ETH Exchange Outflows Outweigh Inflows In Anticipation of ETH-PoW Airdrop

SEP 06, 2022 • 5 Min Read

Yun Heng Lin

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🌅 Welcome!

We’re going to roll out some upgrades to our newsletter over the coming months, starting with this short introduction. We hope you’re as excited as us!

ETH outflows from exchanges outweigh inflows, blockchain gaming continues to attract investors, and Binance aggregates stablecoins under BUSD to concentrate liquidity. Today, we have a notable data excerpt from our recent Delphi Pro report, NFT Game Platforms: Through the Eyes of Founders.

This is the Delphi Daily. Let’s dive in.


🚨 In Case You Missed It

  • Binance will stop supporting USDC, USDP, and TUSD as trade-able assets on the platform. Users can still deposit and withdraw these assets, but they will be aggregated into BUSD while trading.
  • Ethereum successfully completes the Bellatrix upgrade, part one of the two-part process for the upcoming Merge.
  • Poolin, one of the largest Bitcoin mining pools, suspends withdrawals from its wallet service. The CEO cited liquidity issues and assured user assets are safe.
  • STEPN sets up its first physical office in Hong Kong’s government-owned Cyberport.
  • Solana adds support for Move, a programming language based on Rust developed by Meta Platforms.

📊 ETH Exchange Outflows Continue to Outweigh Inflows

  • Large amounts of ETH have continued to leave exchange wallets, despite the declining ETH price. Since March 15th, ETH outflows have outweighed inflows, as more than 323k ETH has left exchange wallets.
  • On August 29th, exchanges saw an outflow of over 476k ETH. This has been the third largest outflow of ETH since March. The largest outflow occurred when over 555k ETH was transferred out on July 7th.
  • This can be attributed to the upcoming Merge, which is currently scheduled to occur between September 13th-15th. The Merge is divided into two stages, beginning with a network upgrade called Bellatrix, which was successfully completed today.
  • Later, the Paris upgrade will shift the network from proof-of-work to proof-of-stake. This will occur on September 15th when the Terminal Total Difficulty reaches a value of 58750000000000000000000. Find a countdown for time until the Merge here.
  • Following the Merge, one or more forks that retain proof-of-work on Ethereum may emerge. If a canonical fork emerges, users who hold ETH in non-custodial wallets like Metamask will be airdropped forked ETH-PoW tokens based on their ETH balance just before the Paris upgrade.
  • To collect the most amount of ETH-PoW tokens, users are likely withdrawing ETH balances from centralized exchanges to non-custodial wallets, leading to an increase in the net outflow of ETH from exchanges.
  • For more on post-Merge Ethereum, Delphi members can read our Delphi Pro report here.

⚡NFT Game Platforms: Through the Eyes of Founders

  • Despite negative sentiment in recent times, the intersection between crypto and gaming continues to draw attention from traditional developers eager to explore this sector. With so many different ecosystems and developer tools on the market, it can be difficult to know where to start.
  • While it’s relatively easy to dig up a list of technical specifications, theoretical performance metrics, and claims of UX/UI superiority of a given blockchain, it’s harder to find first-hand accounts of gaming founders that are already building on the front lines.

  • Crypto gaming received $3B in private market investments in 2021. This year, crypto games received $1.7B in investments in Q1 and $1.2B in Q2. The investments in these two quarters accounted for 56% and 59% of investment in the entire gaming industry, respectively.
  • Given the activity surrounding blockchain gaming, it may come as no surprise that gaming is a category Delphi continues to be strongly focused on. However, the decision of which platform to build on remains a tricky one to answer for builders entering the space.

  • When looking at the secondary volumes for the overall NFT market, it is undeniable that Ethereum is king. This is undoubtedly due to its network effects, its unrivaled ecosystem support, and the security it offers.
  • However, if you want the king’s protection, you must pay his taxes. The high level of security comes with the sacrifice of cost and throughput.
  • These factors can have long-term implications for a project and should not be considered lightly. There are now many gaming-focused L1 & L2 solutions on the market beyond the Ethereum base layer, such as Polygon, Solana, Immutable X, Avalanche, and Flow.
  • For more on gaming platforms, Delphi members can read our Delphi Pro report here.

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