Welcome to the Crypto.com Monthly Research Roundup Newsletter!
1. Market Index
The 30-day market cap, volume and volatility indices were positive at +23.07%, +31.41%, and +67.55%, respectively.
2. Charts of the Month
The Bitcoin price is on track to complete a golden cross, a sign commonly interpreted as strengthening bullish momentum in which the 50-day moving average (MA) overtakes the 200-day MA on an upward trajectory. A golden cross indicates that short-term price momentum is outperforming the long-term.
Learn more about the golden cross in our University article: The Golden Cross and Death Cross in Crypto Trading.
The introduction of friend.tech has revitalised the dApp ecosystem and inspired new friend.tech forks to rapidly develop, which have driven great interest in the SocialFi space. Friend.tech has been dominating the market since its launch; however, contenders such as Post.tech and Stars Arena are experiencing a major uptick in their activity from September — even outpacing Friend.tech at one point — while newer social platforms like Bitcoin-based New Bitcoin City are also quickly emerging as competitors and vying for a share of the market.
The transition of NFT collection ‘y00ts’ from the Polygon to the Ethereum blockchain has rolled out. This started on 16 October 2023, and within the first seven hours, 4,600 ‘y00ts’ holders migrated their assets from Polygon to Ethereum. To incentivise early adoption, the project is covering all gas fees for first movers within the first 24 hours. It’s also randomly distributing 10 ‘y00ts’ NFTs to wallets that switch blockchains within the first day. The transition process has been facilitated by partnering with Wormhole Crypto’s cross-chain NFT standard. Additionally, to prompt ‘y00ts’ holders to migrate their assets to Ethereum, the project will impose a royalty fee of 33.3% starting 22 October for ‘y00ts’ collectibles traded on Polygon.
3. Monthly Feature Articles
Monthly Feature Article | Friend.Tech
Friend.tech is a decentralised social networking application built on the Base blockchain (a Layer-2 blockchain for Ethereum). It allows creators such as influencers, Key Opinion Leaders (KOLs), and celebrities to connect with their audiences (via token-gated chats) using social tokens called “keys”.
Friend.tech has garnered significant attention and has shown surges in activity across several key metrics, particularly in its initial period after launch. Its success can be attributed to features like embedded wallets, progressive web apps (PWA), a monetisation scheme, and a bonding curve.By leveraging concepts such as tokenisation and the trading of user profiles, platforms like friend.tech offer new ways for creators and users to monetise their content and connect with others. This report explores what friend.tech is and how it works, highlights a number of criticisms regarding its approach, and looks at some similar platforms that have emerged since friend.tech was launched.
- Friend.tech is a blockchain-based social platform. Its key feature is token-gated chats through tokens called ‘keys’ that can be traded. This allows users to potentially profit from a content creator’s growing popularity.
- The key factors that have likely contributed to friend.tech’s popularity include a monetisation concept, progressive web app, embedded wallet, key price bonding curve, and Layer-2 rollups.
- Monetisation concept: Friend.tech’s feature of tokenising users’ profiles into keys, which can be traded and speculated upon as assets, is attractive because it allows people to profit along with a creator’s popularity.
- Progressive Web App (PWA): This delivers a native app-like experience through web browsers on mobile devices. It sidesteps the need for users to download apps from marketplaces like Apple’s App Store or Google Play. It also avoids the fees typically imposed by these platforms.
- Embedded wallet: The platform employs Web2-based login features (e.g., with phone number, Apple, or Google account) and autonomously generates a self-custodied wallet for users — a user-friendly feature that effectively lowers the entry barrier for newcomers.
- Bonding curve: Friend.tech’s key pricing mechanism aims to motivate people to join and buy keys quickly.
- Layer-2 rollup: Supported by the Layer-2 rollup technologies, friend.tech significantly reduces the cost of transactions, which makes trading of keys cheap and acceptable for general users.
- Similar platforms like Stars Arena, Fan.tech, Post.tech, and New Bitcoin City have launched on other blockchains, with additional features like tipping, fractional shares, trading of posts, and dynamic fees.
- There are debates around the long-term sustainability of friend.tech’s business model and potential for a downward key price spiral if engagement declines.
Monthly Feature Article | SocialFi Trends
SocialFi — which combines functions in traditional social networks with Web3 technology — takes different social categories, from content publishing to instant messaging to social media, and builds an integral financial experience into the product.Discussions about Web3 social today primarily revolve around the surge of the social platform friend.tech, enhancing the narrative around decentralised social networks and SocialFi. In our latest private article, we take a closer look at the friend.tech model and report on the current state of the SocialFi space’s trends. We also discussed the potential directions that SocialFi platforms could take by looking into emerging models being explored today outside of friend.tech, including social graph, messaging, and decentralised identity. Read our report on the SocialFi trends, exclusive to our Private members.
- Friend.tech is a blockchain-based decentralised social platform allowing users to buy and sell shares (keys) of creators. Users can mint keys to unlock access to the creator’s content and a direct line of interaction.
- Friend.tech‘s social functionalities mirror those of other legacy social media platforms, with token-gated chats as its core utility. Its key features include: embedded wallet and progressive web app (PWA), as well as bonding curve and Layer-2 rollups.
- Beyond friend.tech, the SocialFi landscape is vast and continuously growing. There are also multitudes of emerging models being explored today, boasting innovative ways to move towards Web3.
- A social graph is a global map of all users, reflecting individuals, their connections, and their interactions and behaviours towards others. SocialFi takes the social graph concept one step further by allowing users to create and own their networks, plus monetise their connections and content, with decentralised social graph protocols such as Lens Protocol, CyberConnect, and Farcaster.
- Messaging serves as an open blockchain standard for communication, facilitating interoperability and data portability. By giving users private and secure communication channels, decentralised messaging services can provide them with greater assurance of data privacy and security. Several current protocols represent this, including XMTP Protocol and Cronos ID Messaging Service.
- In Web3, the identity of a user is decentralised and based on blockchain wallets. Through a programmable on-chain identity, users have full control of their digital identity by deciding with whom and to what extent their profile can be accessed — even allowing them to monetise their content, in some cases. Examples of decentralised identity include soulbound tokens, representing a user’s social identity held by ‘Souls’; ENS Domains; and Cronos ID.
4. Alpha Navigator
This institutional-focused report dives into macro trends, market-neutral pairs, style-factor screens, and events. Read the full Alpha Navigator report here.
- Asset classes were mixed in October, with BTC outperforming significantly.
- BTC’s 1-month correlation with equities is strongly negative, while positive with gold and commodities.
5. Crypto Conference & Economic Calendar from Market Pulse
Crypto Conferences Calendar
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Research & Insights Team