As we draw curtains on 2022, it is safe to acknowledge that this was one of the most extraordinary years in the history of blockchain. On one hand, players like FTX, Luna, and Celsius highlighted what has been going wrong in this space, i.e., centralized exchanges with no relation to core blockchain technology, riding the cryptocurrency craze and luring (read – ‘duping’) their investors. On the other hand, Ethereum Merge, zK technology, Polygon integration with F500 enterprises, and the emergence of Omni-chain crypto networks like LayerZero showcased that blockchain technology is now at the cusp of mainstream adoption.
Arguably the biggest event of 2022 was the Ethereum Merge. Ethereum's network transition into a proof-of-stake mechanism received wide adoption, with a total of almost 16 million ETH staked. This number has nearly doubled since the beginning of the year, making it more costly to attempt to attack the network while also economically aligning validators' incentives with Ethereum's long-term growth. The successful implementation of this transition has solidified Ethereum's position as a leading cryptocurrency and smart contract platform.
How is Tykhe and your investment tracking?
At Tykhe, we continue to evaluate several exciting projects and have seen some great strides made by the companies we had invested in. Here are some callouts for the month of December: -
Besides, all our portfolio companies continue to track well. We shall keep you updated on key highlights in the times to come.
Current Deal Flow
Buoyed by peak developer activity, we continue to evaluate some very interesting projects in the blockchain space. Our team is currently doing DD on 5 projects. Sneak Peek, we are in the final stages of making an investment in Theya. The below infographic gives a good idea about what they are doing. The deal is not yet finalized, but we thought it would be good to give you a heads-up.
How do we feel about the next few months?
Ethereum Shanghai Update
As we enter 2023, one of the most important events to look forward to is the Ethereum Shanghai Update. The update will enable withdrawals from Ethereum staking contracts, and significantly reduce the risk of staking ETH. This will provide an opportunity for liquidity staking protocols to grow. Projects like LDO, RPL, and SWISE are worth keeping an eye on, as they have seen significant growth recently.
On-chain analysis of Lido’s stETH & LDO token clearly shows that interest in Ethereum LSDs is on a rise as we enter 2023. In total, users have staked 4.8 million ETH through Lido, representing a value of $5.8 billion.
Here's a brief note from Ganesh (Investment Partner) unpacking the mystery around Liquid Staked Derivatives.
Ethereum L2 & Arbitrum
Ethereum's layer 2 (L2) solutions are expected to surpass $10 billion in total value locked (TVL), fueling a resurgence in the decentralized finance (DeFi) industry. This growth in TVL is expected to drive innovation and adoption within the DeFi space, as more projects and users are drawn to the scalability and lower transaction fees offered by L2 solutions.
Arbitrum, a layer 2 solution, is expected to become the second-largest L2 by TVL after launching its token. This will likely be a significant milestone for the project, positioning it as a major player in the Ethereum ecosystem.
From the Research Desk
Our research team has curated content from across the web. Hope you enjoy reading through the same!
ZK Tech: Revolutionizing Blockchain Transactions with Privacy and Scalability
Have you heard about ZK technology in the world of blockchain? This revolutionary tech is enabling privacy and scalability like never before, and it's worth paying attention to....Read More
How Can Crypto Gain Adoption This Year?
How can crypto gain adoption in 2023, Here’s an article by Revelo Intel that debates the Wallet Wars, ETH vs Bitcoin, the rise of insurance, app-specific vertical integration, the adoption of CBDCs, Coinbase vs DEXs, MEV as a business model.Read More
Is the current price for Bitcoin at the “bottom”?
Here’s an opinion piece from one of our favorite writers, Arthur Hayes. He talks about whether or not the bitcoin price has bottomed with very convincing reasonings.Read More
Modular vs monolithic: a beginner's guide
Modular blockchains optimize for a future of collaboration, flexibility, and sovereignty that strives for principles that empower people and communities first.Read More
Asia Tech Podcast Episode 248:
Listen to our Investment Partner, Ganesh Kompella talk about macro markets, FTX, the Future of Web3, and how trustless infrastructure, smart contracts, and full ownership of data will shape the world.Listen on Spotify
The Future of Crypto with Xan and Bew. They discuss Bitcoin DeFi, this bear market vs the previous bear market, Web3 gaming, and much more.Listen on Spotify
As we start 2023, we would like to thank you for your belief and partnership. From the entire Tykhe family, we wish that 2023 holds success and good fortune for you and your loved ones!