It Was All a Twitter Botnet? - Always Has Been
Resurgence in On-Chain ETH Activity? Coinbase NFT Marketplace Dud
Theo Delarosa
February 02, 2023
Daily Bullets - Thursday, February 2nd
The Fed delivered the expected 25 bps rate hike and once again reiterated their hawkish mission to bring inflation down to their target of 2%. The catch? The market doesn’t believe they’ll stick to what they say and will soon pivot! It’s one big game of chicken. The Fed vs the market. On the ground we can see that many alts and risk assets are soaring. What a time to be alive! Today we’re looking at:
- Crypto Twitter Botnet Fraud
- Resurgence in On-Chain ETH Activity?
- Coinbase NFT Marketplace Dud
It Was All a Twitter Botnet? - Always has been
The rundown: An organized ring of influencers and founders drained $200M+ from over 274 projects. A crazy 158 document dives in and exposes an expansive Twitter botnet and cabal of conspirators that worked in conjunction with a network of influencers and alpha groups to sell out projects and squeeze retail for all they’re worth.
Thanks for participating everyone - Little Shapes was a social experiment by @BALLZNFT_
The exposé was real though. Here’s how a ring of influencers and founders drained $200,000,000+ out of the ecosystem over 274 projects:
gold-cal-45.tiiny.site
(158 Pages)— Little Shapes NFT (Ballz Venture 1) (@LittleShapesNFT)
Feb 1, 2023
Analysis: This is not surprising in the least. Shady business practices are commonplace within the crypto space which is inherently full of speculation, hype and narrative. People see a project that is pulling in crazy numbers and “seemingly” getting lots of attention and feel the need to FOMO in. No one wants to miss the next big hit when projects are routinely doing crazy multiples. Never think for a second that it isn’t in someone’s interest out there to mislead you. To shift and paint the arena to give themselves a competitive edge. Fake wash trading volume, painting charts, bots, fake accounts, shills, lies and direct fraud. Whatever it takes to profit from you. Crypto is an attention economy and commanding attention (even if fake) commands power. Stay safe out there and approach everything with a critical eye.
Resurgence in On-Chain ETH Activity?
Key details: Ethereum's total circulating supply reached a post-Merge low of approximately 120.5M tokens.
Analysis: Could this be due to a resurgence in on-chain activity? One perspective as to why ETH has shifted towards being deflationary is that due to the rising market, there is an increased demand for the network and a wave of new transactions, causing the average ETH burned from each transaction to rise, further reducing supply. Is that what’s going on though?
- Transactions don’t appear to be moving up in any meaningful way. We got a bounce in January but overall still consistent with a downtrend.
- Neither are active addresses. We’re not getting a wave of new users.
- On-chain volume also doesn’t look like anything to write home about. We saw an uptick in January but we’re still moving in a downtrend
Conclusion: Unclear what’s contributing to the decreased circulating supply but it doesn’t seem to be a resurgence in on-chain activity, at least yet. Overall, less tokens circulating is good for the price.
Coinbase NFT Marketplace Dud
Key details: Coinbase NFT is pausing creator drops to focus on other features and tools that creators have asked for but claims the marketplace is not shutting down and remains optimistic about its future.
Analysis: So far, it ain’t looking too hot for Coinbase NFT. Since launching in May 2022, the total transaction all time volume is only $7.34M. That is literally nothing.. A hyped ETH NFT project can do that type of volume in one day. What’s worse is that it’s rumored that the head of its product was paid hundreds of millions to develop it. Clearly in the minds of the higher ups, they expected the bull market to continue and the endeavor to be financially successful, which is why they were willing to pay someone so much to build it. Many speculated that retail NFT mania would take off. Unfortunately it didn’t really. Can Coinbase ever recover? Despite being one of the most accessible platforms for retail, the actual volume and market share that we’ve seen captured has been by marketplaces such as OpenSea and Blur which appeal to a more crypto native audience. On the other hand, Coinbase NFT still stands a chance at capturing retail interest if and when it returns.
Daily Bullets
- BonqDAO and AllianceBlock exploited for $120M. An oracle hack allowed the exploiter to manipulate the price of the AllianceBlock token
- NFL reveals first Super Bowl 'Metaverse' concert in Roblox
- Amazon Web Services is hiring staff to help increase its clientele in the Web3 space
- Berkshire Hathaway vice chairman Charlie Munger has called for the United States to follow in the footsteps of China and ban cryptocurrencies
- South Korean authorities have arrested the former chairman of crypto exchange Bithumb, on charges of embezzlement and market manipulation
- DeFi protocol bridge Stargate proposed to reissue all STG tokens to eliminate the risk of illegitimate STG transfers from compromised Alamada wallets
- The Optimism Foundation has proposed the first protocol upgrade to the Optimism Collective: Bedrock on Mar. 16 to boost performance and functionality
- Axie Infinity partnered with the crypto lender MetaLend to allow players to borrow up to 30% against their digital assets, as well as stake their assets for a reward
- Wormhole Bridge launches on Acala EVM+, bringing cross-chain assets and xApps to the Polkadot ecosystem
- Cool Cats NFT project going multi-chain and adding customizable NFTs
- MetaMask introduces new privacy features
- Chainalysis is laying off about 44 of its 900 employees, 4.8% of its workforce
- U.S. television network TNT will air a ‘watch-to-earn’ quiz during ‘Inside the NBA’ powered by ImmutableX
Market Movers
- Gainers: Optimism came out with positive news related to its Bedrock upgrade to boost performance and functionality. Stargate also up on news they plan to reissue tokens to address tokens held by Alameda in compromised wallets. Big post FOMC pump.
- Losers: Market is looking pretty good! Most of the losers of the day are stablecoins. Risk in the market is hungry for alts.
Research/Reads
- Ethereum's Shanghai fork is coming but it doesn't mean investors should dump ETH - source
- Withdraw and sell ETH as quickly as possible? This scenario is improbable
- The Creator Economy In Gaming - source
- Looks at the potential of gaming to scale to a billion users
- a16z - Consensus canon - source
- List of resources for those looking to understand and build with consensus protocols
- Video Game Economies - source
- Video game economies explored for their applications in economics, finance
- Tokenizing & Securitizing Real World Assets on Public Blockchains - source
- How tokenized securities offer lower costs, increased liquidity, and more transparency
- Where Did All the Terra Developers Go? - source
- Finding new homes but many left crypto
- RAI – one of the coolest experiments in crypto - source
- Explains the concept of RAI, a decentralized stablecoin
- ETH 2.0 Hot Concept: SSV.Network Eco Inventory Decentralized Staking Infrastructure - source
- Aims to consolidate the DVT as the key Ethereum infrastructure
- The State of Crypto and Sport - source
- Possible scenarios for web3 to revolutionize this category
- zkSync - source
- One of the most awaited L2 ZK-Rollup blockchain
- The Next Frontier in Crypto Economic Business Models - source
- The critical catalysts for the next wave of experimentation and disruption
- LayerZero from First Principles - source
- CEO addresses misconceptions
Bonus
Canto price, volume and NFT activity has been going crazy but there’s still not a ton of data out there. Here’s a good thread covering various metrics to bring you up to speed:
1) #Canto, a free public infra layer-1 blockchain built to deliver on the promise of defi, driven by a group of chain-native builders have attracted notable activities recently. Let's take a look at its protocol metrics and unwrap some possible insights.
app.hex.tech/568457d0-cdce-…
— Minion ⌐◨-◨ (GM, JoSun) (@0xminion)
Feb 1, 2023
We hope you find this issue engaging and enlightening. As always, we welcome your feedback and suggestions for future issues.