Ecosystem Update January 24

Dear investors,

We're excited to present our January 2024 Ecosystem Update. This comprehensive report delves into key industry trends, achievements within the Advanced Blockchain ecosystem, and recent organizational progress, offering a complete view of both our journey and the broader industry.

Macro Industry View

January 2024 highlights a major landmark in the blockchain industry due to the final approval of the SEC to the spot Bitcoin ETF. The approval comes after several delays of numerous applications from prominent asset managers, including Grayscale, Fidelity, WisdomTree and Blackrock, among others. The approval is a crucial step in establishing the regulations long sought for the broader acceptance of cryptocurrency investments.

The interest in the ETFs has seen a steady increase following their approval, with total inflows hitting $5.9 billion since they were first introduced. Bitcoin price surged to new 52-week highs, approaching $49,000, on the approval day of the spot Bitcoin ETFs. Despite significant outflows from Grayscale Bitcoin Trust (GBTC), net inflows have reached $807 million which is positive for the overall market. 

Blackrock iShared Bitcoin ETF (IBIT) has become in the lead to achieve +$2 billion in assets under management (AUM). Coming second is Fidelity Wise Origin Bitcoin Fund (FBTC), which is projected to cross the $2 billion mark in the next weeks.  

With the approval of the Bitcoin ETF, numerous Ethereum investors are optimistic that this development might lead to the SEC's approval of the first spot Ethereum ETF. Nevertheless, on January 25, the SEC postponed its decision on the proposed spot Ethereum ETF applications from Blackrock and Grayscale. The SEC has until at least late 2025 to make a decision on the approval of the spot Ethereum ETF.

As we enter February, the narrative in the crypto market is expected to remain dominated by spot Bitcoin ETFs, along with the anticipation of Bitcoin's halving event in April 2024.

Speculation based on a recent market study involving nearly 10,000 cryptocurrency investors, suggest that the fourth upcoming Bitcoin halving could drive Bitcoin price to a new all-time high. However, it's important to note the inherent volatility of the crypto market, which often makes accurate predictions difficult.

Ecosystem Key Updates

Summary

• Composable's Ethereum IBC testnet bridge approaches $100 million in transaction volume since its Q4 2023 launch.
• Neon secured partnerships with MYSO, Meridian Finance, and Liteflow, enabling these blockchains to utilize Neon's EVM parallel processing architecture on Solana network.
• Peaq's integration with Wormhole boosts interoperability and liquidity across 30+ blockchains like Ethereum, BNB Chain, and Solana, complemented by key partnerships with AYDO AI and Staex as January 2024 concludes.
• MYSO protocol's Total Value Locked (TVL) approaches $2 million organically
• Panoptic successfully wraps up Epoch 4 trading competition, setting the stage for Epoch 5 of its Beta launch
• Polymer collaborates with EigenLayer to enhance Ethereum network interoperability and scalability

Composable 

Composable has announced the introduction of Liquid Staked DOT (LsDOT), which aims to offer the users not only staking rewards but also liquidity within the wider Polkadot ecosystem. Users can now stake their DOT tokens on the Trustless wallet. 

As Composable’s lease of Polkadot’s 8th parachain auction ended on the 16th of January, all DOT contributions of all supporters have been unlocked and returned to the community with an exciting announcement regarding the Token Generation Event (TGE) of the LAYR token which is anticipated to happen in HY1 2024. 

Furthermore, transaction volume on Composable's Ethereum IBC testnet bridge has been steadily increasing, nearing the $100 million mark since its initial deployment in the fourth quarter of 2023.

Neon EVM

Neon closed a partnership with MYSO, one of our portfolio companies, allowing MYSO to leverage the technical advantages of Neon’s EVM parallel processing architecture. 

Additional collaborations have been revealed, featuring partnerships with Meridian Finance and Liteflow, which will allow both protocols to utilize Neon's EVM infrastructure on the Solana network.

peaq

A recent Cointelegraph article  featured Peaq Network, focusing on its role and the prospective future of DePINs in 2024 and beyond. According to Messario.io, the current market valuation of DePIN is close to $2.2 trillion, and it is on a path that could potentially lead to an increase up to $3.5 trillion within the coming four years.

peaq made an integration with Wormhole, a leading interoperability protocol, to unlock liquidity of more than 30+ blockchains, including Ethereum, BNB Chain and Solana, among other networks. 

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As January 2024 nears its end, the ecosystem keeps expanding, marked by the recent announcement of major partnerships with AYDO AI and Staex.

MYSO

MYSO protocol has recorded impressive growth, with the Total Value Locked (TVL) nearing $2 million organically, according to DefiLlama.

Several protocols have been integrated on MYSO Finance, including f(X) Protocol, Threshold Network, Evmos as well as Neon EVM.

Panoptic

Panoptic concluded its Epoch 4 trading competition paving the way for the launch of Epoch 5 of its Beta launch. Key highlights of Epoch 5 include:

• launching on on Optimism, a fast and stable Ethereum Layer 2 blockchain 
• Partnership with Threshold Network, a decentralized threshold cryptography network that connects Bitcoin to DeFi with tBTC, to introduce Bitcoin options on Base.

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Discover more information about Epoch 5 in this dedicated blog. 

Permanent Ventures

Permanent Ventures Fund performance has been developing quite well with the token launch of KYVE, among other investments. Not only KYVE has exhibited positive growth; other investments such as Meson, Gateway.fm, Verto, MetaPrime, and Bundlr have also demonstrated remarkable progress.

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Polymer Labs

Polymer has partners with EigenLayer to achieve interoperability and scalability for the Ethereum network and its Layer 2 chains. EigenLayer is a protocol built on Ethereum that enhances network security and introduces restaking.

Moreover, Polymer’s multi-hop specification merged recently to the IBC repository specification which enables the Inter-Blockchain Communication (IBC) protocol to expand to all other existing ecosystems and scale further. The multi-hop upgrade simplifies the way IBC channels communicate by significantly reducing the total number of connections required.

Lastly, Polymer Labs has concluded its raise of $23M in Series A funding which started almost one year ago. Investors included Maven 11, Distributed Global, Coinbase Ventures, Figment Capital, among other investors.

ABAG Update

The beginning of 2024 has been characterized by positive developments, culminating in a few transactions that have advanced us towards our revenue goals.

Our team has had a constructive workshop to shape the company's strategy and set goals for 2024 and beyond. The workshop emphasized a central focus on generating recurring revenues, executing OTC transactions, along with further capital investment in promising projects and exploring partnerships with local partners in emerging crypto markets. 

Additionally, our team is working closely with AVS-Valuation GmbH to provide an update on the valuation of our top 10 holdings for the second half of 2023. This update is anticipated to be announced concurrently with the release of the preliminary figures for the year 2023, if not sooner.

Simon Telian and Sebastian Markowsky had the privilege of discussing their perspective on the evolving market dynamics in an interview featured in Going Public magazine. Beyond their view on the dynamic market changes, in 2024 we are excited about topics, such as: 

• Decentralized Physical Infrastructure Networks (DePINs)
• Real-world asset tokenization
• The synergy between AI and blockchain
• Emerging data marketplaces and decentralized storage solutions
• Enhancing blockchain interoperability
• Development of modular blockchain systems

Our team expresses our heartfelt gratitude for your ongoing support and wishes everyone an exciting journey into the new year.

Thank you for being a part of our journey.

Best regards,

Advanced Blockchain Team

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