In today’s newsletter:
🔎Major Crypto Catalysts in April
📊This Week’s On-chain Alpha
😂Crypto Meme of the Week
🗞️The Latest DeFi news
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🔎Major Crypto Catalysts in April
April is going to be a big month for crypto.
The highly anticipated Bitcoin Halving will finally occur.
Not only that, but there are also several well-known projects which will either launch their tokens or undergo a major upgrade.
Here are 4 upcoming key crypto events to pay attention to the next month:
1. The Bitcoin Halving
The next Bitcoin Halving is expected to happen in ~22 days.
Once it goes live, it will reduce the no. of new BTC entering circulation by 50%.
However, it’s worth noting that the current BTC inflation rate is already very low. (less than 2% annually)
Due to this, from a fundamental point of view, I’d say that the Halving is not really a big deal. But from a psychological standpoint, this isn’t the case.
A lot of people know that historically, BTC has performed very well in the months after every single Halving event. And because of this, they’ll likely buy our bags again soon, expecting history to repeat.
On top of that, Hong Kong’s Securities and Future Commission is expected to approve the launch of the first spot Bitcoin ETFs in Hong Kong in Q2.
The stars are aligning for Bitcoin.
2. Stacks Nakamoto Upgrade
Stacks is a Bitcoin L2 enabling smart contracts & dApps.
Stacks’s Nakamoto Upgrade, which has been under development for a very long time, seems like it will finally begin rollout to mainnet next month.
Nakamoto Upgrade will:
allow sBTC (a BTC pegged asset) to be used in DeFi on Stacks
lower the network block times from 10 minutes to a few seconds
increase the Stack L2 scalability
The upgrade might spark a new Bitcoin L2 season.
$STX, the token of Stacks, can also be considered a beta play for BTC.
Stacks is by far the most popular project built on top of Bitcoin.
3. Solana Airdrop Season
Last year, the huge airdrop announced by Jito led to the revival of the Solana ecosystem. In April, several other popular Solana dApps will launch a token:
All these protocols will do an airdrop.
This list includes only the airdrops that are officially confirmed, so there might actually be a few additional ones that haven’t been announced yet.
Big airdrops can have a massive positive impact on an ecosystem, as they inject more liquidity into it. Here’s for instance what happened with $SOL after $JTO launch was announced in Nov. 2023:
Expecting $SOL to do another 2-3x in the short term due to the upcoming airdrops is unrealistic imo since SOL market cap is now over $80b.
Still, Solana will likely benefit a lot from these ecosystem airdrops, as it has also done in the past.
4. Eigenlayer mainnet launch + potential token launch
There’s a small chance that the Eigenlayer token will go live in late April / early May.
There are multiple reasons for this:
Eigenlayer mainnet is confirmed to go live over the next weeks (and this might be the perfect time for Eigenlayer to also launch a token)
many early investors say that the token will be released in late April / early May
Besides this, April will likely also be the month when the first Eigenlayer Actively Validated Services (AVS) go live. Altlayer, a decentralized protocol for rollups, is an example of a popular AVS.
Protocols that choose to 'rent’ security from Ethereum through Eigenlayer are called AVS (those can be oracles, sidechains, L2s, etc.)
Many of these AVS projects might do an airdrop for Eigenlayer users as Altlayer has also done a few months ago when it launched its token.
According to the Etherfi team, 8 AVSs will start distributing points or token rewards to EtherFi’s eETH liquid restaking token holders soon.
By restaking ETH, you’ll be able to farm the airdrops of Eigenlayer, liquid restaking protocols, and Actively Validated Services at the same time🧑🌾
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On-chain Alpha🔎
$86B in institutional funds entered BTC in the past 6 months
As you can see in the image above, the institutional inflows into BTC have skyrocketed following the launch of the spot BTC ETFs.
This makes me think about what will happen with ETH institutional adoption after a spot Ethereum ETF is (hopefully) also approved later this year.
It’s becoming increasingly clear that institutions are starting to realize that crypto is here to say.
Crypto Meme of the Week😂
The latest developments in DeFi
CTFC reaffirmed that ETH is a commodity, increasing the chances of a spot Ethereum ETF being approved
Ethena announced that the $ENA token launch will happen on April 2. 5% of $ENA supply will be airdropped to early adopters
Optimism has allocated $3B for grants within the Optimism Collective & Superchain
NEAR Protocol introduced Chain Signatures, which enable NEAR accounts to sign transactions for any blockchain. The goal is to improve the cross-chain UX
Circle released its Cross-Chain Transfer Protocol on Solana. USDC holders can now move USDC across 8 chains with 1:1 capital efficiency
Zero1 introduced Keymaker, a marketplace for all things related to Decentralized AI. Keymaker aims to be the largest deAI ecosystem
Ankr introduced Neura, a blockchain built for AI. Neura will secure its network by leveraging Bitcoin’s security via Babylon
Polygon introduced the dApp Launchpad, a developer's gateway to the Polygon ecosystem. dApp Launchpad’s goal is to improve the Polygon developer experience
Angle Protocol introduced USDA, a yield bearing and RWA-backed USD stablecoin. USDA will have several anti-depeg mechanisms and the same liquidity as USDC
PancakeSwap announced the launch of MancakeSwap, PancakeSwap’s first affiliate DEX on Mantle Network. Mancake will pay 60% of its revenue to Pancakeswap
Liquity presented the key feature of Liquity V2, user-set interest rates, aiming to create an efficient market between borrowers & stablecoin holders
EtherFi released Points Season 2. Season 2 allocation is 5% of the total ETHFI supply and will conclude on June 30
Munchables, a popular protocol on Blast L2, has suffered a $63M hack. Happily, the funds have been returned by the hacker
That’s all for this week!
Until next time,
The DeFi Investor
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