spread across new networks. In the past seven days, inscriptions accounted for more than 91% of transactions on Avalanche, 75% on Gnosis, 65% on Ethereum’s Goerli testnet, 62% on Arbitrum, and 58% on ZkSync Era.
- Frax Votes To Move $20M Of Stablecoin Collateral Into Treasury Bills The community behind Frax Finance, the multifaceted stablecoin protocol voted to invest $20M of its collateral into U.S. Treasuries. The capital will be deployed via Centrifuge Prime, a DAO-focused platform for real-world asset investment.
- Ondo Brings Treasury-backed Tokens To Solana Ondo Finance has deployed two stablecoins backed by U.S. treasuries on the Solana blockchain. “Solana has recently become an undeniable hotbed of activity and a black hole for incoming liquidity,” Ondo said.
Tuesday 12/19
- Frame Announces Funding Round and Airdrop for NFT Community Frame, an upcoming blockchain focused on NFTs, concluded a funding round led by Electric Capital, a prominent venture capital firm. The project also announced an airdrop for active NFT traders on Ethereum.
- Senator Elizabeth Warren Questions Crypto Lobby in Letter to CoinCenter, Blockchain Association and Coinbase U.S. Senator Elizabeth Warren sent a letter to major industry members expressing concern about their lobby efforts. Warren claimed their objectives would prevent regulators from preventing crypto-based terrorist financing.
- INJS Halts Inscriptions Mint on Injective Blockchain Minutes After it Started INJS, an inscriptions marketplace on the Injective blockchain, urged users to stop minting inscriptions just minutes after launching. The project plans to refund users after transaction fees unexpectedly skyrocketed.
- EigenLayer Deposits on Track to Hit New 500,000 ETH Cap EigenLayer's total value locked surged after the restaking protocol increased its LST deposit limits to 500,000 ETH. The protocol also introduced support for six new liquid staking tokens.
Monday 12/18
- Uptick In Crypto Volatility Drives $230M In Liquidations Crypto market volatility is beginning to pick up again after sinking to a multi-year low. More than 100,000 traders were liquidated in 24 hours as leading assets plunged and then rallied by 5% in one day.
- Hacker Steals $830,000 From Cross-Chain Bridge of Solana Game Aurory Aurory, a Solana-based Pokemon-inspired web3 game, lost around $830,000 worth of its native tokens to a bridge exploit. The project bought back the stolen tokens through its market makers on a decentralized exchange.
- Coordinape Launches ‘CoLinks’ Professional Social Network For Crypto Coordinape launched CoLinks, a professional networking application that centers around the concept of reputation, or “rep.” Users can establish rep through their wallet activity or through off-chain actions like linking a Twitter or LinkedIn account.
- Institutions Break 11 Straight Weeks Of Buying Crypto Digital asset investment products suffered $16M worth of outflows this past week after 11 straight weeks of purchases. Analysts attributed the move to profit-taking, with institutions realizing gains made over the recent crypto rally.
- Crypto Leaders Raise $78 Million to Support Pro-Innovation U.S. Politicians Blockchain industry leaders have collectively raised $78M through Fairshake Super PAC to support pro-crypto politicians for upcoming 2024 congressional elections. Fairshake will back candidates from both the U.S. House and Senate regardless of political affiliation.
- Boring Security Rescues 38 Apes Stolen In NFT Trader Exploit Boring Security, an ApeCoin DAO-funded funded security firm, recovered 38 Bored Apes and 18 Mutant Apes stolen in an exploit last week. The NFTs were returned in exchange for a bounty equating to 10% of the stolen assets' floor price.




