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Summary

The podcast episode discusses the recent developments in the crypto industry, with a focus on on-chain data, the growth of Bitcoin ETFs, and the emergence of new projects on the Bitcoin blockchain. The hosts share their experiences from the Denver conference, highlighting the significant interest in the Blast chain launch and its impact on the market. They also delve into the rise of Bitcoin layer two solutions, the dynamics of institutional flows versus meme coins, and the potential future of various crypto projects.

Takeaways

• 🎙️ The podcast episode features a discussion on the crypto industry, onchain data, and recent events in the space.
• 🏛️ The guests disclose that the views expressed in the podcast are independent and do not represent their employers.
• 🤝 The community power of the data house was highlighted during the meetup in Denver.
• 📈 The launch of the blast chain and its impact on the crypto industry was a significant topic of conversation.
• 💡 The blast chain managed to gather an impressive 2.2 billion in TVL despite being a 'fancy multisig'.
• 🔄 The shift of various protocols and projects to the blast ecosystem was noted, with some teams forking themselves or spinning up new entities.
• 🚀 The developer incentive program on blast was discussed, which rewards developers for creating useful contracts without heavy BD processes.
• 📊 The growth of Bitcoin layer two solutions and their TVL was analyzed, with a focus on Merlin and B squ.
• 🌐 The interest in Bitcoin layer twos is primarily based in Asia, with the majority of VCs involved being Asian.
• 🦅 TheOrdinals on the Bitcoin blockchain and their impact on NFT trading volumes were highlighted, showing a significant increase in activity.
• 📈 The Bitcoin ETFs have seen substantial flows, with Fidelity and Black Rock ETFs recently hitting record numbers.

Q & A

What is the main topic of discussion in the podcast?

The main topic of discussion in the podcast is onchain data, charts, crimes, and metrics that move the crypto industry.

Who are the hosts of the podcast?

The hosts of the podcast are Denning, Corgi, Dobby, and Boxer.

Where did the hosts meet recently?

The hosts recently met in Denver.

What was a highlight of the week for Dobby in Denver?

A highlight for Dobby was meeting a bunch of people he works with, either closely or not, and experiencing the data community connection outside of their companies.

What was a low point during the Denver trip for the hosts?

A low point was the difficulty in booking the podcast recording, which resulted in most of the week being empty and not as happy.

What is the significance of the Blast launch in the conversation?

The Blast launch is significant as it represents a major event in the crypto industry, with the company announcing its chain in November 2023 and attracting a large amount of attention and investment.

What did the hosts discuss regarding the Ethereum layer 2 solutions?

The hosts discussed the growth and development of Ethereum layer 2 solutions, such as Optimism and Blast, and their impact on the crypto industry.

What was the main issue with the Denver venue according to the hosts?

The main issue with the Denver venue was the cold and dry weather, which made it uncomfortable for the hosts and caused physical discomfort.

What was the hosts' general consensus on attending conferences?

The hosts agreed that while attending conferences can be time-intensive and temporarily affect work productivity, it is useful in the long term for networking and gaining industry insights.

What was the notable event at the Denver conference involving block builders?

A notable event was a heated panel with block builders on stage, where the moderator asked about the launch of a relay and the presence of a significant portion of Ethereum's block builders.

Outlines

00:00

🎙️ Podcast Introduction and Denver Experience

The paragraph introduces the podcast, highlighting the hosts and their roles in the crypto industry. It discusses their recent gathering in Denver, sharing personal experiences and interactions within the data community. The conversation ranges from the enjoyment of meeting colleagues and attending side events to the challenges of recording the podcast and dealing with the cold, dry climate of Denver.

05:02

🚀 Blast Launch and Market Response

This section delves into the launch of Blast, its development as an L2 solution, and the community's response. It covers the initial skepticism around Blast's TVL growth, the migration of capital to different smart contracts, and the eventual transition to an actual chain. The summary also touches on the variety of protocols emerging on Blast and the potential for scams, weighing the opportunities for developers and the strategic decisions behind farming airdrops.

10:04

🌐 Bitcoin Layer 2 Developments and Market Trends

The paragraph discusses the growth of Bitcoin Layer 2 solutions, particularly Merlin and B squ, and their rapid TVL increase. It explores the reasons behind this growth, including the abundance of dormant capital in Bitcoin and the interest from Asian-based VCs. The conversation also highlights the potential for Bitcoin L2s to attract users due to Bitcoin's reputation and the possibility of deploying EVM-compatible chains on Bitcoin.

15:04

📈 Bitcoin ETFs and Their Impact on the Market

This section provides an in-depth analysis of Bitcoin ETFs, their flows, and their impact on the market. It discusses the tracking of on-chain flows, the percentage of Bitcoin supply moving into ETFs, and the potential future growth. The summary emphasizes the manual effort required to track these flows and the goal of promoting transparency in the blockchain space.

Keywords

💡onchain data

Onchain data refers to the information that is recorded on a blockchain, such as transaction histories, balances, and smart contract interactions. In the context of the video, onchain data is crucial for understanding trends and metrics within the crypto industry, as it provides a transparent and immutable record of all activities on the blockchain.

💡Layer 2 solutions

Layer 2 solutions are technologies designed to increase the scalability and efficiency of a blockchain network by processing transactions off the main blockchain (Layer 1). They are often used to reduce congestion and transaction fees, thereby enhancing the user experience and enabling more transactions to be processed simultaneously.

💡yield farming

Yield farming is a DeFi (Decentralized Finance) strategy where participants provide liquidity to a protocol in exchange for rewards, often in the form of tokens. It involves lending or staking cryptocurrencies to earn interest or additional tokens, and is a way for users to generate passive income from their holdings.

💡developer airdrop

A developer airdrop typically refers to the distribution of a certain cryptocurrency or tokens to developers or users as an incentive for them to build or use applications on a particular blockchain platform. This strategy is often employed to attract developers, increase network effects, and stimulate ecosystem growth.

💡bridged total value locked (TVL)

Bridged total value locked (TVL) is a metric that measures the total amount of cryptocurrency value that has been transferred or 'bridged' from one blockchain to another, and is locked in liquidity pools or smart contracts on the destination network. This metric is significant as it indicates the level of interest and capital flowing into a particular blockchain ecosystem.

💡DeFi (Decentralized Finance)

DeFi, or Decentralized Finance, refers to a financial system built on blockchain technology that aims to provide services traditionally offered by banks and financial institutions, but in a decentralized manner. DeFi platforms enable lending, borrowing, trading, and investing without the need for intermediaries, offering users more control over their assets.

💡Bitcoin ETFs

Bitcoin ETFs, or Exchange-Traded Funds, are investment funds that hold Bitcoin and are traded on traditional stock exchanges. They allow investors to gain exposure to Bitcoin without having to directly purchase and hold the cryptocurrency, thus making it more accessible to a wider range of investors.

💡ordinals

Ordinals refer to the practice of inscribing, or writing, data onto a blockchain, specifically in the context of Bitcoin. This term has gained popularity with the emergence of technologies that enable the creation of NFTs (Non-Fungible Tokens) directly on the Bitcoin blockchain, which is different from the traditional Ethereum-based NFTs.

💡zk-rollups

zk-rollups are a type of Layer 2 scaling solution for blockchains that use zero-knowledge proofs to bundle multiple transactions into a single proof that can be verified on the main chain. This technology allows for greater transaction throughput while maintaining the security and privacy of the original blockchain.

💡memcoin

Memcoin, or meme coin, is a term used to describe cryptocurrencies that have gained popularity primarily due to social media hype and community support, rather than having a strong utility or technological innovation. These coins often experience high volatility and are driven by speculative trading.

Highlights

The podcast discusses onchain data, charts, crimes, and metrics in the crypto industry.

The podcast guests include Denning Onchan, Corgi at flbs, and Dune's resident data house.

The podcast guests share their experiences from the recent Denver gathering.

The launch of the blast chain and its impact on the crypto industry is a major topic.

Blast gathered 2.2 billion in TVL with its initial chain, which was just a smart contract multi.

Blast chose the optimism stack but did not follow the super chain standard.

After 12 days since launch, blast has a bridged total value locked of 2.66 billion.

Many teams are forking themselves or spinning up new entities to operate under new names in the blast ecosystem.

The blast protocol has a developer incentive program that rewards smart contracts based on usage.

Bitcoin Layer 2 solutions are gaining attention and have significant TVL.

Ordinals, which allow inscriptions on the Bitcoin blockchain, have led to a surge in NFT activity on Bitcoin.

Bitcoin Layer 2s like Merlin and B squ have attracted significant VC interest, much of which is based in Asia.

Bitcoin ETFs have seen significant flows, with 1% of Bitcoin supply moving into ETFs.

The Bitcoin ETF has the potential to吸收 up to 8.2% of Bitcoin supply annually based on recent flows.

The podcast also touches on the Solana ecosystem and its recent meme coin activity.

There is a notable split in the market with institutional flows going into Bitcoin ETFs and retail flows going into meme coins on Solana.

The guests discuss the impact of Bitcoin Layer 2s and ETFs on the perception of Bitcoin as a secure and established technology.

The podcast highlights the importance of transparency in the blockchain space and the potential for on-chain analysis to reveal significant holders of Bitcoin.

The discussion includes the potential for cross-chain interactions and the bridging of assets between EVM chains.

The podcast concludes with a reflection on the overall state of the crypto industry and the diverse opportunities it presents.

Transcripts

hello everyone uh welcome to the index

podcast where the three of us come

together every couple weeks to discuss

onchain data charts crimes and metrics

that move to crypto industry um with me

I have Denning onchan Corgi at flbs

Hobby resident data House of at

dragonfly and myself that is boxer uh

Community power horse at Yun um before

we properly start this episode um we

need to disclose that nothing we say

here is Legal Financial invest

text or even life advice um the re the

views expressed in the podcast are not

representative of our employers and uh

we are acting independently of our

respective professional roles so with

that um last week we all hung out at

Denver so maybe um Dobby how how was

your week in Denver week was awesome I

mean it's really cool to meet like a

bunch of people that you work with close

or not uh you know like the the whole

data Community thing is like we're all

connected apart from aside from our

companies and it's kind of cool to meet

all those people you guys as well then

we also had like you know low points

where we try to to to book like the

podcast recording uh thing and we

couldn't and then so it was empty most

of the week so that was uh not as happy

at a moment but you know overall very

cool uh very cool week yeah um I liked

it I I had like a more packed agenda of

like meeting the teams and I didn't even

go to the main venue until the last very

day I was like at the Meb side events um

the one organized by Titan was pretty

cool there was like a heated panel of

all the block Builders uh on the stage

and like you know the moderator was

asking unhinged question about are you

guys GNA launch a relay Etc and there

was like a photo taken by someone who

was like oh that's 90% of blocks of

ethereum on the stage which is like by

three top Builders so um it was quite

interesting event um I learned about

execution tickets by Mike neuter like

the new epbs Direction Etc um yeah and

also great to see y'all in the um venue

briefly um Dune happy hour was cool like

a lot of the data people around there

low lights was definitely like Denver

sucks I I'm just a hater Denver it's so

cold and it's also like so dry my nose

was bleeding every day yeah and it's

dusty kind of so yeah I I don't know who

like decided that Denver was the place

we're all going to meet at in February

it's like it's really really a strange I

I think it just developed like this

historically but also like my my lips

and my nose they were they were

absolutely [ __ ] I've never had it this

bad in my life like it was insane um I I

think it used to be a small Meetup with

like locals there and that's why like

yeah go into this yeah yeah quite yeah

crazy how how these things go um I also

like pretty good week um we we had a

dune company onite at the same time so I

also like met a bunch of Dune people we

kind of aligned on product directions

and stuff um but yeah in general it's

like really really cool to always meet

Wizards wherever you go it's like

especially like as a dune employee you

can just like walk around a conference

with a dune shirt and somebody will oh

my God you work at Dune this is amazing

I love the product you're just like yeah

we're trying our best it's always like

quite a quite a humbling experience um

so funny like the very last day I went

to the main venue to meet Dobby and he

said he was like working on his Dune

dashboards and then you and another Dune

guy walked over like oh you're a doom

user and like oh it's BBY yeah yeah

Berard and me we were just hanging out

ber like spotted from the distance like

hey this guy's working on dude like

turns out to be Dy which was pretty

hilarious just to Total coincidence um

but yeah overall like really cool to to

also meet kind of the North American

wizard like before I like I mostly meet

like the European and and I guess the

Asian people because they they have like

an easier time coming to Europe um but

now I actually met met quite a few

people who are based in North America as

well um so yeah just real good times um

the conference itself is like Giant and

it was really interesting like for me

it's always like really I have like a

good time just asking questions and I

going deeper and going deeper and it's

like usually it's it's not really

sociable socially acceptable to just

like ask ask like a hundred questions

but like if the people are in the booth

they need to answer my question so like

I have a really good time just like

pressuring them and like asking asking

not not the nicest question sometimes um

but yeah really really engaging

conversations and you can really kind of

load your load your brain with a lot of

content with with a lot of understanding

and kind of The Vibes of the industry so

I think like while it is very time

intensive and like your usual like work

productivity really suffers in such a

week um I I think long term it's always

useful to kind of go to these

conferences like once in a while so yeah

with with with our weeks in Denver

covered one big topic that I that

repeatedly came up in in conversations

there is um the blast launch and just to

kind of recap um blast launched their

their chain or like their they announced

their chain in November uh 2023 so

that's four month ago um and their

initial chain uh in quotation marks uh

was just a fancy multi so uh they didn't

really have a chain they were just like

hey deposit your money with us um you're

going to get the native yields which is

the whole kind of uh trademark or the

the whole uh pitch of blast is um they

are developing an L2 which has the

native yield for uh D or usdb what how

however they call that which basically

deposits uh stable coins into the maker

uh Reserve module and then they have

ethereum which uh they deposit into um

the liquid staking module of L Lio and

basically um up until uh March 20 uh

February 28 or 29 um this Capital was

just sitting around there it was not

like an actual chain but rather it was

just sitting in this smart contract

multis um and they had gathered an

insane um 2.2 billion uh in tvl so

that's that's pretty insane um so maybe

let me share my screen real quick let's

do this so 2.2 billion in tvl

and for for those just listening we're

now opening up def Lama um and we're

we're looking at a chart which basically

just show shows the pre-launch farm uh

blast tvl um and surprisingly if we look

at this in US dollar terms and in eth

terms because eth went up 70% during

like during the time from uh from

November when last first launch to uh to

now um and surprisingly if we look at

the US dollar and the e they're not that

different even though eth went up quite

a bit so what that basically tells us is

that continuously during the whole time

this Farm was live people were

depositing funds in there which is quite

surprising to me I I would have not

expected this like I I I only looked at

this data yesterday the first time and

it yeah very very surprising that

there's so many people who are kind of

like not late to the party but like in

in mid December or like like end of

December they were like ah yeah let me

like deposit my eth into blast which is

I I can't really rationalize that

decision um but in the end like I think

a lot of blast TBL was big farming

Capital so maybe it was just this was

the best opportunity for them risk

adjusted to deploy their capital in this

yield opportunity so I I I guess it's

it's not really the retail users who are

driving a lot of this but more like the

big farmer or like the professional

Farmers so yeah um that the that for

that um and then blast finally launched

February 28 I think I wrote this down

somewhere um but 12 days ago um I wrote

down 12 days ago but not the DAT that's

that's pretty stupid but yeah um so

blast finally converted to actually

being being a chain um they chose the

optimism stack um but they didn't choose

to be part in the super chain so yeah

maybe the super chain is if you follow

certain methodologies or certain

standards that the optimism Collective

is kind of enforcing so that all the

that all the chains are kind of

interoperable in case they ever get to

like a level where they can more easily

do interoperability in the future blast

did not choose to follow the super chain

standard because Blast has made too many

changes in their kind of

core like mechanisms just because of the

Native yield and and and all of this ja

um so so yeah um but they're still using

the optimism stack um so in in the end

they kind of benefit from from what

optimism has developed in the source

stack there um and yeah um in the

beginning there there was like a bit of

unclarity there's a bunch of Articles

from blockworks or from uh from from

other news news outlets where there like

ah Blast has lost all all of its tvl but

then what what ended up happening is

just defi Lama is only so Nea Lama had

indexed the the multi contract that was

the bridge or like that is supposedly

the bridge um but it ended up that you

didn't so if you actually funds moved

into a different smart contract so it

looked like a lot of capital left um the

blast bridge but in the end it just

moved somewhere else um and now 12 day

12 Days After launch um we are at 2.66

billion in bridged total value locked um

so I think there's a net outflow of 50K

in ether so I think the The Ether terms

here are more kind of like that's the

better metric to look at because the

market is the market is sending so hard

at the moment so uh at the time the

bridge uh or the prearm finished we were

sitting at 670k ether um in value so

it's not 670k ether but rather The

Stables plus The Ether in the bridge

contract where worth 670k ether and now

we're sitting at 650k worth of ether

even though the e e price has gone up so

nominally they've actually lost 20K in

ether but since the prices are all going

up um the tbll overall has like in in

dollar terms has increased so yeah uh

what does all of this tell us um and and

what is actually happening on blast so

if you if you look at the blast

protocols and I for those of you just

listening we're still on the on the defi

Lama page there's kind of a a lot of new

names here there's a few names which are

kind of noticeable I've I I kind of

remembered basabi from 2021 like this

was like the peak defi yield farming era

I I think I I I lost quite a lot of

money in their pool too so no good

memories from me to Babi um but fair

enough um and a lot of like there's not

a lot of um kind of rutal prot protocols

deployed here so there's no Unis swap

there's no a there's no maker I mean

maker is being used in the background

but maker maker itself hasn't deployed

here um and yeah um just just a lot of

new names and um I overheard some

conversations at e Denver that basically

what what what is happening is that a

lot of teams are they basically Fork

themselves or they just spun up a new

entity um and are now um operating under

a new name in the blast ecosystem so if

you've previously kind of had whatever I

I don't want to put bad names on any

protocol now so I'm just gonna like I

don't know some like Unis swap V2 Fork

on Phantom or polygon or whatever they

just um have a new skin now and now

they're operating on blast as I don't

know P Finance or orbit protocol or

Thruster and I think sometimes the the

associations are publicly known so

they've actually kind of like they've

publicly said hey we're going to do this

and and like this is this is like a

project that the team's also taking on

but I think there's also like quite a

few Protocols of basically like ah we're

a new team and since the old team or

like the team that was operating on I

don't know mes was unon they can just

like Sprout up in a new place and and

this place is now blast and they they

they're like basically rinse and

repeating their like I don't know

they're sioning Grand money on mates and

now they're kind of like farming the

developer air drop on blast um so that

actually is is a good yeah in a in a way

it makes sense where like you're goingon

to as as a Dev if you're if you're

working on a now dead chain and you see

this chain that's just launched with all

this liquidity and you know you have a

chance to be like first mover uh and you

have like there's like 50% of the

upcoming air drop or something going to

protocols so there's there's a good

flywheel for a potential you know

potentially your protocol doing well

there and so I guess it's a you know if

it wasn't doing so well in other chains

or if you just want to expand it there

probably a good rational here but of

course it's a it's a d gen chain maybe

for now and kind of a bet uh on its

future more than anything so yeah yeah I

agre people was saying like they're

going to be so many scams on blast but I

I'm not aware what exactly are you guys

aware of any like projects that's like

scam on I mean why why more or less than

other chain launches may maybe I don't

know but I'm not really looking for scam

so I don't really

know let me a to some scam Farms let's

go there definely some like mcoin mcoin

was like a thing you know there's

several few mcoins that launched and

were announced pre prior to the launch

of the main net so maybe that's where it

comes from where it's like d gen heavy

and therefore if if it attracts the DJ

they'll probably have you know a lot of

scams as a result but yeah I don't know

if there's like much proven to that yeah

I think so so far those legit projects

here so if you're a Unis swap for or if

you're V2 for or something like this

actually I think the game theory

basically plays out in a way that you

are like it's an EV plus action to just

stay stay in the game and actually Farm

the airdrop legally I think if you if

you kind of weigh like committing a

crime versus just getting getting money

from the developer air drop from blast I

I think that turns out to be the better

decision in in a lot of cases um and

that's basically the whole playoff last

year they they've like tried to do like

a good kind of web two inspired GTM

motion the same play that they did with

b um just rinse and repeat or like not

rinse and repeat but basically evolved

that Playboy to be like hey we can

actually like power a whole chain with

this maybe um put a lot of like put a

little bit of innov innovation with uh

the the native yields um on this chain

and now they're basically trying to get

developers um to deploy on this chain

with a developer incentive program and

this developer incentive program is

designed in a way where it's mostly kind

of like not BD heavy and like you don't

need to like Lobby for Grants or

something but rather um the smart

contracts that are deployed on the chain

and that are getting usage are actually

just going to get air drop the points or

gold I think it's like the the internal

name that they're using for this um so

so it is really interesting um where

where a lot of other chains are

basically like they have this like very

heavy DD process and like you need to

submit governance proposals and like do

all of this stuff like basically like

what blast is doing here is like they're

more or less employing this retroactive

program where they're like build

something useful make people use the

contract on our chain and we're actually

going to reward you with with the native

chain tokens without without like having

like heavy BD or like all of this like

belts and wizards that you like Hoops

you need to jump through um so we'll

we'll see how this ends up I I think

this is like like blur like the the

founder Pacman how whatever his real

name is I forgot um he's really keyed

into the things like I I think these are

like he's he's like learned the lessons

that like all of these other chains are

are painfully learning uh slowly and

like we we'll see if this actually has

attracted any any useful Builders or

like any any good Builders um maybe

maybe as a last aspect from from the

data side um even though there's so much

Bridge tvl so bridge tvl is is is not

like value locked on the Chain but

rather just like how many stables and

how much ether is on that chain um their

place eight or nine um so really really

impressive number actually um they

they've surpassed optimism in wait have

they pass optimism wait in terms of in

terms of l2s they're like third I think

if you just look at total brid

rollups yeah yeah optimism I think uh no

optimism optimism has M but but they

basically like they're in the top 10 of

bridged tvl chains so like that's super

impressive for like a chain that's 12

days old basic basically um so we'll

we'll see if actually something use to

cons this what I can say for right now

is that even though there's all of this

tvl and like theoretically there's a lot

of users there's very little Dex

activity or like in general like I don't

think there's that much interesting

stuff happening on this chain so we will

we will see how this actually turns out

um I I think users will kind of keep

grinding for the points and for the

airdrop there's a lot of other

interesting things happening at the

moment so maybe that's like actually

kind of bad for blast in a sense because

it's like it's not really the most

exciting thing and there's not like that

like the casino is not spinning as fast

on blast as of now and like how how do

you get the casino over on blast um so

yeah that's my uh that's my short uh

recap of what's happening on last and

yeah really a big Topic in Denver like

every I don't know like lots of

conversations which you're like ah like

is your project going to deploy there

and like is June going to integrate

blast and like what what is happening

here um so it really has captured a lot

of attention which is like compared to

all the other like I don't know there's

like so many l2s and layer ones who had

like even like Booth uh in in the actual

e Denver and you just walk past them and

be like ah whatever another L2 and Blast

has really like they like we're talking

about it they they've captured the

attention they've they've captured a lot

of uh a lot of Rich Capital um so yeah

we'll we we'll see how this story heads

up yeah I I feel like this chain is

definitely going to be more like yel

heavy or like like speculation heavy

chain and like in East Denver I most

thing I've heard was like it's going to

be a [ __ ] show because all the developer

tools aren't even ready like bunch of

like devs complain to me about like even

the node provider like you can only use

Quick node back then using uh to deploy

on plus but then the node doesn't even

allow you to query per like block range

specified Etc so like it's just really a

pain in the ass to integrate blast and

seems like it was kind of like a sh Show

after the launch but I guess it's live

now this morning I saw they were down

for a few minutes after Duncan upgrade

but they're back now so we'll see how it

goes you conf yeah okay I I you confuse

me with this morning because uh for me

it was like two hours ago which in the

middle of after I always forget but my

the the like it's it's funny because I

think I think they're the First on to

have like native yields and you have um

you have that tried to Pivot into doing

the same thing in December so like blast

at the reward program starting from

November up until like two weeks ago or

something and Mana was like okay we got

to front run them by basically doing the

same program but even more D gen

starting in December and only making it

last a month so we launched prior to

blast um but I think it's it's like they

if you look on like L2 beat you'll see

like M has done them before behind blast

um but I don't know I don't know much

going on on menta which has launched uh

a bit earlier while I like I've heard

more about things launching on blast uh

so I'm just yeah I don't know I don't

know what the reasoning here is maybe

it's just like bless has the bigger

branding and was the first mover and the

First on to do all this uh whereas menta

was more of a

copycat um yeah I'm just curious on how

that plays out in the long term I think

Native yield does make sense for the end

user though on a protocol level it's not

really how it was intended or how it was

designed but like you know it's it's it

makes sense uh to have um to have the

user not being diluted uh to death

through uh you know native yield of

ether and stable coins especially since

Le funds are often just sitting there

anyways speaking of l2s I remember like

a lot of people were talking about

Bitcoin later too as well at East

Denver so I think we going to like walk

us through about some findings and data

there yes so give me one second while I

share my screen first of all first of

all like I don't why Bitcoin layer to um

my general understanding is that people

think now there is capital flowing

through Bitcoin ETF and like people want

to use Bitcoin in a more like easier way

like you could use the wbtc on ethereum

but it's not like they want the capital

to be bridged off from Bitcoin so there

there needs of like using Bitcoin layer

to and they are supposedly all evm

compatible and that's all I understand

all more or less so I first want to roll

it back to like the original state of

like what was the first layer two which

is lightning which isn't a layer two in

in how you would compare it to what you

have on etherum so it's it it only is

for transfers but at much lower fee and

and everything and you can see that that

usage is going is well it hasn't ever

really been uh crazy high in terms of

usage but also it's been going down

lately um so this is this has been the

main known you know uh it's like a

staple of Bitcoin in a way and was a was

a big part of uh of of uh I think it was

launched in

2018 uh so that was a big development

for the chain um then you had others uh

come in and one of them was Stacks which

also launched in I think 2018 and was uh

you can compare it more maybe to polygon

where it's a you know it's a side chain

more than an L2 that uh you'll find on

on uh on on ethereum much like

optimistic rollups or ZK rollups so

technically while it is like connected

to the Bitcoin chain it really can

sustain on its own uh and I think it's

more of a you know it's a it's a States

uh it like track the state rather than

the actual uh every transaction those

are settled offchain so that's why you

are able to have much lower costs um and

this you know this didn't get much

structured until maybe later on where

actual uh inscriptions came around and

you could settle on bitcoin uh and have

actual proofs uh posted on bitcoin

that's where it get through tvl you also

have another one

which um you may have heard of which

isn't either a L2 but Thor chain which

is another one but it's a bit

controversial so the the point of Thor

chain is to bridge native assets across

chains so one of the main ones being eth

to bitcoin uh the problem here that I'm

showing is a tweet that shows that uh a

lot of the a lot of the transfers are

used basically for uh kind of like

scammers moving across chains to

obfuscate uh where the the funds are

headed uh so that's just one thing is

just that you know there is any check

you're not you're not going to get

censored so it's just an easy way for

anyone including of course Bad actors uh

to bridge off of ethereum onto Bitcoin

and just keep shuffling funds until

hopefully you've lost the people you've

lost the white hats trying to track you

I guess or you you know you move first

onto the exchanges before they're able

to to alert them and and say hey like

can you block these funds um so that's

just an unfortunate development but you

know um that's St chain I don't know if

they if they've done much work there or

if they've actually uh iterated on On th

chain in a way to to make it like you

know it's hard to have

permissionless uh chain that also

prevents uh Bad actors but I don't know

maybe there's something like this is

basically the torado like thing repeated

right where it's like are you really

trying to like be permissionless or are

you I don't know do do you want to

prevent North Korea or Russia to to like

use your protocol and that's like it's a

really like hard philosophical debate

and question but like I I I wouldn't I

don't know to toor chain doesn't seem to

give a [ __ ] like I haven't seen any

communication from them being like no

we're like censoring or whatever yeah

it's like they would lose most of their

volume if they can if they prevented

this so it's kind of like you know it's

it's hard to which side do you choose do

you choose Being Greedy or do you choose

being right and uh I guess they chose

the first one uh for now maybe that

changes uh and then you had another

development that uh you've heard about

which are ordinals uh so ordinal are uh

in a way roughly to put nfts on on the

Bitcoin blockchain but really it's

inscription so you are submitting Json

uh packets on Bitcoin to put it simply

and the major difference probably that

the metadata is going to be posted on

the Bitcoin blood chain straight away

rather than being offchain like on other

uh ERC 721s and ERC and what I want to

show here is how actually some of the if

you look in the top F some of the more

prominent nfts overall in terms of

market cap uh although I mean for more

IL liquid tokens market cap isn't

necessarily the best metric but I guess

it's what you know it's the best we have

probably

uh you can see that like node monkeys

here is like second to uh B apes and if

you look throughout the like the top 20

you'll see quite a bunch of Bitcoins in

there uh so it is a prominent chain uh

there's almost you know there's like

probably fewer Solana ones than Bitcoin

ones for example which I would have you

know I would have guessed the opposite

but I think this comes from uh Solana we

have more public access to like sonana

data whereas Bitcoin usage especially

ordinal I honestly I know a little less

on the data and also because usage of

the Bitcoin ordinal seem to have St like

they've stemed wrong from um the Asian

side of the world uh so we probably

didn't see it coming as much um so yeah

that's that's another thing uh and if we

look overall if we look

overall sorry what if you click on the

number of O owners of the ranking of

this

nft uh number of owners yeah there's

there's fewer for no monkeys so I guess

it's it's not as spread out but also

those are younger so you know Supply

like holders tend to grow over time so

maybe this is just an impact of them

being younger relative to B Apes

honestly I don't I don't know the

Dynamics exactly of holders on B apes

and not monkeys it's a maybe maybe

there's something there I I honestly

don't know but yeah it's it's probably

more well heavy on not monkeys um but if

you look wait maybe how great can we can

we quickly put in plain words what we're

looking at here was this the last

24-hour trade volume of nftd collections

this is based on last last 30 24 hours

let's look at 30

days uh 30 days it's I mean it's I put

24 hours but it roughly looks the same

even more skew TOS Bitcoin it seems on

you on 30

daysin ones then

just to put this in plain words once for

anyone who's not like uh looking at this

website um oh yeah in the last 30 days

ordinals related collections or like nft

collections on bitcoin are taking up

maybe 10 spots on the top 20 leaderboard

of nft volume in the last 30-day in

nominal Vol or like volume in US dollar

yeah

exactly um it doesn't necessarily mean I

think volume

uh I mean it's hard to find a good

source again for like orinal because

it's hard to be to track it um but I

think volume is comparable uh to

ethereum mainnet volume uh but it it you

know uh overall isn't much higher but it

is higher in terms of uh I guess what

like you know um high value nfts are

going to be more prominent over there uh

and also because I think ethereum

overall hasn't moved all that much for

nfts lately in volume it's been

relatively stable it's grown like

slightly but you know uh relative to

previous uh 2021 highs it's it's much

lower uh we're yet to even come close to

those uh and I think the the the biggest

price moves have got have been like

fudgy Penguins moving up uh over the

past three months and then over the past

month with uh e ethereum going up uh

most of the nfts have gone down because

I'm guessing people are exiting to get

the native assets and also maybe it

remains somewhat stable in USD value um

yeah those are mostly guesses to be

honest so it's just that it Bitcoin

seems a lot more active lately in terms

of nft trading than ethereum uh which is

surprising could we maybe say that like

the nft cycle like there's nft cycle

happening on bitcoin just because they

don't have access to

shitcoins almost like there there's like

there's like so many memec coin and

shitcoin trading happening on on like

sonana and ethereum and I think like on

on bitcoin like even if we look at this

list there's like some brc2 related nfts

or something so maybe this website just

groups them weirdly and like they're

actually just fungible tokens and not

really un like non

fungible it's it's it's a weird thing

but like it it seems to me that almost

like the the meme cycle in Bitcoin is

more like happening on the nft side

rather than on ethereum and and Sana

where it's on the on the like fungible

shitcoin side yeah I agree I think it's

a you know it's not as black and white

as on ethereum where you have a clear

cut between the two um so there's

definitely some of this because you just

can't have uh shitcoins on on bitcoin uh

I mean ic20 is on Bitcoins I guess um so

yeah there's definitely this um but what

I wanted to get at with this ordinal I

didn't really want to talk about ordinal

themselves it was more about like

ordinal was the first practical

application of inscriptions on bitcoin

um but with those actually came other uh

applications which are rollups uh well

rollups uh l2s which can mean a lot of

things but the main uh the main two l2s

on bitcoin which if you look at like tvl

uh now Merlin is at like 2.1 billion in

tvl but I think I had it there uh in

total if you include the OS that bridge

on there there's almost 4 billion uh on

there which is quite a lot um and you

also have B squ uh which is another L2

but this one is yet to launch I think

the difference between the two is uh

Merlin has launched and is on Main net

uh whereas B squ is still on test net

and Merlin is currently in its uh pre uh

is like farming program where people are

essentially mining the the main uh

governance coin that'll come later uh

that is called mer Merl basically um so

that's also why the high tvl I think one

interesting thing is the the reason

these are able to grow so quickly so

such high tvl I mean if you look at like

the tvl chart it's kind of insane that

Spike how it basically uh it started in

like February and like over a month it's

gathered like substantial amount of

money and that's because you like

Bitcoin is just full of like very dond

Capital that's just sitting there and

doing nothing so you might as well

Bridge your bit Bridge your Bitcoin if

you're if you're fine with the risk

factor of bridging it you you might as

well Bridge it to farm another token uh

you know if it wasn't do anything else

in the first place um in that in that

sense it does make sense if if if that's

your goal um yeah we'll see how those

develop I think uh one one interesting

factor is if we look here so here are

the the two recent raises of uh so

Merlin and B squ and I looked through

all those VCS I wanted to see where they

were based and I think it's a really

good proxy for where interest is and

basically all of those there's like 80%

based in Asia uh there's only like up

horest is based in

California uh one based two of them are

based in Kar two in sells uh in the SE

shells uh yeah and then like one in

London and the rest is all uh Singapore

Tokyo Hong Kong Beijing SE uh yeah

it's it's it's basically very

concentrated over in Asia so that's

probably why we I mean it seems very

distant from us all this maybe I don't

know I don't know about you guys do you

guys hear a lot about like Bitcoin l2s

or is it more something like you don't

understand yeah I think kind of all

makes sense because the first time when

I heard about Bitcoin layer to was when

the

Asia people were talking about

inscription and inscription was like

really hot in Asia like and so many like

trading and like look into like Bitcoin

layer to Meb like ahead of time so I

think it's all like chained together

from like the inscription ordinals um

and now there's Bitcoin L too

yeah yeah exactly um it it it all is

related and it's basically this it's

kind of like it feels similar to B&B

maybe where it's another the change that

I don't necessarily understand all that

well uh and it's heavily tied to Asia um

yeah I don't know it's it's it's

interesting I'm definitely curious to

see how those things develop uh for now

for context those are like just selling

ZK proofs on bitcoin through

inscriptions so that's the only thing

that really makes them uh Layer Two so

you know there isn't uh it's it's it's

it's not you're not going to have

optimistic rollups like on uh ethereum

you can you can have those um but you

have uh evm compatible uh

chains and in fact there's even one of

them where people have proposed to

deploy unisoft V3 uh the chain is called

root stock it's a side chain uh so kind

of like Stacks um but it is compatible

and people are already looking into

deploying existing uh ethereum protocols

on bitcoin l2s which I thought was

pretty interesting uh but now this is

all you know very very much like The

Proposal stage I don't know how the

integration actually looks how usable

the chains are I haven't played around

with them uh I think this will take a

bit of time uh before you know we we P

like the the farming stage and where

like we actually see actively used

protocols on there um but it's probably

worth keeping an eye on so M I have a

question so these are Bitcoin layer too

and so do they submit the confirmation

batch back to

bitcoin I guess

Bitcoin I guess there's something you

can submit in Bitcoin chain rather than

value transfer so how is it attached

back to the Bitcoin say cons security or

whatever it's just it's just a ZK proof

uh that's batched like of batched uh a

batched hash of like transaction posted

uh as inscriptions that's basically it

that's that's all there is to it it's

really I could technically deploy now

too if that's you know if those are the

the chain will submit transaction was

inscription back to bitcoin chain yeah

yeah yeah okay got it got it yeah I see

in in the same field that people do

inscriptions now they basically just

post the like either the ZK proof or I

guess you could also post the raw call

data the way that optimism like that the

optimistic proofs do it today for

ethereum yeah I think I think it's on

easy GPR for now and there's any anyone

posting not anymore not call any more

now it's blog

so get of an hour ago but basically

these are independent chains and the

only yeah there's no decentralized

validator sets it's basically the same

kind of like decentralized theater that

we are seeing on ethereum Chains It's

like we are roll up or like we using the

security of Bitcoin and in the end all

they're doing is like they're posting

data on mainnet or like on it's like

inscriptions where the main thing is the

narrative where it's on bitcoin and

that's the biggest chain regardless is

the first one uh and that is bound to

attract people regardless of what we

think uh because we think like this

being in the space but like people out

outside of the space may see this as

like oh I'm going to use the application

that's on bitcoin because that's the

biggest chain and I don't really care

what the hell is going on behind the

scene as long as like I'm told it's

secure I guess I don't know um but it

it's it'll be interesting to monitor how

those developed but I think you know and

this dolman Capital as well uh which you

don't really have on ethereum because

you can already I mean you have an

ethereum but you can already use it on

Main net for all kinds of things that

can't be done on bitcoin it's just

sitting there so you have funds that

maybe you'll have like yield bearing

stuff on on l2s and you know that's

already a huge thing for a huge unlock

for anyone having Capital sitting on

bitcoin and are they mostly optimistic

rollup or like ZK or ZK okay yeah and I

saw that there's like Wormhole bridge

that if you want to like interact your

assets between evm chains with them you

can Bridge it over anyway uh yeah that

is that is possible I honest I don't

know if you say so I trust you but yeah

I'm guessing there Bridges from your

screen just now so oh really wait what

yeah that was in the Unis swap

governance proposal there's also uh T

bit oh you're right you're right yes

sorry yeah yes there there's also T

Bitcoin which I I talked to them at e

they actually have a trustless bridge on

bitcoin so it's kind of like a not

really a smart contract but it's a

wallet that is managed by a Federated

validator set and they basically they

have a kind of trustless Bridge to kind

of bridge your uh assets natively from

Bitcoin the network to another chain um

also also quite interesting and I guess

an alternative to to Wormhole um yeah it

is it is flourishing there's even like

restating protocols starting to pop up

on bitcoin like it's it's it's just

repeating all the narrative hype in

ethereum yeah I think it's an easy

Playbook maybe it's a good career like

decision to go over to bitcoin like

everyone's going to think oh man this

guy is so smart like all you're doing is

like repeating the E

playbooks there's there's people out

there who are farming this like career

career wise at the moment yeah um with

that out of the way I think um what what

what I'm observing over the last couple

weeks is like kind of a split in the

market where like on the one hand we

have like institutional flows which is

like Bitcoin ETFs and then on the other

side there's like a lot of like mem coin

crazy happening and that's mostly

focused on salana um so maybe Dobby

you've been posting these great updates

on the on the Twitter uh on Twitter

regarding the Bitcoin ETF since You'

like you're kind of like the guy to go

to uh for this data so maybe if you

could give us like a high level take of

like what you see and then um Denning

you've you've kind of participated in

the Solana meme meme CRA so maybe if we

can we can see both sides of the

trenches here I think that's like a

really really interesting um like uh

contrast or or comparison that that we

can draw here Dobby is the official

Bitcoin guy for our podcast and I'm the

Sal girl

now damn okay times have changed um it's

yeah Bitcoin ETFs have been interesting

uh I I so if if you look at how ETFs are

traditionally being reported they're

just reported based on like you know

numbers reported out of like Bloomberg

terminal and everything like this the

difference here for Bitcoin ETFs which

as a reminder launched on January 10th

they were approved by the SEC uh and one

of them was U the grayscale Bitcoin

holding which was converted into a

Bitcoin ETF um and since then I've been

looking into the flows and my goal was

uh instead of looking at reporting

numbers I want to look on CH and

actually Snoop around and see okay where

which addresses are holding those trying

to track track the actual flows on chain

and ensure that you know uh because I

think those are more interesting based

on that's just what I like to look at

and you know looking at on chain flows

also adds more context you can see more

metrics uh yeah so there's all kinds of

things that are interesting here so the

the most uh the main thing is going to

be the flows themselves here you can see

how the 10 different ETF assurers have

been seeing flows over the last few

weeks you see how originally you had

like high grayscale out flows and maybe

somewhat High launch influence for the

other atfs which slowly dwindled but

then over the past weeks they've been

back up quite a bit and in fact I think

there's like quite a few that are seeing

like record numbers lately

uh so Fidelity is one of them with

recent really high numbers black rock

also saw really high numbers and like

black rocks just yesterday so the

inflows the flows happen on chain the

next days they they're settled one day

after being traded that is according to

the sec's ruling where you have one day

settle it uh so just yesterday there was

800 million uh and and so much uh for uh

Black Rock which is its alltime again so

it's kind of crazy to see for an ETF uh

these high flows and continuously

breaking alltime highs uh just a few

weeks after launch uh that really rarely

happens and for context we are now at uh

58 billion which is a little over half

uh that of gold ETFs already um but as a

reminder a lot of it comes from

grayscale uh which had a lot of um

Bitcoin uh in its uh Bitcoin trust that

was there for a while prior to ETF being

approved um if you look they had like

600,000 uh Bitcoin they now have they've

sold off a lot of them so now just under

400,000 but interestingly uh in terms of

USD AUM they're almost uh break even

from the start just because of bitcoin's

price uh going up over time so

technically they're just earning as much

fees as they were on launch day which I

think is like the highest at like

1.5% uh so they're doing very well over

there um and so so far 1% of Bitcoins

have moved uh into ETFs which is like I

think out like way out of people's

expectation and that's also what has

driven a lot of the price hike recently

uh if you annualized that number so

currently there's like 4% backing ETFs

4% of the Bitcoin Supply and if you

annualized the past two weeks of flows

uh roughly 8.2% of Bitcoins would be

absorbed uh into uh ETFs which is really

really insane uh it's like it's it has

the impact of uh the haling from uh not

the previous one but the one before so

it's it's quite quite a wild impact on

Supply and why that is uh you know

hasn't been uh seen in a very very long

time um so yeah it's it's kind of

interesting it's kind of cool there's

also we talked about it uh previously

there's there's rumors of the ETF

happening sometimes this year the first

deadline is end of May uh I think uh now

that like speculation is around 20% of

that happening because not much has

happened uh on it and we're just a few

weeks away uh the other next deadline is

going to be in August this one has a

higher probability obviously because

it's further away so maybe things will

have moved by then um but yeah it'll be

interesting to monitor if like the same

happens on ethereum say the 8% number um

did you consider The Happening happening

in

April this is just looking at uh ETFs so

if you if you only look at ETFs and the

flows so

if you the past two week if you look at

I guess those numbers here the past two

weeks and you spread the two weeks onto

a year you would see that 8% is being

absorbed into the uh ETFs does that make

sense like you're the you're saying it's

Bitcoin Supply percent absor absorption

so it's like your denominator is total

Supply Bitcoin right yeah so then like

yeah no I yeah I am facturing oh yeah I

am I am facturing ing uh yeah I am

factoring all the consideration I have

like the model of how the supply is

going to look over time and yeah it's

it's factoring all this I see it's also

kind of interesting to see this like

daily bar chart and it's every five days

there's a bar and there's like two days

missing and there's five days like

they're still operating in the Boomer

banking way you know like only five days

you can even I i' I've now also started

to know a lot more about when banking

holidays are in the US because if you

see there's there's a three day Hall in

the middle that's there was a yeah it

was like President's Day oh right I mean

yeah and yeah so that's that's

interesting it's a it's a big throwback

to the old system um but it's cool to

see it like I thought I think it's kind

of cool to see this kind of bridge

between trefi and crypto uh so yeah

that's that's what stand this analysis

it is kind of maintenance heavy because

every every day I need to look into um

so maybe I can show a quick context how

I look through it um I know that like uh

so Black Rock for now right after this

podcast I'll be looking into where those

800 million uh come from and I I've kind

of familiarized myself with the patterns

and how uh coinbase custody handles them

and you can see how they tend to

increment by round numbers of 600 so

these are wallets I've tagged from

yesterday but if you look at today

you'll see uh wait those are still

yesterday do I see any with 600 and not

tagged okay maybe they haven't popped on

yet but I'll eventually see some with

like 600 and I'll know that those also

all are funded through the same coinbase

uh custody address and you know there's

a pattern to it so that's how I identify

them but it is very manual and I'm up to

right now I'm just under 3,000 addresses

overall that I'm tracking throughout all

the issues um but my goal is to is to

force those issues into disclosing those

addresses and proof of funds because at

the end of the day I like I'm not I

don't want to my goal isn't to dox

everyone at all my goal is here doing so

because uh there's actual investors

behind and who have custody their money

through them so you might as well

leverage this uh this this whole thing

the blockchain enables which is

transparency um you know uh and if you

look now there's only uh 21 shares has

shared a proof of fund so I'm tracking

37,800 uh this should have the yeah so

these are the flows from today so

there's probably a thousand or so

Bitcoin that moved today as well but

otherwise we're in the same ballpark

when I'll have updated every day I check

that I'm on the same number and I am uh

I have a question oh yeah I forgot to sh

here here's the tab was this all these

addresses you labeled are you able to

like label who are the top holder of

Bitcoin on the on channel I I it's it's

a you know it's an individual um I know

how to label Black Rock now because they

have a similar pattern but each of them

have a distinct pattern and how things

are done uh so for now it's all in my

head I know I know what I'm doing

because I've done it so much that

you know now I know what I'm looking for

um but the original idea is you have so

many people who are moving these high

amounts on chain so already that singles

out so many so many wallets um and and

then from there you're just looking for

a set of addresses that matches roughly

the reporting number uh the only problem

is that the reporting numbers are going

to be in dollars and they're going to be

in Dollars Dollar denominated based on

the Bitcoin price from yesterday so I

look at the average price price of

Bitcoin yesterday during trading hours

the average price of today and then I do

what is the ratio between those to like

get a sense of what I'm looking

for yeah but like my my question is like

are you able to say tell people reveal

what's the top 10 Bitcoin holders like

for example like because I've I've heard

like US government and China government

are on the top five like holding Bitcoin

which I I think Arkham Arkham should

have this cuz they're regularly when

they when they shared like their

grayscale um uh sluffing thing where

they found all their Holdings I think

back in September that's when they

discovered that there are

actually in the top five I can't

remember exactly one of the top five

holders of Bitcoin uh and the first one

to actually uh you know associate all

those Holdings to one single uh entity

uh because it's so spread out across

like um the reason why there's so many

addresses is because coinbase custody

spreads out their Holdings by chunks of

like 1,000 Bitcoins or something and

they also regularly shuffle them so

every two weeks or so uh Black Rock is

going to like remove all their addresses

move to all new ones and it's really

annoying but that's how it works it's

just I'm guessing it's for security

purposes of course uh that like you know

that makes a lot of sense and you don't

want to have everything held in one

address and I'm guessing think they have

you know systems that are put in place

to handle all this for them um but it's

interesting to reverse engineer uh this

systems and trying to understand why and

how those work um yeah there's

definitely a lot more work to be done

there even you know if you look at um if

you follow Arkham on Twitter you'll see

them regularly uh doxing new high

entities I think they they recently did

maybe the British government and maybe

the the German one or something uh and

there was like the biggest ethereum

traded product that was finally found on

chain today or yesterday uh in Europe um

and that's also a very very big holder

terms of Bitcoins so you know there's a

lot of stuff to be done in terms of uh

labeling um and labeling in the open

source side is still a very lacking

thing uh you know it's there's a lot of

work to be to be done and I think we can

collaborate on on this idea a lot

more show you guys a bunch of ridiculous

meme from the salana side of

Casino um so I guess are you guys also

trading on salana or at all I I got the

I got the pyop phone