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- 🟣 Move Chains are making moves
🟣 Move Chains are making moves
Aptos and Sui strike enterprise partnerships.
Hayden
April 18, 2024
Welcome back to 0xResearch – quick hitting alpha for the crypto degens. Here's what we got for you today:
Aptos and Sui announce partnerships
Solana L2s?
Binance dumps $1B in BTC from insurance fund
On the back of Solana’s resurgence, other high-performance Layer 1s are making moves to compete with the rising star.
Yesterday Sui announced a partnership with ByteDance (the company behind TikTok). In collaboration with Mysten Labs, “BytePlus will explore data warehousing, content recommendation, content generation, and augmented reality in Web3 game platforms and socialFi projects.” And this morning Aptos announced a partnership with Microsoft, Brevan Howard, and SK Telecom to offer institutions access to DeFi.
It is unclear whether these developments are bullish–I typically don’t place too much credence into these deals; however, as TradFi institutions file into crypto via the spot BTC ETFs, I don’t think I can discount these traditional enterprise relationships just yet, especially as I keep in mind finding the next trojan horse. MOVE chains are on the move.
Zeta Markets–a perp DEX on Solana–is launching its native token Z. More interestingly, they are building Solana’s first Layer 2. There have been murmurs about Layer 2s on Solana, as mentioned on this Bell Curve podcast, but there aren’t very clear reasons as to why one would deploy a Layer 2 on Solana. On one hand, to circumvent the negative externalities of spam, a Layer 2 could afford more blockspace and basically create a siloed execution environment for a dApp’s transactions. On the other hand, Layer 2s on a monolithic global state machine are antithetical to the purpose of said vision. Plus, dApps on Solana, and even ORE miners, are already leveraging Jito to successfully land transactions.
From here, I have two questions: Why is Zeta bullish Layer 2s on Solana? And how much more capacity does Jito’s block engine have (before Solana Layer 2s or bigger blocks makes sense)? My initial reactions are: (1) I’m guessing Z has something to do with launching “Solana’s first Layer 2,” and I look forward to the white paper for more on the technical aspects. (2) MORE.
Finally, Binance dumped $1B in BTC from their SAFU insurance fund. These sell flows probably explain some of the recent BTC weakness. Whatever the case, it seems like they made a great trade.
Thousands of rollups will continue to launch. With that, rollup interoperability presents a major challenge. Our latest unlocked report here unpacks how Avail presents a potential solution to rollup fragmentation through its three products: Avail DA, Nexus, and Fusion. Avail, the unification layer for web3, may prove to be the logical end game for DA layers, so if you’re interested in what that means, check the report out!
Last month, Blackrock launched BUIDL–its first tokenized fund on Ethereum. In partnership with Securitize, the fund seeks to provide qualified investors access to yield holding an onchain stablecoin via cash, U.S. Treasury bills, and repurchase agreements. Since the launch, BUIDL has attracted nearly $300M.
To make the transition onchain more seamless, Circle created a smart contract that allows investors to trade BUIDL shares for USDC. This functionality provides BUIDL holders instant cash-settlement guarantees, 24/7. These developments are subtle changes to cryptocurrency markets and most crypto-native participants might overlook these activities, yet they have potentially large implications–namely, institutions are learning how to operate onchain.
Today, Franklin Templeton announced FOBXX, their first tokenized fund on Ethereum, which offers U.S. government securities, cash, and repurchase agreements collateralized fully by U.S. government securities or cash.
Zooming further out, as markets experience volatility in the short term, in light of the SEC taking more aggressive actions on DeFi, this steady appetite for institutionalized onchain assets is a promising sign of institutional adoption.USDC supply (~$32.8B) has been up only this year (33.43% YTD), signaling demand from more investors and businesses to participate onchain.
These larger institutional stablecoin tailwinds are healthy signs that TradFi money is still developing ways to gain exposure to onchain activity. It seems two outcomes are inevitable: more regulation and more institutional adoption–both of which are bullish.
Arweave recently launched the testnet for AO computer, a new messaging protocol that will sit atop a PoS network and aims to become a scalable global compute platform through parallel processing and modularity.
Solana current design is causing users’ transactions to be displaced or dropped. Until further solutions mature, we do not see the appetite to add additional risk at present; however longer term, we think the market will eventually look past these idiosyncratic headwinds and believe SOL is still a top candidate for outperformance throughout this cycle.
Chorus One tried to tease out some risks that could emerge from the buzzy restaking protocol.
Bitcoin mining is dominated by pools — with one industry veteran anticipating some will be flushed after the halving
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The insights, views and outlooks presented in the report are not to be taken as financial advice. Blockworks Research analysts are not registered broker/dealers or financial advisors. Blockworks Research analysts may hold assets mentioned in this report, further outlined in the Firm’s Financial Disclosures.
