In the ETH ecosystem, Layer2, LSD, DeFi, ETH-backed stablecoins, and restaking are the key areas and projects of focus in the industry. This article, sourced from an article by 日月小楚, has been organized, compiled, and written by PANews.
Summary:
ETH’s ETF approval is highly anticipated, and if successful, it will benefit not only ETH but also projects within the ETH ecosystem. Therefore, it is important to focus on the following sectors and projects within the ETH ecosystem:
Main Projects: arb, op, strk, metis, manta.
Layer2 plays a crucial role in supporting the prosperity of the ETH ecosystem with its high TPS and low GAS. It is also the most valuable sector within the ETH ecosystem.
However, most projects in this sector are criticized for having low circulation and high FDV institutional coins. arb, op, and strk, as three of the four major projects, have FDVs exceeding $10 billion.
arb has the highest TVL and the largest number of DApps among all projects. However, arb has weaker price performance and has recently experienced a large amount of unlocking.
op’s advantage lies in the ecosystem formed by op stack, which has attracted numerous excellent projects and capital. Historically, op’s price performance has been more aggressive than arb, possibly due to preference from investors.
strk, as a zk core layer2, lags behind the other two in terms of ecosystem recommendations and users. However, its market capitalization is lower than arb and op, and it has experienced a continuous decline since listing without a decent rebound.
metis was a hot topic for a period of time, with its decentralized sorter gaining popularity. After being listed on Binance, it experienced a significant pullback.
manta represents modular Layer2 and has a hardworking team and rapidly developing ecosystem projects. It has the lowest market capitalization of only $400 million among the mentioned projects.
Main Projects: LDO, SSV, PRL.
The LSD protocol is related to nodes and staking services that emerged after the upgrade of ETH from POW to POS in Shanghai. LDO is the largest service provider with the highest TVL in the network and a market capitalization of $2 billion.
SSV is a decentralized node infrastructure setting and has performed well recently.
Main Projects: Pendle, uni, aave, comp, crv, mkr.
DeFi is the most well-known sector, and its applications have become widespread in various aspects of on-chain daily life as the largest innovative sector in the previous bull market. Key players include uni, aave, comp, crv, and mkr, representing DEX, lending, stablecoin trading, and stablecoin issuance, respectively.
Due to the maturity of DeFi, most projects in this cycle are based on previous upgrades and lack innovation. Pendle, on the other hand, stands out as it separates tokens into principal and interest, which are used for future trading gains. Pendle has recently gained attention in terms of TVL and token price.
Main Projects: ENA, LBR.
There are various ways to issue stablecoins, and one of them is asset-backed issuance, with ETH being the largest collateral asset. With the introduction of LSD and restaking, project parties can obtain liquidity income from staked ETH. These stablecoins naturally have returns. Additionally, project parties provide token incentives and dividends from coin minting and borrowing. The annual returns from these activities can be substantial.
One of the projects that has gained attention this year is lbr. The foundation of Ena, a project launched on Binance’s launchpool, is also based on this concept, and Ena uses hedging derivatives to maintain the value of collateral assets.
Ena has a TVL of up to $2.5 billion and a market capitalization of $1.3 billion.
Main Projects: REZ, ETHFI.
Restaking is the most valued aspect of the current ETH market for three reasons:
It is a new sector, and the market tends to favor trading new sectors.
It has a small market capitalization, with ethfi having a market capitalization of $460 million and rezon having a market capitalization of $150 million.
Eigenlayer, as the leader, has a confirmed airdrop amount, and the trading time is approaching.
Related Reports:
Franklin launches BTC/ETH separate managed accounts, what are the advantages compared to spot ETFs?
Coinbase urges SEC to approve ETH spot ETF: ETH is not a security, has strong governance, and economic potential.
Will the approval of ETH spot ETF really ignite ETH? A review of the price changes during the launch of futures ETF in October.