July Performance
In This Issue:
Market: BTC consolidating + a 25bp hike + BlackRock gives the thumbs up
Narrative: Good vs. Evil: Worldcoin launches & Lightning payments heat up
Highlight: Bittensor (TAO): Empowering ML models through crypto networks
Market Action
The market was relatively flat in July, pulling back (-2.7%). Bitcoin continued to trade in an incredibly tight range despite the Fed dismissing inflation’s 2-year low and hiking rates another 25 bps anyway.
Someone orange-pilled BlackRock CEO Larry Fink who last month filed for a Spot Bitcoin ETF and this month publicly touted BTC’s ability to “revolutionize finance”.
We’re so back.
The battle between good and evil rages on... Worldcoin, the dystopian eyeball harvesting orb, went live in July, and users around the world lined up to sell scans of their irises to the company. At the same time, Lightning Labs, the company behind Bitcoin’s Lightning Network, introducing new tools to help developers integrate Bitcoin and Lightning payments into applications including AI.
Which way, Western man?
Web3
In July, after underperforming DeFi last month, Web3 was +5.9% with HNT (+25.2%) and LINK (+19.7%) leading the way. Chainlink announced their CCIP (cross-chain interoperability protocol) and Helium continues to see sustained growth on its mobile network, which has beaten out IoT to become the primary contributor to network fees.
Google’s policy change now allows developers to integrate digital assets like NFTs into their apps and games on the platform, a catalyst for the blockchain gaming industry that has stagnated recently.
Lens protocol announced Lens V2 with multiple upgrades that will include an integration with ENS where “.eth” domains will soon be able to be used as handles on the decentralized social media protocol
Akash’s GPU testnet includes AI model deployment and GPU benchmarking. Google’s BERT, a powerful language model, was deployed on an Nvidia V100 GPU via Akash Console, and the amount of CPUs leased on the Akash Network crossed 1.05k, +23.4% since the beginning of July
Helium’s daily network usage (in terms of DC spent) has surged +370% over the past 30 days, which has resulted in revenues increasing +85% m/m. IoT activity is expected to continue growing as WeatherXM, QNECTD, and KitchenOS choose Helium to power their IoT solutions
Arweave has been seeing increased activity, with active addresses up ~3x since March. Each transaction is essentially a piece of data stored on the network, and last week, the network crossed 1 billion total transactions, which means that over a billion pieces of data are now permanently stored, forever
DeFi
DeFi blue-chips in the lending space were in focus throughout July as revenues surged. The most notable gainer in terms of revenue and price was Maker DAO, which eclipsed $4.4m in revenue for the 30-day period(+48% MoM). This coincided with a +55% increase in price, breaking the $1,000 level for the first time since October 2022.
Following close behind, Aave V2 saw significant revenue growth of +30% MoM, reaching $5m. Despite this growth, Aave’s token has largely retraced the upside move made earlier in the month. This is a result of the deteriorating health factor of the Curve founder, Michael Ergorov, and his $150m CRV collateral position in the wake of a Curve exploit at the end of the period.
Base, Coinbase’s L2, launched in July with an explosion of deposits bridged from mainnet to the tune of $44m. The activity generated over $700k in fees in just 3 days. It is expected that Base chain will be fully operational and have a method of bridging assets two ways in early August.
Lyra Finance, has captured >50% of onchain options volume and unveiled V2 plans which include their own rollup on Optimism called Lyra Chain. Should the proposal pass governance, Lyra DAO will accrue the trading fees as well as transaction fees from the chain.
GMX, the decentralized derivatives exchange, saw a +40% increase in trade volume and a +43% increase in total revenue for the 30-day period, reaching $1.06m. Public use of its V2 was also announced on July 31st.
Vertex, a newer perpetual swap and spot DEX, has managed to beat out GMX in trading volume on occasion. Vertex generated $318k in fees in the past 30 days, which will be distributed back to holders upon creation of a DAO. This is worth watching going into the October token launch.
March Highlights
Partner Highlights
Coinbase will be surveillance partner for Fidelity and other ETFs
Bitmain is expanding into Filecoin mining
Huddle01 launched “Huddle Spaces” that will run as a feature across various decentralized social media protocols
Protocol Highlight: Bittensor (TAO)
Bittensor is a machine learning protocol and marketplace that incentivizes knowledge production and addresses inefficiencies in machine learning. The protocol allows researchers to train AI models while exchanging information with other models, accelerating learning and transforming collaboration.
In the ever-evolving landscape of crypto and AI, the focus has predominantly been on leveraging latent GPUs to offer cost-effective compute power for training machine learning models. However, the potential for cryptonetworks to add value to ML models extends beyond mere computation. These networks can play a pivotal role in incentivizing community-driven data sourcing, foundational model development, computation, and even the monetization of trained models.
How it Works
Miners on the network provide model intelligence and earn TAO tokens on the network for their contributions
Miners train their own models on the network, and share data and information with each other through a process called fragmented learning
Users can stake TAO on the network and access the collective intelligence of the network
Apps can be built on top of the network’s intelligence layer, through the network’s validators
Takeaway
Bittensor stands at the forefront of integration of artificial intelligence and machine learning in blockchain networks. With its decentralized architecture, secure data sharing, and innovative consensus mechanism, Bittensor holds the potential to revolutionize various industries by enabling efficient, trustless, and intelligent communication between machines and AI agents.
Upcoming Events
The M31 Capital team will be speaking at and attending a number of upcoming conferences and events. Please reach out if you are interested in connecting, or better yet - meet us there:
Goa: Web3Conf India 2023 (8/11-8/14)
Toronto: ETH Toronto (8/13-8/16)
Austin: Bit Block Boom (8/24-8/27)
Bali: Coinfest Asia (8/24-8/25)
Stanford: Stanford Blockchain Conference (8/29)
Copenhagen: Nordic Blockchain Conference (9/7-9/8)
Austin: Permissionless (9/11 - 9/13)
Singapore: Token 2049 (9/13 - 9/14)
Dubai: Crypto Expo Dubai 2023 (9/20-9/21)
Cologne: W3.vision (9/20-9/21)
Riyadh: Future Forum (10/4 - 10/5)
Dubai: Blockchain Dubai Exhibition & summit (10/12 - 10/13)
Barcelona: European Blockchain Convention (10/24-10/26)
Riyadh: Future Investment Initiative (FII) (10/25 - 10/27)
Dubai: AIM Summit (10/30 - 10/31)
Athens: Decentralized (11/1-11/3)
Miami: Quantum Miami (1/24-1/26)
About M31 Capital
M31 Capital is a global investment firm dedicated to crypto assets and blockchain technologies supporting individual sovereignty.
Website: https://www.m31.capital/
Twitter: https://twitter.com/M31Capital
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