Buidler DAO: Crypto Market Summary & A must-read for the Year Ahead

原文标题：《 Buidler DAO 蝗虫精选（21）：加密市场总结&来年展望的必读文章》

原文来源： Buidler DAO

Deep Picks are our must-read articles under this week's hot market topics, taken from Buidler DAO's daily push of the Cognition Locust Project; Here, senior readers of Web3 Native will extract the core content of high-quality articles and personal deep thinking from the complex information sources.

The timeline takes us to the end of 2022 for a panoramic market review and analysis. From the investment principles of a16z partners, to its philosophy and standards in the execution of investment process; From the market status and future prediction of NFT to the interpretation of the core mechanism of NFTFi; From application classification of Ethereum ecosystem to value interpretation of "thin application"; From an overview of decentralized storage, to a summary of on-chain data. This article covers a macro review and future outlook for the end of 2022, as well as a summary of the potential for development in each circuit. Read below and understand the key points, welcome to discuss!

Full text of 6300 words, expected reading time 16 minutes

A quick look at the article:

Chris Dixon, a16z Partner: Investing Principles, crypto Markets in the History of Technology, and the Year Ahead @wes

02/ The Road ahead for NFT markets @SCaesar

03/2022 End Summary: The present and future of decentralized storage @Boss Cat

04/ Vitalik: Five exciting Apps for the Ethereum App Ecosystem @wes

05/2022 Annual Summary of on-Chain Analysis -- Glassnode@Hugo

06/ Coinbase: 2023 Crypto market outlook @Cat Boss

Analysis of 07/ NFTFi's core mechanics and seven sub-tracks @memeswap

08/ Thin Applications @old.cn

Conversation with Chris Dixon, a16z Partner: Investing Principles, crypto Markets in the History of Technology, and the Year Ahead @wes

1. a16z's investment strategy and views on how encryption projects build trust: either all must be on the chain, with appropriate code audits to ensure security; Either be regulated in one country, have audited financial data, have 1:1 client assets, and have highly secure custody.

2. Investment direction of a16z: infrastructure layer and application layer. Investments in infrastructure include the layer 1 blockchain and the layer 2 cross-chain bridge, wallet, and all the other things needed to build applications. The application tier includes Defi, payments (one area to watch is the Bitcoin Lightning network), Web3 gaming, and NFT.

3. NFT takes cryptocurrencies out of the financial world and brings them into the larger world of the media world, through which the path to a billion people actively participating in cryptography is likely to take place one way or another.

4. The benefits of decentralized socializing: In terms of money and power. First, look at the percentage of money that network operators keep for themselves as it flows through the network. On Youtube, the conversion rate is 45%. Twitter's conversion rate is 100 percent, and Facebook's is 100 percent. We are now in an era where social networks are owned by platforms, which creates less incentive for people to create content. Then there's the power part. No one should have the right to change the rules of a platform at will.

5.  We don't interact directly with the Internet, but with a network built on top of the Internet. Network is what we do with the Internet. Community ownership and building true believers is a better structure. People can own a part of the network through the Token, while also having some control and rights to community governance. The feeling of ownership is a powerful force. Decentralized governance is a more pressing issue, and one worth discussing.

think

不知道是否是受到马克安德森的影响，A16Z 的投资人并没有将加密行业看做一个孤立的行业，而是将其视为打造更好的「网络」的一种途径或者方式。过去是软件吞噬一切，而后面的发展路径是否会是加密吞噬一切，最起码吞噬网络呢。这其中，最值得关注的议题无疑是利用 Token 分发更好的来进行网络的治理，网络的建设者乃至采用者如何从中获得自己的权利。

Link to original article:

https://www.chaincatcher.com/article/2084854

The Road ahead for the NFT Market @SCaesar

This article examines the current landscape by comparing key stakeholders and discusses iterative trends in the NFT market.

Direct market: There are royalty, fraud, and API issues. Opensea has maintained its lead, while other markets have tried and failed to mine liquidity. Rarible, Opensea, and Magic Eden are examples of product-led growth.

The AMM NFT market: The selling points are instant liquidity advantages, decentralization and on-chain nature, while the disadvantages are possible incompatibility with some classes of NFT and greater complexity for users.

NFT Market Aggregator: Easy and convenient, and prevents fake transactions, but high value NFT is still being bought in the direct market. In the case of Gem and Uniswap, NFT market Aggregators have not yet emerged, but Uniswap is worth looking forward to.

NFT 市场现存问题：交易费用和版税，NFT 市场的 Token 经济学问题，市场过于笼统，缺乏社交功能，NFT 基础设施需要进一步发展。

Future models of NFT markets: vertical markets, infrastructure to launch project-only markets, members-only trading platforms, dealer-centric trading platforms, etc.

think

一篇扎实的分析文章，从 NFT 的交易层面到 NFT 市场之间的差异，再考虑到 NFT 用户的因素。NFT 的两大需求群体是 NFT 社区用户与机会主义者。前者从 Twitter 或 Discord 获得的链接一般直接指向 Opensea 等直接市场；后者则更有可能使用 NFT 市场聚合器。但无论是哪种 NFT 市场类型，产品都是引领增长的最大可持续动力。NFT 市场需要更多考虑针对的用户群体，提供创新的用户体验。NFT 的火热使得下一波涌入的用户们很可能是习惯 Web2 世界模式的，需要有更多侧重不同方向的 NFT 市场，来满足不同类型的需求。无论是垂直市场的 Axie Infinity 和允许项目启动自己专属市场的 Reservoir，还是 Uniswap 推出的同质化 Token 与 NFT 融合的交易，NFT 市场正在向能够实现产品市场完美契合的 NFT 生态快速迭代。

The original link: https://bixinventures.medium.com/the-road-ahead-for-the-nft-marketplaces-12b139a545a6

2022 End of summary: The present and future of decentralized storage @Boss Cat

Data storage has always been the cornerstone of the development of science and technology industry and the focus of the field. With the explosion of Web3, a number of decentralized storage providers began to meet the needs that the traditional cloud storage market could not meet. The author believes that the storage layer under the chain will eventually become an important infrastructure in the Web3 ecosystem, and solve the data storage problems of any protocol layer and operation layer through hot storage and cold storage. In the future, the capacity expansion problem in the "Impossible Triangle" can be solved by completely stripping the storage layer but maintaining interoperability. Meanwhile, middleware, API and other services built on the cold storage layer can improve the efficiency of data calculation, call, and push.

Current development: In terms of classification, Arweave, Filecoin, and Storj are three decentralized storage networks. Filecoin and Storj are more decentralized P2P storage networks, while Arweave is a more tightly organized network of storage nodes. In terms of scale, Filecoin is the leader in revenue, FDV, and market share, and is still growing. Arweave and Storj, on the other hand, are in the $100,000 range, not nearly as big a market as they should be.

Filecoin and Arweave  The comparison of In terms of functionality, they are a complementary pair: Arweave is more focused on permanence and stability of data storage, and is better suited for things like metadata and historical data; Filecoin offers a more flexible storage solution. In terms of costs, it is difficult to make an intuitive comparison. From the examples in this article, the Filecoin storage cost is almost zero cost storage. In the already hack-prone world of Web3, the value of Arweave's permanent storage reliability is more than a simple storage price. In terms of ecological projects, Arweave has already incubated a number of excellent projects, mainly young entrepreneurs, with high growth potential. Filecoin has the advantage of having a large number of eco-projects and is more like an open source environment that can meet a wider range of storage-related needs but doesn't have a focused direction.

New scheme:

1) Aggregation network, hosting and Bucket are its two main products. hosting does front-end hosting with 4EVERLAND's 200 + global gateways accelerated, and Bucket is an aggregation gateway.

2) L1 storage extension network. Essentially the same as the existing Layer 2, it is a solution to improve L1 performance and scalability.

Taken together, Filecoin and Arweave have become the poster children for decentralized storage and represent the 0-to-1 process of decentralized storage. In terms of development concept, the separation of non-on-chain core data into the storage tier has become the main means of expansion of Ethereum. In the future, the following types of projects are likely to be the next wave of growth engines: 1. DSN aggregators. 2. Off-chain calculation. 3. L1 storage extension network. 4. Third-party data security network.

think

去中心化存储本质上服务于 Web3 生态的应用层，Arweave 和 Filecoin 对比来说，Filecoin 更适合个人或者项目早期存储，因为价格或许更便宜。而 Arweave 更适合专业的项目使用，因为永久存储的可靠性对于专业项目比低廉的价格更重要。顺便说一句，虽然 Filecoin 在去中心化存储赛道是老大，但是其发行的 Token FIL，最近跌得惨不忍睹，可谓是，从哪儿来又回哪儿去了。

The original link: https://mp.weixin.qq.com/s/KDpI6OTMCpDsOgDUDCg6sg

Vitalik: Ethereum App Ecosystem, five exciting apps @wes

1. Money: Vitalik focuses on the example of money transfers, stablecoins, and cryptocurrencies used in scenarios where privacy and digitalization are combined.

2. DeFi: The product of interest, forecasting, synthesizing assets, the glue layer that effectively trades between other assets.

3. Identity system: Vitalik is optimistic about blockchain identity but not about identity platform. Personally, I think the future will be a unified consensus agreement plus a variety of reputation providers (and eventually a handful of oligarchs).

4. DAO: Vitalik put forward several potential exploration directions of decentralization governance in this paper: decentralization promotes robustness, decentralization promotes efficiency, and decentralization promotes interoperability; And several types of decentralized and novel governance mechanisms. My biggest impression is that although everyone is talking about DAO, many people may not be talking about the same thing.

5. Hybrid applications: Applications are not entirely on-chain, but take advantage of both blockchain and other systems to improve their trust model. Typical cases include business accounting, government registration, full chain games, supply chain management...

think

Although there are five scenarios, I think they fall into two broad categories -- assets and identity, and behavior (reputation).

In 2021, the adoption rate of Crypto increases significantly, especially in Latin America, Southeast Asia and other places. Among them, the most important usage scenarios are payment and cross-border remittance, which is still a demanding scenario, and many of these are provided by centralized institutions and even traditional financial giants. For some Crypto believers, embracing Defi and code as law is an alternative. Individuals feel that they don't belong in the same group, but it doesn't matter, every need is met.

A different kind of exploration of identity/behavior is more conceptual. In addition to technical support, there also needs to be a supporting system of thought and ideas.

It really kind of pushes the potential vision of a cyber state.

At the moment, it seems possible to think of encryption as a subculture for a while, but there is a growing sense that it will explode with great innovation and disruption at the margins.

The original link: https://www.chaincatcher.com/article/2084088

2022 Annual Summary of On-Chain Analysis - Glassnode@Hugo

The trading volume of BTC and ETH futures reached its lowest point at the end of 2022. The leverage ratio has fallen significantly after the FTX mine, and the funding rate has remained negative since November, indicating the market is dominated by bears

During the decline from June to October, the proportion of long-term BTC holders increased; BTC mining machine close to shutdown price, mining difficulty decreased, more absenteeism quit

After The Merge, the number of verifiers increased, and the pledged ETH accounted for 12.89% of the total circulation, but the ETH circulation decreased significantly and became a deflationary currency

DeFi TVL is down 75% from its high and now stands at 39.7 billion, the same level as in February 2021; Gas Fee consumption decreased from 30% to 14%

The stablecoin USDT held steady at more than 45 percent of the market, while BUSD stood out and USDC declined after peaking in June and may have had an impact with the Tornado event

Stablecoin transactions and transfers have remained at their peak amid a spate of deleveraging events, indicating demand for dollar liquidity during extreme events

think

In 2022, with LUNA, 3AC and FTX deleveraging events as well as the impact of the macro environment, we experienced a chaotic and brutal year. But looking back, all the wealth myths seem so silly, Bankless host in a recent review of 2022 also mentioned that the Crypto market needs such 2022.

However, the proportion of long-term investors in BTC continued to increase, indicating that more money is still coming in against the trend; After the merger of Ethereum, the total amount of ETH has decreased since the merger, and the most actual deflation data is there. However, global central banks have raised interest rates and reduced balance sheets successively, and the impact of macro environment is really great. The ETH price has continued to fall after the merger and fluctuated at 1200 USD.

The demand for stabocins is very strong, and after the Tornado incident this year, there will certainly be more decentralized stabocins in the future, such as AAVE's GHO and Curve's curveUSD, which was released after a misreported security warning caused air snips.

The original link: https://insights.glassnode.com/chinese/the-week-onchain-week-50-2022-chinese/

Coinbase: 2023 Crypto market outlook @Cat Boss

Coinbase sees three themes in 2023:

一是转向优质资产。数字资产选择将转向更高质量的生态；以太坊和 ETH 的叙事将会被强化；DeFi 的发展会加速；有更多对许可式 DeFi 的需求和关注；RWA Token 化会被重新提起。

The second is that creative destruction eventually leads to new opportunities. The liquidity spiral will take time to recover; Bitcoin mining is poised for further consolidation; The market will explore new use cases for NFT, and royalty issues will be widely discussed.

Third, infrastructure reform, which fuels optimism. Regulatory clarity is more urgent; Crypto field lending practice will be more mature; The shock of the market turmoil will continue, but institutions will adopt crypto widely and launch more new partnerships.

think

This article is just one chapter of the Coinbase 2023 Crypto Market Outlook report, which also covers the current status and outlook of bitcoin, Ethereum, L1/L2, stablecoins, NFT, regulation, and more. The events of 2022 are still essentially centralized risks in an environment of regulatory uncertainty, which will also make the crypto field pay more attention to decentralization and regulation in the next few years. For the former, DeFi's good operation will accelerate its development in the next few years, while the surge in stablecoin transfers after the deleveraging event, as well as the increased holdings of BTC and ETH by investors, also shows the cornerstone status of Stablecoin and the quality assets of BTC and ETH.

As for the supervision, the crypto industry is also learning the lessons of systemic defects. The DeFi of permission, clearer regulatory framework and more mature crypto lending process will form a positive flywheel, constantly stimulating the confidence of institutions and investors, and making more people hone themselves in such an environment. build and prepare for the future. As the saying goes, break and then stand, crypto step back, is to recognize yourself, see the shortcomings, learn a lesson, and then better move forward.

The original link: https://news.marsbit.co/20221209104034245575.html

NFTFi's core mechanics and seven sub-track analysis @memeswap

Background of the birth of NFTFi: To solve the problem of insufficient liquidity, the core reasons lie in the changing environment, high investment threshold of NFT (expensive blue chip, opaque information of common projects), and lack of application scenarios.

The essence is to expand the financial attributes for NFT, making the flow form of NFT more diversified and higher, providing more combination of gameplay.

At present, the circuit can be preliminarily divided into 4 stages according to the pricing & Valuation, lending, derivatives, fragmentation and leasing.

The main pricing methods are artificial pricing (game pricing) and algorithm pricing (prediction machine). The former is prominent with abacus, while the latter is mature with banksea and upshot.

There are two main types of lending: point-to-point (NFTfi, arcade.xyz) and point-to-pool (BendDAO, JPEGd, etc.), and installment play derived from lending.

Derivatives are mainly options (e.g. Nifty, Hook, etc.)

The fragmented representative project is tessera.

Leasing is currently dominated by double protocol's ERC-4907.

An interesting lending mode mentioned in the paper is JPEGd, which borrows NFT to lend the project side's own stablecoins. In fact, it is no different from BendDAO's lending ETH, but it increases the risk due to the increase of excess stablecoins in thin air.

think

NFTfi, based on NFT, aims to solve liquidity problems for NFT and provide users with more liquidity channels and leverage tools. But in actual use, except BendDAO, most of the performance is not good.

The valuation model mentioned in this paper is one of the problems. At present, there is no mature valuation model that can provide reasonable valuation for non-homogeneous and rare NFT respectively. At present, it is more applicable to floor price NFT and ERC1155 type NFT.

In addition, since most NFT have poor liquidity, most of the borrowing tracks in NFTfi use the white list system, which has threshold requirements for NFT access, and the scalability is limited.

However, fragmentation and other modes naturally have certain logical defects, such as the lack of NFT holding equity, the failure to timely realize the fragmentation, bidding and so on. Through the verification of BendDAO, it can be seen that there is a large market demand in NFTfi market, but there are also many technical difficulties and commercial logic hindering its development.

The original link: https://www.theblockbeats.info/news/33206

Thin Applications Thin applications @deeply

The architecture of blockchain applications will in the future be captured by the "protocol layer" that captures most of the value of the crypto market, while on the network it will be captured by the "application layer".

Similar to Defi, using many of the same protocols to build similar crypto financial applications allows them to provide a complete set of financial services without having to build all these functions, infrastructure and liquidity in-house. This structure is good for startups because they bring a fully functional product to market before their first real round of funding.

Self-contained data: Unmanaged is another way cryptocurrencies are cutting application costs. Encrypted service architecture, combined with an unmanaged data model, enables start-ups to compete more effectively with centralised incumbents. Adopting these patterns allows enterprises to run at a very low cost, and applications benefit from each other's success because they contribute to a shared resource pool at the protocol level. As a network, thin applications can scale across markets more effectively.

Value capture vs. return on investment: Value capture is more about TAM and other macro elements, while returns vary based on factors such as cost base, growth rate, and ownership concentration. The difference between protocol and application is how these elements are combined.

P2B2C: Thin applications are cheaper to run because they push a lot of the cost onto the protocol and the user. But because of homogenized data sources and services, they need to differentiate themselves through branding, planning, and customer experience, namely "P2B2C", from the agreement to the enterprise to the consumer.

think

The discussion of thin application and fat protocol, Ethereum is a typical fat protocol, the value is more concentrated in the protocol layer, and now has turned to the fat money theory, the sustainability in the later period is worthy of attention; After sorting out the categories of protocols, you can see that the market value of the protocols always increases faster than the aggregate value of the applications built on them, because the success of the application layer encourages further speculation on the protocol layer. It's worth thinking about how the value of an application should be defined in light of the above discussion. How to choose the application chain?

The original link: https://web3caff.com/zh/archives/43194

Original link

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