Stranded at Sea

Blubber Notes #102

Dear Future Whales,

In today’s note, I share my opinion on the Blast Token Generation event and why I believe we’re in for a bumpy ride with further downside and little room to trade our illiquid JPEGs. A new game has just been published by Truth Labs that connects the Goblintown IP with Roblox. Lastly, I share a podcast from Real Talk NFT featuring yours truly. Let’s dive in!

Summary:

• Blur, Blend, Blast…Bust?

• New Game: Escape Goblintown

• Recommended Podcast: This week’s Real Talk NFT episode

💣 Blur, Blend, Blast…Bust?

The market sentiment around NFTs is quite low. Even the most coveted digital collectibles have taken a massive tumble from their all-time highs, falling sharply in just the last year. This includes top names such as CryptoPunks, Azukis, Chromie Squiggles, and many other assets often referred to as "Grails" among collectors. My assumption is that it’s about to get much worse in the short term, and partly because of Blast’s Token Generation Event this week. Here’s why.

• First, a short history lesson. Blur changed the game in the fall of 2022 with one of the most engaging and welcomed token airdrops or claims at the time. This event was so successful that they quickly took over marketplace volume from OpenSea and many others. The next part of their strategy involved awarding points to people who created bids on collections, with more points awarded for bids closer to the floor price. Yes, this provided much-needed liquidity to the market, but it also created nasty incentives for traders to flip their assets, often at a loss, to maximize their claim. This led to a spiral down in NFT prices.

• Blur later came out with Blend, a lending protocol, which was interesting, but the bigger news was Blast. The Blast network was designed to enhance NFT liquidity and trading efficiency through a decentralized, permissionless protocol. The expected results were improved liquidity, faster transactions, and a more dynamic trading environment.

• To maximize participation in earning Blast Gold during its upcoming Token Generation Event, protocol participants were incentivized with multipliers to complete various transactions and jackpot activities on new dApps.

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• I see a major problem with this. Since these multiplier incentives were held weekly, users were essentially were forced to participate, otherwise, they risked having their rewards diluted by users who did. The second issue is that, like all chains, there is only so much liquidity, and having a few massive whales earn multipliers ultimately means that the payouts that others are expecting will be exceedingly low.

• So, what remedy does Blast have? I suppose they could come up with yet another new mechanism, perhaps a new idea that starts with “B” to reward users who stake or complete some other activity. However, while there will be some new liquidity injected into the market, I’m expecting 10x the amount of FUD. This TG event occurs on June 26th. Grab some popcorn and let's see what happens.

🕹 New Game from Truth Labs

• I'm seeing more and more potential collaborations between web3 gaming ecosystems and Roblox. Just this morning, Truthlabs, the creators of one of the more memorable mints from 2022, announced a new game playable on Roblox. "Escape Goblintown," the first Roblox game developed by Illuminati DAO and Odyssey Gaming.

• This fast-paced multiplayer escape game immerses players in a thrilling race against time, where they must evade goblins and their friends. "Escape Goblintown" is a serious milestone for web3 gaming, bringing the Goblintown IP to life on a new platform. Check out the trailer here.

  

  Source:Youtube.com

🎧 Recommended Podcast Real Talk NFT Featuring Me!

This podcast will likely be published on Tuesday, 6/25/24, so be sure to check it out then. I spent time chatting with Joe Chui and Brian McNutt from Real Talk NFT. We covered a lot, from VanEck’s Web3 efforts to real-world assets. Check out their channel here.

Authored by Matt Bartlett, CAIA. Follow Matt on x.com @MattBartlettVE

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