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Notable Infrastructure Investments in the Binance Quarterly Report


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Binance Research has just released its Q3 report for 2023. “State of Crypto: Market Pulse” provides a snapshot of the blockchain industry as the year prepares to enter its final quarter. There’s been a lot to pack into the last three months of crypto activity but Binance Research does its best to cover it.

One key highlight from the 53-page document is significant investment in blockchain infrastructure projects, but this is tempered by tough market conditions. Total value locked (TVL) into DeFi protocols is down in Q3, as is volume, while the total market capitalization has decreased by 8.6%. There are other positives, though, including positive regulatory news that has raised expectations of Bitcoin ETF approval in the near future.

Market Conditions Tighten in Q3

Binance’s Market Pulse report cuts straight to the chase in detailing the areas where crypto struggled in Q3 2023. The most obvious sign of this is the 8.6% decline in the capitalization of all crypto assets. The fact that Ethereum transaction fees have decreased in Q3 can also be taken as a bearish indicator. So too have those on BNB Chain. But it hasn’t all been bad news: “In Q3, institutional adoption surged even in the face of declining prices, with major companies like Deutsche Bank, Sony, Grab, and PayPal announcing their involvement in web3 initiatives,” we read.

While three-month analysis of a particular industry can reveal short-term trends, sometimes you need to zoom out to see the bigger picture. The State of Crypto: Market Pulse authors acknowledge this, emphasizing that 2023 has still smiled kindly on crypto, with BTC up 63% YTD.

VCs Are Still Writing Checks

There are some who say the days of crypto VCs writing big checks for blockchain projects are over. The Market Pulse report would disagree. It points out Flashbots’ $60M Series B fundraising and Bitmain’s $54M strategic investment in Core Scientific. It then adds: “Gaming and Metaverse also saw strong interests with Futureverse clinching $54M in funding to develop AI-centric consumer games,” and notes Animoca Brands’ $20M raise for its Mocaverse project.

While VCs continue to cautiously seek out web3 projects with a clear pathway to profitability, another sector that has been ticking over nicely this quarter is Ethereum staking. It remains in rude health; 20% of all ETH in circulation has now been staked, the report notes, with LSTfi taking credit for much of this uptick in staking activity. Lido remains the market leader for ETH liquid staking.

Gaming Keeps Trucking as NFTs Falter

NFTs have been on life support for months, as evidenced by their low trading volume and general industry apathy. Despite there being multiple predictions of NFTs’ demise in Q3, crypto tokens empirically have a habit of rallying when everyone’s written them off. There’s been a lot of money sunk into NFT projects, and it’s hard to believe that none of them will yield dividends, especially with the likes of Yuga Labs and Animoca Brands busily working away.

As the NFT space deals with its demons, web3 gaming has been enjoying greater fortunes. BNB Chain now hosts the highest number of onchain games, the State of Crypto report reveals, followed by Ethereum and Polygon. But GameFi’s full potential has yet to be realized: only 28% of web3 games are live, most remaining in their alpha or beta phase.

Despite a choppy couple of months on the markets, the Binance Research report shows there’s still reasons to feel confident about where crypto is headed next.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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