😭 Are you winning son? "No dad, Jump liquidated me"

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Good Morning.

I hope you’re all safe and sound. Bitcoin was temporarily back below $50,000 as liquidations are inching close to $1 billion. If you’ve given back all of your YTD gains, I’m sorry — the market always reminds people to take profits.

In Today's Email:

• What Matters: Dems crypto roundtable 🏛️

• Product: Eclipse, SVM L2 on Ethereum 🖥️

• Charts: Coinbase revenue & memecoins volume 📈

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WHAT MATTERS

Democrats & Crypto Leaders to Discuss Policy

State of play: According to Politico, White House officials and top Democratic operatives will attend a virtual roundtable with crypto industry executives today to discuss digital asset policy.

• The roundtable, hosted by pro-crypto Rep. Ro Khanna, appears to follow up on his July meeting on the same topic, attended by Mark Cuban and NY Senator Kirsten Gillibrand, among others.

• White House officials and outgoing Senior Adviser Anita Dunn (pro-Harris $300M super PAC adviser) plan to attend the roundtable.

• No other lawmakers besides Khanna are expected to attend the roundtable.

Genesis Begin to Distribute $4B to Creditors

Meanwhile, Genesis announced that it has completed its restructuring process. The firm has begun distributing about $4B in digital assets and USD to repay creditors, according to a press release.

• Wallets linked to Genesis began transferring $1.5B in Bitcoin and Ether on Friday.

• On average, Genesis creditors will recover 64% of their in-kind cryptocurrency, varying by coin.

• Bitcoin creditors will receive 51.28%, ETH creditors 65.87%, Solana creditors 29.58%, and stablecoins or USD creditors will receive 100% of their missing funds.

Jump Moves Millions in Crypto

Addresses tagged as belonging to Jump Crypto have received inflows of about $300M since August 3, mostly from exchange wallets. The firm's wallets also saw outflows of about $80M to exchanges like Coinbase, Gate.io, and Binance.

• Much of the moved funds are in the form of Ether.

• EmberCN noted that Jump has redeemed over $500M worth of Lido's wstETH into Ether since July 25.

• According to EmberCN, Jump still holds about $130M in staked Ether, while nearly $200M in unstacked Ether has entered exchanges.

What’s next: There are many uncertainties until November. Wait and see how the Fed and US politics will play out in the next few months.

For builders and investors: Back to building mode, the memecoin casino will be on pause until further notice.

Take a peek at our referral reward at the bottom of this issue. Share this newsletter and receive our list of 500 crypto VC individuals 👇

PRODUCT OF THE WEEK

Eclipse: The first SVM L2 on Ethereum

Eclipse is the first Solana Virtual Machine (SVM) L2 on Ethereum, combining the best of Solana’s speed with Ethereum’s security and liquidity. Eclipse recently announced that Eclipse Mainnet is open for builders.

• Eclipse chose to build on Ethereum to enable devs to work where users and assets are while prioritizing scale and UX using the SVM.

• Eclipse was founded by Neel Somani, who previously worked as a software engineer at Airbnb and a quant at Citadel.

• Eclipse’s architecture uses Ethereum as the settlement layer, Celestia for DA, RISC Zero for generating zk fraud proofs, and SVM as the execution environment.

Other cool products:

• KaiKai, a web3 shopping app.

• Hot Game, a Telegram wallet built on NEAR.

• CARV, a gaming credential and data infrastructure.

• Revox, a decentralized content distribution platform.

• Particle Network, a modular L1 powering chain abstraction.

CHARTS OF THE WEEK

Coinbase Revenue

Credits to Travis Hoium for the original chart.

State of play: Coinbase’s significant growth in blockchain rewards revenue and consistent increases in stablecoin and custodial fee revenues indicate a well-rounded and dynamic revenue strategy.

• Currently, most of Coinbase’s revenue comes from stablecoin ($781M) and blockchain rewards ($505M).

• Meanwhile, Coinbase’s custodial fee contributes only $102M (under 10%) to its total revenue.

• However, Coinbase’s custodial fee revenue increased by 451% from December 2020 to June 2024, with a CAGR of 62.89%.

• Coinbase revenue from blockchain grows 4755% from December 2020 to June 2024, with a CAGR of 203.37%.

• Stablecoin revenue shows moderate growth compared to the other sources of revenue but remains the largest contributor to the overall revenue.

Our take: Revenue from Base is not included in the chart, but its growth may make it Coinbase’s top future revenue source. Moreover, Ssablecoin revenue is expected to decline as Fed interest rates decrease.

Memecoins Lead Solana and Base DEX Volume

Credits to Messari for the original chart

State of play: Memecoins are the largest contributor to Solana and Base DEXs volume according to data from August 2023 to July 2024, accounting for around 50% of all transactions on both networks.

• Solana recorded a total volume of $377B, with memecoins accounting for 51% of this volume, making Solana the lair of memecoins.

• While memecoins account for 50% of the volume on Base, the volume of memecoin transactions is just $45B, which is 4x lower than Solana.

• Memecoins only account for 16% ($92B) of Ethereum’s entire volume ($577B); it is twice higher than Base’s but only half of Solana’s.

Our take: New blockchain founders need to understand that having tokens for people to speculate on will be the number one reason for people to bridge over to your chains.

• Think about it like running equity stock exchanges. People want to trade on NYSE because specific equities are only available there.

QUICK BITES

• France opens MiCA applications.

• Genesis completes bankruptcy restructuring.

• AAVE rakes in $6M in revenue as market plunges.

• Jump Crypto moves hundreds of millions in crypto.

• Bybit withdraws from France in response to regulations.

• CFTC subpoenas BitBoy’s former company in fraud investigation.

NOTEWORTHY READS & MEME

• Jon Wu’s read on the JPY carry trade unwinding.

• Alex Kruger’s read on the market downturn situation.

• Variant’s read on things we’re excited about in crypto.

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Disclaimer: All the information presented in this publication and its affiliates is strictly for educational purposes only. It should not be construed or taken as financial, legal, investment, or any other form of advice.