.png){kind=small}
To receive our Insights newsletter you can sign up here.
Key Takeaways:
The fourth Bitcoin halving
Hong Kong launches spot Bitcoin and Ether ETFs
Restaking leader, EigenLayer, launches its Mainnet
Portfolio Spotlight: Movement Labs announced their $38m Series A round
Bitcoin Halving
The major highlight of the month was the fourth Bitcoin halving on April 19th, a programmed event that occurs every 210,000 blocks, or roughly every four years. This halving reduced the mining reward from 6.25 BTC to 3.125 BTC per block, halving the daily issuance of new bitcoins to about 450 BTC and reducing Bitcoin's annual inflation to 0.85%. This event is designed to diminish the supply of new bitcoins. Historically, halvings precede bull markets, though this time, Bitcoin's price has shown only slight fluctuations post-event. Additionally, Coinbase has integrated support for the Bitcoin Lightning Network, enhancing transaction speed and cost efficiency. This allows users to choose between Lightning and the traditional Bitcoin network for transfers, with Lightning offering nearly instantaneous processing compared to the slower transaction times on the Bitcoin blockchain.
A Spot ETH ETF Is Here
ETF excitement continued in the industry, with Hong Kong announcing the approval of spot Bitcoin (BTC) and Ethereum (ETH) ETFs. This makes Hong Kong the second region to do so in 2024, following the US SEC's approval of 11 spot BTC ETFs. However, the US has not yet approved any spot ETH ETFs, though analysts speculate this could change later in the year. Despite the fanfare, the Hong Kong ETFs had a modest market debut, with the first-day turnover significantly lower than that seen in the U.S. Meanwhile, Australia's Securities Exchange (ASX), which dominates 90% of the country's equity market, is anticipated to approve its first spot BTC ETFs by the end of 2024. These include applications from prominent players like DigitalX Ltd. and VanEck, as well as plans from Sydney-based BetaShares.
Layer 2s For The Win
Crypto exchange OKX recently unveiled an Ethereum-based Layer 2 solution, named X Layer, to reduce costs and enhance efficiency and interoperability for users interacting with decentralised applications. This solution, leveraging zero-knowledge proofs and built using Polygon's chain development kit (CDK), facilitates shared state and liquidity across various blockchains. This development reflects a growing trend of launching Layer 2 solutions among exchanges, exemplified by Coinbase's earlier launch of Base. Kraken has also been reported to be launching its own Layer 2. In related news, Kraken has also launched a non-custodial wallet, the "Kraken Wallet," which supports multiple blockchains and is notable for being open-sourced.
EigenLayer Mainnet Is Finally Here
The momentum around restaking in the DeFi sector continued, notably with EigenLayer, the largest provider of restaking and cross-chain security solutions on Ethereum. This month, EigenLayer celebrated the initial launch of its Mainnet. As a result, users can now deposit liquid staking tokens such as Lido’s stETH, Rocket Pool’s rETH, and Coinbase’s cbETH into the protocol. Additionally, they can set up EigenPods for native ETH restaking. EigenLayer also launched its inaugural Actively Validated Service (AVS), EigenDA, a data availability solution. An AVS includes any blockchain or blockchain-based service secured by the restaking capabilities of EigenLayer. Following this, EigenLayer also announced the addition of six more AVS’ to its platform, expanding its range of secured services and enhancing the robustness of its security features. These AVS’ encompass a wide range of services including decentralised public infrastructure (DePIN) coordination and Oracles among others. Users can now delegate their deposited funds to an AVS of their choice.
Move Making Moves
The Move ecosystem has had an eventful month. Aptos (Move-based Layer 1) announced a strategic partnership with Microsoft, Brevan Howard, and SK Telecom to offer institutions a gateway into decentralised finance (DeFi). This will be accomplished through Aptos Ascend, a suite of institutional solutions that enhance institutional access to DeFi by offering regulatory compliance, privacy tools, and integrated KYC features. In parallel, Mysten Labs (the developers behind the Move-based Layer 1 SUI) and BytePlus (a subsidiary of ByteDance) have formed a partnership to integrate Web3 technologies with BytePlus's advanced data solutions. This collaboration will focus on enhancing data warehousing and AI capabilities for Web3 gaming platforms. Finally, this leads us to our portfolio spotlight of the month.
Eterna Portfolio Company Spotlight:
Movement Labs announced their $38m Series A round
Movement Labs, a network of modular Move-based blockchains designed to combine performance with liquidity and composability, announced their $38m Series A round led by Polychain with participation from Hack VC, Placeholder, Archetype, Robot Ventures, and others. Movement Labs is pioneering a simple yet powerful idea: making the Move programming language accessible and available across Ethereum and the entire modular blockchain ecosystem. In doing so, Movement Labs is tackling some of the most pressing challenges facing the industry today, including smart contract vulnerabilities, scalability limitations, and fragmented liquidity. By bringing the Move Virtual Machine (MoveVM) to Ethereum through their innovative MEVM (Move + EVM) Zero-Knowledge Layer 2 solution, Movement Labs is poised to unlock a new era of secure, high-performance blockchain applications.
Disclaimer: this newsletter was put together for informational purposes only based on our review and analysis. This should not be construed as a solicitation, offer, or recommendation to acquire or dispose of any investment or engage in any transaction.
Comments