The MegaBrainX Crypto Investment Newsletter

The newsletter is designed to be an Investor’s best-friend, each week we’ll cover:

1. Macro Overview

2. Crypto Overview

3. NFT Overview

4. Building an Investment Thesis

Together, we grow as Investors. Let’s dive into it

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Key Metrics

• Crypto investment products saw $176 million inflows last week, now totaling $1.32 billion this year, as trading volumes doubled averages and Bitcoin products took in $155 million over 8 straight weeks of gains.

• Twenty one projects secured a combined $375.1 million in funding during the past week, with Blockchain.com leading the way with $110 million in investments.

• Two ICO launches this  week, with 22 projects launching in November.

• There are 8 projects with token unlocks scheduled for this week, with the most notable ones being $213.07M (2.68% of circulating supply) for AVAX coin, $4.8M (6.46% of circulating supply) for ID  token of SPACE ID project, and $3.08M (6.88% of circulating supply) for LOOKS token of LooksRare project.

• Developer activity has been relatively steady for the past year, with Internet computer (ICP) in the lead in number of hours and commits in Github, followed by Cosmos & Then Chainlink. The total number of developers have been in a downward trend with a 32% decrease year on year in September 2023.

• Bitcoin was able to secure the first spot as the top revenue-generating blockchain protocol with $7.47M avg daily fees a 55% increase WoW, followed by Ethereum at $8M. DeFi leaders Uniswap, BNB &, Aave round out the top 5

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World Events Highlights

This Week’s Major US Economic reports

November 20: U.S. leading economic indicators

November 21: Minutes of Fed's Oct. 31-Nov. 1 FOMC meeting

November 22: Initial jobless claims | Consumer sentiment (final)

• Foreclosures are surging on risky commercial real estate mezzanine loans as higher interest rates exacerbate industry turmoil, signaling growing distress beyond mortgages. Learn more

• Treasury Secretary Yellen disagrees with Moody's shifting the US outlook from stable to negative, calling the economy "fundamentally strong" despite political divides posing fiscal risks. Lean more

• US producer prices declined 0.5% in October, the largest drop since 2020, indicating inflationary pressures continue to ease after aggressive Fed interest rate hikes over the past year. Learn more

• US jobless claims increased last week and continuing claims reached a nearly two-year high, signaling some cooling in the labor market that the Fed aims to achieve to curb inflation. Learn more

• Biden signed a short-term government funding bill passed by Congress, averting shutdown for now but kicking contentious fiscal debates over spending and Ukraine aid into 2024, an election year. Learn more

• Markets have rapidly swung between certainty of higher interest rates and cuts based on limited data, reflecting uncertainty on economic volatility, policy impacts, and the long-term outlook. Learn more

• The US Treasury is draining the Fed's Reverse Repo Facility to fund its ballooning debt, but when this capital runs out, it may have to take actions like changing bank regulations or printing money to ensure demand for more debt. Learn more

• Though military war risks between the US and China have declined recently, a new type of intense conflict has begun - an economic, technological and social battle through covert actions to gain advantage, rather than direct combat. The US currently leads in power, but China is rising. Learn more

• Biden and Xi struck deals to restart military talks, counter fentanyl trafficking, increase flights, and exchange students, while China will send pandas back to US zoos, thawing relations despite tensions on Taiwan. Learn more

• In a speech after meeting Biden, Xi said China doesn't seek conflict with the US or aim to unseat it, wants friendship, and won't fight any war, though some investors remain skeptical. Learn more

• China's home prices fell for a fourth straight month in October with declines widening to hit dozens more cities, indicating persistent weakness in the property sector that could hamper broader economic recovery. Learn more

• Russia has largely evaded the G7's $60 per barrel oil price cap, selling for over $20 above it in October, but Western officials remain committed to the sanction meant to restrict war funding. Learn more

• Western investors in Russian companies fear a new decree under consideration could force them to sell shares cheaply to the government, marking the latest blow as Moscow cuts foreign ownership. Learn more

• Iran won't directly join Hamas' war on Israel but will keep backing the group, pressing allies like Hezbollah against deeper conflict while targeting US forces, as Tehran walks the line between solidarity and restraint. Learn more

• Citigroup employees expect layoffs of thousands and management changes to be announced Monday as the bank undertakes its biggest reorganization in decades. Learn more

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Investors need-to-know | Macro

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Overview

Crypto Market Treads Water

Bitcoin closed last week around $37k, moving sideways as excitement cools after the recent pump.

One catalyst that's now off the table is a spot Bitcoin ETF approval, at least for the next couple months. So we likely won't see major pumps sparked by ETF news before early 2023.

However, issues simmering in traditional finance like Citigroup's latest round of layoffs could potentially impact crypto markets ahead.

This week all eyes are on the release of the latest FOMC meeting minutes on Tuesday. This will give insight into the Fed's thinking and potential clues about the path forward for monetary policy.

While crypto continues consolidating, big macro events like Fed statements remain key drivers to monitor closely for the next market move. News from the banking world also bears watching as a potential catalyst.

You can also check crypto project-specific upcoming events Here

Key Charts

Valuation vs. Trendline

In bear markets, Bitcoin often outperforms altcoins. So its dominance rises as its share of the total market cap increases.

BTC dominance has trended higher overall since May 2021. This suggests Bitcoin will continue taking a bigger slice of the crypto pie.

The latest reading is 55.9%, down from late October due to the recent altcoin pump. But Bitcoin dominance should correct back up to resume its uptrend.

Hash/Price

This chart shows Bitcoin's price divided by its hash rate, and vice versa.

Hash rate measures the overall computing power securing the Bitcoin network. More power means greater mining difficulty.

Interpreting the Ratios

• When price rises faster than hash rate, Hash/Price drops and Price/Hash rises

• If they rise/fall at similar rates, the ratios stay stable

• If hash rate climbs faster than price, Hash/Price increases and Price/Hash decreases

The ratios intersect halfway through major trend shifts, marking the midpoint of bull and bear runs.

Currently, hash rate is outpacing price, signaling Bitcoin is still in a bear market.

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Investors need-to-know | Crypto

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Market Moves

The NFT market saw a pullback last week, with most blue chip PFPs giving back recent gains. Leading projects like Bored Ape Yacht Club and Mutant Ape Yacht Club declined around 10% to floors of 27.12 ETH and 5 ETH respectively. Other top collections like Azuki and Proof also saw double digit losses.

The declines erased much of the upside seen in previous weeks, bringing floors back near recent ranges. The market seems to be biding its time ahead of expected launches and liquidity catalysts with $BLUR on ETH and $PYTH on Solana.

On the art side Fidenzas continued to show strength, with fresh wallet swept 2 Fidenzas, 8 Anticyclones and 10 Life in West America NFTs, driving up the floors of all 3.

Mad Lads led the week on Solana, grinding up to a 105 SOL floor before settling at 86 SOL

It's a period of consolidation for blue chips as capital rotates between chains and investors await the next narrative driver. Liquidity from airdrops and support from ecosystem players like Flooring Protocol could provide the spark for the next leg higher.

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New Highlights

• Blur Season 2 claim goes live and Pacman announces the launch of Blast, an L2 seeking to: reduce transaction costs and build institutional-grade NFT perps. Know more

• Nike posts RTFKT shoes on Instagram for second time in the last week, reaching their 300 million total followers Know more

• Animoca Brands is partnering with Ubisoft’s Strategic Innovation Lab to bring Champions Tactics™ Grimoria Chronicles into the Mocaverse, amplifying Ubisoft's web3 initiatives.  Know more

• Phantom introduces "Cross-Chain Swapper," simplifying token bridging between Ethereum and Solana.  Know more

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This week’s spotlight

Blur Drops Blockbuster $100M Airdrop and Launches New L2

This week saw a major announcement from Blur, the leading NFT marketplace. After closing out a strong Season 2, Blur dropped a $100M+ airdrop for its community along with details for Season 3 and the launch of a new L2 scaling solution called Blast.

The Season 2 airdrop totals over 300M $BLUR tokens, with top trader Hanwe netting $7.2M himself. Blur also revealed staggering growth metrics, hitting $6.1B in volume and over 260K users last season alone.

For Season 3 starting now, Blur shifts incentives to stabilize $BLUR through partial allocation of farming rewards to token holders (rather than just traders). Founder Pacman also unveiled Blast L2, offering yield on bridged crypto assets ahead of an airdrop next May. Early data shows strong initial demand.

Overall an eventful week for one of the biggest players in web3 - a $100M community payout, the next iteration of growth incentives, and a new L2 scaling solution in the works. The Blur ecosystem expands again.

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Investors need-to-know | NFT

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let’s recap the key insights uncovered so far:

We began by outlining a framework to analyze narratives that will shape the next crypto cycle. Rather than chasing hype, we want to map secular trends.

So far we’ve explored major sectors like:

• Smart contracts - Scaling and interoperability improvements underway

• NFT gaming - Long-term potential if sustainability issues are addressed

• DeFi - Innovating quickly but facing regulatory uncertainty

• Real world assets - Tokenization set to unlock trillions in value

• Decentralized identity - Empowering but early stage overall

While crypto sentiment remains depressed in this bear market, builders keep shipping behind the scenes. There’s still much progress needed, but promising foundations are emerging across Web3 spheres.

Subscribe to this Newsletter, this is where we’ll be tracking the research process and following the narratives from the thesis.

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