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tl;dr: LUNA and the Otherside (BAYC land sale) drain liquidity and cascade fungible and non-fungible tokens, golbintown blasts off, everyone wants a wallet, NFTs & GameFi as the current best risk/reward, DeFi & token developments, and L2 scaling begins to take shape.

Funding & News:

while this is not a comprehensive list of every announcement, the total capital deployed to the below sectors are common themes across the crypto ecosystem in May and totals ~$9.5B

General Funding:

• a16z raises $4.5B for crypto fund 4; $1.5B for seed, $3B for venture investing

• Standard Crypto raises new $500M fund for “equity and crypto”

• Republic Capital reportedly raising $500M for crypto dedicated fund

• SPiCE VC announces $250M fund dedicated to crypto ecosystem

• Fasanara Capital raises $350M for new crypto & fintech based fund

• Archetype announces new $150M fund for early-stage investing

• Mike Dudas led 6th Man Ventures raises $145M for second crypto fund

• Blockchain Coinvestors raises $200M fund for “mid-stage” investing

• Ryan Watkins & Daniel Cheung launch $85M digital asset fund Pangea

• Old Fashioned Research fund launched with $100M by former Binance execs

• NGC Ventures raises $100M for DeFi, NFTs, and GameFi focused fund

• Volt Capital raises $50M for second fund focusing on DAOs, NFTs, DeFi & infra

• a16z launches $600M gaming fund

Coin News:

• Layer Zero Labs ($STG creator) is seeking fresh funds @ $3B valuation

• StarkWare (ZK scaling) raises $100M and quadruples valuation to $8B

• Dapper Labs announces $725M ecosystem fund for FLOW blockchain

• Aurora Labs, EVM layer of NEAR, announces $90M developer fund for DeFi

• Nym, privacy enabled blockchain startup, launches $300M ecosystem fund

• Bitcoin.com raises $33.6M in private token (VERSE) sale

• LUNA/UST collapse wiping ~$50B in value; LUNA relaunches as LUNC w/o UST

Infrastructure:

• Chainalysis, blockchain data/analysis provider, raises $170M @ $8.6B valuation

• Babel Finance, institutional crypto lender, raises $80M @ $2B valuation

• Moralis, NFT/gamefi infrastructure provider, raises $40M series A

• Jump leads $150M round into exchange Kucoin, valuation @ $10B

• Elwood Technologies, crypto trading infrastructure, raises $70M series A

• Solidus Labs, crypto risk monitoring service, raises $45M

• BVNK, crypto banking services, raises $40M from Tiger Global

• Amberdata, crypto analytics for institutions, raises $30M series B

• Certora, contract security, raises $36M; currently secures ~$50B in DeFi assets

• Talos, crypto trading infrastructure support, raises $105M in series B

NFTs & GameFi:

• Zora, NFT tooling/infra/marketplace provider, raises $50M @ $600M valuation

• BUD, Singapore based Metaverse startup, raises $37M series led by Seqouia

• Travis Kling led Ikigai raises $30M fund for “x to earn”, NFTs, DAOs & web3

• N3TWORK Studios, blockchain gaming startup, raises $46M series A

• SO-COL, Irene Zhao’s influencer NFT platform, raising @ $100M valuation

• GameStop releases self-custodial wallet for $IMX integrated NFT marketplace

• Meta to start testing NFT integration to Instagram this week, developing wallet

• OpenSea announces SeaPort; looks to increase NFT liquidity & seller optionality

• Moralis, NFT/gamefi infrastructure provider, raises $40M series A

• 14 NFT and Gamefi integrated projects raised between 10-25M in funding:

  • Commonwealth, SingularityNET, FreshCut, Azra, CyberConnect, Arianee, Co:Create, Nyan Heroes, Highlight, Branch, Untamed Planet, InfiniGods, Cometh, LootRush

General Notes & Adoption:

• Stripe & OpenNode partner for instant fiat to BTC conversion for businesses

• JP Morgan says crypto has replaced real estate as preferred alternative asset

• NFL taps Mythical Games for play to earn game releasing in early 2023

• Alan Howard details his crypto investments and thesis on the asset class

• Coinbase launches in-app/browser direct web3 connections, Coinbase Pay SDK for easy on-ramps, and liquid token staking collaboration with Alluvial

• Nomura, Japan’s largest investment bank, launching crypto subsidiary

• Robinhood releasing web3 wallet EOY; SBF purchased 7.5% of HOOD last week

• Google Cloud is creating and enhancing developer support for web3

• Cloudflare announces release of public Ethereum and IPFS gateways

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Thoughts & Notes:

Wallets — Data was/is the gold mine of web2 and wallets give access to potential products and marketing based on user’s preferences expressed through token holdings in web3. Everyone wants a wallet, and this month saw announcements from Coinbase, Braavos, Robinhood, Zerion, Ledger, and Meta joining Argent, Context, Cogni, Venly, Spruce, Privy and the established market leading wallets in the race to capture users’ entry point to web3. Expect continued experimentation here.

NFTs & GameFi — As I continually noted in Round Tripping, NFTs and GameFi are low risk bets that provide the highest potential return in the current market environment. While the sector doesn’t operate independently from BTC and ETH, there are routinely (sometimes short term) winners like we’ve seen with goblintown. Venture seems to agree as large NFT/GameFi funds and infrastructure investments along with small bets (14 between 10-25M this month) are increasingly directed to the sector.

Sentiment — May, headlined by LUNA/UST’s collapse, was a difficult month for our beloved tokens. MoM returns of BTC -22%, ETH -37%, DeFi TVL ~50%, NFT activity and virtually every other metric continue on a downward trajectory as risk assets are repriced. Fortunately, the cyclical nature of crypto has been well established, something you can read further about in my post from last week Cyclicality & What’s Next. While the pain may last in the short to mid term, there are numerous catalysts awaiting throughout Q3 potentially reigniting markets through EoY.

Token Developments:

• $IMX releases cross-rollup liquidity solution across L2s & L3s and partners with GameStop to backbone their NFT marketplace

• Aura Finance introduced — integrates veBAL vote escrow tokens for BAL after the success of veCRV and partners with BTRFLY’s Pirex

• OP (Optimism Token) launches to shaky results while Velodrome (VELO), AMM on OP, has also launched their protocol and token

• Axelar Network confirms & outlines token launch on July 14th

• Aztec Network, zk shielded DeFi, to launch Aztec Connect on June 9th

• Bancor (BNT) launches Bancor 3 and outlines the protocol here

• Redacted Cartel (BTRFLY) — v2 tokenomics passed (outlined here), BTRFLY’s Pirex, futures marketplace for yield generating tokens, launched, and their Hidden Hand bribe marketplace expands partnerships

• MATIC — releases Polygon Nightfall a zk powered L2 live on mainnet along with a tweet suggesting an upcoming “massive product release”

• LOOKS releases boosted listing rewards incentivizing liquidity to their platform

• Frax (FXS) — added as asset to AAVE V3 markets, Convex (CVX) announced boosted FRAX staking rewards, and synergy between FXS, CVX, & CRV builds

• Bancor (BNT) 3 launches, full details here

• JPEG’d (JPEG), NFTxDeFi collateral, launches the Citadel for CVX/CRV rewards

• Inter Protocol (IST), over collateralized stablecoin for ATOM’s IBC, announced

• Hop Protocol’s token airdrop and vision moving forward; tokenomics here

• Polkadot releases parachain messaging for interoperability of assets

• StarkWare releases StarkGate Alpha for ETH mainnet direct bridging

• Synapse (SYN) releases cross-chain NFT integration support

NFT Review:

This is by no means a comprehensive list of the ongoings in NFT land. These projects are covered in more depth throughout past Page One posts, so find more info on all of this in those posts from April.

Familiar Faces:

• Azuki had more time in the spotlight than they’d have liked:

  • Beanz revealed on May 5, but

  • Zagabond reveals he and some Azuki team members were behind CryptoPhunks and other projects, causing some serious drama

  • Twin Tiger Jackets were airdropped on May 20

• Doodles hire former Billboard president as CEO, airdrop Dooplicators

• DuskBreakers parent company Metatheory raise $24M in Series A

• ENS Domains in the “10k Club” sell out and moon

• Huxley releases Issue 4: The Guide

• LinksDAO inks partnership with golf brand Callaway

• Milady Maker plummets after discussion of its origins re-ignites

• Moonbirds find some Oddities in their nests, which reveal in July

• The Otherside keeps details light but releases short teaser trailer

• NFT Worlds debuts their avatar collection which provides in-game benefits

• Pixel Vault makes a number of announcements at VeeCon

• RTFKT Space Drip Capsules were redeemed for custom Nike Air Force 1s

New Entrants:

• Admit One marks the start of the next chapter in gmoney’s journey

• Augminted Labs Scientists experiment with free, uncapped supply collections

• Chimpers continue TBAC’s story and showcase Timber’s meticulous pixel art

• CPG: Pop expands the utility-focused “Crypto Packaged” community

• goblintown.wtf produces one of the greatest memes the NFT market has seen

• Ivy Boys bring prep school style to the pfp market

• Kith Friends see Ronnie Fieg make his blockchain debut

• Okay Bears take over Solana (and Ethereum)

• Phantom Network continues the anime meta, removes tributary pieces

• Ragnarok kickstarts their quest to create web3 Runescape with avatar mint

• rektguy from OSF flashes onto the CC0 scene, attracts the Dogg’s attention

Market News and Announcements

• Blur marketplace goes live in Beta

• GameStop introduces the GameStop Wallet

• Gem adds sweep data, batch transfers and live mode

• icy.tools was acquired by Web3 analytics company QuickNode

• OpenSea teases new marketplace contract Seaport, updates UI

• Robinhood is developing a DeFi wallet