"Sunday Afternoon on the Island of La Grande Jatte" --- --- Georges Seurat

Introduction:

The SEC has approved the 19b-4 forms for 8 ETH spot ETFs. Although trading is still pending the approval of the S-1 registration statement, the entire market has higher expectations for ETH price trends and has already begun to warm up in advance.

1. Investment and Financing Observation

Last week, there were a total of 33 investment and financing events in the crypto market, a week-on-week increase of 26.9%, with a total funding scale exceeding $270 million, a significant week-on-week increase of 58.8%. As the market warms up, the scale expansion is evident:

In the DeFi sector, 8 investment and financing events were announced, among which the Ethereum liquidity re-staking platform Kelp raised $9 million, led by SCB Limited and Laser Digital;

In the GameFi sector, 1 investment and financing event was announced, the RPG chain game Aria completed its seed round financing, led by Folius Ventures, Spartan Group, and Merit Circle;

In the NFT sector, 1 investment and financing event was announced, the Singapore collectible design company Mighty Jaxx secured an additional $11 million in its extended A+ round financing;

In the DePIN sector, 1 investment and financing event was announced, the DePIN project Blockless, focused on providing computing power support, raised $8 million in two rounds of early financing;

In the infrastructure and tools sector, 8 financing events were announced, among which the zero-knowledge hardware startup Cysic completed a $12 million pre-A round financing, led by HashKey Capital and OKX Ventures;

Other Web3/crypto applications announced 8 financing events, among which the Web3 social media platform Farcaster completed a $150 million financing, led by Paradigm, with participation from a16z crypto and others;

From the week-on-week data, the number of investment and financing events in the cryptocurrency market last week showed a significant rebound, and the total funding scale expanded rapidly, indicating that institutions are increasing their funding leverage and investment frequency as the market warms up. Among them, there were 6 financing events in the tens of millions of dollars, including Fracmaster, Cysic, Dora Factory, Plume Network, Fantom, and StripChain, with market enthusiasm betting on DeFi, RWA, and SocialFi fields. This week, the most active institution among VCs was Paradigm, followed by OKX Ventures and Animoca Brands, which also showed active participation.

About Farcaster

Farcaster is a decentralized social network based on Optimism, supporting an open protocol for many clients, allowing users to 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 help reduce ZK proof generation time, currently having multiple ecosystem partners, including Scroll, Nil Foundation, and Hyper Oracle.

About Kelp DAO

Kelp DAO is a triple-yield re-staking protocol based on EigenLayer. Kelp plans to use the latest financing funds to expand its liquidity re-staking services on blockchains such as Bitcoin, Solana, and BNB Chain, expecting 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

SoSoValue data: As of the close on May 24 (Friday) Eastern Time, the BTC spot ETF has seen net inflows for 10 consecutive days. As of the 27th, the total net asset value of global BTC spot ETFs was $61.203 billion, with an ETF net asset ratio (market value compared to total BTC market value) reaching 4.53%.

In the data from the past two weeks, the net assets of BTC spot ETFs have shown positive growth, and the proportion of net assets has been continuously increasing, with the ETF growth rate significantly higher than BTC output, indicating that buying power exceeds supply, and BTC is expected to show a slow upward trend in its phase.

Hong Kong ETH ETF Trading Volume Significantly Increases

As of the close on May 24, the total trading volume of 6 Hong Kong virtual asset ETFs was approximately HKD 45.3323 million, with the trading volume of 3 ETH ETFs significantly higher than usual. This occurred after the approval of the US ETH spot ETF 19b-4 form, indicating the strong impact of US policies and economic trends on the crypto market, and that the Hong Kong ETF market still needs more strength to guide and drive it.

Hong Kong ETF Trading Data on May 24

Huaxia BTC ETF (3042.HK) trading volume: HKD 15.168 million; Huaxia ETH ETF (3046.HK) trading volume: HKD 8.5851 million;

Jia Shi BTC ETF (3439.HK) trading volume: HKD 6.8468 million; Jia Shi 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;

Selling Pressure Eases, Whales Accumulate 20,000 BTC

On May 23, IntoTheBlock data: In the past week, whale addresses holding 1,000 to 10,000 BTC have accumulated a total of 20,000 BTC. This indicates that long-term holders are beginning to return to a bullish buying phase, especially compared to the significant sell-off that occurred after BTC reached a high of $73,000 in March, the recent market selling pressure has significantly eased, providing more space for bullish sentiment.

Farcaster User Data Hits New Highs

Dune data: The decentralized social protocol Farcaster has set new historical highs since the 21st:

• On May 22, Farcaster had 69,901 daily interactions (Unique Reaction) and 60,387 Unique Casts;
• On May 25, Farcaster's total revenue exceeded $1.45 million, currently reaching $1.4579 million, with total users exceeding 400,000;

Farcaster positions itself as the infrastructure of the social field, closer to the concept of "Layer" rather than a single Dapp application, which gives Farcaster the potential to derive more diverse and broader application scenarios, making its growth performance significantly different from other SocialFi products, warranting focused attention.

On May 22, Farcaster completed a $150 million financing round, led by Paradigm, with participation from a16z crypto, Haun, USV, Variant, Standard Crypto, etc. The announcement stated that this year will mainly focus on daily active user growth and adding developer primitives to the protocol, such as channel functions and private messaging functions.

3. VC Holdings

Note: The above data is sourced from https://platform.arkhamintelligence.com/, statistical time: May 27, 2024, 15:00 (UTC+8).

4. This Week's Focus

May 27

• The Solana mainnet V1.18 version will be released on May 27 to address mainnet congestion issues;
• Bitlayer will launch a two-week Mining Gala event from May 27 to June 10;
• Sei has voted to pass the "Upgrade to V2 Version" proposal, with the mainnet upgrade taking place on May 27;
• YGG will unlock approximately 16.69 million tokens on May 27 at 22:00, valued at about $16.94 million, accounting for 4.49% of the circulating supply;

May 28

• US Conference Board Consumer Confidence Index for May;
• The London Stock Exchange accepts listing applications for BTC and ETH ETNs, with the first batch expected to list on May 28;
• Blast will upgrade to support blobs on May 28 at 5:00;
• The open beta test network for the blockchain game Illuvium is expected to open on May 28;
• SingularityNET (AGIX) will unlock approximately 8.71 million tokens on May 28 at 8:00, valued at about $8.4 million, accounting for 0.68% of the circulating supply;
• Blockchain Week Rome will be held from May 28 to 31, 2024;

May 29

• Federal Reserve Governor Lisa Cook and 2024 FOMC voter, San Francisco Fed President Daly will speak on artificial intelligence;
• The US SEC will make a decision on the listing of BTC spot ETF options;
• The UK consultation on implementing the OECD crypto report framework will end on May 29;
• Bitcoin Seoul will be held from May 29 to 31 in Seoul, South Korea;
• Consensus 2024 hosted by CoinDesk will be held from May 29 to 31 in Austin, Texas, USA;
• Binance will release the latest NFT collection of international football star Cristiano Ronaldo on May 29;
• Blockchain Economy Istanbul;
• GenAI Summit San Francisco 2024;

May 30

• US initial jobless claims for the week;
• The Federal Reserve will publish the Beige Book on economic conditions;
• FOMC permanent voter, New York Fed President Williams will participate in a roundtable discussion;
• 2024 FOMC voter, Atlanta Fed President Bostic will speak on economic outlook;
• The US Department of Justice will hold a seminar on competition in the artificial intelligence industry at Stanford University on May 30;
• The virtual asset trading platform VAEX will begin prohibiting Hong Kong users from trading;
• OKX HK will delist stablecoins and corresponding trading pairs on May 30, 2024, and will launch Hong Kong dollar trading pairs in "spot trading";
• Cryptopunks will hold an auction for the digital avatar series "Super Punk World";

May 31

• US April Core PCE Price Index Year-on-Year;
• EOS's new token economics model is expected to be deployed to the mainnet by the end of May;
• BNB Chain will announce the winners of the 2024 Q2 hackathon and enter a one-month incubation period;
• The Uniswap Foundation will launch on-chain voting on May 31, proposing to upgrade the fee mechanism to reward UNI holders;
• Those who have not applied for a virtual asset trading platform license in Hong Kong must cease operations in Hong Kong by the end of May;
• Optimism token OP will unlock 31.34 million tokens on May 31 at 8:00, valued at about $79.61 million, accounting for 2.88% of the circulating supply;
• Echelon Prime token PRIME will unlock 1.66 million tokens on May 31 at 8:00, valued at about $31.66 million, accounting for 4.23% of the circulating supply;
• Tornado Cash (TORN) will unlock 92,000 tokens on May 31 at 11:30, valued at about $240,000, accounting for 2.41% of the circulating supply;

June 1

• Dogechain Wallet will close on June 1, users need to withdraw DOGE in time;
• dYdX token DYDX will unlock approximately 33.33 million tokens on June 1 at 8:00, valued at about $67 million, accounting for 11.91% of the circulating supply;
• ZetaChain (ZETA) will unlock approximately 5.29 million tokens on June 1 at 8:00, valued at about $8.2 million, accounting for 1.99%;
• 1inch (1INCH) will unlock approximately 98.74 million tokens on June 1 at 8:00, valued at about $42 million, accounting for 8.52%;
• Manta Network (MANTA) will unlock approximately 1.87 million tokens on June 1 at 7:59, valued at about $3.2 million, accounting for 0.74%;
• Sui token SUI will unlock approximately 65.08 million tokens on June 1 at 8:00, valued at about $68.07 million, accounting for 2.78%;

June 2

• Ethena (ENA) will unlock approximately 53.6 million tokens on June 2 at 7:00, valued at about $46 million, accounting for 3.62%;

5. Conclusion

Last week, the FIT21 bill was passed in the US House of Representatives, marking a friendly shift in the US regulatory attitude towards crypto. The positive policies have clarified a more standardized regulatory direction and political support for the cryptocurrency industry; meanwhile, the continuous net inflows of the US BTC spot ETF for 10 days are driving expectations for a slow upward trend in BTC's phase. Additionally, the number of investment and financing events in the cryptocurrency market has begun to rebound significantly, and the total funding scale has rapidly expanded, indicating that institutions will increase their funding leverage and investment frequency as the market warms up, with market enthusiasm betting on DeFi, RWA, and SocialFi fields.

This week, 18 token projects will see unlocks, with the cumulative unlock amount for PRIME, OP, Sui, DYDX, 1INCH, and ENA exceeding $300 million. As the total circulating tokens in the market become increasingly inflationary, it remains to be seen whether more buying support will enter the crypto market, requiring cautious observation and assessment. At the same time, with the Trump team accepting cryptocurrency donations, positive market information is increasing, and it is expected that there will be more discussions around crypto topics related to the upcoming elections; the fee incentive mechanism voting initiated by UniSwap this week may bring stable benefits to UNI and the industry in the future.

We can see that with the legislative level in the US showing a positive attitude towards crypto, the overall trend is favorable, and market confidence is warming up. Although the final implementation timeline remains uncertain, significant progress has been made on the path of regulatory challenges, laying a solid foundation for future industry innovation and development.