Runes Protocol launches in 2 days: Ready to FOMO in?

Hold up. 

There are few reasons to stay bearish for now:

Pre-rune token market is hot.

Runestone, RSIC, and PUPS are already pumping, promising holders shiny new Rune token airdrops. 

And FOMO threads keep coming...

But, like the NFT frenzy post-JPEG reveal, the market could soon cool off. 

Here's why:



• As Bitcoin transaction fees skyrocket, small traders may struggle and get disillusioned

• Runes might not initially revolutionize BRC20 trading experience as UTXOs and BRC20s trade similarly to NFTs.

For example, Unisat and Ordinal Wallet Rune UIs are same as BRC20s.

https://twitter.com/udiWertheimer/status/1779635860083704313

Also, dozens or even hundreds of Rune tokens will hit the market:

This dilutes: 
1) trader attention 
2) money inflows per token.

And Rune 0 (UNCOMMON•GOODS) set by Casey Rodamor is no easy pump – it's freely mintable for 4 years, limited to just 1 mint per transaction. 

Finally, utility-wise runes will trade as memecoins like BRC20s. 

At least at first, so the excitement of “new” will fade away. 

Especially if no rune token manages to sustain the pump and degens lose money.

Sure, some Runes will do great; you'll see success stories on CT.

But will you managed to be the one?

If I'm right the real opportunity comes after the hype cools down post the Rune protocol launch.

I'm bullish on Runes long-term.

Notice that narrative speculation comes in waves:

First wave: Fueled by shiny newness and hype, often from tech innovation or meme potential. 

Recent examples: Friend tech, ERC404, Telegram bots...

Meme tokens can feel like a gamble, with most one-hit winners fading fast. 

https://twitter.com/DefiIgnas/status/1757029397075230846

But narratives rooted in technical advances stand a better chance post-hype.

Ordinals debuted in December 2022. 

But BRC20's launch in May 2023 sparked the 1st wave. While initial hype waned, ongoing development led to 2nd and 3rd wave surges in late 2023.

4th is Runes. 

Runes is here to stay – not just for one more wave, but many more to come.

Why?

• Runes aims to unify the BTCFi industry with a single standard, akin to Ethereum's ERC20. 

Before Runes, the dev attention was scattered across BRC20, CBRC-20, ARC20s, and more.



• Runes is paving the way with multiple protocols and infrastructure for Rune tokens. 

Like Saturn is building a familiar looking DEX or @LiquidiumFi a lending/borrowing market for Runes.

But perfecting the user experience takes time.

And Runes won't be just memecoins.

Finally, there's a more fundamental reason I'm long-term bullish on Runes and BTCFi in general:

In every bull market, new tech emerges.

Bitcoin was said to be 'unfit' for NFTs or tokens. Yet, Bitcoin NFTs are outperforming Ethereum NFTs.

This innovation of Ordinals gave Bitcoin the extraordinary privilege of printing new tokens out of thin air and assigning crazy valuations.

It was reserved for smart contract blockchains like Ethereum/Solana. 

Until Ordinals inadvertently gave rise to BRC20s and now Runes. 

https://twitter.com/DefiIgnas/status/1726598420368871860

Finally, BTCFi's storytelling potential is off the charts!

Storytelling breathes life into technical innovation turning it into something people can relate to and join.

Bitcoin Ordinals as immutable NFTs on the most secure & decentralized blockchain is a sexy story. 

https://twitter.com/DefiIgnas/status/1748317085954924682

And memecoins on boomer Bitcoin? Cooler than Solana or Ethereum! 

The good thing is that we're truly early: Everyone is playing a catch-up with the tech and story.

With devs flocking to Bitcoin and more BTC degens joining in, the future looks bullish.

If you want to learn more, check out yesterday's blog post on Runes.

You'll find:

• Additional Rune protocols and tools to explore
• A more in-depth explanation of my Runes thesis.


https://twitter.com/DefiIgnas/status/1780193878689386887

Runes Protocol: To FOMO or Not to FOMO

When will Ethereum ($ETH) pump?

This year, it suffered a -24% drop against $BTC.

But here are four catalysts that could lead to ETH finally breaking out: 🧵

Money is actually flowing to Ethereum.

Yet, investors prefer to buy discounted Grayscale ETH, which is up 298% YTD compared to +98% for ETH.

The discount has reduced from -59% to -20% this year, and when it closes down, more money will flow to spot ETH.

BTC spot ETF is around the corner.

When it's live, attention, narrative, and speculation will turn to ETH Spot ETF.

Plus, Grayscale is vying to convert its Ethereum trust into an ETF, further increasing demand for ETH.

Cancun upgrade is coming in H1 2024.

It includes 5 EIPs such as EIP-4844 proto-danksharding to reduce gas fees associated with rollups.

Overall, the upgrade should bring faster transaction processing times, reduced transaction costs, and optimized data management.

Eigenlayer mainnet launch next year will make ETH the most productive asset in crypto.

Expect ~25% APY on ETH without accounting for initial airdr0ps.

• ~5% native staking yield
• ~10% Eigenlayer restaking rewards from AVS
• ~10%+ LRT protocol token emissions

More ↓

https://twitter.com/DefiIgnas/status/1725530139008581778

$ETH had lagged at the start of the previous bull market as well.

DeFi with liquidity yield farming was all the rage, but the tide shifted an ETH pumped by 1820% from $250 to $4800.

It's already showing some signs of reversal.

Catalysts for Ethereum's Pump

Are VCs getting FOMO?

Fundraising amounts have finally picked up, reaching $2.15B in November.

The flow of VC money helps to identify the newest trends.

Here's where all that cash went: 🧵

Wormhole's $225M raise at a $2.5B valuation is the most prominent one.

Then there's @ritualnet - sovereign execution layer to integrate AI into any protocol on any chain for monetization.

@blur_io raised additional $40M to build an Optimistic Rollup L2.

Note that these raises might have been made months ago.

As the market picks up, projects make announcements when it makes more sense for them for maximum effect.

I wrote more about it in my AMA with 4 VCs 👇

https://twitter.com/DefiIgnas/status/1717130990055743655

BTCfi is attracting capital:

- Taproot Wizards raised $7.5M for its Ordinals project to bring the ‘magic’ back to Bitcoin
- @unisat_wallet raised undisclosed amount for Ordinals & BRC20 wallet & marketplace

Expecting more VC money to flow to BTCfi.

https://twitter.com/TaprootWizards/status/1725163116059627761

@privy_io is a cool one, raising $18M.

dApps can now onboard users with email, social profiles to only require a wallet from a user only once it’s needed.

It's user friendly way to onboard a new wave of crypto users who might not even know they are using crypto.


https://twitter.com/privy_io/status/1726967584472576157

@Panoptic_xyz raised $11.5 million in two rounds since Dec 2022 to build oracle-free perpetual options platform on Uniswap.

Panoptic is expected to launch on mainnet in Q1 2024 and Q4 2025 for V2.

Is option trading finally going to pick up?

@NapierProtocol raised $1M for fixed-term asset trading.

Napier splits yield-bearing assets like stETH into principal tokens (PT) and yield tokens (YT).

You can trade yield between PT, YT, and their underlying assets on Napier AMM.

Complicated? Yes. Interesting? Also yes.

http://twitter.com/NapierProtocol/status/1723985187422564381

 Two perp DEXes:

• @IntentX ($2.5M) an OTC DEX leverages LayerZero, account abstraction, and intent based architecture.

• @MYX_Finance ($5M) offers zero slippage through Matching Pool Mechanism to match long and short positions for capital efficiency


https://twitter.com/MYX_Finance/status/1729479613674590224

In general, an active fundraising market is great news.

With new money flowing into the ecosystem, we can expect the launch of innovative protocols that will drive the industry forward.

And some airdr0ps on the way...

VC Funds Flow: Identifying Trends and Noteworthy Raises

Looking to upgrade your wallet?

Check out the new-gen wallet @avowallet that offers new features you won't find elsewhere.

Here's why you'll like it : ↓

Unified Gas Tank:

USDC is the native gas token on Avocado for 11 EVM chains.

Yannis likes it as it gives better control over his gas expenditure and he doesn't need to worry about reimbursing himself for ETH spent on gas.

https://twitter.com/yannisDeFi/status/1704105754901307865

Non-custodial 2FA.

Set up Google, Authy, Email or SMS OTP for your wallet.

Remember Avocado when 2FA becomes standard for most wallets.

https://twitter.com/avowallet/status/1717922127398228018

Automated Revoke approvals.

"Many users could have been saved from losses If it were a default feature in all wallets." - @DeFi_Made_Here

https://twitter.com/DeFi_Made_Here/status/1727655495467491384

One single address for 11+ chains for your multisig wallet.

Perfect for teams, but also great for individuals looking for an easy-to-use multisig solution.

https://twitter.com/Instadapp/status/1696537797916799035

Alex says that "This is truly one of the best DeFi solutions I have come across."

I'm an ambassador for Instadapp, so you'll think I'm biased, but Avocado is really cool 😎

https://twitter.com/wacy_time1/status/1674754757871763457

I invite you to try it out and if you like it, recommend it to your friends.

Earn a 20% commission in USDC for 2 years every time your referrals top up their gas tank.

Just DM @avowallet to get your referral link

https://avocado.instadapp.io/z/OTX20H

Upgrade Your Wallet with Avocado: New-Gen Features

So total cryptocoin market cap just hit $1.5T today.

But have we *earned* it?

1.4B people globally are unbanked.

Even in the US, it's 4.5%.

Study by the Fed itself found that high-income individuals treat crypto as investment, but poorer use for transactions.

60% of those using it for txs earn less than $50,000, and 13% don't have a bank account!

https://twitter.com/VitalikButerin/status/940744820406013954

Venezuela ranks 40th in the Chainalysis Crypto Adoption Index.

Stablecoins are a lifeline against crippling inflation.

Similar to Argentina, stablecoin purchases soar as their national currency plummets - a sign of widespread adoption of crypto.

https://twitter.com/VitalikButerin/status/940745762736132096

It's not just inflation, but crypto is also used to resist the oppressive regimes.

During Covid, crypto was used to direct aid to doctors and nurses in Venezuela without interference from the corrupt regime.

And Ukraine raised $225M in crypto donations this year.

https://twitter.com/VitalikButerin/status/940744893428674560

TVL in DeFi stands at $47B!

DEXes are now challenging CEXes, Maker, Avalanche & others are bringing RWAs onchain.

And censorship-resistant stablecoins like LUSD has $713M USD locked in its smart contracts.

A big win for crypto!

https://twitter.com/VitalikButerin/status/940745607047548928

Uniswap v3 alone has 35k weekly users (@DappRadar data).

And non-speculative decentralized social apps are also growing in adoption.

@farcaster_xyz and @LensProtocol have thousands of daily users and numbers are growing.

We now have real dApps to use.

https://twitter.com/VitalikButerin/status/940745220706017280

The story of crypto for micropayments has faded since 2017, but it still matters.

With L2 solutions and low-gas fee blockchains like Solana gaining popularity, micropayments could soon gain more traction.

Perhaps they'll see more adoption with AI for machine-to-machine txs.

https://twitter.com/VitalikButerin/status/940746178781528064

Five years have passed since Vitalik posted those key questions.

The total crypto market cap has grown by 300% from $0.5T to $1.5T today.

So, are those innovations enough to say that we *earned* it?

I really think we do.

https://twitter.com/VitalikButerin/status/940746391256678400

Getting increasingly bullish on $FTM

In the Modular vs Monolithic era, Solana is currently leading the monolithic category, but Fantom 2.0 Sonic upgrade will put $FTM in the game.

Sonic brings 2k+ TPS and 1.1s finality without sharding or L2s.

Plus, the chart is juicy.

Coming in spring next year, hopefully Sonic isn't too late for the new gen of dApps such as GameFi, SocialFi, as well as trading and high-frequency oracles.

The beauty of monolithic designs is that there's no need for an execution or data layer L2s.

So no annoying bridging.

The Fantom ecosystem was wiped out during the bear market, and as a result of the Multichain fiasco.

But like Solana ecosystem, new dApps will surface from the ashes.

Rebuilding brings opportunities, as user attention and $$$ will be concentrated on a select few dApps.

https://twitter.com/crypthoem/status/1723328774081593659

Bullish on $FTM's Sonic Upgrade

The bull run will get crazier than we expect. Are you ready?

In this blog post, I cover:

• Is this the start of a bull run?
• Setting the right mindset to prepare for what's coming.
• My top narratives to follow.

Check it out here👇 https://www.ignasdefi.com/p/navigating-the-crazy-bull-market

Did you know this week's blog sponsor @PancakeSwap launched the position manager?

• Auto-compound LP rewards with zero gas fees
• Automated, optimal-range LP management to stay in the liquidity range
• Integration with leading protocols for diverse strategies

Navigating the Crazy Bull Market

Why is Vitalik Buterin more active on Farcaster than Twitter?

And is DeSoc the new meta in crypto? Vitalik hopes it is.

Check out my latest blog post where I cover the vision and share my personal experience using decentralized social networks.

https://www.ignasdefi.com/p/decentralized-social-media-vision

Ready to launch your own stablecoin?

Check out this week's blog sponsor: @reserveprotocol.

With Reserve Protocol, you can create your decentralized stablecoin, flatcoin, or tokenized index RToken.

It's live on Base L2 for fast speeds and near-zero gas fees.

Decentralized Social Media

What's @VitalikButerin's biggest concern for Ethereum? What keeps him motivated?

And what's next non-speculative meta in crypto that he sees?

There was an AMA with Vitalik on @farcaster_xyz and 99% of CT missed it.

Here are the best questions & answers from his AMA: 🧵

Q: What's your biggest concern for Ethereum's future?

Vitalik: The risk of crypto stagnation, loss of privacy and open internet infrastructure, and the big techno-political questions being decided by AI without proper incentives from big actors.

(Full answer in screenshot)

Q: What keeps you motivated?

Vitalik: The knowledge that our community and the technology that it's building is in a very unique position to do something really valuable in an increasingly complicated world and that a positive outcome here is not automatic...

Q: What book helped you most understand how western culture ended up here?

Vitalik: I feel like books are overrated for this and real-world experience with cultures is more underrated. I don't just mean going to and living in different places, I also even mean...

Q: What are some non tech related hobbies of yours?

Vitalik: "The past week I was poking into Toki Pona, we'll see what it is next week :D"

On L1 complexity:

Vitalik: There's a counter-movement toward more standardization across L2s, including:

* Account abstraction (ERC 4337)
* The L2 EVM effort
* Standardizing the cross-domain wallet experience, including recovery
* Possible L1-enshrined ZK-EVM

On his favorite places:

Vitalik: I've definitely become less of a "city person" lately, but cities he likes staying in:

* Singapore
* Taipei
* Vienna
* Toronto
* Ithaca, NY

On prediction markets:

Vitalik: "They're slowly getting there! Polymarket has been making quite a bit of progress lately, it seems to have a better combination of business development talent and crypto talent than any of the previous attempts."

Q: what do you think about most of the time?

Vitalik: "For the last week or two, thinking through what my opinions on the various AI-related issues are (including x-risk etc) and how/if the ethereum community could productively engage on them."

Q: What's on his reading list?

Vitalik: Outlive: The Science and Art of Longevity

Book by Bill Gifford and Peter Attia

On climate change:

Vitalik: Anything that might do something like this to the world is really worth worrying about. 2x cut in GDP to the world's already-poorest countries is awful, not to mention more direct human consequences...

On Marc Andreessen's Techno-Optimist Manifesto:

Vitalik: I see crypto as being in part about being the sector of tech that tries to think not just about consumer utility, but [...[preserving freedom and openness and ability for regular people around the world...

Q: What do you think is the next meta that’s *not* 51%+ speculation related?

Vitalik: I do hope that Farcaster and Lens and co become as big as Meta one day.

Note: I'm actually writing a blog post about Farcaster and Lens so make sure to subscribe!

Vitalik Buterin on Ethereum's Concerns and Motivation

What do crypto VCs know that you don't?

I asked industry insiders:
• @0xsachi from Polygon Ventures
• @EtienneTRGC from TRGC
• @Jaimin_Building, who just raised money
• Mr. Anon

And what's their lesson for retail investors?

Find out in my blog👇 https://www.ignasdefi.com/p/what-do-crypto-vcs-know-that-you

Wanna launch your own stablecoin?

So check out @reserveprotocol, this week's blog sponsor.

With Reserve Protocol, you can create your own decentralized stablecoin, flatcoin or tokenized index RToken.

It's now live on Base L2 with fast speeds and near-zero gas fees.