Crypto market hot spots in November: excellent projects and catalysts worth paying attention to

With the breakout on the chart, there is a glimmer of hope that many market participants (especially on Twitter) have overcome the mental depression caused by the long period of volatility and poor price action. With indicators such as the total stablecoin market capitalization bottoming out and TVL continuing to grow across the board, there has been a significant increase in activity. This means that teams that want to take advantage of this momentum will have a lot of updates in the works.

1. Bitcoin ETF

Since we reported this story a week ago, no further details on the matter have been released. This topic seems to be widely reported, but most of the time news outlets just want to capitalize on the narrative without providing fresh, valuable information. While we wait for further developments, let’s take a look at Galaxy Digital Research’s estimates of inflows following the listing of a spot Bitcoin ETF.

What is the inflow we can expect?

This is a difficult question to answer with absolute certainty, so we can only make an assumption: We expect inflows of approximately $79 billion over three years.

Bitcoin spot ETF market size and inflows (by year)

How will this affect the price of Bitcoin?

Increased buying pressure is clearly beneficial in offsetting third-party (e.g. US government)/miner selling. Similar to the gold market, and taking into account potential estimated inflows, Galaxy Digital calculates that 74.1% of the price impact could occur within the first year.

2. Frax

With a slew of already released products and more interesting developments on the horizon, Frax is definitely one to keep an eye on.

sFRAX

sFRAX has successfully created a yield mechanism for FRAX holders using real world assets (RWA), providing depositors with competitive returns while achieving comfortable growth.

sFrax Supply Growth

sFrax APY% Change

frxETH v2

The much-anticipated frxETH new mechanism upgrade is coming soon. Frax caters to validators and decentralization instead of just chasing returns, aiming to bring innovation to the booming LSD industry.

Borrow validators instead of ETH

To increase decentralization, the nodes themselves act as borrowers and lenders act as validators. The collateral deposited by the node operators is put into existing validators.

Low collateral requirements

The cost of borrowing a validator may be as low as 4 ETH or any other collateral option, the configuration of which is determined by governance participants.

Floating Rate

Validators will receive a floating fee that is set by the market rather than the protocol operator.

Unused asset utilization

Any Ethereum not actively used as a validator is sent directly to Curve to mint LP tokens for deeper liquidity and additional income.

Solving the centralization problem while providing good yields will definitely give a competitive advantage to competitors.

Fraxchain

The upcoming L2 rollup, the central hub of the Frax ecosystem, is said to be launched by the end of this year.

3. Rollbit

Well-known DeFi cash cow Rollbit has reappeared on this Substack, and something interesting is going to happen this month.

Rollbit Duel Arena

Launched on Twitter by the Rollbit co-founder, Duel Arena is said to be a 0% edge PvP game inspired by RuneScape's infamous Sand Casino, which promoted insane bets at the time.

The core component of this new feature is a negotiation phase, which takes place before a match and allows duelists to propose their bet conditions. Additional returns through NFT staking are also promised, but the specifics remain subject to speculation.

To benefit RLB holders, the gambling platform operator uses a significant portion of its revenue to buy back tokens from the open market and continues to destroy them:

• 30% of futures income;

• 20% of sports betting revenue;

• 10% of casino revenue;

As of now, 37.87% of the total token supply has been destroyed.

4. Swell Network

Swell is a liquidity staking provider that operates the native ETH LST "swETH", whose TVL is approaching 50,000 ETH ($95 million). SwETH holders can obtain competitive staking returns as well as "pearls", which can be converted into the native SWELL token released early next year.

Swell recently launched the "Super swETH" vault, which allows users to stake their stETH (from Lido) and receive swETH in the vault in return. The goal is to increase the supply of swETH while diversifying the ETH liquid staking landscape and further decentralizing the Ethereum network. The vault will be valid for 180 days and receive increased pearls as well as all DAO income throughout the period. As can be seen in the figure, the current yield is 59%.

5. dYdX v4

Moving to full decentralization in the v4 update, the platform will fundamentally change in every imaginable way. Rather than relying on L2 rollups to host its exchange, the team decided to leverage the power of Cosmos to create its own independent application chain. With this version, dYdX puts the community in the driver’s seat when it comes to future decisions involving the protocol.

What does this update mean for users?

There are many benefits for people trading on the platform. Gas fees have been completely eliminated, and traders only need to pay transaction-related fees. In addition, the dYdX chain can process up to 2,000 transactions per second (a 200x improvement over v3), greatly improving the efficiency of transaction execution. DYDX token holders can now stake their tokens to receive a portion of the revenue generated by fees.

How much can we earn from staking?

While there are no exact numbers, we can make educated guesses using the information currently available.

First we need to calculate the possible staking ratio. We can estimate this by averaging the staking ratios of similar protocols such as SNX, GMX, and GNS. Using this method, we get an estimated staking ratio of 68.33%. The total value staked using this ratio is approximately $271.22 million. Next we need to consider the annual fees generated by the exchange. As of now, according to the token terminal, the annualized fees are $77.4 million. Using these values, we can calculate an estimate of approximately 28.54%, assuming that all fees are distributed to stakers.

Since its inception, dYdX has repeatedly proven that in the perpetual trading space, they are forced to be taken seriously by maintaining their dominance as an industry leader.

6. Redacted Cartel

In early October, the folks at Redacted Cartel deployed Pirex ETH (pxETH) — a liquid and tokenized ETH for staking ETH on the Ethereum Goerli testnet. This marked a big step towards the phased rollout of Dinero. Redacted Cartel’s take on LSD lets users decide whether to just hold pxETH or deposit into the auto-compounding rewards treasury to earn apxETH. The proceeds generated from Dinero revenue will then flow into the rewards treasury. The next key element after pxETH will be the DINERO stablecoin and custom RPCs for users.

7. Synthetix

Non-custodial derivatives exchange Synthetix has recently begun working on overcoming the shortcomings of decentralized exchanges to bridge the huge trading volume gap between DEXs and CEXs, thereby increasing DeFi adoption.

Infinex

Their solution? Infinex. By simplifying the cumbersome process of bridging assets to a more scalable and efficient L2, introducing one-click trading, and eliminating the need to sign every action you make on the platform, Infinex aims to bring many of the conveniences of traditional centralized exchanges to the blockchain while reducing the dreaded counterparty risk (e.g. bankruptcy, sensitive data leaks). The protocol will be hosted on Optimism, and the launch date has not yet been determined, but a waiting list is currently open on its website.

This approach is definitely a net positive for all of DeFi, as attracting new users with little or no experience has always been a challenge for developers trying to grow their user base.

Synthetix has been enjoying a lot of volume all year as it remains a major player in the market. If their Infinex theory is confirmed, the expected rise in volume should be reflected on the activity chart.

8.Arbitrum Grant Winners

Following the recently concluded Arbitrum Foundation Grants Program, we’ve learned that household names like GMX, Pendle, and Frax successfully passed community quorum voting and received sizable grants respectively. How many tokens did they receive exactly? And what do they plan to do with the ARB tokens?

GMX

With an initial request of 14 million tokens, later changed to 12 million, GMX is by far the largest grant recipient in terms of value. The intended use case for their funding is to stimulate on-chain activity on Arbitrum by increasing adoption and activity on the V2 protocol. Most, if not all, of the tokens received will be used to create a variety of highly liquid and capital-efficient perpetual and spot pools.

Breakdown of proposed grant uses:

50% (6 million ARB) - Trader incentives;

50% (6 million ARB) - Liquidity incentives;

Pendle

The 2 million tokens Pendle receives from the Arbitrum Foundation will be used to increase yield trading volume, deepen liquidity in existing pools, and provide token incentives for users to bootstrap liquidity on newly listed Pendle markets.

Proposed breakdown of grant use:

55% (1.1 million ARB) — Liquidity incentives;

40% (800,000 ARB) - Trader incentives;

5% (100,000 ARB) — integration incentives;

Frax

Frax, which requested the lowest of the three projects at 1.5 million tokens, applied for the grant, which is intended to incentivize the protocol’s broad Ethereum mainnet user base to try out Arbitrum’s growing DeFi ecosystem.

Proposed breakdown of grant use:

100% (1.5 million ARB) — user/liquidity incentives;

9. Radiant Ethereum Mainnet Launch

Initially, Radiant was scheduled to launch on October 3rd. However, they decided to postpone the deployment until the 15th in order to optimize Gas costs and improve the user experience on the platform. Unfortunately, this delay was followed by another one. As of a few hours ago (November 1st), the Ethereum mainnet expansion was officially completed, integrating multiple loanable assets such as wstETH, sDAI, rETH, etc. Radiant is another protocol that has been confirmed to receive a large amount of ARB funding this month