We are in a bull market. Retail is trickling back, BTC is floating right above / around 2021 ATHs and there are so many bullish catalysts ahead of us. As someone that was around for all of 2023, it’s crazy to see a 7 in front of the Bitcoin price.

As our industry has matured, the market scope has increased drastically – from modular blockchain infrastructure to Solana memecoins to Bitcoin NFTs (and beyond), there are more things than ever to keep up with.

The goal of this write-up is to provide an overview of Q2 2024 and is meant as a way for me to synthesize everything I’ve learned and observed. I want to use this as a starting point on what I think happens in the next 90 days or so. There is zero guarantee I am right here. Remember, the market is constantly changing, so updating your priors based on new information is of the utmost importance in this space (and markets more generally).

I’ve split these into a number of sections:

• Majors
• Altcoins
• NFTs
• Airdrops
• Narratives

This is a longer write-up from me (and no I’m not gonna summarize my own writing), so feel free to pick and choose what you want to dive into. And no, I don’t have a memecoin section – this is not an area I have any edge in lol

Majors

BTC

Majors look amazing on higher time frames. Bitcoin had it’s highest EVER monthly close yesterday. (insert tweet) – this is the 7th green monthly candle. With the BTC ETF approval, Fink and Saylor tag teaming the BTC shills, and the halving a few weeks away, I don’t see how you could not be bullish Bitcoin over Q2.

ETH

From the polymarket prediction market, it is apparent that most (if not all) of the ETH ETF rejection has been priced in. The first deadline is on May 23 so we will hear about that.

Beyond the vanilla spot ETF, several of the leading ETF issuers have filed for staking as part of the spot ETF itself. I believe this is a natural, logical sequence given that trad-fi fucking loves yield and staking yield is native to the Ethereum protocol itself. Additionally, given:

• the success of the spot BTC ETF, 
• Fink’s ETF track record, 
• Coinbase paving the path for regulatory clarity (with most respectful, professional approach) it 
• tight correlation between the ETH futures ETF and spot ETH
• Gensler’s (and the SEC’s) contradictory statements around digital currencies

It’s difficult for me to envision a world where we don’t get a spot ETH ETF sometime this year.

Solana

I put out a bullish Solana thesis in Aug 2023 — seeing this play out in real time has been unreal. At each step of the way, there’s been countless criticism (which in turn, actually makes me more bullish). It’s pretty clear that Solana has established itself as a “major” at this point, and it is very clear to me that Solana’s trajectory sustains over the next quarter.

From being the most accessible on-chain casino to being the home of the most innovative RWA and DePIN protocols, I think it’s undeniable they’ve found product market fit. The pace of change from the core Solana team and the ecosystem builders has been a sight to see.

In Q2, there’s an onslaught of protocols releasing tokens (more on this later). “Come for the memecoins, stay for the d’apps” seems to be the slogan for Solana – and it is clear that every other L1/L2/L3 eco is looking to mimic the Solana playbook. With the FTX estate OTC out of the way, I think Q2 will be another quarter of up only for Solana after we’ve spent most of Jan/Feb consolidating.

Lastly, if/when we see the spot ETH ETF approved, I expect this to ignite trad-fi progress on the Solana front. It’s been clear that there’s institutional demand for Solana (just look at the historical Digital asset fund flows, and the Greyscale SOL trust). Once the spot ETH ETF is approved, the market will shift its focus and look at the clear #3.

SOL futures ETF anybody?

Overall, I am extremely bullish – when the monthly chart looks like this and the overall sentiment is still 50/50, this only means one thing: we are going MUCH MUCH higher.Note every time the RSI crosses the 70 mark, BTC goes on an INSANE run

Beyond this, the major catalysts to look out for are (please let me know if you think I’ve missed any other significant ones!):

• Bitcoin halving around April 20
• Robinhood earnings April 24
• Doge futures Coinbase trading April 29
• Coinbase earnings tentatively May 2
• Spot ETH ETF deadline May 23 (and subsequent ETF decisions)

Altcoins

Many of alt btc pairs have drawn down significantly in the last quarter relative to their crazy run-up through Q4 ‘23. This makes sense considering:

• Institutional focus on BTC (spot ETF approval and the upcoming halving)
• Memecoin insanity

I’ve had conversations with numerous builders in this space pointing out the concern that this changes the incentives for legitimate builders in this space. Why grind on infrastructure or protocols that are core to the future of finance when you can launch a memecoin? I do think this shifts at some point.

At the end of the day, crypto markets (and markets generally), are a game of attention. The goal for any project is to stay relevant and to draw eyeballs. Although existing memecoins have in fact suffered, new tokens (ETHFI, DYM, JUP as some examples) have done fairly well since launch. Again – this comes back to attention. tweet

So what triggers a shift back to the governance tokens aka alts to run again? The 2 major catalysts top of mind are:

• Positive SEC v. Coinbase (re: tokens as securities) news
• Uni V3 gov fee switch implemented and going live

I suspect both of these will play out sometime in Q2.

In between, there are pockets of alts that will continue to outperform as they have in the last several months. There are too many to name and I would check out the crypto narratives substack for a more granular breakdown of what has run up (the newsletter provides a very thorough week by week recap).

NFTs

NFTs were pronounced dead in Sept 2023 by numerous mainstream media sources. Since then we’ve seen signs of a reinvigoration that have faded and come back. We aren’t close to peak activity relative to the activity in late 2021 and early 2022. What gives?

In my opinion, there are 2 reasons for this:

• Memecoins are scratching the gambling/speculative itch for degens
• Market is burnt out by the excessive supply of jpegs

However, we’ve seen some clear outperformance with bitcoin related NFTs over the past quarter. I think the market leaders (puppets, nodemonkes, RSICs) continue to do well through Q2.

To generalize as to why (and this applies beyond NFTs), the meta I’ve observed is:

• Market comes out with some new tech, clear market leaders are identified
• The tech becomes more accessible – in this case, buying, minting NFTs becomes much more accessible
• Copycat projects are created on the premise of sky high expectations (“we’ll be the next cryptopunk/bored ape”)
• A select few of these projects deliver, the vast majority don’t

And somewhere in between the last two points, supply overwhelms demand and it is down only. To add fuel to the fire, NFTs are fairly illiquid (relative to memecoins and governance tokens aka fungible tokens). The illiquidity is a powerful feature on the way up – it’s a factor on why BAYCs were able to run from 5 -> 40 ETH while ETH ran from low 3000s to 4000 back in Aug to Sep 2021. They are a bug on the way down as participants rush to the exit – who’s going to be the incremental buyer aka exit liquidity on the way down?

So where are we at today?

Through a brutal bear market, there’s been a couple communities that have stuck through. The two most prominent ones are pudgy penguins and mad lads. Empirically speaking, you commonly see industry leaders and OGs rock lads and pudgys as their PFPs. And from their recent price run-up in Q4 2023 and Q1 2024, being a holder of either of these projects means you were either early (and resilient enough not to sell) or wealthy enough to be a late buyer.

In either case, it is desirable for builders to target these NFT holders in an attempt to bootstrap their own projects and communities. As such, these communities have been targeted for multiple airdrops.

This continues to happen through Q2, and we probably see puppets/nodemonkes communities start to be targeted as more BTC related protocols spin up.

Airdrops and New tokens

We are in for a load of airdrops in Q2. Many projects that have been heads down building over the last bit will be airdropping and releasing tokens. Some metas I’ve observed are:

• Liquidity Bootstrapping Pools (LBP) – smaller scale projects like doing this as a way to bootstrap liquidity. Effectively, LBPs are a way for these projects to test out demand for their token while maintaining an incentive structure that rewards early (and smaller) buyers.. for more details, this tweet is a good ELI5 for LBPs
• Points programs – we are all familiar with this at this point. Some protocol’s have run their program for over a year now (the market only has so long of an attention span). Whales market place and Aevo are platforms where you can hedge / trade your points and pre-launch tokens but there is some friction. For example, on Whales you have to put up collateral, and there’s an information asymmetry around how many total points there are and/or how certain protocols will do the conversion exactly. A separate approach is to leverage farm points – Gearbox and Pendle are good protocols to do this on the ETH side. I haven’t found the solana equivalent yet.
• Staking meta – I wrote about this in more detail here. In summary, stake a certain governance token and receive some set of airdrops from protocols that have integrated with the staked token’s protocol. Originally, this came from Celestia and made a lot of sense (protocols that integrated Celestia saved a lot in DA fees). If the price of TIA dropped, this would compromise on security of the network – so protocols that economically benefit from Celestia’s data availability (DA) tech should reward TIA stakers (hence propping prices up). We’ve seen this approach extend to other projects like PYTH, JUP more recently and I expect this to continue.

The most anticipated airdrops in this coming quarter seem to be:

Dates confirmed:

• Ethena ($ENA) on Apr 2
• Wormhole ($W) on Apr 3
• Zeus ($ZEUS) on Apr 4

Solana:

• Parcl ($PRCL)
• Tensor ($TNSR)
• Kamino ($KMNO) most likely within April
• Drift Protocol ($DRIFT) sometime in Q2?

Modular:

• Nim network ($NIM)
• Rivalz Network ($RIZ)
• Avail
• LightLink

Restaking:

• Renzo
• Eigenlayer
• Swell
• Kelp

AI:

• GetGrass
• IONet

Other:

• ZKSync
• LayerZero
• Hyperliquid
• Blast

I’m sure there’s more that I’ve missed (bridges for instance), please let me know if there’s any significant ones.

Narratives

Bitcoin halving – BTC beta

I’m seeing many more BTC related protocols being built up – many of which don’t have a token yet. With how Stacks (STX) has done as of late, this is expected. We saw a mini version of this back in Dec 2023 in anticipation for the spot BTC ETF approval. Coins like MUBI, BSSB, ORDI, and TRAC ran *hard*. I think we see a larger version of this going into the halving and the weeks/months afterwards.

ETH ETF / Restaking – ETH and restaking beta

ETH has been severely beat down over the past several months — there’s been numerous calls for the death of ETH (including from me). ETH has done well in pockets, most recently with the recent run up from mid 2000s to 4000 before retracing.

There are a number of interesting catalysts ahead of itself – namely the spot ETH ETF decision and the eigenlayer restaking / LRT token launches. With how well EtherFi’s TGE went (peaking at 8B FDV few days post launch), it is clear the market has an appetite for restaking. And as Eigen launches, I expect the ETH meta to shift to something like the Celestia – participate and restake to qualify for airdrops (protocols/dapps that leverage restaking to whatever capacity).

As a side note, Karak is an interesting protocol to keep an eye out on – they are building restaking but for generalized assets. If Eigen has a very strong launch, Karak should also do very well.

SocialFi

With how Farcaster and $DEGEN have run up (original thesis here), FriendTech is definitely eyeing the demand here. There’s clearly demand — just look back to Aug / Sept 2023 and you’ll see how quickly FriendTech grew. The V2 launch and airdrop are highly anticipated with how much points have been trading for. If FT V2 does well, this could be a strong catalyst for projects orthogonal to SocialFi such as Fantasy top (disclosure: I am an advisor in this project).

Lastly, if FriendTech points are really going for $10+ a pop, I think it’s highly unlikely that Farcaster to *not* drop a token…

Crypto x AI coins

I’d split AI coins into two segments:

• Decentralized compute / storage / bandwidth 
• ML / AI / LLM wrappers

With getGrass and IONet dropping, this should be the catalyst that reignites projects falling under the first category. The market leader in this section is Render, and it has done extremely well over the last quarter. A strong continuation of NVIDIA earnings should also renew interest in this area.

Within the latter section, any update on existing LLMs and AI capabilities should be a catalyst. Most of the projects that exist out there are wrappers, so updates to ChatGPT, Sora, Bard and the other existing models are generally bullish catalysts. Bittensor is the leading project in this space (here’s a good write up on it), so most other projects will be valued relatively – the higher Bittensor goes, the better this latter category does. If we look back, Bittensor had a very strong run through Q1 – with TAO running from low 200s up to the mid 700s. We probably get some consolidation here for the first half of Q2.

Another bullish catalyst is the Wayfinder ($PROMPT) launch – the team behind Parallel TCG and Colony are building an LLM that specializes in navigating all-things onchain. As we get more glimpses and updates into everything they’ve built, I expect this to reinvigorate hyper around AI / LLM related projects.

Disclosure – I’m an investor in Parallel / Wayfinder

Modular Blockchains

After one hell of a run-up towards the end of Q4 2023, Celestia (arguably the market leader in modular blockchain infra) has been consolidating.

Besides price action, it seems like actual progress is being made, apps like Aevo, Lyra, Conduit, Polygon, and RitualAI are starting to use Celestia for data availability. Similar things can be said about Dymension.

As these projects that are built on top of this modular blockchain infra continue to do well and airdrop stakers, there’s an inevitable attention shift towards the modular blockchain category. As a result, I think we’ll see another repricing to the upside especially if we get positive new on the SEC v. Coinbase front re: tokens as securities.

Additionally, with unlocks coming up towards the end of 2024 teams, I expect some degree of coordination between the infra projects (e.g. DYM / TIA) and integrated d’apps to figure out a strategy going into team and investor token unlocks.

On the longer term (beyond Q2), my view is that as these initial market leaders re-price and find success, this modular meta will start to get exhausted. My base case for how this plays out through the end of the cycle is:

• Infra projects that help d’apps / middleware save $ → airdrops → repricing higher
• Follow-on / beta projects launch → some deliver value, but nowhere close to market leaders
• More projects launch with zero usage building some “cool” tech funded by investors that missed projects from the former 2 bullets

Some other narratives that will probably come about are: RWA, DEXes, DePIN, Blast.

That’s it from me. Good luck to all the market participants out there. My DMs are open if you ever wanna chat or you think I’ve misspoken / missed something significant.