Research Summary
The report discusses the resurgence of the NFT market, with a focus on the increase in volume, floor prices, and mindshare. It also highlights the potential role of NFTs in gaming, with companies like Roblox and Epic Games showing interest. The report further discusses the revival of the Arbitrum ecosystem, driven by token incentives and increased volatility and volumes.
Key Takeaways
NFT Market Resurgence
- Volume Increase: The report notes a significant increase in NFT volume over the past six months. The author predicts that volume and users will 10x last cycle’s peak, with few collections surviving but those that do seeing outsized gains.
- Role in Gaming: The report highlights the potential role of NFTs in gaming. The CEO of Roblox discussed NFTs within the frame of Roblox, and there are rumors that GTA 6 will have some form of digital asset integration. Epic Games already has multiple crypto-enabled games on their creator marketplace.
Arbitrum Ecosystem Revival
- Token Incentives: The report discusses a “Short Term Incentive Program” (STIP) that was proposed and passed to incentivize usage and growth in the Arbitrum ecosystem. With 50m (~$58m) ARB tokens up for grabs, protocols from across the sectoral spectrum requested tokens to pursue growth strategies.
- Impact on Protocols: The Perpetuals sector was the largest beneficiary of grant tokens, with ~43% of all tokens being directed towards the sector. GMX, the largest protocol on Arbitrum and largest grant beneficiary, took 12m tokens or ~24% of the entire grant pool. This has led to a significant increase in liquidity and trading volume on the platform.
Actionable Insights
- Monitor NFT Market Trends: With the resurgence of the NFT market, it would be beneficial to keep a close eye on market trends, including volume, floor prices, and mindshare. This could provide insights into potential opportunities and risks in the NFT space.
- Investigate the Potential of NFTs in Gaming: Given the interest shown by gaming companies in NFTs, it would be worthwhile to investigate the potential of NFTs within this industry. This could include exploring potential partnerships, investments, or development opportunities.
- Assess the Impact of Token Incentives: The report highlights the significant impact of token incentives on the Arbitrum ecosystem. It would be beneficial to assess the potential impact of similar incentives on other ecosystems or protocols, and consider whether such strategies could be beneficial.
