1. Summary of Industry Dynamics
Industry News
The crypto market experienced a slight correction last week. The correction mainly occurred after the release of the unexpectedly large non-agricultural data on Friday. The market may have some concerns about repeated inflation. It can also be seen as a technical correction after a month of continuous growth. The liquidity of the exchange is still at a recent high, without obvious fluctuations, and the trading volume fluctuates around 30 billion. As of writing, Bitcoin closed at 23113.69, down 2.65% on the week, with an amplitude of 7.50%; Ethereum closed at 1643.4, down 0.07% on the week, with an amplitude of up to 10%.
On the other hand, the US stock market ended last week with the first interest rate meeting of the Federal Reserve in 2023. In line with market expectations, the interest rate was raised by 0.25%, and the interest rate reached between 4.5% and 4.75%. The meeting statement pointed out that employment growth has been strong in recent months, the unemployment rate has remained low, and inflation has eased but is still high. The Federal Open Committee insists on the 2% inflation target unchanged, and will continue to raise interest rates and continue to reduce its holdings of US Treasury bonds and asset-backed securities. The two major tools of raising interest rates and shrinking the balance sheet will continue. Powell then gave a speech at 14:30 Eastern Time. In his speech today, Powell repeatedly mentioned price stability, firmly determined to reduce inflation to below 2%, and mentioned that the rapid rate hike will be transformed into a small rate hike, which can provide the committee with more time to analyze the effect of the rate hike. This sentence can be understood as dovish. The market began to soar after Powell's speech, directly consolidating the technical form of the rebound and bottoming of US stocks. The S&P quickly walked up and stood firm on the annual line, and the Nasdaq also touched the pressure of the annual line and had a certain probability of breaking through. The non-farm payrolls were released on Friday, with a surge of 517,000 non-farm payrolls, far exceeding the expected 185,000. At the same time, the unemployment rate hit a 53-year low of 3.4%. However, the hot labor market did not cause too much damage to the market. On the contrary, the Nasdaq closed with a positive line after repeated fluctuations during the day, representing the resilience of the market rebound. Of course, it is not ruled out that the increase in service inflation caused by wage increases will cause the market to worry about repeated inflation. This can be found out after the February inflation data.
Industry data
1) Public Chain & TVL
As of February 5, the overall locked-in volume of various public chains denominated in US dollars continued to rebound, but the increase slowed down, rising from about 48B last week to 49B, an increase of about 2.08%.
The TVL of various public chains generally increased, among which Arbitrum, OP, and Fantom had the highest growth rates.
Fantom Chain has been receiving positive news recently. This week, the price of FTM continued to rise by about 18%, mainly due to Andre Cronje's post, stating that he would launch the stablecoin fUSD v2 and migrate the v1 version. fUSD is an overcollateralized stablecoin launched by Fantom, generated by staking FTM. However, in 2022, due to the excessive drop in the price of FTM, insufficient collateral and bad debts occurred, and the price of fUSD fell to as low as $0.22. It has now recovered to around $0.86.
2) Stablecoins
As of February 4, 2023, the combined supply of the top four stablecoins (USDT, USDC, BUSD, DAI) was approximately 132.07 billion, with little change from last week, a slight decrease of approximately 170 million (-0.13%). The supply of stablecoins continued to stabilize.
Among the three major fiat stablecoins, the supply of USDT continued to rise, increasing by about 517 million (0.77%) this week, and the downward trend reversed. The supply of BUSD improved this week, with a sharp increase of about 470 million (2.97%); it is worth noting that the supply data of USDC has intensified its downward trend this week, with a sharp decrease of 1.12 billion (-2.61%), setting a new low in the past year. Although the market rebound continues, funds in the US market are still continuing to flow out.
DAI, which is ETH leverage, did not change much, with a slight decrease of 37 million (-0.64%), and some investors cashed in their profits.
Overall, the increase in USDT and BUSD basically offset the decrease in USDC. The withdrawal of US investors may be more due to macro uncertainties, including the "super central bank week" and the non-farm payroll data that exceeded expectations.
3) BTC Miner Balance
The BTC miner address balance shows the total BTC holding balance marked as miner addresses on the chain, including Foundry USA, F2Pool, AntPool, Poolin, Binance and other addresses.
This data is usually used to judge miners' interest in the current BTC price. When the miner's balance increases, it usually means that the chips are in a state of accumulation; when the miner's balance decreases, it indicates that miners are selling or pledging their BTC.
According to OKLink data, the balance of miners has been in a slow downward trend in the past six months, but the overall change is not significant, and miners are still accumulating chips; the market rebound since January has not caused a large-scale sell-off, and the selling pressure from miners is not great.
2. Macro and Technical Analysis
The market is still in a sideways phase, and there may be a short-term correction demand. It is recommended to allocate BTC and ETH
Two-year Treasury notes traded sideways.
Nasdaq breaks through the annual line, and the need for short-term correction is obvious
1. Ahr999: 0.6, the cost performance is not as good as before
2. MVRV: 1.193, same price/performance ratio as Ahr999
Number of BTC addresses: The number of addresses holding more than 100 coins is decreasing
Number of ETH holding addresses: The number of addresses holding more than 100 ETH is decreasing
III. Summary of Investment and Financing
Investment and Financing Review
In the fifth week of 2023, the crypto VC market disclosed 29 investment and financing events, with a cumulative financing amount of more than 140 million US dollars; (https://www.rootdata.com/Fundraising)
During the reporting period, there were three events with financing amounts exceeding US$10 million:
Bitcoin miner TeraWulf raised $32 million in a public stock offering, and the company also reached a binding agreement in principle with existing lenders to restructure its debt.
Web3 infrastructure company BlockJoy announced the completion of nearly $11 million in seed and Series A financing. Investors include Gradient Ventures, Draper Dragon, etc. BlockJoy will use the new financing to launch blockchain node management software.
Blockchain security solution provider Sec3 has completed a $10 million seed round led by Multicoin Capital, with participation from former ParaFi Capital partner and Solana co-founder. Sec3 currently only serves Solana ecosystem projects, and its clients include Helium Network, Metaplex, and Tulip. Sec3 plans to expand to Ethereum, Aptos, Sui, and Polygon in the future.
Organization News
4. Crypto Ecosystem Tracking
NFTs & the Metaverse
(1) This week’s NFT market
Market Overview: This week, the NFT blue chip index performed relatively mediocrely, and there is still a trend of further decline compared with last week. The blue chip index within 30 days also continued to decline. As of February 3, the NFT blue chip market did not show a strong recovery trend. This may be because apart from the strong performance of Sewer Pass, there has not been a very noteworthy project to increase the blue chip market value. All products under Yuga Labs accounted for 34.3% of NFT sales on the Ethereum chain.
NFT total market value: This week, the total market value of NFT has not changed much, down 1.08%. After the total transaction volume fell last week, it continued to fall this week (-8.76%). It has fallen by more than 15% for two consecutive weeks. The overall data within 30 days is not very optimistic. However, looking at the market performance from November to early February, we can see that the overall trend is still upward, and we can also expect the total market value of NFT to rebound in the first quarter.
Market activity: Overall in January, NFT market holders showed an upward trend of +4.07%, and trader activity also increased year-on-year in the past 30 days, +7.35%. Buyers increased by +3.81% year-on-year, and sellers increased by +11.25% year-on-year.
The top three NFTs in terms of NFT market transaction volume this week are Otherdeed, MAYC, and Doodles. The floor price of BAYC has dropped in the past week and is currently around 72ETH. The transaction volume of Sewer Pass mentioned last week is also a new high, exceeding 30,000ETH, and the floor price is about 2.3ETH.
Overview of Metaverse Projects This Week:
This week, the 10 leading blue-chip projects in the Metaverse sector performed well compared to the NFT market, and the total transaction volume continued to show an upward trend, with a 7-day increase of 3.23%. NFT Worlds also continued to occupy the second place in transaction volume, surpassing decentraland and the sandbox. In terms of total market value, the top three Metaverse projects are still Otherside, Decentraland and the Sandbox. The floor price of land prices has not changed much, remaining in the range of 0.9-1.69 ETH.
(2) This week’s NFT & Metaverse dynamics focus:
NFTScan and MAY
NFT data infrastructure service provider NFTScan has reached a strategic partnership with the interactive social metaverse platform MAY, and the two parties have begun in-depth cooperation at the multi-chain NFT data level. NFTScan's NFT API provides professional NFT data services for the MAY metaverse space.
Through the MAY Metaverse infrastructure, developers or users can generate their own Metaverse space on MAY in just 30 seconds, display multi-chain NFT assets, bind DID identities, and share them as 3D social business cards. Through mobile phones or desktop applications, actions and expressions can be captured in real time, and multi-person interactions can be carried out with other users.
About MAY
MAY, which means "Meet Another You", is an interactive metaverse social platform. Based on leading multi-terminal motion capture and AI technology, users can gather and communicate in a personalized 3D virtual space, and experience an unprecedented virtual-real fusion social experience with their "real self" with real-time expressions, movements, and synchronized voice. MAY is committed to building the next generation of social networks — strong interaction, high immersion, and personal self-sovereignty. In just 30 seconds, users can have their own metaverse space. It can also provide serverless metaverse construction services to partners to jointly build an open and interconnected multiverse.
About NFTScan
NFTScan is the largest NFT data infrastructure service provider in Asia, currently supporting multiple blockchain networks such as Ethereum, BNBChain, Polygon, etc. As of December 2022, NFTScan is providing professional NFT API data services to 100+ financial technology companies.
(3) Key project: Cool Cats announces three new strategies for brand, strategy and product experience
New Brand Identity
In the past year, the floor price of CoolCats has dropped from a high of nearly 13 ETH to the 2 ETH range, and the trading volume has also dropped significantly. Last week, CoolCats left some mysterious clues on social media. First, its official Twitter account stopped updating for five days, and then on January 31, it announced its "new brand identity": a "front view of a blue cat" with a red background.
New strategic direction
There are two aspects to CoolCats’ brand strategy. The first is to expand the audience through story content and mainstream brand partnerships. The second is to attract users by providing gaming products and experiences that are fully immersive in Cooltopia (Cooltopia is a web game developed for the Cool Cats sub-NFT series Pets NFT, which allows Cool Pets NFT holders to interact with their pets by completing tasks and collecting loot, and help their pets upgrade. According to the current settings, Cool Pets holders will be able to earn the in-game universal Token MILK by completing game tasks).
In addition, CoolCats also announced a number of partnerships, such as: Cool Cats has cooperated with Ledger to launch the brand education program LedgerQuest in early February; Cool Cats announced that it has become a partner with Hologram, allowing NFT holders to experience CoolCatNFT through holographic technology and 3D avatars; CoolCats has also reached a cooperation with the well-known department store brand Macy’s and launched NFT special balloons.
This model brings new ways of interaction and story-based participation to current and future NFT holders, which can further expand the broader CoolCats ecosystem.
New product experience
In addition, CoolCats has launched some new products and experiences, mainly including:
a. CoolScore: "Cool Score" is a scoring and reward system designed to reward loyal and active members of the Cool Cats community. Cool Cats said that the scoring reference criteria include: the length of time holding Cool Cats NFTs, the types of items hoarded in Cooltopia, community participation, etc. Currently, Cool Cats holders can connect their wallets to the website to access and view their Cool Score scores.
b. Journeys: Journeys allow users to engage more in immersive gaming experiences. These journeys will guide users through the Cooltopia game world and also introduce a soft staking mechanism and rewards path for Cats and Pets, providing better NFT features, digital/IRL rewards, etc. to NFT holders who invest the most in Journeys.
c. Fractures NFT (Pass Card): Cool Cats will airdrop Fractures NFT to Cats and derivative project Pets holders. Fractures (also known as the gateway to Cooltopia) is a new dynamic NFT and will become the "casting pass" MINT PASS when Cool Cats releases the next character.
d. Explorers: In the second half of 2023, Cool Cats will release a new NFT that will help more people join the Web3 field. In addition, Explorer NFT will provide a new way to represent user digital identity and support cross-chain and cross-platform operations.
2. GameFi Chain Games
(1) Overall review
In general, the Gamefi industry as a whole has pulled back. From the perspective of token prices, 6 of the top 10 blockchain games by market value have seen a drop in token prices. This week, illuvium led the gains, rising 33.85% in the past week (illuvium announced a full platform update, supporting Mac, PC and Android)
Judging from the on-chain contract interaction volume, the interaction activity of the top ten active blockchain games has remained basically the same in the past week. It is worth noting that Oath of Peak broke the "top ten list that has remained unchanged for thousands of years" and entered the top ten for the first time. In the past week, its on-chain interaction volume has increased threefold. (New game, 3A-level blockchain game, you can pay attention to the performance of tokens and NFTs)
2. Key project: Degen zoo
Degen Zoo: A game that was planned to be completed in 30 days and developed at a cost of $20,000. The progress is currently being live-streamed on Twitter.
Founder: Chris Zaknun, founder of DAOMaker and former MakerDAO development engineer
Animal Egg NFT: There are 5,800 of them, which are used to hatch into animal NFTs. There are 100 animal species in the game. The number of NFTs that can be minted for each animal is fixed. If all NFTs of a certain animal have been minted, they will become more scarce as they reproduce or die. Each animal has 4 characteristics (diet, size, gender, and rarity). Different diets and size characteristics will determine the amount of DZOO Token revenue that the animal can generate; Regarding the gender of the game, only animals of the opposite sex can mate with each other to reproduce offspring. Two male animals cannot produce offspring, and the same is true for two female animals; the more endangered the animal species, the higher the rarity of the NFT. Degen Zoo divides the rarity into Least Concern, Vulnerable, Near Threatened, Endangered, and Critically Endangered.
The total supply of DZOO Token is 100 million. The initial market value is uncertain, but the official estimate is around $300,000. Tokens are mainly used to obtain animal eggs and hatch eggs in the game.
How to play: Get animal eggs — Hatch animal eggs — Evolve animals — Kill animals to gain benefits
(1) Obtaining animal eggs: Players can obtain animal eggs by providing liquidity, staking DZOO Token, and whitelisting.
(2) Hatching animal eggs: Players need to consume 100,000 DZOO Tokens to hatch pet animal eggs into animals. The species of animals hatched are completely random, and each animal has 25,000 to 500,000 DZOO Tokens locked inside.
(3) Animal Evolution: Players can feed their own animals with other species to make them evolve. The number of DZOO Tokens locked in a high-level animal is always greater than the sum of the two low-level animals. Each animal can evolve twice. Feeding an animal with the same species twice will raise the animal to level three. Evolution increases the number of tokens gained by the animal and changes its appearance.
(4) Killing animals to get benefits: Each animal has an independent life expectancy, ranging from 10 to 250 days. Players can kill animals to cash out, that is, destroy the animal NFT to obtain the DZOO Token locked in its body. However, if the player kills the NFT in advance, the locked token will be burned. The shorter the life of the animal, the more tokens will be released when burned. There is a fine for killing underage animals. If the animal's life is 100 days, the fine is 1% per day. For example, if a player kills an animal on the 22nd day, the player will be punished for locking 78% of the unexpired tokens. If the NFT is destroyed on the day of minting, the player will lose 40% of the tokens, and the remaining 60% will belong to the player.
Feeding: Promote Evolution
Two female (male and female) animals NFT mate: (will die) produce new child animals NFT
Every time you feed or mate, the total amount of NFTs decreases. In theory, NFT deflation can be achieved, and in the later stages of the game, NFTs in the game will become increasingly scarce.
Participation suggestions: The game is still in the category of ponzi mode. The first players can kill animals earlier due to low cost and have a greater chance of profit. If the game becomes less popular later, players who enter the game in the middle and late stages are likely to take over at high prices. When they see the bad trend of token prices, they will kill animals in advance to stop losses. In addition, according to the founder’s Twitter, different animal NFTs have different APRs, and some are even negative.
Progress Tracking:
January 7: First tweet, announcing the formation of the team; first version of the white paper released:
January 8: First community vote on zoo style, over 300 votes
1月10日：TG: +130 & 4 mods, good community spirit ；Twitter: +3,833；SC: Architecture is done Whitepaper finalized. Brand items finished.
January 11th: TG: 1000+; TW: 6000; Website: 80% done (https://www.degenzoo.co/)
1月12日：China Marketing、KOL meeting、UX/UI sync call、CEX Call、TG Marketing Group、Onboard Twitter Manager、Daily CM training、Sync with Tech on SCs、Fix WP typos 、Infographics for economics、Update SEO onhttp://degenzoo.co、Mainstream coverage call、Send info to AI expert
1月13日：4,500 community members on Telegram、contacted about 50 NFT projects、finished staking、UI 65% done、Already $20M in assets connected
1月14日：TG: 2800+, 670 online、TW: 600+, avg views 1200+、Assets connted to vote: $19M、UI is 90% finished
January 15th: 7,000 Twitter Followers, 10,000 Telegram Members
1月16日：Smart contract architecture、Working on “The Price of Extinction” Collection、Logo for Degen Zoo
1月18日：upgrade tg bot with referrals、500 social miners、work on ar、create concepts for 2nd collection、establishing charity network、twitter marketing、evolution yield simulation model、start frontend dev work
1月19日：Evolution algorithm and improved the yield model、NFT Marketing in progress、Twitter: 3.5k+、Upgraded referral links.
January 21st: 80% done building the game simulation in excel
1月23日：10k followers on Telegram & Twitter、Robust game theory、Revolutionary staking model、UI/UX on mobile & desktop
1月24日：Game theory update、Killing animals on day one will return 60% — 40% and burn 40% of the player’s $DZOO、100k to hatch、Get a rare animal with 1.5x Killing on day 1 will give:150k * 0.6 = 90k and burn 60k DZOO
January 25: Simulations, Math, UI/UX, Frontend, Smart contracts
1月27日：finished the Egg Halvining formulas:eggs will gradually be released in the market、First fast then slows down. If all eggs are hatched then 60% of the total supply would be burned
January 31: Issues such as on-chain and gas were confirmed
February 1st: Making good progress on the whole system
February 2:
SC: Testing 70% done
FE: Bug fixing 85% done Art: In progress, have few helpers now. Looking really good.
TW: FINALLY out of search ban. TG: Been slow, need to do something about the bots.
Marketing: On hold until audits are done. Biz Dev: TBA；The frontend is 85% done
2月3日：Logan files defamation lawsuit、Coffee shares suit docs、Community will do massive fundraise、Enough funds for class action of all affected $zoo holders was collected
February 4th: Minor bugs on the frontend and some features not yet completed, problems with some Egg staking contracts, CTO is working late into the night trying to get it done.
February 6: Launched
3. Web3 Social & DID & DAO
We give & our
We give:
Last week, a social networking application called Damus was launched on the AppStore; within one day it reached the tenth place in the AppStore social media category download list.
Many users mistakenly believe that Damus is a decentralized version of Twitter, but in essence, Damus is just an iOS client based on the Nostr protocol. In other words, Damus and other Nostr clients are just entrances to this social network. The social network built by the Nostr protocol itself is the one that can replace a series of traditional social media platforms such as Twitter and Facebook.
Our
What is it?
The full name of Nostr is: Nostr stands for "Notes and Other Stuff Transmitted by Relays, which can be understood as: transmitting notes and other things through relay devices."
Think of Nostr as a social network, built similarly to Twitter, where you can create posts or "notes" (like Twitter), like posts, like, follow, and unfollow other users and friends. You can also retweet posts.
Nostr is a protocol, that is, a set of rules that servers and clients use to communicate. Nostr is not an application, nor is it a "platform" like Twitter. However, there are many applications that can be built on top of Nostr.
principle?
Nostr has two main components: the client/app and the relay, which is similar to a simple server. Anyone can run a relay.
To use Nostr, you need to run the client. The client is just the way we, the users, interact with Nostr, for example (web client for browser, mobile client for iPhone, etc.)
To publish something on Nostr, you write the post, sign it with your key, and send it to multiple relays.
Here we have two keys: a public key and a private key. You can think of your public key as your username or bank account, and your private key as your password.
To find another Nostr user, one needs to search for their public key, just like searching for a username.
Summarize
The project will not issue coins, but the breaking circle effect is obvious, and it has become a carnival for Bitcoin fundamentalists
The ecological future of Bitcoin Lightning Network is more sustainable, not just focused on Ethereum
Regulation is a double-edged sword. Decentralization is free from regulatory constraints and is also prone to losing official traffic support (it was directly removed from the shelves in China); anonymity is the cradle of negative information, and it is still difficult to move towards the mainstream
FixDAO
Introduction: FixDAO, the FTX Asian victims' legal aid project organized by the Mask Network team, has now officially opened membership registration to all FTX creditors.
Motivation: “As the FTX bankruptcy process was transferred to the US court, we were concerned that the US creditors would be protected at the expense of Asian creditors, which is why we launched FixDAO.”
Results:
FixDAO has signed professional lawyers in the United States, Singapore, Hong Kong, and Taiwan to help FTX’s Asian creditors defend their rights.
FixDAO has accumulated over US$200 million in debt claims, involving more than 2,000 Asian creditors, including small and medium-sized investors and project parties, mainly in mainland China, Hong Kong Special Administrative Region, Taiwan, China, South Korea and Singapore.
5. Team News
JZL Garden Half Monthly Talk (Third Issue) Topic: SandBox and Upstairs talk about the Metaverse Time: 21:30 Beijing time on February 4th In this issue of JZL Garden, we invited Sandbox Asia Growth Director @erichwong, Upstairs Cofounder & CEO @rexteo_upstairs and Khmer Maidens project founder @Lavie_Roooooy to discuss the topic of the Metaverse.
Thanks to the partner media Jinse Finance @JinseFinance, Odaily @OdailyChina, Foresight News @Foresight_News and Coinlive @CoinliveHQ, the partner projects Sandbox @TheSandboxGame, Element @Element_Chinese, Upstairs @UpstairsNFT, and the partner community Buidler Dao @BuidlerDAO for their strong support for the JZL Garden Half-Month Talk event.
about Us
JZL Capital is a professional institution registered overseas, focusing on blockchain ecosystem research and investment. The founder has extensive work experience and has served as CEO and executive director of many overseas listed companies, and has led and participated in eToro's global investment. Team members come from top universities such as the University of Chicago, Columbia University, University of Washington, Carnegie Mellon University, University of Illinois at Urbana-Champaign, and Nanyang Technological University, and have served internationally renowned companies such as Morgan Stanley, Barclays Bank, Ernst & Young, KPMG, HNA Group, and Bank of America.
