Introduction:
The SEC has approved the 19b-4 forms for eight spot ETH ETFs. Although trading will still require the approval of the S-1 registration statement, the entire market has higher expectations for the ETH price trajectory and has already started to warm up.
1、Investment and Financing Observations
Last week, the crypto market saw 33 investment and financing events, a week-on-week increase of 26.9%. The total funding scale exceeded $270 million, a significant week-on-week increase of 58.8%. With the market warming up, the scale expansion is evident:
- DeFi: 8 investment and financing events were announced. Notably, Ethereum liquidity staking platform Kelp raised $9 million, led by SCB Limited and Laser Digital.
- GameFi: 1 investment and financing event, with RPG chain game Aria completing a seed round of financing, led by Folius Ventures, Spartan Group, and Merit Circle.
- NFT: 1 investment and financing event, with Singapore collectible design company Mighty Jaxx raising an additional $11 million in an extended Series A+ round.
- DePIN: 1 investment and financing event, with DePIN project Blockless, focused on providing computational support, raising $8 million across two early-stage financing rounds.
- Infrastructure and Tools: 8 financing events, with zero-knowledge hardware startup Cysic completing a $12 million pre-A round, led by HashKey Capital and OKX Ventures.
- Other Web3/Crypto Applications: 8 financing events, with Web3 social media platform Farcaster completing a $150 million financing round, led by Paradigm and including participation from a16z crypto and others.
The week-on-week data shows a significant rebound in the number of investment and financing events in the cryptocurrency market, with the total funding scale rapidly expanding. This indicates that institutions are increasing leverage and investment frequency as the market warms up. Notably, six financing events exceeded $10 million, including Fracmaster, Cysic, Dora Factory, Plume Network, Fantom, and StripChain. The market is focusing heavily on DeFi, RWA, and SocialFi fields. Paradigm was notably active among VCs this week, followed by OKX Ventures and Animoca Brands.
About Farcaster:
Farcaster is a decentralized social network based on Optimism that supports an open protocol for multiple clients. Users can freely move their social identities between applications, and developers can freely build applications with new features on the network.
About Cysic:
Cysic is a ZK hardware acceleration project dedicated to designing advanced ASIC chips to reduce ZK proof generation time. It currently has multiple ecosystem partners, including Scroll, Nil Foundation, and Hyper Oracle.
About Kelp DAO:
Kelp DAO is a triple-yield restaking protocol based on EigenLayer. Kelp plans to use the latest financing to expand its liquidity restaking services on blockchains such as Bitcoin, Solana, and BNB Chain, with plans to launch 1–2 new chains in the third quarter of this year.
2、Industry Data
US BTC Spot ETF Net Inflows for 10 Consecutive Days
According to SoSoValue data, as of the close of business on May 24 (Friday), BTC spot ETFs had net inflows for ten consecutive days. As of May 27, the total net asset value of global BTC spot ETFs was $61.203 billion, with an ETF net asset ratio (market value compared to BTC total market value) of 4.53%.
Recent data shows that the net assets of BTC spot ETFs have consistently increased, with the net asset ratio also rising. The ETF growth rate significantly exceeds BTC production, indicating that buying pressure outweighs supply. This suggests a slow upward trend for BTC in the short term.
Significant Increase in Trading Volume for Hong Kong ETH ETFs
As of the close of business on May 24, the total trading volume of six Hong Kong virtual asset ETFs was approximately HKD 45.33 million, with the trading volume of three ETH ETFs showing significant increases. This occurred following the approval of the 19b-4 forms for US ETH spot ETFs, demonstrating the strong influence of US policies and economic trends on the crypto market. The Hong Kong ETF market still requires more momentum for guidance and driving forces.
May 24 Hong Kong ETF Trading Data:
Huaxia BTC ETF (3042.HK) trading volume: HKD 15.168 million;
Huaxia ETH ETF (3046.HK) trading volume: HKD 8.5851 million;
Harvest BTC ETF (3439.HK) trading volume: HKD 6.8468 million;
Harvest ETH ETF (3179.HK) trading volume: HKD 9.2268 million;
Bosera HashKey BTC ETF (3008.HK) trading volume: HKD 1.7207 million;
Bosera HashKey ETH ETF (3009.HK) trading volume: HKD 3.7849 million;
Reduced Selling Pressure, Whales Accumulate 20,000 BTC
According to IntoTheBlock data on May 23, whale addresses holding 1,000 to 10,000 BTC accumulated a total of 20,000 BTC over the past week. This indicates that long-term holders are returning to a buying phase, especially compared to the significant sell-off after BTC reached a high of $73,000 in March. The recent market selling pressure has significantly reduced, providing more room for bullish sentiment.
Farcaster User Data Reaches New Highs
According to Dune data, the decentralized social protocol Farcaster has reached new historical highs since May 21:
- On May 22, Farcaster had 69,901 unique reactions and 60,387 unique casts.
- On May 25, Farcaster’s total revenue surpassed $1.45 million, currently at $1.4579 million, with a total user base exceeding 400,000.
Farcaster positions itself as the infrastructure layer for social networks, closer to the concept of a “Layer” rather than a single Dapp application. This gives Farcaster the potential to derive more diverse and broader application scenarios, distinguishing its growth performance from other SocialFi products.
On May 22, Farcaster completed a $150 million financing round, led by Paradigm and participated in by a16z crypto, Haun, USV, Variant, Standard Crypto, among others. The announcement stated that this year the focus will be on increasing daily active users and adding developer primitives to the protocol, such as channel and private messaging features.
3、 VC Holdings
Note: The above data is from https://platform.arkhamintelligence.com/, and the statistical time is 15:00 on May 27, 2024 (UTC + 8).
4、This Week’s Focus
May 27
- Solana Mainnet V1.18 version to be released to address mainnet congestion issues;
- Bitlayer’s two-week Mining Gala event from May 27 to June 10;
- Sei voted to upgrade to version V2, with the mainnet upgrade scheduled for May 27;
- YGG will unlock approximately 16.69 million tokens worth approximately $16.94 million at 22:00, accounting for 4.49% of the circulating supply.
May 28:
- US May Conference Board Consumer Confidence Index;
- London Stock Exchange accepts applications for BTC and ETH ETNs to be listed, expected on May 28;
- Blast to upgrade support for blobs at 5:00;
- Illuvium Open Beta testnet expected to open on May 28;
- SingularityNET (AGIX) to unlock approximately 8.71 million tokens worth approximately $8.4 million at 8:00, accounting for 0.68% of the circulating supply;
- Blockchain Week Rome from May 28 to 31, 2024.
May 29:
- Federal Reserve Governor Lisa Cook and 2024 FOMC voting member, San Francisco Fed President Daly to speak on AI;
- SEC decision on BTC spot ETF options listing;
- UK consultation on implementing the OECD Crypto-Asset Reporting Framework ends on May 29;
- Bitcoin Seoul from May 29 to 31 in Seoul, South Korea;
- Consensus 2024 hosted by CoinDesk from May 29 to 31 in Austin, Texas, USA;
- Binance to release international football star Cristiano Ronaldo’s latest NFT collection on May 29;
- Blockchain Economy Istanbul;
- GenAI Summit San Francisco 2024.
May 30:
- US initial jobless claims for the week;
- Federal Reserve Beige Book on economic conditions;
- FOMC permanent voting member, New York Fed President Williams to participate in a roundtable discussion;
- 2024 FOMC voting member, Atlanta Fed President Bostic to speak on the economic outlook;
- US Department of Justice AI industry competition inquiry seminar at Stanford University on May 30;
- VAEX virtual asset trading platform to ban Hong Kong users from trading;
- OKX HK to delist stablecoin and related trading pairs on May 30 and launch HKD trading pairs in “coin-to-coin trading”;
- Cryptopunks to hold an auction for the “Super Punk World” digital avatar series.
May 31:
- US April core PCE price index annual rate;
- EOS new token economic model expected to be deployed to the mainnet by the end of May;
- BNB Chain to announce Q2 2024 Hackathon winners and begin a one-month incubation period;
- Uniswap Foundation to initiate on-chain voting on May 31 to upgrade the fee mechanism to reward UNI holders;
- Unlicensed virtual asset trading platforms in Hong Kong to cease operations by the end of May;
- Optimism token OP to unlock 31.34 million tokens worth approximately $79.61 million at 8:00, accounting for 2.88% of the circulating supply;
- Echelon Prime token PRIME to unlock 1.66 million tokens worth approximately $31.66 million at 8:00, accounting for 4.23% of the circulating supply;
- Tornado Cash (TORN) to unlock 92,000 tokens worth approximately $240,000 at 11:30, accounting for 2.41% of the circulating supply.
June 1:
- Dogechain Wallet to close on June 1, users need to withdraw DOGE promptly;
- dYdX token DYDX to unlock approximately 33.33 million tokens worth approximately $67 million at 8:00, accounting for 11.91% of the circulating supply;
- ZetaChain (ZETA) to unlock approximately 5.29 million tokens worth approximately $8.2 million at 8:00, accounting for 1.99% of the circulating supply;
- 1inch (1INCH) to unlock approximately 98.74 million tokens worth approximately $42 million at 8:00, accounting for 8.52% of the circulating supply;
- Manta Network (MANTA) to unlock approximately 1.87 million tokens worth approximately $3.2 million at 7:59, accounting for 0.74% of the circulating supply;
- Sui token SUI to unlock approximately 65.08 million tokens worth approximately $68.07 million at 8:00, accounting for 2.78% of the circulating supply.
June 2:
- Ethena (ENA) to unlock approximately 53.6 million tokens worth approximately $46 million at 7:00, accounting for 3.62% of the circulating supply.
5、Conclusion
Last week, the FIT21 Act was passed in the US House of Representatives, marking a positive shift in the US regulatory stance towards cryptocurrencies. This policy benefit has clarified more standardized regulatory directions and political support for the cryptocurrency industry. Additionally, the continuous net inflows into US BTC spot ETFs for ten days are driving a slow upward trend in BTC prices. Furthermore, the significant rebound in the number of investment and financing events in the cryptocurrency market and the rapid expansion of the total funding scale indicate that institutions are increasing leverage and investment frequency as the market warms up, with a strong focus on DeFi, RWA, and SocialFi fields.
This week, 18 token projects will unlock tokens, with cumulative unlock amounts exceeding $300 million for PRIME, OP, Sui, DYDX, 1INCH, and ENA. As the total circulating supply of tokens continues to inflate, whether the crypto market will attract more buyers remains to be seen. With Trump’s team accepting cryptocurrency donations, positive market sentiment is increasing, and more discussions around crypto are expected as the election approaches. Additionally, Uniswap’s fee incentive mechanism voting this week could bring further positive momentum to UNI and the industry.
Overall, with the US legislative stance on cryptocurrencies becoming clearer, the market trend appears favorable, and market confidence is rebounding. Although there is still uncertainty regarding the final implementation, a significant step has been taken towards addressing regulatory challenges, laying a solid foundation for future industry innovation and development.
Note: All of the above opinions are not investment advice. If there are any inappropriate points, please feel free to leave a message to correct them.
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