🟣 Bitcoin halving a bounce

Welcome back to 0xResearch – quick hitting alpha for the crypto degens. Here's what we got for you today:

• Post-halving bounce

• Selling FTX’s SOL

• Degen Corner: Reya Network

Happy Earth Day to those who celebrate! It’s only 1,419 days until the next Bitcoin halving, and contrary to conventional wisdom, bitcoin miners are not merely profligate energy guzzlers and may rather prove to be part of the solution to excessive greenhouse gas emissions.

Bitcoin, the asset, is starting the week with a bit of a bounce alongside US equities, though I wouldn’t get too excited about it just yet.

While it’s tempting to imagine the 4/20 halving date as a bottom, and something-something-miner-cost-of-production at $60k yada yada, momentum on longer time frames (2-day, 3-day, 5-day, weekly) are still all pointed to the downside.

The economic calendar over the next two days has plenty to keep an eye on: data on US producer prices, manufacturing and corporate earnings from a host of major firms, like Tesla, among others.

The dollar still looks strong, and although geopolitical uncertainty stemming from Israel and Iran’s tit-for-tat, there remains the "unfinished business" of the Israeli military in Rafah, according to the Wall St. Journal.

All of that’s to say, that the $66.5k resistance BTC is hitting may not break so easily.

Firesale SOL

Remember how the FTX estate’s law firm cut a sweetheart deal with some deep-pocketed investors to buy locked SOL at $64?

The next round may be done a little more fairly — via an auction.

Figure Markets and its CEO Mike Cagney are gathering interest from prospective participants in a new Special Purpose Vehicle (SPV), that would seek to bid on some of the FTX estate’s remaining SOL. The SPV would be open to accredited US investors and non-US investors who go through a KYC process.

— Macauley Peterson (X: @yeluacaM | Farcaster: @Macauley)

Thousands of rollups will continue to launch. With that, rollup interoperability presents a major challenge. Our latest unlocked report here unpacks how Avail presents a potential solution to rollup fragmentation through its three products: Avail DA, Nexus, and Fusion. Avail, the unification layer for web3, may prove to be the logical end game for DA layers, so if you’re interested in what that means, check the report out!

Ethereum scaling effects: up and to the right

According to Steakhouse Financial, total wallet activity, and other related metrics like stablecoin transfers have doubled since the start of the year.

Recently, Base has been making its mark, but activity is also up sharply on Polygon’s PoS chain, which should be immune from the effects of speculative token farming.

A new attempt to tackle the liquidity bootstrapping problem of perpetual exchanges is launching a two-week "Liquidity Generation Event" today.

Reya Network is a trading-optimized layer-2 using the Arbitrum Orbit tech stack and Gelato’s Rollup-as-a-Service, settling to Ethereum mainnet.

The team claims to have block times of 100ms, 30,000 transactions per second and no gas fees, which compares favorably to other trading-focused L1s like Sei and Monad (yet to launch).

Co-founder Simon Jones and around 10 developers previously launched interest rate swaps protocol Voltz, but decided it wasn’t a big enough idea.

Now, backed by Framework Ventures, Coinbase Ventures, Wintermute Ventures and Amber Group, Reya Network’s novel feature is to bake liquidity for dexes directly into the L2.

Any exchange building on Reya will tap into the same passively LP’ed pool of capital. That enables features like a single margin account across all exchanges, a capital efficiency boon for market makers.

A homegrown DEX will be the first offering, but the team is talking to "a bunch of other exchanges" that will start to launch on the network over the course of the year, Jones said.

For Reya’s spin on points incentives, users can earn "experience" (XP) by depositing USDC from Ethereum, Polygon PoS, Optimism or Arbitrum.

The protocol shares the same centralization and risk profile as other layer-2s, including a centralized sequencer and a 3-of-5 multisig controlling smart contract upgrades. Two keys are held by the Reya core team and three by "well-known and trustworthy individuals" from the community, Jones said.

Reya has undergone audits, and "months and months and months of testing," but the usual caveats around smart contract risk and other concerns surrounding brand-new protocols apply.

Avail: A Unification of Crypto Infrastructure

Data publishing costs have historically been a bottleneck for rollups, and as more rollups launch, interoperability will continue to be a major challenge. Avail presents a potential solution to rollup fragmentation through its three products: Avail DA, Nexus, and Fusion, which together aim to unify the web3 experience.

Read more→

The AO Computer: Spawning an Agent Economy

Arweave recently launched the testnet for AO computer, a new messaging protocol that will sit atop a PoS network and aims to become a scalable global compute platform through parallel processing and modularity.

Read more→

Bitcoin ETF snapshot: GBTC drives second straight week of outflows

The US fund segment snapped a five-day net outflow streak on Friday ahead of the Bitcoin halving that night.

Read more →

Hut 8’s business diversity to give it an edge after the halving: Benchmark

Research analyst Mark Palmer starts coverage of the bitcoin miner and puts its price target 50% higher than its current level.

Read more →

The insights, views and outlooks presented in the report are not to be taken as financial advice. Blockworks Research analysts are not registered broker/dealers or financial advisors. Blockworks Research analysts may hold assets mentioned in this report, further outlined in the Firm’s Financial Disclosures.