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Ignas | DeFi Research Profile picture
@DefiIgnas
May 19 • 6 tweets • 3 min read • Read on X
1/ Runes protocol launch ended up as a "sell-the-news" event.

But the Runes community is still strong and BTCFi protocol teams continue to build.

I believe a small spark is needed to ignite the Runes hype fire again. A few possible catalysts ahead: ↓ Image
2/ First short-term catalyst is Runes token listing on major CEXes.

Both Kraken and Binance recently released research reports on Runes.

Kraken even teased Runes listing on their exchange. Image
3/ Currently, Runes trading experience isn't much different from trading BRC20s.

(Although Magic Eden did some UI improvements).

But Bitcoin soft forks (or speculation of it) like OP_CAT could bring significant improvements for Bitcoin L2s, smart contracts & all BTCFi space.
Image
4/ Another catalyst for BTCFi growth can be the launch of USDC or USDT on Bitcoin as Runes.

Circle/Tether can pre-mine trillions of Rune tokens and issue/redeem them on demand.

Demand for stablecoins is low, but would increase as Bitcoin AMM/Lending dApps improve UX.
5/ What other catalysts do you see?

Quite likely, a new catalyst for FOMO will end up being something unexpected.

But as I was bearish leading to the Runes protocol launch, I'm now turning more bullish on Runes with each passing day.
6/ In any case, as speculation on narratives comes in waves, I'm waiting for the 5th BTCFi wave.

I believe it will come soon as narratives based on technical innovation often have multiple waves and BTCFi is one of the top 0-to-1 innovations this cycle. Image

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More from @DefiIgnas

Ignas | DeFi Research Profile picture
May 17
1/ Bearish sentiment for $ETH is dominating on Crypto Twitter.

But Coinbase believes ETH will surprise to the upside later in the cycle.

Here are the top ten reasons why: 🧵
2/ Ethereum vs. Competing L1s:

Ethereum ecosystem still dominates DEX volume but Solana and other L1s are eating into ETH's market share.

Plus, ETH's developer ecosystem, EVM proliferation, and role in DeFi as collateral keep it competitive. Image
3/ Stablecoin Supply:

ETH dominates in stablecoin issuance: a sticky metric for adoption.

Even as Solana grows, even Ethereum L2s like Arbitrum surpass Solana in stablecoin supply. Image
Read 12 tweets
Ignas | DeFi Research Profile picture
May 17
1/ Airdrop farming with points is losing its hype.

But points are just the latest trend in our ongoing token printing experiments.

So, what's next for points, airdrops, and token printing? 🧵
2/ Airdrops is the evolution of the way we issue new tokens to the market.

And every cycle, we find a new way to print tokens. And it gets easier each time.
3/ In pre-Ethereum times, launching a PoW blockchain was the way to print tokens.

Litecoin, Bitcoin Cash, Bitcoin Gold...

Fair enough, as tokens were either airdropped to BTC holders via a fork or mined with relatively low requirements.
Read 24 tweets
Ignas | DeFi Research Profile picture
May 16
1/5 Two major crypto hacks in two days:

• Alex Labs for ~$29M
• Pumpdotfun for ~$80M

Yet the number of hacks and losses has dropped this cycle.

We lost ~$2B since 2023 but crazy ~$77B until then, with Terra collapse accounting for $40B. Image
@DeFi 2/5 Compared to 2022, DeFi hack losses dropped by 63.7% in 2023 and median losses per hack decreased by 7.4%.

Two reasons for that: Bear market & improved security.

Chainalysis info. Image
3/5 The type of exploits also changed.

Previously, most DeFi hacks were due to flawed smart contracts bugs.

But compromised private keys are now the biggest culprit (Alex Labs suffered from this type of account too). Image
Read 6 tweets
Ignas | DeFi Research Profile picture
May 15
Wow. Maker will likely have two stablecoins.

Rune proposes:

1. NewStable: Prioritize dollar peg and real-world asset (RWA) collateral

2. PureDAI: Focus on complete independence from centralized control, using decentralized collateral.
NewStable

- Successor to Dai, aimed at mass adoption with RWA backing and regulatory compliance.
- Maintains a dollar peg, focusing on utility, yield, and resilience.
- Will eventually have a freeze function for legal compliance, implemented via governance vote.
PureDAI

- Focuses on pure decentralization with decentralized collateral like ETH and stETH.
- Features no governance or budgets and will be immutable upon release.
- Available after a few years, independent of MakerDAO.
Read 4 tweets
Ignas | DeFi Research Profile picture
May 15
L1s are productive assets: you use it to farm ecosystem airdrops, stake for rewards, and as the ecosystem expands, price goes up.

That's why my playbook for the bull run consisted of farming with L1 coins.

Thought I'd play it safe, but the L1 strategy did better than expected.
Plus, if you include the airdrops received from holding ETH, SOL, NEAR, APT, SUI, their performance is even better than in the table above.

Yeah, memecoins did the best but there are hundreds of memecoins so hard to pick a winner and easy to dilute your cash.
Finally, L2s are non-productive assets:

You can't stake them for native rewards (exceptions are $STRK, $MNT, and $METIS), can't use them as gas tokens, and the inflation from unlocks is typically too high.

Plus, their own ecosystem protocols rarely reward holders of L2 tokens.
Read 4 tweets
Ignas | DeFi Research Profile picture
May 2
1/ Finding Zero-to-One innovations in crypto is my ultimate quest.

The rare gems that change the game.

Arweave's AO 'absurdly scalable' hyper parallel computer could be just the thing I look for: 🧵 Image
2/ Arweave started with a simple yet a powerful idea: permanent, secure storage of documents and applications.

If you have Ethereum NFTs, chances are the JPEG is stored here. Or on Filecoin's IPFS.
3/ Arweave allows for data to be stored permanently with a one-time fee.

The protocol connects those with spare hard drive space to users needing long-term data storage or content hosting.
Read 17 tweets

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