We are experiencing a dreamlike year 2024 when Bitcoin ETF Spot was finally approved by the SEC, along with the green color of the market. In the context of the current situation, we are seeing that the market is too dependent on ETFs without any truly outstanding trends. In this article, let’s take a look at 3 trends to pay attention to in the early stages of 2024.
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Cautiously & Calmly Optimistic
There are some notes that users need to clearly see the current market context because it will be very difficult for the same trend to occur, it is very difficult to explode strongly or, most optimistically, to explode over a period of time. short in a bear market or sharp correction. Let’s look back at the current market situation:
- The biggest driving force helping the entire Crypto market grow strongly in recent times is the acceptance of Bitcoin ETF Spot. Up to now, it has been officially accepted and it seems that the Crypto market has not gained any new momentum.
- We have experienced 4 consecutive green monthly candles and we are in January 2024 which is still continuing to be a green candle. Obviously, we have not had any strong correction months yet. (Or maybe we are really in an Uptrend but our psychological state is doubtful and skeptical).
Therefore, remember that when Bitcoin drops, it causes most of the Crypto market to also go down and no matter how strong and potential the trend is, it is very difficult to go against the wave.
Looking back at the past 2023 in the context of the market recovering and especially in the period of slight decline – moving sideways like the middle of the year, the trends, although potential, exploded very small, in a short period of time, even There are trends that, although highly appreciated, could not happen.
In the article below, I will go directly into 3 trends that need attention in the early stages of 2024, each trend I will present based on arguments such as:
- Growth driving force & Reasons why it is considered a growth driving force.
- Predicted time to take place.
- Potential projects in that trend.
- What we need to do at the present time.
3 Trends to Pay Attention to in the Early Stage of 2024
EigenLayer creates Liquid Restaking & Liquid Native Restaking
Up to now, although EigenLayer has not been mainnet yet, it has attracted a large number of users with a huge asset stream, with more than $1B TVL and it must be reiterated that EigenLayer is not yet mainnet, all assets in EigenLayer are not yet available. generate profit. The money flowing into EigenLayer is currently based on two main user thoughts:
- 90% of users who put their LSTs into the protocol to earn EigenLayer Points will definitely have a chance to receive Airdrops in the future.
- The remaining 10% of users hope that the APY when EigenLayer officially operates will be high, thereby optimizing profits from their own ETH.
Growth motivation will come from the second idea. Currently, users will stake ETH on LSD protocols to receive an APR of about 5 – 7% and if EigenLayer’s profits are about 10% (which is being predicted), it will certainly create a wave of financial deposits. produce in EigenLayer to earn maximum profit from idle ETH. EigenLayer itself has also proven its reputation in terms of development team, operating model, investment fund, famous KOLs in the industry mentioned,…
Then the cash flow will flow in the following direction:
- LSD platforms that produce LST Tokens accepted by EigenLayer will benefit first. Up to now we have seen LDO break ATH but opportunities in other LSD protocols still exist. LSD’s explosion leads to LSDfi’s direct benefit, but it will not be much because the money flow will flow directly to EigenLayer instead of LSDfi’s CDP, Index, Yield Strageties,… protocols. However, it is still possible.
- The next two segments receiving that cash flow are Liquid Restaking & Liquid Native Restaking. These are 2 solutions for EigenLayer in the context of user liquidity locked in the platform. Liquid Restaking & Liquid Native Restaking will allow users to earn additional profits in DeFi using LRT Tokens in addition to receiving profits from ETH staking on LSD and from EigenLayer.
Here we need to look for potential projects in the LSD, Liquid Restaking & Liquid Native Restaking fields. If LSD is too familiar and does not need to be mentioned again, Liquid Restaking & Liquid Native Restaking are still quite new. Some outstanding projects include:
- Liquid Restaking: Kelp DAO, Renzo Finance, Astrid, Yield Nest, Retake Finance DAO, InceptionLRT, Genesis, Supermeta Restaking, Rio Network, Swell, Origin Protocol, Layerless, Restaking Cloud,…
- Liquid Native Restaking: Puffer Finance, Ether.fi.
So where are our opportunities? In my opinion, currently most of the projects in the Liquid Restaking & Liquid Native Restaking segment have not yet launched Tokens, so if investment opportunities in Tokens will mainly lie in projects in the LSD and LSDfi segments. As for Liquid Restaking & Liquid Native Restaking projects, there are some opportunities as follows:
- Put your LST Token into EigenLayer to receive EigenLayer Points to earn Airdrops in the future.
- Put your ETH or LST Token into Liquid Restaking & Liquid Native Restaking projects to have a chance to receive Airdrop of direct projects & EigenLayer. However, only a few projects share EigenLayer Point with their users.
However, bringing assets into the Liquid Restaking & Liquid Native Restaking protocols is still very risky because most of the projects are newly born. The first option is the safest, the second option is riskier but more profitable. People need to analyze the project carefully before putting money into the protocol.
Decun Upgrade & Huge Momentum for Layer 2 Platforms
Dencun Upgrade is considered the most important update in 2024 for Layer 2 solutions as it helps transaction fees on Layer 2 platforms decrease by 10 – 100 times. Simply imagine, if the fee on Arbitrum is currently about $0.3, then after Dencun Upgrade, it can drop to $0.03, even in the best scenario of $0.003, a number similar to leading Layer 1 platforms such as BNB Chain, Avalanche,… This factor will promote Layer 2 to develop even more strongly.
We already have so many signs that Layer 2 will become a huge trend in the future:
- Many DApps, Protocols, even Layer 1, are redirected to become Layer 2 such as Celo, Frax Finance, Polygon, Aevo, Manta Network,…
- A series of Layer 2 projects are preparing to launch Native Tokens such as Starknet (STRK), zkSync (ZKS), Manta Network (MANTA),…
The motivation is so clear that our next task is to arrange Layer 2 according to different Tiers (for reference) to forecast cash flow such as:
- Tier 1: Arbitrum, Optimism, zkSync, Starknet,…
- Tier 2: Mantle Network, Polygon, opBNB, Scroll, Taiko,…
- Tier 3: Boba Network, Metis, Celo, Frax Finance,…
Next we will consider the investment aspect:
- The safest is still Airdrop/Retroactive, although the opportunity has gradually closed with Layer 2 platforms, there are still many of them such as Scroll, Taiko, Aevo, zkSync,…
- Next is direct investment in Native Tokens of projects such as Arbitrum (ARB), Optimism (OP), Starknet (STRK),… Direct investment in Native Tokens of projects will also be coming soon. ranked in order from safe to risky like the Tier I put above, the lower the Tier, the riskier the investment.
- Next is investing in the ecosystem. The ecosystem will be divided into two types including oil pipeline projects and smaller projects. For example, GMX leads Perp DEX or MAGIC leads GameFi on Arbitrum, some smaller Perp DEX projects such as Gains Network, Rage Trade, Vertex Protocol,…
In investing in the ecosystem, you should focus on investing in the key areas that the ecosystem is building. A DeFi ecosystem should not focus too much on NFT & GameFi if there is no sign of it. Foundation’s encroaching brand, it should be noted that “in any system”, investing out of season can easily be “poisoned”.
Gas Hero & GameFi’s Return
Gas Hero is bringing GameFi back to the Crypto market after Big Time and Shrapnel. It’s clear that the market is focusing a lot on Pixels, but Gas Hero is the one who “seems” to be coming first when launching a very interesting economic model. It will be difficult to say everything about Gas Hero in a few short lines. You can read more here.
Although the economics are very lengthy, it is simpler than Gas Hero that allows investors to earn their capital back in just 7 – 10 days. However, its current problem is that the capital involved is quite high, from $4K to tens of thousands of dollars. If this barrier is removed, Gas Hero will be able to do what StepN has been able to do.
In the next phase, I believe GameFi will explode with projects that few people predict like the stories of Pixels and Gas Hero. The signs are clear from a small bull run in the GameFi industry. Currently, regarding the model we have a number of games as follows:
- AAA games that focus on Play rather than Earn can be called Play and Earn.
- The game follows the 2021 – 2022 model. However, there will be a change in the economic model, but the outcome is still only one ending, so when participating, you must be very alert. These titles will still focus on Earn rather than Play.
- Game Fully On-chain. However, with this game, everything is still not so clear.
Summary
Above are 3 trends to pay attention to in the early part of 2024 including Restaking & accompanying trends, Layer 2 with momentum from Dencun Upgrade and the GameFi story is heating up again.
