Highlights
GCR is a research and investment community. As a collective, we source investments, conduct research and diligence, and make investments together.
This piece lays out some highlights from the 2nd quarter of 2024:
The GCR Community saw over 36 investment opportunities in Q2, of which ~40% came directly from community members and contributors.
The top category we invested in was Infrastructure.
During Q2 2024, GCR invested in a total of 3 deals.
GCR Core Team presents a Q2 macro review and shares our outlook for Q3 2024.
Market Resurgence and Growth Opportunities in Q2
Q2 2024 Summary Stats
The GCR Community continues to make significant strides, demonstrating unwavering discipline in curating top-notch deal flow and forging partnerships with high-conviction companies.
During Q2 2024, GCR assessed 36 deals, a commendable number and slightly below Q1 2024. Notably, approximately 40% of these opportunities were directly contributed by the community and external contributors. This figure is down from last quarter, where we saw around 80% of opportunities brought by the community. We continue to strive to encourage more contribution from the community. In Q2 2024, deal opportunities continued to rise steadily, with a consistent increase in member and deal activities in the overall crypto industry.
When categorizing the opportunities explored by the community, DeFi leads at 50%, followed by Infrastructure at approximately 40%. Web3, Social Networks, and GameFi collectively represent another 10%, with the remaining categories covering various other areas.
Furthermore, the community solely focused on investments in the Infrastructure category during this quarter, similar to past quarters .
In alignment with the prevailing market sentiment and the selective approach of the GCR Community, GCR executed 3 deals in Q2 2024 – signing a steady activity flow for 2024.
Every quarter, we proudly share our progress to showcase the capabilities of GCR’s community-led investment platform. The GCR Community continues to grow stronger as members educate each other about their specific areas of expertise. If you would like to learn more about how you can be involved with the GCR Community, join our Discord.
Q2 Cryptocurrency Market Analysis
The second quarter of 2024 was marked by a 3 months long consolidation of the rally in Q1 2024. BTC fell by 27% from peak to trough while altcoins fell by roughly twice as much. However, this can be seen as a healthy correction. For context purposes, BTC has nearly quadrupled since the bottom in November 2022 and has doubled since September 2023. Some time spent to consolidate these gains is natural and healthy.
So far in July, we have seen a nice rally and it looks like volumes and momentum are picking up. In the macro lens, inflation seems to be moderating and while the six rate cuts that were initially forecasted for 2023 are no longer on the table, it does seem that barring any unexpected developments, the Fed’s next move is likely a rate cut – potentially as soon as September. We discuss regulatory developments further below, but with macro factors, regulatory easing and additional institutional adoption of this asset class working in our favor, we expect Q3 to be a strong quarter.
GCR Portfolio Company Update
We have previously focused our quarterly reviews on highlighting our deal pipeline and funded investments, but since last quarter, we want to take the opportunity to showcase what some of our awesome portfolio companies have been building in the bear market.
GCR now has grown to over 80 portfolio companies that are relentlessly building, we are proud to be backers of these projects building the future of Web3.
Ava Protocol formerly Oak Network is the Web 3.0 Hub for DeFi and Payment Automation
OAK Network is transforming into Ava Protocol, expanding its autonomous transaction capabilities to Ethereum while maintaining its Polkadot foundation. Ava Protocol will enable private transactions across chains, launching on Ethereum’s EigenLayer and Polkadot. OAK tokens will be rebranded as AP tokens, keeping their value and compatibility with EVM and Substrate wallets. The team will continue supporting the Turing Network (TUR) token and address its future tradability. In the next three months, Ava Protocol will focus on launching protocols and the AP token, boosting developer adoption, and leading in autonomous transaction technology. Learn more here.
Goldsky is a centralized data indexing tool. Web3’s Realtime Data Platform.
Goldsky is excited to announce the general availability of Goldsky Mirror, our cutting-edge realtime crypto data streaming platform. Designed to simplify access to Web3 data, Goldsky Mirror syncs data directly to your database in real time, eliminating the need for costly API pulls and complex ETL setups. This release marks a significant milestone in making onchain data integration seamless and efficient, empowering developers to combine onchain data with internal systems flexibly. With support for over 40 networks, including Ethereum and emerging networks like Blast and Berachain, Goldsky Mirror also integrates off-chain datasets like NFT metadata and token prices. Whether you’re running a weekend hackathon or managing infrastructure for millions of users, Goldsky Mirror scales effortlessly to meet your needs. Explore the future of decentralized data integration with Goldsky Mirror today! Learn more here.
Intella X is a Web3 gaming platform that was started by Neowiz (a Korean gaming company) that partnered with Polygon and many other prominent companies in the Web3 space.
We are pleased to announce significant updates to the Intella X Adventure user interface (UI) and user experience (UX) aimed at enhancing usability and efficiency. A new bottom navigation bar has been introduced, offering quick access to key sections such as Home, Crew, Points, Game, and Profile. The Home menu layout has been improved with the addition of My Profile and Trending Games, simplifying navigation and providing direct download links. Additionally, to streamline crew management, a bulk delete feature has been implemented within the crew application management section, allowing captains to efficiently manage member applications in one go. These updates reflect our commitment to enhancing user interaction and functionality within the Intella X Adventure platform. Learn more here.
LayerZero is a User Application (UA) configurable on-chain endpoint that runs a ULN.
LayerZero Labs and Initia Labs are collaborating to develop an interoperability standard for Cosmos, enabling Cosmos SDK-based chains to connect with LayerZero-enabled chains. This initiative aims to enhance omnichain interoperability, allowing applications to communicate across various blockchain networks. LayerZero, which has already facilitated over 135 million messages across 80+ networks, seeks to expand its reach by supporting appchains built on the Cosmos SDK. The new interoperability solution will be implemented as a Cosmos SDK Module, accommodating different virtual machines (VMs) and enhancing user experiences for developers and users alike. This partnership aligns with the broader vision of creating an “Internet of Blockchains,” integrating LayerZero’s capabilities with Initia’s innovative tech stack for scalable, sovereign multi-chain solutions. Learn more here.
Magic Eden is the leading community-centric NFT marketplace.
Magic Eden Wallet introduced a new lineup of perks in Q2, including point boosts, loot boxes, and various partner benefits. Users can earn bonuses, NFTs, and early access by connecting their wallets to partners like Lingo, Hybrid, Mezo, Rize, Rune, MixMob, LuckySea, Flip.GG, and Alphabot. In-Wallet token claim product is also coming late Q3. Learn more here
Manta Network is the multi-modular ecosystem for zero-knowledge (ZK) applications.
The largest meme community, BONK, and the largest Modular L2, Manta Network, are joining forces for the ultimate Meme-ta szn on Manta Pacific. This cross-ecosystem partnership marks a significant step toward building and growing an interconnected meme community on Manta Pacific. Learn more here.
Morpho Labs is the most efficient and liquid protocol to supply and borrow assets on Ethereum.
The Morpho Bug Bounty has been raised to $2.5M. It is now the second-largest bounty for any lending protocol, providing an added layer of security to Morpho’s heavily audited and formally verified code base. Learn more here.
prePO is a decentralized trading platform allowing anyone, anywhere to gain exposure to any pre-public asset.
prePO now supports logging in with Face ID, Touch ID, security keys, and other passkeys! These new login methods offer unparalleled convenience and security, making your PrePO experience smoother and more secure. Passkeys are resistant to phishing attacks, providing a robust layer of protection for your account. Learn more here.
Sweat Economy is the original Move-to-Earn. The easiest way to walk into crypto.
After carefully considering community feedback about the current $SWEAT minting window—specifically concerns that it may not fairly reward those who are genuinely active—a new DAO vote is expected to result in a 30% reduction in monthly $SWEAT minting. This decision aims to shape the future and value of $SWEAT. Additionally, earlier in Q2, one of Europe’s leading regulated exchanges announced that they have listed $SWEAT on their platform. Learn more here.
t2 is building an open internet of ideas, starting with writing
The t2 x Kiwi Writing Contest has officially concluded, and we are thrilled by the incredible response! Writers explored the future of decentralized social, sharing their insights and innovative ideas. Over the contest period, participants submitted thought-provoking essays on topics such as potential futures, new app ideas, and the challenges facing Web3 social. Learn more here.
Talent Protocol is a social and economic platform where builders can share their goals and find the support they need to achieve them.
Onchain builders and early believers deserve recognition for pushing the Talent Protocol ecosystem forward. This summer, we’re rewarding them with a hot mix of events, opportunities and 30M $TALENT tokens! Learn more here.
zkLink is a trustless chain-to-chain DEX based on zero-knowledge technology.
The highly anticipated reveal of the $ZKL token—NovaDrop Round One—has officially launched for zkLinkers! Eligible users can now check their status at the zkLink NovaDrop portal, with a four-month claim window once open. This airdrop season features a 5% allocation for claiming, and participants must verify their eligibility based on holding NovaPoints, Nova Lynks NFTs, or zkLink Loyalty Points. Additional verification steps are required for some Loyalty Points holders. Rewards from various campaigns will also be claimable through the portal. For those not eligible, future opportunities are available through the ongoing Aggregation Parade. The $ZKL token serves as both the utility and governance token for zkLink, capped at 1 billion tokens. For detailed information on $ZKL’s utility, users are encouraged to review the whitepaper and stay updated via official channels. Learn more here.
Q3 2024 Crypto Market Outlook: Navigating Growth and Regulation
As we approach Q3 2024, the crypto market is poised for significant developments shaped by regulatory changes, technological advancements, and evolving investor sentiment. Here are key factors to consider:
1. Regulatory Landscape
With the MiCA framework now in effect across the EU, we expect increased clarity in regulatory compliance, which could attract more institutional investors. However, ongoing scrutiny from regulatory bodies like the SEC in the U.S. may introduce volatility, particularly for projects deemed to operate outside legal boundaries. That being said, recent positive developments in the US may indicate a thawing of regulatory obstacles including the dismissal of SEC’s cases against Consensys and Stacks Protocol. In addition, digital assets are becoming a voter issue with both-sides, most notably Trump, currying favor with the digital asset industry.
2. Market Sentiment and Adoption
Investor sentiment remains cautiously optimistic but BTC and ETH’s recovery above critical support levels suggests resilience. Of note, Germany’s $3B liquidation of confiscated BTC is in the rearview and its selling, while painful, had no lasting effect on the market. Mt. Gox distributions loom, but we are on firmer footing with ETH ETF approvals slated for the second half of July and cooler CPI figures boosting the odds of a Fed rate cut by September. Continued adoption of cryptocurrencies for payments and as investment vehicles is likely, driven by institutional interest and mainstream acceptance. If macroeconomic conditions remain stable, we may see more bullish momentum as confidence builds.
3. Technological Innovations
Technological advancements, especially in DeFi, NFTs, and the Metaverse, will play a crucial role in market dynamics. Innovations such as cross-chain interoperability, enhanced scalability, and user-friendly platforms could facilitate broader adoption. Projects like Solana’s new features and Goblintown’s NFT initiatives may lead the way in attracting new users and increasing transaction volumes.
4. Investment Trends
Bitcoin miners like Hut 8 securing significant investments indicate a long-term bullish outlook on mining operations as energy solutions improve. The growing interest in ESG (Environmental, Social, and Governance) considerations among investors may further influence funding decisions. New ecosystems developing include the Bitcoin L2 and TON ecosystems as well as increasing interest in Solana as an outperformer thus far this cycle. Some investors are looking for the killer consumer app, but these aren’t easy to identify and incentives make it easier to raise capital for infra-type projects. In terms of newer verticals that investors are excited about, we expect the intersection of AI and blockchain to remain in focus, along with RWAs, intents and interoperability solutions.
5. NFT and Metaverse Growth
The NFT market has had a tough stretch lately, with less interest compared to the prior cycle. Still there is hope that as crypto wealth is generated during the bull market, capital will come back to NFTs. In addition, we expect new use cases to continue to emerge beyond digital art. As companies like Animoca Brands explore public offerings, the legitimacy and interest in the Metaverse will likely surge, attracting both users and investors.
Conclusion
Q3 2024 presents a unique blend of challenges and opportunities for the crypto market. While regulatory clarity could spur institutional investment, vigilance will be essential as the landscape continues to evolve. With technological innovations driving adoption and the NFT sector expanding, the potential for growth remains significant. Investors and stakeholders should stay informed and agile to navigate this dynamic environment.
