The 300% Gain You Can’t Ignore

Gm friends,

VC firm a16z says crypto adoption is continuing to grow at the same rate as the Internet.

You’re in the right place if you want those extraordinary gains and a16z’s latest State of Crypto report shows just how early you are.

Here is your weekend crypto update…

Here’s what’s in today’s issue:

• Chart of the day: BTC ETFs hit $20B in net inflows.
• Rebecca shares her thoughts on a16z’s State of Crypto report, Atheneum’s roadmap, Radiant Capital’s $50M hack, Kraken’s kBTC & Robinhood launching BTC and ETH futures.
• Today on chain.
• Altcoin Alpha.
• This week’s airdrop by Jesse.

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Chart of the Day

US Bitcoin ETFs collectively hit $20 billion in net inflows for the first time. It’s a milestone that took gold ETFs five years to achieve and these Bitcoin ETFs have done it in less than a year.

It’s a metric that Bloomberg ETF analyst Eric Balchunas has called the “most important” yet “most difficult,” which means Bitcoin is showing its strength as an asset. 

This week in particular has been an explosive week with over $1.5 billion in inflows alone, with the largest daily inflows since July coming in at $393.4 million on October 16.

Whilst the Bitcoin ETFs now hold around $65 billion in assets, the net inflows number is important to look at because it shows the true demand after GBTC’s outflows.

These ETFs are now 86% of the way to equaling Satoshi’s stack.

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News Now

A16z’s State Of Crypto 2024 Report

VC company a16z dropped its annual State of Crypto report for 2024 and one thing is clear: crypto adoption is continuing to grow—even without retail investors flooding into the market. 

The report outlines 7 key takeaways:

1. Crypto activity and usage hit all-time highs 
2. Crypto has become a key political issue ahead of the US election
3. Stablecoins have found product-market fit
4. Infrastructure improvements have increased capacity and drastically reduced transaction costs
5. DeFi is still popular and growing
6. Crypto could solve some of AI’s most pressing challenges
7. More scalable infrastructure has unlocked new onchain use cases

In September, 220 million addresses interacted with a blockchain at least once, up 300% from the end of 2023. That’s huge!

Ethereum is the favorite blockchain among founders, but Solana leads for software developer growth and is the biggest contributor to monthly active addresses. 

But…with an estimated 617 million crypto owners worldwide, the bad news is that a16z estimates that only 5-10% are active.

After you apply de-duplication filters to remove bots, those with multiple wallets and temporary use wallets, a16z arrives at a much more conservative number of 30-60 million monthly active users. But, this can grow over time and already is.

The Roadmap For Ethereum’s Next Era: The Surge

Ethereum’s next major upgrade will be Pectra, which is expected to go live in two phases starting in early 2025. It’s this upgrade that is gearing Ethereum up for its next era: The Surge.

Vitalik Buterin shared his vision for The Surge in a new blog post called “Possible futures for the Ethereum protocol, part 2: The Surge.” This new era will focus on scaling through its rollup-focused roadmap. This combines the power of Layer-2s, data availability sampling and data compression to give the network that all-important boost in transaction throughput. 

Whilst there’s no launch date yet for The Surge, there is a set of highly ambitious goals:

• 100,000+ TPS on Layer-1 and Layer-2
• Maintain decentralization on Layer-1
• Upgrade some Layer-2s to reflect Ethereum’s core properties
• Maximum compatibility between Layer-2s to help the Ethereum blockchain feel like an entire ecosystem

The tricky blockchain balancing act, of course, is to keep the base layer secure and decentralized whilst optimizing Layer-2s for scalability—the classic Blockchain Trilemma.

It’s a race to see who can solve it the quickest and in the best way possible—something Vitalik is clearly thinking a lot about for Ethereum’s next era. 

Radiant Capital’s $50M Hack

It’s another week and unfortunately another DeFi hack. Radiant Capital halted its lending services after a security breach resulted in over $50 million stolen from the platform across Arbitrum and BNB Chain.

A hacker gained control of Radiant’s smart contracts after getting three of the platform’s private keys to its multi-sig wallet. 

On October 16, blockchain security firm Ancilia Inc. flagged suspicious activities linked to one of Radiant’s smart contracts on the BNB Chain. A series of on-chain transactions were identified that showed hackers had already made off with at least $16 million.

It was after that, that Ancilia discovered Radiant on Arbitrum had been compromised too, pushing the total stolen funds to more than $50 million.

It turns out that Radiant’s hardware wallets were compromised in such a way that made the front-end of Safe Wallet display legitimate transaction data whilst the unauthorized transactions occurred undetectable in the background. 

Upon further analysis, this was the hacker’s second attempt at gaining control of the platform, after a failed attempt on October 10. Unfortunately, this isn’t the first time Radiant Capital has suffered a hack this year. In January, Radiant was hacked for $4.5 million through a bug in one of its smart contracts.

If you have used Radiant Capital, then do this immediately: go to revoke.cash and remove any permissions related to Radiant. It’s also a reminder to clean up your permissions across any apps, wallets or devices you use. Now is the time for a security health check before the bull market mania kicks off.

Kraken Follows Coinbase With kBTC

Now it’s Kraken’s turn to launch a wrapped Bitcoin token. kBTC is fully backed 1:1 by Bitcoin and kept securely in custody at Kraken Financial. As an advocate of “don’t trust, verify” Kraken has published its proof-of-reserves for users to check on-chain at any time. 

kBTC is an ERC-20 token that’s compatible with other networks like Ethereum and OP Mainnet, which Kraken hopes will open the Bitcoin ecosystem up to new use cases to reinforce “Bitcoin’s position as the epicenter of crypto.”

Robinhood To Launch Bitcoin And Ethereum Futures

The further into the bull market we go, the more Robinhood is expanding its crypto offering beyond simple spot trading.

Robinhood is expanding its futures trading options with assets including oil, the S&P 500 Index, Bitcoin and Ethereum. Specifically, the crypto futures offering includes Bitcoin contracts, micro Bitcoin futures, Bitcoin Friday futures, Ethereum futures, and micro Ethereum futures.

The news was unveiled at Robinhood’s HOOD Summit, where it was announced that the futures trading would be integrated directly into its trading app. These new advanced trading options will begin to be rolled out to Robinhood users over the coming months.

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Today On Chain

Bitcoin’s dominance hit a 3.5-year high of 58.98% on October 16. It comes after Bitcoin whale transactions jumped to their highest level in over 10 weeks.

According to Santiment, on Tuesday alone, there were 11,697 transfers of $100,000 or more worth of BTC. Bitcoin’s share of the crypto market could be peaking, ahead of a potential altcoin season in 2025, once the euphoria kicks in.

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Altcoin Alpha

• Hamster Kombat [HMSTR] has hit an all-time low of $0.0037, but the teaser just dropped ahead of its Season 2 launch in late October, which reveals an overhaul to the game. A token airdrop is also planned for Spring 2025.
• Worldcoin [WLD] unveiled a bunch of announcements at its live-stream event on October 17, including, rebranding to “World,” launching the mainnet for its Layer-2 WorldChain and debuting the new generation Orb device.
• Goatseus Maximus [GOAT] hit $300 million in market cap after rumors spread that it was launched by the a16z-funded AI bot called “Truth Terminal.” Having been created by Solana’s Pump.fun, it’s leading to a bunch of new AI memecoins.

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Weekly Airdrop

NotPixel Airdrop

NotPixel is the latest Airdrop from those Liquidity-farming folks over at Notcoin. With the previous success of Notcoin, there was very little chance that the project wouldn’t follow up with another massive opportunity to earn some free crypto. If it isn’t broken don’t fix it right? This time around instead of the standard do-nothing game. The Notcoin people have created the NotPixel game. 

You can think of NotPixel as a giant community canvas that everyone interacts with in real-time. With each pixel in complete control of players. Communities battle against each other in an attempt to wipe out their logos and art. A never-ending struggle for supremacy and control of each pixel. Players can purchase items like Paint Cans and Dynamite to inject havoc on the landscape of the world. 

Zoom in on any area of the map and claim your pixels. Everyone has a certain amount of energy that refills each day. All you have to do is spend them by interacting with pixels. Pretty simple right? Head to the Star Shop if you want to increase or refill your energy to claim even more pixels each day. The main focus of NotPixel is to earn PX tokens by playing and completing quests in the PX tab.

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Legal Disclaimer

Wealth Mastery (Lark Davis, and the Wealth Mastery writing team) are not providing you individually tailored investment advice. Nor is Wealth Mastery registered to provide investment advice, is not a financial adviser, and is not a broker-dealer. The material provided is for educational purposes only. Wealth Mastery is not responsible for any gains or losses that result from your cryptocurrency investments. Investing in cryptocurrency involves a high degree of risk and should be considered only by persons who can afford to sustain a loss of their entire investment. Investors should consult their financial adviser before investing in cryptocurrency.

You can find a full disclosure of all my crypto & venture investments here.