Source: MIIX Capital

Introduction:

The implied volatility of BTC's short-term out-of-the-money put options is still higher than that of call options, indicating that the market's concerns about the recent price correction have not been eliminated, but the implied volatility of long-term options remains stable, showing that institutions are optimistic about BTC's long-term prospects.

1. Investment and Financing Observation

Last week, there were 26 investment and financing events in the crypto market, a decrease of 36.58% from the previous month. The total amount of funds exceeded 170 million US dollars, with no change in the previous month and the scale remained basically the same:

DeFi announced 9 investment and financing deals, including the cryptocurrency trading platform Arbelos Markets, which completed a $28 million financing led by Dragonfly Capital;

GameFi track announced 7 investment and financing deals, among which Web3 game developer Seeds Labs completed a $12 million seed round of financing, with participation from Blizzard Fund and others;

The AI ​​track announced one investment and financing, and ChainML, an AI platform supporting Web3, completed a $6.2 million seed round of expansion financing, led by Hack VC;

The Infrastructure and Tools track announced 4 investment and financing deals, among which Humanity Protocol announced a new round of financing of US$30 million at a valuation of US$1 billion, led by Kingsway Capital;

The centralized finance sector announced one financing deal: Raven, a crypto trading company founded by former Wintermute employees, completed a $2.7 million seed round led by Hack VC.

Other Web3/crypto applications announced 4 financings, among which the crypto prediction market Polymarket has raised $70 million through two rounds of financing, the most recent round led by Founders Fund;

Judging from the month-on-month data, the number of investment and financing deals in the crypto market last week ended its two-week upward trend and fell sharply, but the total size of funds remained basically unchanged, indicating that while institutions were cautious in their layout, they increased their bets on the bids they made, and the market was betting on DeFi, infrastructure and GameFi. Among VCs, Animoca Brands was still the most active institution, followed by Founders fund, Framework Ventures, Endeavor Ventures and Electric Capital.

About Polymarket

Polymarket is a decentralized information market contract trading platform that allows users to trade on the world's most controversial topics (such as coronavirus, politics, current affairs, etc.). Currently, betting on the 2024 US presidential election has become the most popular contract.

About Humanity

Humanity Protocol is a DID-resistant blockchain network that uses palmprint recognition technology and zero-knowledge proof to ensure user privacy and security. It aims to provide an easily accessible and non-intrusive method for establishing human proof in Web3 applications.

About peaq

peaq is the DePIN network that powers the Internet of Things (EoT) on Polkadot. peaq enables entrepreneurs and developers to build decentralized applications for vehicles, robots, and devices, while empowering users to manage and earn income when connected machines provide goods and services.

2. Industry data

The number of new BTC wallets has dropped to the lowest level in 6 years

The block data: In the past week, the average number of new BTC wallets per day was 275,000, the lowest since 2018. Other related indicators also declined, among which miners' income measured by hash rate fell to a historical low, and transaction fees on the network and on-chain transaction volume indicators were also on a downward trend.

From the trend point of view, the overall data shows a bottoming trend, and the expected data recovery and rebound will begin to change and adjust as the market turns. In addition, although the on-chain indicators have declined, new protocols on the BTC network are attracting record interest from venture capital companies, which also lays the foundation for the market recovery.

Six months ago, the average daily number of new BTC wallets was 625,000, more than twice as much as it is now. At that time, due to the listing of BTC spot ETF, the development of BTC ecosystem and the halving event, the number of new addresses was close to the historical high.

BTC Rune is down 99% from its peak in late April

In the past week, the number of new runes etched on the BTC chain has dropped below 250 per day, down 99% from the peak data at the end of April, but rune transactions are still the most active part of May, and these transactions mainly occur on markets such as Magic Eden, OKX, Ordinals Wallet and UniSat.

The decline in the number of rune etchings is consistent with the heat and activity of the entire market. The main reason is the impact of market conditions, but it also indirectly reflects that runes have not been able to generate independent market heat like previous inscriptions. The subsequent trend still depends on the macro market and the activity of the BTC ecosystem.

According to the data dashboard created by RUNES on Dune: From April 26 to 30, an average of 14,700 new runes were etched every day, with 23,061 runes etched on April 26, setting a record high;

Since Runes was launched on April 20, BTC miners have received a total of $4.5 million in transaction fees, about $189 per day. To date, more than 91,200 runes have been engraved on the BTC chain;

Solana becomes the public chain with the highest TPS

CoinGecko data: Solana's on-chain TPS (transactions per second) reached a maximum of 1,504 times, making it the fastest large-scale blockchain, more than 5 times faster than Polygon and 46 times faster than ETH. Despite this, Solana only achieved 1.6% of its claimed theoretical TPS (65,000 times per second). In addition, the second fastest blockchain is Sui, which reached a maximum TPS of 854 in July 2023.

Combining data comparison, the average TPS of non-EVM public chains is 284, while the average TPS of EVM and EVM-compatible public chains is 74, which means that non-EVM public chains are nearly 4 times faster than EVM public chains. However, in terms of stability and security, ETH-based public chains still have an advantage, and the TPS of ETH-based public chains has not become an important factor affecting or hindering their rapid development.

BSC and Polygon are the fastest EVM blockchains. BNB Smart Chain (BSC) reaches up to 378 TPS and Polygon reaches 190 TPS, making it the fastest Ethereum scaling solution.

3. VC holdings

Note: The above data comes from https://platform.arkhamintelligence.com/ , statistical time: 19:00 on May 20, 2024 (UTC+8).

4. This week's focus

May 20

• FOMC voting member and Atlanta Fed President Bostic was interviewed by Bloomberg TV;

• Federal Reserve Board Governor Barr speaks on bank regulation;

• Federal Reserve Vice Chairman Jefferson spoke on the economic outlook and the housing market;

• PayPal’s new policy, which takes effect on May 20, will remove buyer and seller protections for NFTs;

• BounceBit announced the asset withdrawal schedule, and BTCB, WBTC, FDUSD, and USDT that are not staked in Premium are now available for withdrawal;

• 2.13 billion PYTH tokens will be unlocked at 22:00 on May 20, worth approximately $812 million, accounting for 141.67% of the circulation;

• Crypto Expo Dubai 2024;

May 21

• FOMC voting member and Cleveland Fed President Loretta Mester was interviewed by Bloomberg TV;

• U.S. Treasury Secretary Janet Yellen, European Central Bank President Christine Lagarde, and German Finance Minister Lindner delivered speeches;

• Fed Governor Waller spoke on the U.S. economy, and Fed Governor Barr participated in a fireside chat;

• Chiliz Chain plans to conduct a Dragon8 hard fork and introduce Token Economics 2.0;

• IoTeX and DMC jointly held an online event with the theme of "What are the development directions and trends of DePIN in China and the West under the expectation of interest rate cuts?"

May 22

• FOMC voting members Bostic, Mester and Collins participated in the panel discussion on "Central Banks in the Post-Pandemic Financial System";

• Jupiter’s LFG third round of voting will begin on May 22;

• The SEC, Terraform Labs and Do Kwon will hold court debate on the fraud case compensation plan on May 22;

• Bitcoin Pizza Day;

• 9.54 million AVAX tokens will be unlocked at 8:00 on May 22, worth approximately $340 million, accounting for 2.49% of the circulation;

• 18.49 million ID tokens will be unlocked at 8:00 on May 22, worth approximately $14.26 million, accounting for 4.29% of the circulation;

• Microsoft Build developer conference;

May 23

• Initial jobless claims in the U.S. this week;

• The Federal Reserve releases the minutes of its monetary policy meeting;

• The SEC will decide on May 23 whether to approve VanEck’s spot Ethereum ETF application;

• Aethir, a decentralized GPU cloud infrastructure, will officially release its edge computing device Aethir Edge on May 23;

• Crypto V Summit;

May 24

• US Consumer Confidence Index for May;

• FOMC voting member and Atlanta Fed President Bostic participated in a student Q&A session;

• Federal Reserve Board Governor Waller delivered a speech;

• The proposal voting on “Lido Alliance: Ethereum Alliance Ecosystem” will end at 12:00 on May 24;

• The SEC will decide on May 24 whether to approve the spot Ethereum ETF application submitted by ArkInvest/21 Shares;

• The Alliance of Super Artificial Intelligence (ASI) is scheduled to be launched on May 24, and the merger of the three has been approved by the proposal vote in each community;

• Euler (EUL) will unlock approximately 4.66 million tokens at 00:17, worth approximately $370,000, accounting for 0.34% of the current circulation;

• ETH Berlin will be held from May 24 to 26, 2024 at the CIC Innovation Campus in Berlin, Germany;

May 25

• Animoca Brands Japan launches Fairy Tail digital collectible cards, which will be available on Quidd at 05:00 on May 25;

• Notcoin’s 5% token distribution to community members and exchange users will end on May 25;

• Acala (ACA) unlocked 4.66 million tokens at 08:00 am, worth about $500,000, accounting for 0.48% of the current circulation;

• Bitcoin 2024;

5 Conclusion

Last week, the slightly lower-than-expected U.S. CPI inflation data restored the market's confidence in the long-term bullishness of BTC, but short-term volatility remains high, and the macroeconomic environment remains the key driver of the crypto market's performance; in addition, the number of investment and financing transactions in the crypto market ended its two-week upward trend, but the total size of funds remained basically unchanged, indicating that while institutions are cautious in their layout, they have increased their bets on the bids, and the market is betting on DeFi, infrastructure, and GameFi.

This week, there are several important events and conferences, such as Crypto Expo Dubai 2024, Microsoft Build Developer Conference and ETH Berlin, which will bring new technological innovations and cooperation opportunities to the industry. In addition, tokens worth about $1.3 billion will be unlocked one after another, including $340 million worth of AVAX and $812 million worth of PYTH, which will inevitably bring great selling pressure to the market. After two months of falling prices, AVAX and PYTH will not fluctuate significantly in FDV after token unlocking. If the macro performance is favorable, market confidence will be further enhanced, and the long-term trend will be more optimistic.

In addition, voting on the US FIT21 Act is underway, which may become a critical event in the history of US crypto regulation and have a huge impact on the entire industry, providing a strong positive trend at the macro level and becoming a key factor affecting subsequent industry trends and market changes. Investors are advised to pay close attention.