Research Summary
The report provides a comprehensive analysis of WAX, a Layer-1 network focused on gaming and NFT use cases. It covers the network’s performance, including its market cap, revenue, and network activity. The report also discusses the impact of various events, such as the launch of Funko’s Stranger Things collection, the acquisition of AtomicHub by Wombat, and the upgrades made to the Cloud Wallet by WAX Labs.
Key Takeaways
WAX Network Performance
- Market Cap and Revenue: WAX’s circulating market cap decreased by 8% QoQ to $141 million, while its total quarterly revenue increased by 22% QoQ to $2.1 million.
- Network Activity: Average daily transactions fell by 5% to 17 million, and average daily active addresses fell by 11% to 302,000. However, both figures rebounded after reaching their lowest points near the end of August.
- Security: WAX had 69 validators with voting power at the end of the quarter. A malicious actor would need to control 15 validators to execute a two-thirds attack on the network.
Key Events and Developments
- Funko’s Stranger Things Collection: This collection reached $1.2 million in combined primary and secondary sales on the day of its drop, marking the second-highest daily trading volume for a WAX collection in the past year.
- Acquisition of AtomicHub: Wombat acquired AtomicHub, WAX’s most popular NFT marketplace by secondary sales volume, and plans to integrate its existing features into the marketplace.
- Cloud Wallet Upgrade: WAX Labs launched a Cloud Wallet upgrade, allowing users to claim control over their admin keys. Over 17,000 addresses have claimed admin control so far.
NFT Marketplaces and Games
- Active Address Activity: Active address activity on WAX is dominated by Play-to-Earn (P2E) games Alien Worlds and Farmers World. Alien Worlds experienced a decrease in active addresses, while Farmers World saw an increase.
- NFT Sales Volume: WAX averaged $78,000 in daily NFT sales volume, a 12% decrease QoQ, with an average of 20,000 daily sales. Funko collections accounted for 68% of total WAX NFT volume.
- Power Addresses: Power addresses, defined as addresses active for over 80 days in the quarter, accounted for 128,000 out of 877,000 total active addresses.
Future Developments
- Antelope Protocol Upgrade: The Antelope protocol powering WAX is set for a milestone upgrade in Q4, which will expand the validator count beyond 21 and bring near-instant finality to the network.
- Developer Incentives: WAX plans to incentivize new builders by tapping into its treasury, which currently stands at $3.6 million.
- Cloud Wallet Features: WAX Labs plans to continue launching new features for the Cloud Wallet, including enabling users to easily claim control over their admin keys.
Actionable Insights
- Monitor the Impact of Key Events: The impact of key events such as the launch of Funko’s Stranger Things collection and the acquisition of AtomicHub by Wombat on WAX’s performance should be closely monitored.
- Assess the Effectiveness of the Cloud Wallet Upgrade: The effectiveness of the Cloud Wallet upgrade in improving user experience and security should be evaluated.
- Investigate the Potential of the Antelope Protocol Upgrade: The potential impact of the upcoming Antelope protocol upgrade on WAX’s network performance and security should be investigated.
