Bull Market Scenario Unfolding?
Light emerges at the end of the tunnel. After six months of turbulence, the cryptocurrency market is showing signs of revival. Solana and Base have both performed well, and we finally have something new called “AI Meme.”
Some predict that the price of Bitcoin may exceed $100,000 in the coming months. The bullish market sentiment is supported by the following reasons:
1. The US presidential election will take place in two weeks. Trump’s victory would be a huge win for cryptocurrencies.
2. On-chain indicators are bullish. Base and Solana’s Total Value Locked (TVL), trading volume, and active addresses have been consistently growing.
3. Stripe’s acquisition of stablecoin payment platform Bridge is underestimated in terms of its long-term benefits for cryptocurrencies.
4. The emergence of AI x Meme is a new trend in the current retail market, similar to NFT.
Sentiments are improving, and the nostalgic atmosphere is returning.
Now is the time to overcome the trauma from the bear market. So many interesting things are happening, and I want to be at the forefront of the trend.
In the market, protocols and narrative are mixed, and it is not easy to distinguish signals from noise. Here are some things I will pay attention to in the coming months:
1. AI Agents x Memecoins: The Return of Cults
Memecoins have always been an important part of the cryptocurrency market. They work by leveraging viral spread for promotion. As memes are “static,” their popularity relies on the community.
But what if memes could upgrade and evolve? What if memes could self-promote? This is where AI agents come in.
Last week, GOAT (Goatseus Maximus) became the preferred choice for AI agent speculation, with its market value skyrocketing from 0 to $800 million within a week.
What is GOAT? Truth Terminal is an autonomous chatbot that manages its own Twitter account and generates content. It releases nonsensical philosophical content but has a special affection for “GOATSE OF GNOSIS,” a pseudo-religion based on an ancient internet meme.
GOAT was created by an anonymous individual who airdropped some tokens to the creator of Truth Terminal.
The next scene is Truth Terminal heavily promoting GOAT on Twitter. Will AI launch its “own” memecoin? It has good “memecoin fundamentals”: high liquidity, fair distribution, and no team risks like VC or memecoin “conspiracy groups.”
The momentum of AI memes can continue for the following reasons:
Truth Terminal has over 100,000 followers and is still growing. Each tweet from this account has tremendous influence. It tweets every hour, making it an unstoppable Key Opinion Leader.
No AI meme has been listed on top CEXs yet. GOAT’s daily trading volume is about $374 million, undoubtedly attracting attention from tier-one CEXs. (Note: Binance has listed GOAT contract trading)
AI is constantly evolving and will continue to learn and grow.
AI memes exist at the convergence of Crypto x AI x Religion, creating a new “cult.”
We have only scratched the surface of this new domain. How should you play in it? The easiest way might be to go long on the leading memecoin, GOAT. Take a moment to calm down, as there are potential explorers emerging, such as Fartcoin and Gnon.
It is important to note that there will be many scams trying to take advantage of this wave. Their token distribution is nowhere near as good as GOAT’s, and I’m sure many of these “AI agents” are actually humans playing AI role-playing games.
NFT gained attention from retail investors as early as 2021. AI agents x Meme have the same potential, and reaching a $1 billion market value for GOAT is not difficult.
Lastly, remember that these are memecoins. They rise and fall quickly. So, make sure to secure your profits.
2. Solana: Riding the Wave of Memecoins and AI
“Do you remember when the first millionaires during the gold rush were not the gold miners, but the ones selling shovels and picks?”
I love Ethereum, but ignoring the progress and adoption of Solana is foolish.
Solana is currently riding a wave driven by memecoins and AI tokens. With the surge in memecoin prices and trading volumes, Solana is once again in the spotlight.
Solana seizes the opportunity by leveraging memecoins and AI tokens:
Well-known memecoins such as SLOP, GNON, Shegen, and FART are gaining attention, and GOAT is leading the way as an AI token.
As of Q4 2024, Solana creates an average of 96,010 tokens per day, with Pump.fun accounting for around 9.3% of the total, creating approximately 9,000 tokens per day.
In addition to memecoins, Solana is also home to innovative DeFi protocols.
Let me highlight three protocols:
Jupiter: Known for exchanges and perpetual contracts. They recently launched ApePro, a new trading platform designed specifically for memecoins.
Kamino Finance: Kamino Lend, launched just a year ago, currently holds nearly 70% market share on Solana with a Total Value Locked (TVL) of $1.65 billion.
Pump.fun: Solana’s memecoin factory, which may have a future airdrop. Their new internal trading tool is called Pump Advanced. They have also launched a video tokenization platform that allows users to tokenize videos, making them tradable assets on the platform.
With continuous innovation and attracting various projects, Solana has become a strong competitor to Ethereum. The combination of memecoins and AI tokens not only diversifies its products but also strengthens community engagement, making Solana a choice for new retail audiences.
3. AI Tokens
While AI x Meme is currently capturing everyone’s attention, we should not overlook Crypto AI tokens.
Bittensor (TAO) is the leader in this field.
Bittensor is the infrastructure for Crypto AI, focusing on AI utilities:
Opentensor FDN recently launched an Ethereum-compatible layer, connecting to the $3 trillion Ethereum ecosystem.
Real-world adoption: Three major DeFi protocols have already built on Bittensor’s machine learning infrastructure.
Multiple revenue streams: Transaction fees, staking, AI services, targeting over $10 million in quarterly revenue.
Institutional support: Two major cryptocurrency VCs increased their positions in September.
A potentially interesting strategy for AI exposure is to hold GOAT (high risk with explosive potential) and TAO (infrastructure). Both are worth paying attention to and have support from mature communities.
AI agents are now making breakthroughs. One protocol that I am particularly interested in is the Virtuals Protocol, described as an AI agent version of Pump.fun.
Virtuals Protocol allows you to co-own AI agents in the gaming and entertainment space with others. Imagine jointly owning entertainment robots deployed on platforms like TikTok, Roblox, and others. How interesting!
4. Fantom’s Rebirth: Hello, Sonic
Fantom is one of the hottest blockchains in 2021. At its peak, its TVL reached $8 billion.
Fantom is currently going through a transformation and rebranding itself as Sonic Chain, focusing on speed and scalability. With Andre Cronje’s return, expectations for Fantom are high.
What are the new features of Sonic? Sonic Chain promises faster transaction speeds, up to 10,000 TPS. It’s not the fastest, but enough to make it competitive in the high-performance blockchain space. Improved tokenomics make it one of the most anticipated updates in Q4.
Some catalysts for Sonic include:
With Pendle’s support, Sonic will have liquidity staking capabilities.
Curve, KyberSwap, Snapshot, and other major DeFi protocols are launching on Sonic.
Sonic’s new fee mechanism allows developers to earn up to 90% of fees.
Projects like Sonic & Sodas, Sonic Boom, and Sonic University aim to attract developers.
Sonic Arcade’s TVL has grown by 20% in the last quarter.
Finally, money talks. Sonic has confirmed an airdrop worth approximately $132 million, and on-chain activities are growing.
Andre’s involvement, large-scale airdrops, upcoming DeFi tools, and changes in tokenomics may drive growth for Sonic in Q4.
Every day, I wake up to new ETH Layer 2 or application chains being launched. However, Solana’s leading position and the rise of Aptos/Sui indicate that there is still room for development in L1 competition chains.
For L1 competition chains, you can consider Solana as the alpha version and Sonic as the beta version.
Some concerns I have:
Andre is innovative, but he has also “disappeared” before. His attention on Sonic brings significant risks due to his key role.
There haven’t been many innovative DApps launched on Fantom in recent years. Their most popular DApps are still Beethoven X and SpookySwap.
Sonic will compete with L2 and other L1 chains.
Will Sonic be able to maintain its momentum after the airdrop is completed?
Currently, the Sonic ecosystem is already crowded, but it is doing interesting things and deserves your attention.
5. Aerodrome: Base’s Secret Weapon
Base’s rise is evident, and by TVL, it is recognized as the largest L2 by Ethereum.
What is the reason? Aerodrome. Aerodrome’s TVL now exceeds $1.36 billion, making it a top participant in Base’s DeFi ecosystem.
This is mainly due to its two liquidity pools.
Aerodrome’s dominance in the Base ecosystem is as follows:
Current TVL: $1.36 billion (56% of Base’s total TVL)
30-day growth: 56%, surpassing the market average of 15%
Market share: 80% of all DEX trading volume on Base
Daily trading volume: over $150 million
As Base matures, the importance of Aerodrome as its default DEX will increase, making it a core participant in the Base ecosystem.
In the past 20 days, a comparison between Base and other L2s:
Average daily transactions:
Base: 5.6 million
Arbitrum: 2.1 million
Optimism: 850,000
Active addresses:
Base: 1.5 million monthly active users
Arbitrum: 780,000 monthly active users
Optimism: 690,000 monthly active users
TVL growth:
Base: $2.5 billion
Arbitrum: $2.4 billion
Optimism: $681 million
It is clear that Base’s current development momentum is strong. So, what will be the next catalyst?
Integration of Real-World Assets (RWA): Platforms like Centrifuge can bring real-world assets into Base, attracting more liquidity and traditional financial participants to join its ecosystem.
GameFi and NFT: Base’s scalability makes it a perfect choice for new gaming platforms or NFT markets, leveraging these growing crypto narratives.
Developer incentives: Base, supported by Coinbase, may promote growth through hackathons and funding programs to attract more talent to its ecosystem.
Aerodrome has created a powerful DeFi ecosystem on Base, attracting both retail and institutional participants. Alongside top protocols like Uniswap, Aave, Balancer, Sushiswap, Curve, and Stargate, Base has the potential to become a strong contender in the L2 race.
6. DeFi 1.0: Don’t Underestimate Established Companies
Do you remember when Aave and Uniswap dominated DeFi? It was an era full of innovation and infinite possibilities. Now, they are ambitiously making a comeback.
Aave plans to bring its native stablecoin GHO into new ecosystems like Base and Avalanche.
As of early 2024, GHO’s market cap is $35 million, growing 350% in the past ten months and currently at $160.1 million.
Growth indicators for Aave:
Revenue of $50 million year-to-date, the highest among all lending protocols.
Circulating supply of stablecoin GHO reaches $160.1 million.
ETH TVL continues to grow and is currently at 5.1 million ETH (over $11 billion), nearing its previous peak.
Grayscale announces the launch of Aave Trust.
GHO is now competing with top 15 stablecoins, attracting institutional investor interest.
As for Uniswap, it recently announced the launch of its own blockchain: Unichain.
We previously delved into the updates to the Uniswap v4 ecosystem and the reception of the Unichain launch. Here are the updated strategic moves for Uniswap:
After the launch of Unichain, massive liquidity migration is expected.
One of Unichain’s main goals is to help users reduce gas costs by around 95%.
Unichain’s launch may introduce new staking mechanisms.
The introduction of revenue-sharing models may boost UNI token prices.
The number of wallets holding UNI tokens exceeds 400,000.
The plans for Aave’s GHO and Uniswap’s Unichain could revitalize DeFi 1.0 and bring these giants back into the spotlight. These moves may redefine the dynamics of stablecoins and reshape the DEX landscape.
Riding the Wave
The past few years in the cryptocurrency market have been very challenging. Countless Ponzi scams and the collapse of Terra and FTX have left us in a prolonged bear market. The entire industry has been focused on building more Ethereum Layer 2 solutions. Now, I can feel the tide turning.
We need to change with it: stop fooling around, overcome the trauma from the bear market, and stand tall at the forefront.
