Quick Note: M31 Capital will be meeting with investors over the next few weeks, visiting Dubai (May), Abu Dhabi (May), Europe (June), and the Caribbean (June). If we are visiting your area, we'd love to meet in-person! Otherwise, fill out this form to schedule a call with us.
April Performance
In This Issue:
Market: BTC hedges bank collapses, Solana dominates Web3, & DEXs > CEXs
Narrative: The crypto industry is more aligned on regulatory efforts than ever
Highlight: Filecoin (FIL) is an old dog with some new tricks. Watch out, AWS…
Market Action
Spotlight on the banking crisis intensified as First Republic Bank faced insolvency and the U.S. mulled another bailout. Like clockwork, Bitcoin (BTC) now rallies immediately on the news of bank troubles.
The overall market was +1.3% in April, but not without volatility. Bitcoin bounced wildly between $27k and $30k breaking up through $30k for the first time since July 2021 on news of continued bank troubles.
Ethereum’s first major upgrade since The Merge, Shapella, was another major success allowing users to withdraw staked ETH from the Beacon chain for the first time since 2020. To everyone’s surprise, rather than withdraw their ETH, users deposited more and the total supply of ETH staked reached a new ATH of over 18.7m.
Offchain, the pro-crypto movement in the U.S. also had a big win when SEC Chair Gary Gensler was publicly taken to task by Congress for his crypto crackdown policy. A satisfying (and rare) moment of justice for the industry.
Web3
The rumors of Web3’s death have been greatly exaggerated. The sector continues to make incredible progress on the fronts of technical improvements and user adoption. Recent migrations of Helium & Render to Solana position it to be the go-to chain for Web3’s “DePIN” assets.
Helium (HNT) (+28.3%) led the Bandwidth sector after a successful migration to Solana. This is expected to significantly improve Helium’s efficiency & ecosystem through Solana’s developer tools, features, & apps eco.
Render Network (RNDR) (+74.7%), the leading protocol for Web3 AI, is likewise planning a migration to Solana, aiming to achieve higher throughput and lower transaction fees, making it even more of an attractive platform for AI development. Stable Diffusion (the most popular AI image generator) now uses Render Network to power its text-to-image tasks.
Filecoin posted its quarterly results, showing a +75.1% increase in active storage deals (580.5 PiB), a +21.4% increase in revenue with $6.9m in quarterly revenue. And Filecoin’s FVM is gaining significant traction, with ~738 unique contracts deployed and over 100k transactions processed. This is enabling new use cases, including perpetual storage, DataDAOs & decentralized computing apps.
DeFi
The migration from centralized finance platforms to decentralized finance platforms continues, defying all efforts to curb their use.
The Derivatives sector has continued to shine post-FTX as Derivatives/CEX volume increased to 1.7%, +15.1% m/m as activity returns to crypto overall. PENDLE (+22.9%) was a top performer this month as its tokenized yield trade volume increased +40.1%, reaching $62.8m, since the beginning of April.
Uniswap has officially surpassed Coinbase in monthly trade volume for the second month in a row, with a total of $71.6bn vs. Coinbase's $49.4bn. The Uniswap mobile wallet is also now live on the Apple App Store, offering support for L2 transactions, a fiat onramp, and a sleek user experience, helping drive crypto adoption.
TL;DR
Bitcoin rallying while more banks fail is a major sign the migration from fiat to crypto is heating up. Web3 in particular shows no signs of slowing down as Helium migrates to Solana, Filecoin launched an AWS competitor, and Render is now partnered with Apple, Stable Diffusion, and others. In DeFi, Uniswap has overtaken the premier global centralized exchange by trade volume, proving the sector is unstoppable.
Onchain, crypto is looking very strong and offchain firms like Coinbase & Messari are fighting back hard with lawsuits against the SEC and new lobbying efforts like the CAMPAIGN for Crypto, gathering more and more political support in the U.S.
Good days ahead.
March Highlights
Gary Gensler gets grilled on Capitol Hill over crypto stance
Coinbase sues the SEC for answer on rule specific to digital assets
Coinbase releases free Web3 profiles in collaboration with ENS
EU Parliament votes in favor of a new crypto licensing regime MiCA
Partner Highlights
Huddle01 raises $2.8m for the first decentralized communication network (link)
Push Protocol launches privacy-focused ChatGPT clone (link)
Coinbase hits back at SEC warning with lawsuit of its own (link)
Injective and Tencent Cloud Join Forces to Support Builders in Injective Ecosystem (link)
Protocol Highlight
Filecoin (FIL)
Filecoin allows anyone to store data in a secure, trustless manner, at a very low cost. Filecoin data storage is the cheapest you can find anywhere, coming in at 99.99% cheaper than AWS.
Let that sink in: Filecoin is ~99.99% cheaper than AWS.
Progress Update
Filecoin Virtual Machine (FVM): Allows developers to create and deploy smart contracts, dApps, and other complex operations on the network, enabling a richer feature set for Filecoin users through new innovations like DataDAOs and other monetization opportunities for the data stored on the network.
Data Retrieval Markets: Filecoin’s Saturn will enable a data retrieval market on the network, allowing more users to store different types of data, while allowing participants with lower hardware resources to efficiently join the network
Takeaway
Filecoin's significant progress and innovations have cemented its role as a leader in decentralized storage. Offering cost savings of 99.99% compared to traditional providers, Filecoin is transforming data storage and accessibility. With the FVM and Data Retrieval Markets, the network's capabilities and use cases have expanded, attracting a diverse range of developers and users. Filecoin's growth in network revenue, storage deals, FVM adoption, and projects built on the platform signal a promising future in reshaping the decentralized storage landscape.
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:
Dubai: M31 Capital Web3 Reception (5/4)
Montreal: W3 Conference (5/5 - 5/6)
New York: Security Summit (5/9 - 5/10)
Abu Dhabi: M31 Capital Investor Luncheon (5/10)
Dubai: M31 Capital x Al Maktoum: Web3 Reception (5/11)
Portland: ETH Portland (5/12)
Amsterdam: The Web3.Conference (5/19)
Santa Clara: Blockchain Expo (5/17 - 5/18)
Miami: Bitcoin 2023 (5/18 - 5/20)
Lisbon: Non-Fungible Conference (NFC) (6/7 - 6/8)
Paris: EthCC (7/17 - 7/20)
Toronto: ETH Toronto (8/13-8/16)
Austin: Bit Block Boom - (8/24-8/27)
Austin: Permissionless (9/11 - 9/13)
Singapore: Token 2049 (9/13 - 9/14)
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