GM Ambirers!

Amidst a myriad of new projects, groundbreaking upgrades, and cutting-edge developments continually being unveiled, the crypto space never fails to captivate with its dynamic and fast-paced nature. It was truly a week full of adventures!

Talking about adventures, it's now the moment to cast your valuable vote regarding the next steps for our W3OF Degen Portfolio.

We hebben ein serieus probleem, the Portfolio is down -34% from the initial $1000 investment 😆 As proper degens tho, we’re never quitting 🪖

You've been cooking up proposals on what to do next in the web3-on-fire Discord which are now collected and ready for voting in the poll below 🔥

We’ll rebalance the portfolio as per the vote results in the upcoming week. Now get this, very soon, we’ll be able to trade tokens on any EVM network with Ambire extension 🔥

This week we're discussing:

• 🔥 MEME CRAZE 💣

• 🔒️ Crypto staking outperforms S&P500 in dividend yields

• 🧅 L2s will be worth $1 trillion according to hedgefunds

• 🥷 Google is targeting crypto scammers with RICO lawsuits

MEME CRAZE 💣

Memecoins stay ahead of the market with crazy gains

Crypto and memecoins have long had a love-hate relationship.

🤡 While some see them as a joke or an insult to the industry, others see them either as a way to make quick gains or a way to protest against traditional finance.

Regardless of one's opinion, memecoins have an insane popularity and profitability that cannot be ignored. 💣️ 

According to CoinGecko, memecoins had an average return of more than 1,300%, with top tokens like Brett, BOOK OF MEME (BOME), and cat in a dogs world (MEW) leading the way. Brett, in particular, boasted a 7,727% pump by the end of the quarter.

Meanwhile, the AI narrative also showed solid gains, with an average return of 222%. All large-cap AI tokens posted profits, with AIOZ Network (AIOZ) and Fetch.ai (FET) leading the charge with gains of 480% and 378%, respectively.

Other DeFi narratives, such as Real World Assets (RWA), Decentralized Finance (defi), and Decentralized Physical Infrastructure Networks (DePIN) also saw good gains. 🪙 

RWA tokens like MANTRA (OM) and TokenFi (TOKEN) had returns of 1,074% and 419%, respectively. Defi gained traction late in the quarter with a boost from the Uniswap (UNI) fee switch proposal and saw a 98.9% return, while DePIN ended with an 81% return.

Not everything is peachy

😥 GameFi in particular was lagging behind with a 64.4% return, and established Ethereum L2s like Arbitrum (ARB), Polygon (MATIC), and Optimism (OP) underperformed with a 39.5% return.

👉️ Overall, the first quarter of 2024 was an exciting time for the crypto market, with various narratives showcasing dynamic performances and meme coins staying ahead of the game with their crazy gains.

Love them or hate them, memecoins have definitely made their mark in the crypto industry and continue to be a force to be reckoned with 🐸 

Are they going to go up forever? That's probably a no, but for now, they definitely have a strong hold on the market.

Crypto staking outperforms S&P500 in dividend yields

The S&P500's growth is a well-known symbol of stock market success. But in terms of dividends, the S&P500 has seen its lowest yield rate in nearly two and a half years 📉 

On the flip side, crypto staking rewards have been on the rise, surpassing average dividend payouts in the S&P500 by over 450% 🤑 this shows the potential for high returns in crypto staking and how it has surpassed traditional investment options.

• On March 31st, the S&P500 recorded its best first-quarter growth performance in five years with a 10.16% increase, according to Google Finance data 🤓 

• The average dividend yield rate of 1.35% was the lowest in over two years, showcasing a significant difference from the all-time low of 1.12% recorded in Q1 2000.

In contrast, the average annual staking reward for crypto is now at 6.08%, according to Staking Rewards data 👇️ 

This is a considerable difference from the S&P500 dividend yield and shows the potential for higher returns in staking.

The top three S&P500 companies with the highest dividend yields are Microsoft at 0.7%, Apple at 0.5%

In crypto though, ALGO had the highest staking reward rate at 84.19%, followed by ATOM at 17.17% and Filecoin at 16.34%. This just further shows how crypto staking can provide significantly higher returns than traditional investments 🤔 

And while staking crypto carries its own risk, such as locking up assets, institutional investors are starting to take notice of the potential for high returns 💰️ 

This means we still have a lot to see when it comes to the potential for crypto staking as more investors and institutions enter the market.

L2s will be worth $1 trillion according to hedge funds

Ethereum Layer 2 networks, or networks that are built on top of Ethereum blockchain, could be valued at over $1 trillion by 2030 according to one of the biggest hedge funds / investment managing firms in the world, VanEck.

For example, Arbitrum is the biggest L2 network by TVL so far with over $18 billions locked 🔒️ 

Not all L2s are destined to make it

VanEck said in a report that it evaluated 46 layer 2 networks across five key areas, and found "thousands" of new rollups are expected to emerge. but a lot of them will fail.

VanEck remains "generally bearish" on the long-term prospects of "some" of the existing L2 networks 🫢 

L2s still have some hurdles before they can pump

VanEck noted several factors that could impact the long-term growth of L2s. These include transaction pricing, developer experience, user experience, trust assumptions, and ecosystem size 👇️ 

• 🪙 The cost for users to transact on L2 networks is a key factor in attracting users. Factors like data compression and scale can help differentiate between different L2 networks.

• 🛠️ Developer Experience: Compatibility with Ethereum Virtual Machine is crucial for L2 networks to attract devs and make it easy for them to port over smart contracts and tools (Solidity language used in Ethereum is already de-facto the standard for smart contracts so some only can cry about it).

• 👴 User Experience: How quickly users can onboard assets and withdraw them plays a big role in shaping the overall user experience.

• 🔑 Trust Assumptions: Building trust around data availability and having measures in place to prevent hacks or exploits is important for an L2 network's success.

VanEck predicts that Ethereum will eventually capture 60% of the market share across all public blockchains.

This is due to the high volume of assets already within the Ethereum ecosystem and its potential for growth.

Google is targeting crypto scammers with RICO lawsuits

The age of digitization has unfortunately seen the rise of various forms of frauds and scams, and the crypto industry has not been spared.

Tech giants have been criticized for not doing enough to protect users from these scams, that's why these recent actions by Google are seen as a step in the right direction.

In an unprecedented move, Google has filed a lawsuit against a group of crypto scammers based in China. The suit was filed in the Southern District of New York and accuses the scammers of using its platforms to distribute and advertise fraudulent crypto apps. This marks the first time that a tech giant has taken legal action against crypto scammers in such way.

RICO law used to target scammers

• According to reports, Google's lawsuit alleges that the scammers have been running an elaborate scheme since 2019.

• They allegedly created and published at least 87 scammy investment and crypto exchange apps on Google Play to try and dupe regular users.

• The perpetrators used various tactics like text messaging campaigns through Google Voice, promotional videos on YouTube, and affiliate marketing campaigns 🙄 

RICO, or a Racketeer Influenced and Corrupt Organizations Act is criminal statute that targets organized crime syndicate members and in this case it’s being being used by Google to bring civil claims against the defendants.

This law was initially designed to combat big mafia groups and carries strict penalties, including up to 20 years in prison and severe fines 🔒️ 

Google is saying that two Chinese nationals, Yunfeng Sun and Hongnam Cheun, were responsible for the scam apps.

The company is seeking damages of around $75,000 for the resources spent on investigating this matter.

They are also seeking a permanent injunction against the defendants to prevent them from creating accounts on Google's platforms or accessing their services 🫠 

Think what you will about the regulations, but one thing is for sure - if crypto is ever to gain mass adoption and trust, the scammers have to go 🤐 

Other worthy reads

Devs are devving?

US states have approached Cardano to build a blockchain voting platform:

Airdrop alpha from Faycy:

MEMES

That's all for now, frens.

We'll meet in a week! And remember, the market conditions are temporary, but our commitment to building a better Web3 is here to stay. Thanks for joining us, and we look forward to seeing you back next week. Cheers!

Yours, The 🔥 Team

Brought to you by Ambire: The Only Web3 Wallet That You’ll Need!