The crypto market catalysts you should watch in April
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The crypto market catalysts you should watch in April
April will be an important month for cryptocurrency.
Navigating Web3 tides with focused insightsAuthor: The DeFi Investor
Translation: TechFlow
Today's article covers the following:
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Key crypto catalysts in April
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This week’s on-chain Alpha
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Latest developments in DeFi
Key Crypto Catalysts in April
April will be an important month for cryptocurrency.
The long-awaited Bitcoin halving is about to happen.
In addition, several well-known projects are set to launch their tokens or undergo major upgrades.
Below are four key crypto events to watch next month:
1. Bitcoin Halving
The next Bitcoin halving is expected to occur in approximately 22 days.
Once active, it will reduce the number of new Bitcoins entering circulation by 50%.
However, it's worth noting that Bitcoin’s current inflation rate is already very low (less than 2% annually).
Therefore, from a fundamental perspective, I don’t think the halving is a big deal. But psychologically, it’s a different story.
Many people know that historically, Bitcoin has performed exceptionally well in the months following each halving event. As a result, they’re likely to buy crypto assets again soon, hoping history will repeat itself.
Additionally, the Hong Kong Securities and Futures Commission is expected to approve the launch of spot Bitcoin ETFs in Hong Kong during Q2.
All signs point toward a favorable environment for Bitcoin.
2. Stacks Nakamoto Upgrade
Stacks is a Bitcoin Layer 2 solution that enables smart contracts and dApps on Bitcoin.
The Nakamoto upgrade for Stacks has been in development for a long time and appears to finally roll out on mainnet next month.
The Nakamoto upgrade will:
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Enable the use of sBTC (a BTC-pegged asset) in DeFi on Stacks
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Reduce network block times from 10 minutes to just seconds
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Improve scalability of the Stacks L2
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Potentially trigger a new wave of interest in Bitcoin L2 ecosystems
$STX, the Stacks token, can also be seen as a form of "beta exposure" to Bitcoin.
Stacks is currently the most popular project built on top of Bitcoin.
3. Solana Airdrop Season
Last year, the massive airdrop announced by Jito revitalized the Solana ecosystem. In April, several other prominent Solana dApps are launching their tokens:
All of these protocols will conduct airdrops.
This list only includes officially confirmed airdrops, so there may actually be more unannounced ones.
Large-scale airdrops can have significant positive impacts on an ecosystem by injecting additional liquidity. For example, here's what happened to $SOL after $JTO was announced in November 2023:
Given that SOL's market cap has now surpassed $80 billion, I believe expecting SOL to rise 2-3x in the short term is unrealistic.
Nevertheless, Solana is very likely to benefit significantly from these ecosystem airdrops, just as it did before.
4. Eigenlayer Mainnet Launch + Potential Token Launch
The Eigenlayer token could launch in late April or early May.
There are several reasons for this:
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The Eigenlayer mainnet is confirmed to go live in the coming weeks (which could be the optimal timing for the token launch as well)
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Many early investors have indicated the token will be released in late April or early May
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Additionally, April might also see the launch of the first Eigenlayer Active Validator Service (AVS). Altlayer is an example of a popular AVS — a decentralized protocol for Rollups.
Protocols that choose to “rent” security from Ethereum via Eigenlayer are called AVSs (which can include oracles, sidechains, L2s, etc.)
Many of these AVS projects may conduct airdrops for Eigenlayer users, similar to what Altlayer did when it launched its token a few months ago.
According to the Etherfi team, eight AVSs will soon begin distributing points or token rewards to holders of EtherFi’s eETH liquid restaking token.
On-Chain Alpha
Over the past 6 months, $86 billion in institutional funds have flowed into Bitcoin
As shown above, institutional inflows into Bitcoin have surged since the launch of spot Bitcoin ETFs.
This makes me wonder what institutional adoption of Ethereum might look like if spot Ethereum ETFs are approved later this year.
It's becoming increasingly clear that institutions are recognizing crypto as an essential asset class.
Latest Developments in DeFi
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The CFTC reaffirmed ETH as a commodity, increasing the likelihood of a spot Ethereum ETF approval
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Ethena announced the $ENA token launch on April 2. 5% of the $ENA supply will be airdropped to early adopters
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Optimism allocated $3 billion in grants within the Optimism Collective & Superchain
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NEAR Protocol launched Chain Signatures, enabling NEAR accounts to sign transactions on any blockchain. The goal is to improve cross-chain user experience
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Circle launched its cross-chain transfer protocol on Solana. USDC holders can now transfer USDC across 8 chains with 1:1 capital efficiency
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Zero1 launched Keymaker, a marketplace related to decentralized AI. Keymaker aims to become the largest decentralized AI ecosystem
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Ankr launched Neura, a blockchain built for AI. Neura will secure its network using Bitcoin’s security via Babylon
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Polygon launched the dApp Launchpad, a gateway for developers to enter the Polygon ecosystem. The dApp Launchpad aims to enhance the developer experience on Polygon
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Angle Protocol launched USDA, a yield-bearing, RWA-backed dollar stablecoin. USDA will feature multiple de-peg protection mechanisms and offer liquidity comparable to USDC
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PancakeSwap announced MancakeSwap, its first affiliated DEX on the Mantle network. Mancake will share 60% of its revenue with PancakeSwap
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Liquity revealed key features of Liquity V2, including user-set interest rates designed to create an efficient market between borrowers and stablecoin holders
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EtherFi launched Points Season 2. The Q2 allocation represents 5% of the total ETHFI supply and will end on June 30
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Munchables, a popular protocol on Blast L2, suffered a $63 million hack. Fortunately, the hacker has returned the funds
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The DeFi Investor
