Main Takeaway: Be Careful Of Traps
Over the past two days, a slew of negative news in the traditional economy and crypto have taken over sentiment and brought down prices. For example, inflation in the UK hit 10.1%, energy prices in France and Germany are skyrocketing, DeFi TVL is dropping, trading volume is stalling, and funding is slowing. All these factors are contributing to increased volatility for cryptos over the past three days. The takeaway is it’s looking like the weekend will break precedent from previous work week closes in the green.
Key Stories: Blockchain Venture Capital Funding Down
CoinTelegraph Research recently reported that inflows in the blockchain venture capital market have declined by 43% m-o-m in July 2022. These numbers have returned to 2021 levels. However, the Web3, GameFi, and Metaverse sectors continue to command the leading share of investor interest. Of course, the bear market is one of the leading contributors to this downturn. The takeaway is Web3, GameFi, and Metaverse sectors are widely seen as the most valuable moving forward, and thus popular cryptocurrencies related to these sectors will subsequently see decent valuation prospects for VC investors.
Investor Insight: Avalanche Alert
Avalanche has taken a beating in recent days as news of declining TVL and DApp use impact investor sentiment. In particular, Avalanche’s TVL dropped 40%, which is more significant than its competitors, Solana (down 27%) and Ethereum (down 33%). Despite declining TVL and DApp use, Avalanche is still a top 15 cryptocurrency by market cap and at one point in 2021 was in the top 10. In fact, Avalanche is one of the best smart contract platforms with the capability of doing many things Ethereum can do. While often labeled as an Ethereum Killer, it doesn’t appear this narrative will play out in 2022, especially as Ethereum goes through The Merge. Nonetheless, Avalanche is a great network with many promising decentralized applications such as Trader Joe.
Today’s Top Gainers
The top five performing cryptos on Phemex d-o-d are Santos FC Fan Token (SANTOS/USDT), FC Porto Fan Token (PORTO/USDT), Lazio Fan Token (LAZIO/USDT), Alpine F1 Team Fan Token (ALPINE/USDT), and StepWatch (SWP/USDT).