Ecosystem Update December 23
We're excited to present our December 2023 Ecosystem Update. This comprehensive report delves into key industry trends, achievements within the Advanced Blockchain ecosystem, and recent organizational progress, offering a complete view of both our journey and the broader industry.
Macro Industry View
In 2023, the crypto markets demonstrated significant resilience, recovering from their 2022 downturn but not reaching the peaks of 2021. The total crypto market capitalization bounced back, climbing from below $1 trillion in mid-2022 to over $1.7 trillion.
Bitcoin saw a steady recovery in 2023, beginning the year under $17,000 and ending at $43,550.40, experiencing minor volatility throughout the year and marking a notable surge in major cryptocurrencies. Although holding nearly 50% of the market share, it remains below its 2021 peak of over $65,000. Amidst geopolitical unrest, including Russia's 2022 invasion of Ukraine, Bitcoin and Ethereum maintained relative stability. Ethereum's Ether [ETH], the second-largest cryptocurrency by market cap, also recorded a significant 83.54% increase.
There are promising signs in the macroeconomics front, with inflation showing signs of stabilization and the Federal Reserve maintaining interest rates without increases. This is coupled with a rise in retail sales, indicating growing consumer confidence and demand. These favorable traditional financial indicators provide a positive context for exploring the cryptocurrency sector.
On the crypto market side, optimism is high, especially with the upcoming January deadline for Bitcoin spot ETF applications. Positive developments like BlackRock's substantial $10 million investment in the ETF, updates to the proposal, and productive SEC meetings have bolstered not just Bitcoin but also positively impacted the altcoin market, evident in the significant uptick across various tokens.
Another reason for Bitcoin’s price surge is the high anticipation of the upcoming halving event scheduled for April/May 2024, which occurs every four years. This halving process reduces the mining reward by half, effectively limiting the supply of Bitcoin.
Moving to 2024, there's a wave of optimism within the cryptocurrency community. The anticipated approval of BTC and ETH ETFs is seen as a catalyst for industry growth. Prominent crypto analysts expect a surge in institutional investment in 2024. Additionally, there's a market expectation that the Federal Reserve may reduce rates in March 2024, which could give a significant boost to crypto markets.
On the development front, the Ethereum network is preparing for the Dencun upgrade, with January 17th marked for testing on the Goerli Testnet. This upgrade is a critical step in Ethereum's evolution to a more scalable settlement layer, aiming to enhance data availability for layer-2 rollups through proto-danksharding. This advancement is expected to reduce transaction costs and bring direct benefits to users.
Ecosystem Key Updates
- Composable's Ethereum IBC testnet bridge surpassed $75 million in transactions since its launch in Q4 2023.
- NEON token's trading volume hit $21 million with a 400% monthly price surge, boosting Incredulous Labs' holdings to over $2 million.
- peaq, Bosch, and Fetch.ai launch a Web3, AI-driven smart device for global users to earn crypto by monetizing data, marking a convergence of Web3, AI, and IoT in peaq's Economy of Things.
- Polymer Labs is developing an interoperability hub for all Ethereum rollups, using native IBC technology with Ethereum security.
Transactions on Composable's Ethereum IBC testnet bridge have shown impressive growth, surpassing a total volume of over $75 million since its deployment in Q4 2023.
Furthermore, Composable team recently announced the launch of Solana IBC, paving the way for the implementation of the Ethereum restaking concept on the Solana network. Ethereum restaking entails depositing an asset with a blockchain's validators following the usual proof-of-stake (PoS) mechanism, obtaining a receipt token in return, and subsequently staking that receipt token again.
Lastly, the team commemorated their accomplishments over the year, including:
- Launch of Picasso DEX and the Token Generation Event (TGE) of PICA token
- Launch of first Inter-Blockchain Communication (IBC) between Polkadot and Cosmos via Cosmos IBC
- Establishment of Composable Foundation in Switzerland
- Launch of Ethereum IBC testnet, aimed at connecting Ethereum, Polkadot & Cosmos
Recently, PICA token has reached an unprecedented trading volume peak, hitting close to $5 million. This surge coincided with a significant increase in its price within the last couple of weeks.
NEON token received a robust traction from their community and the wider market, surpassing $21 million in daily trading volume for the first time since its launch. Additionally, the token recorded a notable price increase of over 400% in the past thirty days. As a result of the price increase, Advanced Blockchain, through its subsidiary Incredulous Labs, holds rights to receive NEON tokens currently worth over $2 million.
The Neon Labs team has launched Neon Points, a program designed to reward community contributors, an essential step in encouraging participation and ultimately contributing to the growth of Neon's solutions.
Moreover, Neon Labs team hosted a blockchain infrastructure event in Lisbon where they showcased Neon EVM architecture, developer tooling and introduced the Neon ecosystem.
peaq’s ecosystem continues to grow being the world’s largest and fastest-growing DePIN ecosystem for:
- No. of Users
- No. of machines
- No. of DePINs building
- Fortune 500 enterprise adoption
- Multichain Machine ID support
Furthermore, peaq, Bosch, and Fetch.ai have introduced a smart device leveraging Web3 and AI technologies, allowing users globally to earn cryptocurrency rewards by gathering and monetizing various valuable data.
The implementation shows how Web3, AI, and IoT converge to create a new open paradigm for data-based services in the Economy of Things on peaq, paving the way to more opportunities for DePIN projects — and for peaq’s ecosystem. Watch the full intro video here.
Lastly, a full recap of peaq’s development over the month of December 2023 can be found below.
Panoptic team resumed their ongoing audit with code4ren aimed at enhancing the overall security of the protocol. More insights on the audit results will be shared once announced by the team.
Guillaume Lambert, co-founder and CEO of Panoptic, joined a podcast episode with the 100x Podcast, explaining how the perpetual options protocol functions to the wider Panoptic community.
Polymer Labs team announced their recent initiative of building interoperability hub, enabling interoperability among all Ethereum rollups through native IBC technology backed by Ethereum security.
2023 has been an exciting journey for our team at Advanced Blockchain, marking several developments, including:
- Restructured the organization in 2023, focusing on a lean core team and cost-efficiency, allowing concentration on key holdings and active portfolio management.
- Diversified investment strategy, involving specialized funds like Permanent Ventures and increasing focus on early-stage incubations.
- Appointed Sebastian Markowsky to lead new initiatives like ABX Analytics as an Advisor and Venture Partner.
- Conducted a valuation of top ten portfolio holdings with AVS-Valuation GmbH, revealing a total value of €40 million, reinforcing Advanced Blockchain AG's innovative leadership.
- Welcomed notable experts to supervisory and advisory boards, including Rüdiger A. Günther, Håkan Saltin, Sebastian Markowsky, Prof. Dr. Marcel Tyrell, and Klaus Rainer Kirchhoff, focusing on business strategy refinement, organizational restructuring, and new initiative development.
- Focused on strategy sharpening, closing OTC deals and additional cost-cutting measures.
- Participated in the Deutsches Eigenkapitalforum in Frankfurt, sharing market insights, recent advancements, and the ABX.VC product roadmap and demo, attracting exceptional attendance and highlighting increasing interest in blockchain technology and Advanced Blockchain's industry role.
Access the full end of the year investor letter through the link here.
Strategic Outlook for 2024
Our focus for 2024 is on solidifying our market position, expanding recurring revenues through new services such as ABX Analytics and capitalizing on Token Generation Events (TGEs).
Enhancing transparency and communication with investors is a priority, with newly implemented initiatives such as quarterly investor update calls and Q+A sessions. We will also continue with the bi-annual assessment of our top ten holdings which will continue to give our investors and partners insights into our portfolio growth.
Establishing a global presence, particularly in the UAE, is a key area of focus, presenting substantial opportunities for collaborations in real-world asset tokenization (RWAs) and other exciting sectors.
In alignment with our strategic outlook for 2024, our team attended the Global Blockchain Congress, which took place on December 11th and 12th in Dubai, and joined multiple 1on1 sessions with potential strategic partners as well as startups for potential investment opportunities.
Looking ahead to 2024, Advanced Blockchain is poised to benefit from the next phase of blockchain market development, and we are eager to continue our work as an early leader in the space.
Our team expresses our heartfelt gratitude for your ongoing support and wishes everyone an exciting journey into the new year.
Thank you for being a part of our journey.
Advanced Blockchain Team