Research Summary

The report discusses the evolving landscape of the cryptocurrency industry, highlighting Kraken’s consideration of launching its own Layer 2 network, the partnership between Yuga Labs and Magic Eden to enforce NFT royalties, and Lido’s governance token holders approving a proposal for new validators. It also touches on the rise in Bitcoin inscription activity, various corporate developments, and collaborations in the crypto space.

Key Takeaways

Kraken’s Layer 2 Aspirations

  • Exploring Partnerships: Kraken is considering launching a Layer 2 network and is in talks with teams like Polygon, Matter Labs, and Nil Foundation.
  • Unique zk-Based Network: The potential Kraken L2 network could be the only zero-knowledge-based L2 among its competitors.
  • Centralized Exchange Strategies: Exchanges are increasingly offering on-chain solutions like sponsored infrastructure or self-custodial wallets to engage users.

Yuga Labs and NFT Royalties

  • Enforcing Royalties: Yuga Labs partners with Magic Eden to launch a marketplace that honors creator royalties amid declining NFT royalties.
  • Influence on Royalty Debate: Yuga Labs, with a significant market share, aims to reshape the anti-royalty narrative.
  • Financial Impact on Creators: The NFT sector is concerned about the potential strain on creators if royalties are eliminated, given the historical earnings of over $1.8 billion from secondary sales.

Lido’s Validator Onboarding

  • Approval of New Validators: Lido governance token holders have approved a proposal to onboard new validators through the Obol and SSV networks.
  • Staking Module Development: A “staking module” will be created to organize new distributed validators into pools, with a phased rollout planned.
  • First-Mover Advantage: Lido’s cautious approach to new technologies, like the slow rollout of staked ETH withdrawals, reflects its significant market presence.

Bitcoin Inscription Activity

  • Record Inscription Count: Bitcoin inscription count reached its second-highest daily figure, with the majority being text-based.
  • Fee Generation Increase: The rise in inscription activity led to a 6-month daily high in fees generated, reaching 55 BTC.

Corporate and Ecosystem Developments

  • Corporate Announcements: Binance unveils a self-custody wallet, Coatue Management marks down its OpenSea stake, and The Graph plans new services.
  • Collaborative Efforts: Polygon Labs and NEAR Foundation work together on a zkWasm L2 Prover, and other ecosystem funds and services are launched.

Actionable Insights

  • Monitor L2 Network Developments: Keep an eye on Kraken’s potential Layer 2 network launch and its impact on the competitive landscape of crypto exchanges.
  • Assess NFT Market Dynamics: Consider the implications of Yuga Labs’ royalty-enforcing marketplace on the NFT sector and creator earnings.
  • Evaluate Lido’s Staking Innovations: Observe Lido’s implementation of new staking modules and their effect on the protocol’s market dominance and decentralization.
  • Analyze Bitcoin Inscription Trends: Study the increase in Bitcoin inscription activity and its influence on network fees and user engagement.
  • Explore Ecosystem Collaborations: Investigate the potential of new collaborations, such as the partnership between Polygon Labs and NEAR Foundation, and their contributions to the crypto ecosystem.

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