Why Coinbase Launched an L2

GM DOers!

We’re back again with your weekly fix of legitimate information that keeps you away from FADS!

What a week… I know, we keep saying that on every Rollup.

But this week was actually a big week. In fact JayBird used the word supercalifragilisticexpialidocious to emphasize what a weak we’ve had in web3.

If you don’t believe us, just know that Puma, one of the worlds largest sports and lifestyle companies, launched a 10k PFP collection and we didn’t even have time to talk about it on the show. 🤯

Here’s today’s agenda:

• Chart of the Week, which perfectly portrays the state & history of the NFT marketplace war 📈

• Coinbase launching BASE, an Ethereum layer 2 scaling solution 🚀

• Spotify testing web3 features 🎶

• Minting NFTs with the Solana Mobile camera??? 🤳

• NFT Of The Month. Hint: It’s GOD-like 😇

Without further ado, let’s jump into it… 

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Chart of the Week

This is perhaps the most important chart in web3 right now! Why?

Because it tells an incredible 3 year story about the adoption of NFTs and the marketplaces that enable this budding economy to exist.

From this chart, we can see how OpenSea has dominated this industry ever since their inception in 2017. 

However, the newcomers, aka LooksRare in 2021, Magic Eden, X2Y2 in 2022 and BLUR in 2023 have slowly but surely taken serious real estate in the battle for market share.

If we look solely at the chart above, we may think that OpenSea is losing this great NFT marketplace battle. Though the reality isn’t quite as simple as that. There’s much more to it.

We need to look at the sustainability of each marketplace to actually determine if the current trend (where OpenSea is losing market share) will continue. 

You see, LooksRare, X2Y2 and BLUR have all airdropped a bunch of tokens to its users, which is the equivalent of bribing them to come and use these platforms. And that made us wonder… Is this sustainable?

The majority of our community on Twitter don’t think that it is…

But what’s the reality? As always, we turn to the blockchain… We 👀🔛⛓️ to see what’s real and what’s not. 

And if you want that insight, make sure to turn to our latest PRO report, where we dive deep into the state of this NFT marketplace war to see who’s actually winning and who’s going to stick around for years to come.

Coinbase Launches Ethereum L2

Create a new blockchain? Nah… Too mainstream.

Instead, let’s scale Ethereum. 🚀

Coinbase looked at Binance (who has BSC, an L1), Aptos (L1) and Solana (L1) and thought… What’s the point in making a separate chain when we can build on top of Ethereum and partake in the current network effects.

So they launched BASE, an EVM compatible layer 2, which is permissionless and allows devs & users to come and build on top of Ethereum, for cheap. 

Base will have no token and they’ll use $ETH for transactions and gas. 

The most interesting thing about this whole launch is that Coinbase is working with Optimism (another ETH L2) and will use their tech stack to build Base! 

This essentially means that Coinbase will copy Optimism’s code (which is open source) to build a competitor of Optimism. WHAT?

This can only happen in web3, where we all work together to build extremely valuable products, with good UX, that’ll onboard billions of people. Once mass adoption occurs, Optimism will benefit much more than if they kept the code for themselves. 🚀

This is where the WAGMI (we’re all going to make it) saying turns out to be true and really explains the culture in web3. 💜

At Web3 Academy, we believe that layer 2s are the future. It doesn’t make sense for new projects to exclude themselves from the network effects happening on Ethereum by making their own layer 1 blockchain. 

So we expect this trend to continue. 🚀

Last week, we wrote a PRO report breaking down how ETH is scaling, where we highlighted the importance of layer 2 in the ETH ecosystem. With the Base launch, our report just got even more relevant. Give it a read here! 

BLUR Overtakes OpenSea In NFT Volume

Sorry if we keep talking about this marketplace ‘match’ but this shit’s bigger than the SuperBowl and the Champions League final combined…

In web3 anyway… Here’s a visual representation of OpenSea and BLUR going head to head.

So what happened? 

Blur, a no-fee NFT marketplace that also has optional creator royalties, just did a massive airdrop last week. To ensure eligibility, you had to trade on Blur, and that made NFT traders flock to the newly launched NFT marketplace. 

So much, that Blur managed to overtake OpenSea in daily NFT trading volume. 

To combat this, OpenSea announced this week that they’re removing all platform fees (temporarily) and they’ll move to optional creator royalties.

And then a couple of days ago… Blur announced a season 2 airdrop of 300M $BLUR, to incentivize traders to remain on the platform. In order to receive the most amount of tokens in season 2 sellers on Blur must delist their NFTs from all other platforms. 

Sounds very much like bribing… But it works.

So now, this battle between NFT marketplaces keeps going back and forth, all in the hopes of capturing the majority of the market share.

Jay and Kyle broke down this head to head battle on the podcast and they discussed how NFT Marketplaces make revenue if they continue operating without fees. Give it a listen here! 

Thread of the Week

Spotify Tests Web3 Features

The web3 wave has just (inevitably) hit Spotify, who’s testing some exciting web3 features.

👉 Token-gated playlists 

WTF ARE THOSE? 

Well if you’re a holder of Fluf, Moonbirds, Kingship or Overlord NFTs then you can connect your wallet to Spotify and access a curated playlist.

Right now Spotify is just testing this feature so it’s only available for Android users in the U.S., U.K., Germany, Australia and New Zealand.

While token-gated playlists are cool and provide creators another way to give value to their members, the big takeaway here is that Spotify is experimenting in web3. 

Through this pilot, Spotify will test their wallet-connect and token-gating tech. Where could this lead? Take a look at Audius, a web3 native music platform.

On Audius, artists are paid out in tokens based on listens. Paying artists in tokens is a million times faster than paying them through the traditional banking system as Spotify currently does. It can take 4-6 weeks for an artist to get paid.

Furthermore, on Audius, curators who create playlists are paid tokens if their playlist is a top 5 most popular for the week. This is the beginning of the Curator Economy. 

With so much content being created we rely heavily on curators to help us find and discover the best stuff. Tokens enable curators to finally be compensated for their effort and impact.

TALK ABOUT NFT UTILITY 🥳

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NFT of the Month

DeGods is a community that constantly ships. And they’re our NFT of The Month, voted by our own community. 🥳

DeGods have been making some big moves recently that caught our attention & motivated us to feature them on today’s show. 

First of all, on Christmas Day DeGods announced they would be moving from Solana to Ethereum and their generation 2 collection y00ts would be moving from Solana to Polygon. Apparently they received a $3m grant from Polygon. 

We can’t wait for this move to happen as we believe that it will set a precedent for other NFT collections who want to switch blockchains. This hasn’t been done before – at this scale anyway – so it’s going to be exciting to follow along. 

Second of all, over the course of this week, DeGods minted NFTs on Bitcoin. When DeGods launched, there were 535 PFPs that were burned. Those have now been revived on Bitcoin. A move that sparked a lot of attention around the project. 

Lastly, the DeGods community members recently launched DeGolf, a golf tournament hosted exclusively for DeGods & y00ts holders, which will take place on the 12th of April (the first day of NFT NYC) in, you guessed it, New York.

This simply shows how a great community can contribute to your project. The DeGods team had nothing to do with the golf tournament. It was completely set up by the community. And it’s fascinating to see.

Congrats DeGods for being NFT Of The Month. 🚀

Next week, we’re choosing DAO Of The Month! Got any suggestions for who we should highlight? Share them with us by replying here. 

Numbers to Know

10,000

Puma launched a 10k PFP collection. It sold during the whitelist phase and the public didn’t even get to try to get their hands on this mint. Btw, this would’ve been a top story if it wasn’t for our supercalifragilisticexpialidocious week.

$2,000

That’s how much Starbucks NFTs were selling for when they launched (for a few hundred whitelisted people). For whatever reason, someone was willing to pay that much for a loyalty token. Insane, but we’re in web3 after all.

120,000

That’s the amount of songs Napster — the music company that went bust before I (Raul) was born — got after acquiring Mint Songs, a music licensing and publishing platform. Napster is now going web3, planning to launch some sort of music platform. Let’s see. 👀

Other Web3 News

• YouTube has appointed Web3-friendly Neal Mohan as its new CEO after the departure of Susan Wojcicki. Source

• Polygon Labs President Ryan Wyatt has said “the next Jeff Bezos will come from Web3.” Source

• Siemens has issued a €60M digital bond on the Polygon blockchain. Source

• Litecoin network gets NFTs after a developer forks Bitcoin Ordinals. Source

• Arbitrum’s transaction volume hit a weekly all-time-high of $2.62B making it the third most active blockchain network following Ethereum and Binance Smart Chain. Source

• Fetch.ai and Bosch have partnered to launch a new foundation committing $100M to a Web3, AI, and IoT grant program. Source

• Pudgy Penguins partner with Retail Monster to put their toys on retail shelves around the world. Source

• LinksDAO is buying a golf course. Source

• Yuga Labs releases new game lick the toad. Source

• Mastercard to allow crypto payments in web3 via USDC settlements. Source

• The NBA launches fascinating tech that tranforms people into virtual avatars. Source

• Nas Daily (60M+ followers on social media) partners with Solana to create a course for devs. Source

For the DOers

READ

Catch up on Wednesday’s DOer Spotlight: How Gitcoin is Disrupting the Way We Fund Public Goods

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The NFT Marketplace war is hotter than ever. Who’s winning and why? Find out by looking on-chain with out latest PRO Report: The Great NFT Marketplace War. Who's Winning And Why?

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