New Trends in the Crypto Assets Industry After Token2049

After the Token2049 event, global Crypto Assets practitioners gradually left Singapore, and the city returned to its former tranquility. Through the intensive exchanges and discussions during this period, there have been some new insights into the narrative of the new cycle.

The overall architecture of the Crypto Assets industry has improved this year:

1. Omnichain is still the most discussed narrative in Layer 0

A certain cross-chain protocol not only defines the full-chain interoperability of ultra-light node mode but also defines a new standard for Omnichain Fungible Token(OFT). OFT provides a more friendly and efficient cross-chain transfer solution, including two versions: v1 and v2, with v2 supporting non-EVM chains. Additionally, there is a standard supporting Omnichain NFT.

Many projects have already adopted this OFT standard, such as a certain Layer2, a certain stablecoin, a certain CDP protocol, a certain Bitcoin protocol, and a certain multi-chain lending protocol.

2. Layer1 is no longer the narrative of the first tier.

There are divergences in this cycle regarding Layer 1 projects. The new public chain in the Move ecosystem has received some attention, but other new public chains focusing on DeFi or NFTs, or those supporting multiple programming languages, seem to have not gained widespread consensus.

Many people no longer believe that a new public chain will emerge that surpasses Ethereum. Even though they think Ethereum may not be the ultimate solution, they are reluctant to focus their investments in new Layer 1 projects. Of course, there are still some institutions investing in new Layer 1 projects.

3. The Layer 2 landscape is basically determined, and the middleware is ready.

Optimistic Rollup mainly consists of two major projects, while the first tier of ZK Rollup/zkEVM includes 5-6 key projects.

The middleware supporting ZK Rollup/zkVM is also in place, including:

• Sequencer: There is a widespread call in the industry for a decentralized Sequencer network, with several leading projects already in place.
• Prover: There are already multiple projects, each focusing on Layer2 ZK Proof or Applications ZK Proof.
• Hardware Accelerators: Hardware acceleration projects aimed at the generation speed of zkp, including GPUs, FPGAs, and ASICs.

4. The middleware sector is not short of cash cow projects

After ETH2.0, the LSD track has become the second "cash cow" business following Bitcoin PoW mining. Under the Ethereum PoS mechanism, the annual output value of Staking is approximately 680,000 ETH(, exceeding 1 billion USD). There are some high-quality or potential projects in this field.

The MEV track has begun rehearsing future profit distribution mechanisms before the implementation of Danksharding. MEV seems difficult to completely eliminate; currently, a more reasonable approach is to return the profits to users' wallets, DEXs, or other dapps.

5. Gao Qi's "Risk-Free Returns" Foster LSDFi and RWA Opportunities

ETH Staking returns have become the "bond yields" in the Crypto Assets industry, and LSDFi further enhances the yield for ETH holders. Currently, the annualized yield for Ethereum PoS is approximately 3.6%, and the exit will be more flexible after the Shanghai upgrade.

LSDFi has derived more applications, such as certain stablecoins supported by LSD, interest rate swap protocols, and more. These applications provide additional yield capture opportunities for long-term ETH holders.

At the same time, the high yields on U.S. Treasury bonds have driven the development of RWA, allowing crypto assets holders to also benefit from this yield.

6. Lowering the User Experience Threshold Becomes a Fundamental Requirement

The user service layer in this round of cycles has multiple innovations, with the common goal of lowering thresholds and achieving large-scale adoption.

Intent Centric has become a hot topic, with multiple projects approaching it from different angles to address the issues of "difficult-to-use protocols" or "maximizing user profits."

TGBot, as one of the landing applications of Web3+AI, has also received much attention. Users can interact with the bot within Telegram to complete operations such as Token monitoring and on-chain transactions, significantly lowering the usage threshold.

7. Crypto Assets and AI Combination Become New Trend

In this event, multiple entrepreneurial projects combining Crypto Assets and AI emerged, mainly including:

• On-chain interaction automation: represented by TGBots, reducing the accessibility barrier for Web3 products.
• To Earn empowers AI business: such as decentralized annotation services in the healthcare sector.
• Web3 version of ChatGPT: Provides natural language search and other features for on-chain data.
• ZKML: Creating zero-knowledge proofs for ML model inference steps, proving the correctness of computations while protecting privacy.

The combination of Crypto Assets technology and AI seems to be the choice of the era, promising to create a better living environment for intelligent robots, thereby better serving humanity.

As an important hub connecting the East and West in the Web3 industry, the Token2049 event in Singapore is grand in scale, bringing together many significant projects. The main venue's exhibition features public chains, Layer 2 projects, exchanges, and payment solution companies, while the Side Events are mostly hosted by leading infrastructure projects or venture capital firms.

The industry still needs to continue working hard to jointly promote the development and innovation of the Crypto Assets ecosystem.