Last month has witnessed groundbreaking strides in Ethereum's network evolution, promising announcements in the modular ecosystem, and exciting new features in popular crypto wallets.
The new Ethereum testnet Holesky was successfully launched in an effort to test and prepare the network for scalability improvements. The new network will end up replacing the Goerli network and will see a larger set of validators operate the network to catch any possible scaling issues. Two of the predominant Layer 2 scaling solutions, namely Arbitrum and StarkWare, also released important software this month. Offchain Labs, the development company behind Arbitrum, announced Arbitrum Stylus, which will allow applications to be built on their rollup with a broader selection of programming languages, opening up the network to a much broader group of developers. Additionally, StarkWare released the open-source code for their Stone Prover, another step in decentralizing their scaling solution.
This month Celestia announced their Genesis drop, which rewarded core developers for Ethereum, Cosmos and notable rollup ecosystems. Additionally, allocations were committed to early builders of the modular ecosystem, by rewarding projects that were part of the Modular Summit which we co-hosted twice. This modular ecosystem continues its steady growth; anticipated scalability solution Eclipse announced their network architecture, having committed to using Celestia for their data availability needs and using portfolio company RiscZero for ZK fraud proofs. Similarly, Pocket Network announced it will be deploying their decentralized RPC protocol upgrade as a sovereign rollup on Celestia.
The month of September was off to a slow start with the industry seeing over 330 million USD in exploits from different centralized companies. The majority of funds were lost through Mixin, while Asian-based centralized exchanges were also impacted. One of the most highly anticipated events of this year are the possible approvals of a Bitcoin and Ethereum spot ETF. This month saw nine futures-based ETH ETFs launched, among which were ProShares, VanEck’s, and Valkyrie’s. The market remains in anticipation of the potential approval of spot ETH and BTC ETF approvals.
The Bank for International Settlements and the central banks of France, Singapore and Switzerland have all successfully been testing their cross-border wholesale CBDCs. This project included trading and settlement of ‘hypothetical’ Euro, Singaporese dollar, and Swiss Franc. At the same time, the industry continues to face regulatory headwinds with regulators targeting crypto exchange Bybit in France and the UK. Similarly, the CFTC has singled out three DeFi protocols for non-compliance, claiming that these have failed to register with them.
Visa announced that it would trial the settlement of USDC payments on Solana. The payment giant has previously worked on using Ethereum to settle payments and plug-in credit cards, but has now expanded this to include Solana. The traditional payment company has remained at the forefront of developments in the digital asset space, seeing opportunity in the technology to improve the speed and ease of cross-border settlements. Additionally, Google Cloud oracle has partnered with cross-chain messaging protocol LayerZero. With this partnership Google Cloud will become the default oracle provider for LayerZero, meaning that Google will now be the default verifier of messages for LayerZero apps.
MetaMask officially launched Snaps, which will allow users to add third-party functionality to their wallets. One of the highly anticipated features that has been released as a Snap is the ability to make the wallet usable with non-EVM blockchain such as Cosmos and Solana. With MetaMask still being the predominant crypto wallet, a widespread assumption is that the growth of non-EVM networks can be boosted significantly if MetaMask users can easily be onboarded into these ecosystems.
Krafton, the Korean video game giant behind the immensely popular game PUBG Battlegrounds is now entering the Web3 space by announcing the launch of a new Cosmos chain called Settlus. This purpose-built blockchain is built in collaboration with Circle and is aimed at providing a transparent settlement system, particularly focused on USDC payments, for the gaming and creator economy. The network is supposed to launch its first testnet early 2024, underlining the opportunity that decentralized crypto payment infrastructure holds for these industries.
Portfolio company NFTPerp relaunched a v2 version of their NFT trading protocol, a hybrid protocol which combines an AMM with a decentralized limit order book. The launch is accompanied by a trading competition; their last trading competition for the v1 version saw the protocol do almost 500 million USD in trading volumes. Finally, Chainflip concluded their token sale on CoinList, having raised an additional 4.3 million USD, which further strengthens their financial situation. The protocol is now gearing up for their impending mainnet launch.