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Gaming beats the trend 🎮
Crypto games raked in big this Q3. Crypto VC funds hit a nostalgia trip back to 2020 levels. Alameda Research's $200M boo-boo. Blackdot's tattoo revolution and Space Force's AI pause.
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While gaming's facing a tad of a downer with job cuts, its crypto counterpart seems to be playing on a different level.
They've attracted a $600M in investments for Q3 2023, as per DappRadar’s latest scorecard.
Key Findings 📊
Q3 2023 Investment: Blockchain games attracted roughly $600 million.
Drop: This figure is down 38% from the $973 million recorded in Q2 2023.
Yearly Total (so far): The crypto gaming investment tally for 2023 stands at $2.3 billion. This is just 30% of the total funds raised during the entirety of last year.
Blockchain gaming activity had an average of 786,766 daily Unique Active Wallets, showing a 12% increase from the previous quarter.
Alien Worlds remains the most played Web3 game, leading in terms of wallet activity.
Leading in Web3 gaming transaction volume were Axie Infinity ($90 million) and Gods Unchained ($55 million).
Virtual worlds dapps reached an all-time trading volume of $13 million.
Gaming Industry Struggles 📉
The gaming industry, as a whole, has been grappling with significant challenges.
Over 6,100 jobs were cut across the gaming sphere in the past year, with major names like Epic Games, Telltale Games, Team17, and crypto-focused firms such as Star Atlas studio ATMTA and Otherside developer Yuga Labs announcing layoffs.
Spotlight on top Web3 games: Alien Worlds and Splinterlands lead the pack. Games like Sweat Economy and SuperWalk are gaining traction.
Axie Infinity remains a popular choice, but Gods Unchained has seen a recent surge in trading volume.
Virtual Worlds overview: Despite a dip in trading activity, there's still a lot of enthusiasm for the metaverse and virtual world dapps.
Projects like Mocaverse are receiving hefty investments, indicating sustained interest in this sector.
BRICK breaks ceilings?
Reddit's reward token, inspired by Fortnite, surged by 131% in just a day.
From nearly $0.075 to almost $0.173, the token more than doubled its worth within 24 hours.
Honestly, it's a bit of a mystery.
The Fortnite community on Reddit didn't drop any major news. And, let’s remember, BRICK isn't officially tied to the Fortnite game or its creators, Epic Games.
One theory? It could be due to the token's limited liquidity.
Just a couple of users trading the tokens might've caused this price surge. With a market cap of $15.6 million and trading volumes just above $1 million, even trading a mere $165 of BRICK could pump its price by 2%.
Most of this activity happened on Kraken, by the way.
BRICK came into play in 2020, when Reddit decided to experiment with crypto rewards for its dedicated users. They named these "Community Points".
Immutable and AWS
Amazon Web Services (AWS) and blockchain gaming firm Immutable are collaborating to reshape the crypto gaming landscape.
Immutable has joined the AWS ISV Accelerate Program, granting game developers using the Ethereum-compatible Immutable X blockchain access to AWS Activate.
This program provides startups with tech support and up to $100,000 in AWS credits. John Kearney, AWS's Head of Startups, emphasised the growing interest in blockchain gaming, with many studios exploring crypto tech integration.
AWS offers an array of services for the gaming sector, from cloud gaming to advanced AI solutions. Meanwhile, other blockchain entities like Avalanche have also teamed up with AWS.
Crypto VC Funding Hits a Bump
Venture Capital (VC) investments in crypto have taken quite the dip recently.
Think back to 2020: the numbers right now haven’t been this low since Q4 of that year.
Put in perspective, this time last year, a whopping $6 billion was floating around in 600 deals, and now, we're seeing a modest $1.98 billion across 376 deals.
TTD Blockquote 🎙️
Renowned investor, Paul Tudor.
“I can’t love stocks, [...] but I love bitcoin and gold.”
Paul Tudor Jones has his radar beeping with a unique market perspective.
Amid geopolitical uncertainties and shaky fiscal scenarios, Jones has a message:
US stocks? Meh. But Bitcoin and gold?
Big thumbs up
There's a growing tension between Israel and Hamas, which according to Jones, could potentially influence a risk-off sentiment in the markets.
Though US indexes seem positive this week, Jones is skeptical about its longevity, hinting at the possibility of a short-lived rally.
Economists' Nightmare - The Yield Curve
The ongoing concerns about the yield curve, which measures the difference between short-term and long-term interest rates, are painting a similar gloomy picture.
Especially now, with the yield curve seeing its deepest inversion since 1981.
🔎 Quick Fact:
The 2s/10s yield curve inversion is currently at 31 BPS, indicating potential economic distress.
Aggressive rate hikes by the Fed, meant to curb inflation, have added to the market strain, leading to speculations of potential rate cuts by 2024.
Such a move could shake up the crypto markets significantly.
The Safe Haven Call - Bitcoin and Gold
Amid this whirlwind of economic drama, there’s a glimmer of stability.
Gold and Bitcoin stand out as beacons. While Bitcoin has seen marginal movement, Gold has been on the rise.
Jones, who made a strategic move by allocating 1% to Bitcoin during the 2020 COVID-induced lockdown, continues to champion BTC as a refuge during unpredictable times.
TTD Numbers 🔢
Blockchain surveillance firm Elliptic has stated that there is a "stronger possibility" that Russian actors were involved in the $477 million FTX hack.
The funds stolen from the bankrupt exchange have been combined with those of Russian criminals.
Elliptic pointed out that funds were moved while FTX founder Sam Bankman-Fried was in court, casting doubt on the theory that he stole the money.
The stolen assets were traced through ChipMixer, with significant amounts combined with funds from Russia-linked criminal groups before being sent to exchanges.
The hackers used various methods to break the blockchain trail and launder the funds.
Alameda Research, a former crypto trading company, lost nearly $200 million to phishing attacks due to lax security practices, according to a former engineer.
The company's focus on speed over security led to vulnerabilities such as storing private keys and API keys in plaintext files accessible to multiple employees.
The losses included $40 million from yield farming on a questionable blockchain, $50 million from a leaked password, and $100 million from clicking on a fake phishing link on Google Ads.
These incidents highlight the ongoing security risks in the crypto ecosystem.
Genesis Global Trading has been ordered by a court to pay $175 million to FTX in a lawsuit, leading to the halt of customer withdrawals in its lending division.
The court-approved settlement aims to avoid prolonged litigation but has faced criticism from FTX creditors.
The legal dispute stems from the collapse of FTX in 2022, with Genesis being financially connected to the company.
Former Alameda Research CEO testified about efforts to hide financial details from Genesis, revealing a complex fiscal web.
The ongoing trial of FTX founder Sam Bankman Fried adds to the turmoil in the crypto market.
The launch of Ethereum futures ETFs has been slow and disappointing compared to the success of Bitcoin futures ETFs. The distraction of Sam Bankman-Fried's trial may have also affected market activity👇🏻
TTD WTF 🙄
Tattoos are getting automated too.
Enter Blackdot, a high-tech tattoo startup.
The Blackdot Device:
Developed by a team of PhD engineers over five years.
Uses advanced technology to determine the exact amount of ink required and the precise depth to ink, in individual dotted increments about twice the width of a human hair.
Promises significantly less pain than a traditional tattoo gun.
Capable of perfectly replicating pre-programmed designs on any skin type.
Impact on Tattoo Artistry
Traditional tattoos have always varied based on the tattooist's technique and skills, making every tattoo unique.
Blackdot promises a standardised quality, allowing designs to be replicated with surgical precision by any trained staff member.
Breaking Geographical Barriers
Artists from around the world can release collections on Blackdot, making their designs available globally without the need for clients to travel.
Digital artists, such as Tyler Hobbs, are venturing into the realm of tattoos, making their digital art available for human canvases.
Monetisation & NFTs
Design fees range from $400 to $8,000, with execution fees set between $600 and $1,850.
Blackdot plans to introduce a Certified Artist program to onboard artists onto the platform.
The company will implement an NFT-based royalties system to ensure artists get paid every time their designs are used.
A future Tradeable Tattoo program will allow users to sell and trade tattoo designs as NFTs.
🛰️ Space Force Says "Hold Up" on AI
The US Space Force has issued a temporary order prohibiting the use of personal generative AI accounts while on duty, citing concerns about privacy and security.
The memo, issued by Lisa Costa, Deputy Chief of Space Operations for Technology and Innovation, aims to provide guidance on the responsible use of generative AI and large language models.
The Space Force joins other organisations, including the US House of Representatives, in implementing restrictions on AI use.
While the Space Force is optimistic about the future use of AI in space and military endeavours, it is taking a strategic pause to ensure data protection.
🇦🇷 Argentinian Election And AI-Powered Scandal
A scandal has erupted in Argentina.
Just weeks before the country's primary elections, with leaked audio recordings allegedly revealing inappropriate comments and behaviour by Carlos Melconian, the pick for economy minister by presidential frontrunner Patricia Bullrich.
Bullrich has dismissed the recordings as edited and suggested they could be fabricated using artificial intelligence (AI).
However, her colleagues have acknowledged the tapes are real but claim they are old recordings from Melconian's time leading the National Bank.
The scandal could impact Bullrich's campaign as she seeks to oust the incumbent Fernandez and present herself as a clean break from the current administration.
🎙️ Senate Speaks Out on Synthetic Voices & Faces
A new Senate bill called the NO FAKES Act proposes to ban unauthorised AI-generated recreations of people's voices and images.
The bill, introduced by a bipartisan group of senators, would hold companies and individuals liable for damages if they create unauthorised AI replicas of someone, living or dead.
Platforms that knowingly host these unauthorised AI copycats would also be held accountable.
However, the bill allows for limited uses of unauthorised AI replicas protected by the First Amendment, such as for news, documentaries, and satire.
The bill aims to protect the rights of individuals, foster AI innovation, and address concerns in the entertainment industry.
TTD Surfer 🏄
Mastercard has successfully concluded a pilot project with the Reserve Bank of Australia and the Digital Finance Cooperative Research Centre for CBDC.
Uniswap Wallet, previously available only on iOS, is now coming to Android.
Indonesia is set to conduct blockchain trials for public services as it aims to become a leader in Web3 technology.
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The Token Dispatch is a daily newsletter that takes you on a 4-5 minute drive through the wild west of the Crypto World. Daily in your email inbox @13:00 GMT. Almost always.