Week in DeFi: How Many L2s Do We Really Need?
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Week in DeFi: How Many L2s Do We Really Need?

5 хв
4 months ago

New Ethereum layer-2s are set to enter the space, as Ethereum restaking protocol EigenLayer launches the second stage of its testnet. Read on to find out more in our DeFi roundup!

Week in DeFi: How Many L2s Do We Really Need?

Зміст

LayerZero drops their latest innovation for verifiable on-chain contribution and distribution via ColorTrace, centralized exchange (CEX), OKX, announces plans for an L2 chain with Polygon’s support, and EigenLayer reaches the second phase of their testnet.
Big week in the world of DeFi! Let’s dive deeper into what went down in DeFi this past week.

Overview

Total value locked (TVL) across all chains retrace slightly amidst pause regarding the ETF approvals from the SEC. Notable exceptions to the trend include Cosmos-based Ethereum Virtual Machine (EVM) chain, Evmos, and Ethereum zero-knowledge EVM chain, Manta Pacific, which both saw more than 35% jumps in TVL.

Source: https://coinmarketcap.com/chain-ranking/

Welcome to Alpha Central

Li Jin and Jesse Walden of Variant Fund discuss token distribution models and how crypto applications should go about doing so to achieve the desired results.

TL:DR:

  • An opt-in, bottom-up approach to token distribution, known as progressive ownership should be adopted by applications
  • Instead of using tokens to bootstrap networks and users, tokens should be used to deepen loyalty
  • This creates a more targeted strategy for protocols, creating a more committed and loyal community
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Crypto Koryo covers some key takeaways from observing the narratives that have taken hold of the markets for 2023 and things to keep in mind when chasing trends.

TL;DR:

  • New narratives generally don’t maintain their top position for more than a month and will usually be the worst performing narrative in the subsequent months
  • Sophisticated narratives such as options and privacy are rarely ever top narratives
  • The strongest performer in a narrative tends to continue performing even after the narrative, as a whole, fades away
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Ethereum: LayerZero’s ColorTrace and EigenLayer’s Testnet Phase 2

Omni-chain interoperability protocol, Layer Zero, unveils ColorTrace, a new method of tracing tokens from mint to their current state. In essence, ColorTrace allows the history of a token to be tracked and consequently, this can be used to reward users who participated in value accretive behaviors in the token’s history which contributed to their success.
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Ethereum restaking layer. EigenLayer, opens up the second stage of their testnet rollout. Stage two allows operators to register with EigenLayer, restakers to delegate to said operators as well as for rollups to integrate EigenDA for their data availability needs.
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Other Product Launches and Updates

L2s: Layer-2s Wars

Launched by Pacman, founder of NFT marketplace Blur, and backed by Paradigm and Standard Crypto, Blast is the newest, hottest L2 in town. In just 24 hours, over $81 million have been bridged, as speculators bet on the airdrop from Blast Points, similar to Blur's season rewards. Blast is an optimistic roll-up that claims to be the "first L2 with native yield," with ETH on Blast natively staked. Funds bridged to Blast are locked until mainnet launch sometime in February 2024.

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Centralized exchange (CEX), OKX, announces their plans to launch the X1 chain, a zero-knowledge rollup on Ethereum, powered by Polygon’s chain development kit.
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Intent-based DEX, IntentX, launches on Coinbase L2, Base, opening up 180 markets to perpetuals traders. IntentX boasts low fees, high available leverage and CEX-like liquidity to elevate the DEX trading experience.
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Other Product Launches and Updates

Solana: Real Estate Perps and JLP Collateral

Parcl introduces their tokenized real-estate trading platform, enabling users to trade perpetual futures on synthetic real-estate assets across 21 real-world real estate markets via a unified and scalable liquidity pool.
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Money market protocol, Kamino Finance, launches Kamino V2, enabling yield-bearing kTokens to be used as collateral, thereby increasing the composability of said tokens. Additionally, they have also integrated the JLP token from DEX aggregator, Jupiter Exchange, as collateral on the platform.
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Avalanche: JPM x Avalanche

JP Morgan’s Onyx blockchain, Apollo Global Management and Avalanche partner up under Project Guardian to link Onyx with the Avalanche Evergreen subnet, enabling the on-chain subscription and redemption of WisdomTree Prime funds.
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Another Week, Another Airdrop

The PYTH airdrop from oracle network, Pyth, will be open for claims on 20th November 2023, with the claims page being open for 90 days until 18th February 2024. Users with eligible activity on applications supported by Pyth will be eligible for the retrospective airdrop.
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Tweet of the Week

Factorydoge reminding us that the Ethereum pump is cursed, as the market fails to break higher again with price continuing to trend sideways.

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Stay updated on your favorite projects and stay tuned for next week’s edition, and keep supporting your favorite projects, degens!
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