Bull Market Code Analysis of 14 Project Cases from 0 to 1

Author: Zixi.eth Source: X, @Zixi41620514

A week has passed, thank you for your feedback. We have completed the following 14 projects to summarize what they did from 0-1. Thank you @DGZbro @JimsYoung_  Part of the help I received from these two brothers was their contribution. We selected Avalanche, Fantom, Solana, Luna, Arbitrum, Merlin, Berachain, Celestia, Eigenlayer, Axie Infinity, Blur, FT, BAYC and Little Penguin. Public chains and products spanning the previous cycle and this cycle.

Let’s post a summary first:

1. The team background of most projects is That’s right, there is no grassroots team, either a Ph.D., a university teacher, or a serial entrepreneur. And Western teams account for the vast majority. [Excellent Team]

2. In current or future head projects, what they will do at the beginning will most likely be unique and something that everyone may not have. The method is acceptable, but you can’t understand it. [Advanced prediction of the market

3. Obtaining financing from leading institutions is the only way to take off. You may not be able to succeed if you get it, but if you don't get it, there is a high probability that the ceiling is not high. [Reliable institutional endorsement]

4. For Infra projects, the core competitiveness across cycles is whether the public chain can produce a Two trump projects. In the early days, the launch of public chains did not rely on ecology, but when the wave recedes, only public chains with real ecology can transcend the cycle. Infra project parties must pay attention to ecological construction. Ace projects are the real competitiveness that enables public chains to transcend cycles. For product project developers, once the product becomes big, they can expand downward and become a public chain. [Ecology is the core competitiveness in the mid-to-late period

5. Whether it is a product or a public chain, it must solve a pain point in the market and have its own solution , unique and definitely not a copycat. [Innovation]

1. Avalanche: The team has a good background + unique technical means, so it has strong financing capabilities and has created a good ecosystem

2021 is an undeniable copycat season, especially in the second half of the year. As Ethereum reached 4000+, the mainnet gas fee was too high, and there was no L2 at the time, so users and funds began to overflow from Ethereum to other L1s.

At that time, Solana was the one pulling the most string. Since it was a bull market, the market was still looking for other targets, so the market’s attention gradually fell on Avax. , because:

1. The Avalanche team is good. CEO Emin Gün Sirer: Computer scientist and associate professor at Cornell University. Sirer developed the Avalanche consensus protocol underlying the Avalanche blockchain platform and is currently the CEO and co-founder of Ava Labs. He was an associate professor of computer science at Cornell University and former co-director of the Initiative on Cryptocurrencies and Smart Contracts (IC3). He is known for his contributions to peer-to-peer systems, operating systems, and computer networks.

2. Unique technical means. It can be said to be the earliest "modular" idea, using XCP three chains, X chain is used to create and trade assets, C chain is used to create smart contracts, P chain is used to coordinate validators and subnets, and gossip avalanche is used to confirm consensus. At that time, it seemed that the brain circuit was very big, and it was a very good idea.

3. Because of 1+2, it has strong financing capabilities. In 2020, it completed 12 million private placements and 46 million public placements. In September 2021, the foundation raised 230 million U.S. dollars, and in November the ecological accelerator raised 18.5 million. The strong financing capabilities combined with the MM pull offer allowed retail investors to see, understand, and believe in the team's endorsement, so retail investors' buying orders were extremely strong.

4. At that time, avalanche had the ace project Defi kingdoms in the ecosystem. This was a very creative DeFi+GameFi project at the time, using games (not bad ’s) exquisite pictures showed the meaning of DeFi, and then DFK changed from an ecological project to Avalanche’s Appchain. This project made avalanche famous. Secondly, there are also good projects such as GMX, traderjoe, etc.

2.Fantom: The soul figure leads the public chain to the peak and also to the bottom

Fantom The soul figure is AC, AC is the old OG of DeFi and the founder of Yearn Finance, Phantom, etc. YFI has created a thousand-fold myth in the bull market, so the community’s expectations for AC are so high that the community calls him the father of DeFi.

1. There is no need for him to say anything about the team, AC is the face of Fantom.

2.Fantom raised 40 million in ICO in 2018. In the 21-year bull market, there were three consecutive rounds of financing. Alameda invested 35 million, Blocktower invested 20 million, and Hyperchain invested 15 million. After experiencing a big correction in May, the reasons why Ftm has been soaring are:

1. AC has been calling for orders, and everyone believes in AC.  2. Having raised a lot of money, Fantom had the confidence to spend 370 million tokens (approximately equivalent to 200 million US dollars) to stimulate ecological development, and DeFi on the chain developed rapidly.

Why Ftm started to plummet at 22:

1. Ftm started because AC was a cofounder The disk will also return to zero because AC leaves. The lack of soul figures has caused the community to lose confidence in it;

2. The ecology is very ordinary, without any innovation, basically all defi, and all copycat. Big projects in the currency circle are all unique. It's just that the ugly ones are unique or the beautiful ones are unique, but neither one is copycat.

3.Solana: Development has been ups and downs, hackathons have created project miracles, this bear market has come back to life, and the ecosystem is unique

Solana’s initial fundraising Capital is not easy. Despite the strong team background, it was not easy to raise funds in 2018-19. In a market that is increasingly wary of high-performance public chain stories, Solana had to compete with other projects. At that time, Solana was not widely known by the market. However, through persistence in its products and a pragmatic attitude, Solana gradually attracted the attention of investors.

In the development process of Solana, there is a key disagreement, which involves the strategic choices of the founders of Multicoin and Solana. As an early investor, Multicoin insists that Solana needs to be listed as soon as possible to build brand community consensus. At the same time, Solana’s founders hope to launch a stable and reliable mainnet first. This decision ultimately proved to be correct, as it laid the foundation for subsequent cooperation with SBF, which was looking for a high-performance public chain to work with.

Several key reasons for the subsequent change from 0-1:

1. SBF participation Played a decisive role in the rise of Solana. SBF not only invested in Solana, but also led his team to develop the Serum project based on Solana, which greatly improved the visibility and legitimacy of Solana. Later it was even reported that 70% of Solana’s TVL was supported by the SBF team.

2. Solana’s hackathon project has created many miracles. Through hackathons and various incentives, Solana cultivates an active developer community, which fuels the growth of its ecosystem. Subsequently, Top projects such as Magic Eden, Stepn, and Jito appeared.

3.Solana, in the hands of SBF, uses pulling power to create miracles. The wealth effect is the best marketing tool.

4. Despite the subsequent collapse of FTX and significant price fluctuations, Solana still maintains its developer ecosystem and community activities through continued incentives and hackers During the marathon, Solana continued to improve its infrastructure and stimulated the development of more innovative applications, further promoting the prosperity of the ecosystem and demonstrating its resilience, which is the key to its ability to survive this bear market. And we have seen on Solana that its ecological development is gradually different from that of the Ethereum community, especially the collective migration of DePIN to Solana.

Good endorsement + the wealth effect of market pull + the existence of SBF has attracted many developers and ecological projects. And because of its high performance, Solana has attracted many unique ecological projects.

4.Terra: Because of the dual-token spiral structure of the ecology + high interest rates, it also takes off because of the ecological spiral structure of death

Several key reasons why Terra went from 0-1:

1. In terms of team, Do Kwon graduated from Stanford and has a good team background. Moreover, I am very active on Twitter and am very good at causing trouble.

2. South Korea’s national chain is extremely fomo in South Korea. Korean VC, 3AC, etc. took off because of Terra, and also returned to zero because of Terra. Financing is also quite good, raising US$77 million in two rounds.

3. In terms of ecology, Luna+UST relies on the arbitrage mechanism and supply and demand to adjust and stabilize prices, while LUNA serves as the stabilizer of UST and became the market leader at that time. The most eye-catching dual-currency algorithm stablecoin system in the world, the two interact to form a positive spiral. Terra also subsequently launched the important DeFi project Anchor, which provides an ultra-high current yield rate of 19%-20%. It was once touted as the "gold standard of Crypto passive income". As a highlight, it attracted a large number of investors and laid the foundation for the future. Thunderstorms set the stage. Everyone is calculating every day how many days Terra’s money can still pay 20% interest. During the bull market, UST became the third largest stablecoin with a market value of US$18 billion, and LUNA's market value reached a maximum of US$41 billion. Its ecological payment project Chai is also pretty good. Chai once received a US$45 million investment from SoftBank.

Once the market reverses, the positive spiral will turn into a death spiral:

3. In 2022, The overall decline in the cryptocurrency market caused investors to transfer funds from other cryptocurrencies to UST in order to obtain high interest, making Anchor's deposit scale much higher than its borrowing scale, resulting in a huge balance of payments. In the early morning of May 8, 2022, LFG was withdrawing US$150 million of UST liquidity from the UST-3Crv pool in preparation for the establishment of the 4Crv pool. An address suddenly sold 84 million UST, which seriously affected the balance of the 3Crv pool. Multiple whale accounts began to sell UST continuously on Binance, causing UST to briefly unanchor.

As the reserves gradually depleted, the market's confidence in UST began to waver, and a large amount of UST was sold, causing the price of UST to further destabilize. In order to stabilize the price of UST, a large amount of LUNA was issued, causing the price of LUNA to plummet, forming a so-called death spiral. In order to prevent Luna and UST from plummeting, LFG needs to sell the treasury's BTC and other tokens, causing the market to plummet. Luna and UST brought down the entire market.

Good tokenomics (actually the bull market ponzi) + unique ecology have created Terra. But Tokenomics also caused the collapse of Terra. If the ecosystem can keep up, will Terra not collapse?

5.Arbiturm: The first team to talk about OPL2 + the bull market has received huge amounts of financing and created an excellent ecosystem

Several key reasons why Arbitrum is going from 0-1:

1. The team offchain labs started working on L2 in 2018 and integrated it in 2019 After completing the angel round, they were among the first batch of L2 teams. The team's first-mover advantage is extremely obvious. Then in April 2021 and August 21, two consecutive financing rounds totaling US$140 million were completed. The team’s technical background has a clear first-mover advantage.

2. The earliest and earliest batch of OP L2 mainnet was launched in September 21, which was in the bull market. It is relatively easy to accumulate users and ecology, and it is easy to accumulate ecology. first mover advantage.

3. Because we have raised a lot of money, we have money to work on the ecosystem and attract developers.

4. The airdrop was issued very well, creating a large wealth effect in the beginning of March 2022. Unlike Starkware, which saw its DAU drop by 90% after its airdrop, Arbitrum did not lose much DAU after its airdrop.

5. There is a trump card project in the ecology, GMX. I won’t go into details about how awesome GMX is. During the bear market, it rose 100% against the trend and used spot dex as an innovative idea for perp dex. GMX contributed a large number of users and transactions to Arbitrum in the early days.  Good team background + leader of the story——》Easy to raise money——》Launch the mainnet at the “right time”——》Because a lot of money has been raised, I can give money to developers——》Until there is a trump card The project can stand up and support the public chain.

6.Celestia: clear positioning, but weak ecology

Several key reasons why Celestia has gone from 0-1:

1. The story of Celestia is well told. As the first project to propose a modular blockchain network, Celestia adopts modular design, separates consensus and execution, and provides DA services. . At its inception, there were few modular blockchain and DA-focused solutions, so Celestia had few direct competitors. This gives Celestia a unique market position.

2. Celestia was founded at a time when the market was clearly moving towards greater scalability and efficiency, by providing a solution focused on data availability. Meet the market demand for higher performance Layer 2 solutions. Celestia is ideally suited as the data availability layer for Rollups. It allows Rollups to push stateful execution off-chain, relying on Celestia for consensus and data availability, thereby improving overall scalability.

3. The team is good. Mustafa is a Ph.D. from UCL and the cofounder of Chainspace, which was later acquired by Facebook.

4. Celestia’s ecological construction is weak. But after choosing to join the cosmos ecosystem, the subsequent airdrop rewards for staking tia are very rich. Therefore, tia has certain value support

7. Berachain: Luna2.0, can the three-token model reshape Luna’s bull market growth miracle

Berachain is getting a lot of attention now (after all, it hasn’t taken off yet), so let’s talk briefly:

1. Although the team is Anonymous team, but an old OG who has been in the currency circle for 15 years. In 2021, I issued a Smoking Bear NFT. After experiencing defisummer, I deeply realized the importance of liquidity to the public chain, so I launched Berachain.

2. It is also because the team background should be good, so it was able to obtain 42m financing from polychain and hackvc during the deep bear period in April 2023.

3. Although the story told by the entire chain still serves defi (taking the sword of the previous dynasty to kill the officials of this dynasty), the token design is very exquisite. Three tokens The design of bera/honey/bgt has the design feel of luna/terra with the left foot stepping on the right foot. The interest rate design of Luna/UST is very fictitious and relies on Anchor's lending interest rate difference. Learning from the failure of Luna/UST, Berachain’s three-token model may be able to effectively mitigate (not avoid) the dual-token death spiral. Referring to Luna’s wild surge in the bull market, the market naturally has high expectations for Berachain.

8.Axie: a special product in the epidemic era, a tool that Southeast Asian users rely on for survival

Axie has grown from 0-1 Several key reasons:

1. The impact of the epidemic at that time caused the daily income of Southeast Asian users to be very low. The P2E model created by Axie has changed players' expectations for games, turning it from a recreational activity into a possible source of income. The key point is that the income is not low. Thanks to the background of the bull market, more and more players are joining the game. , the currency price rises, and the weekly income can reach 300-400 US dollars at its peak. In areas with unstable economies or affected by the COVID-19 epidemic, this model provides a new income opportunity. Games not only provide entertainment but also give players control over the tools of production by allowing them to participate in economic activities, which is particularly attractive to players in developing countries.

2. As the leader of blockchain games at the time, in 2021, with the strong support of various community associations and investment institutions, Axie Infinity’s daily income and The number of active users has reached its peak, and the market share accounts for nearly 2/3 of blockchain games. During this stage, game revenue and token value reached historical highs. AXS's market capitalization peaked at US$10 billion.

Resetting to zero is also very simple. There are no positive externalities in the Ponzi game, and the results are all returned to zero.

9. Eigenlayer: It is in line with the general direction of user funds and leverage, and DA is well combined with restaking

Eigenlayer’s story from 0 to 1 can be understood as:

1. This story is clear enough, and the entire ETH staking ratio will be at the beginning of 2022 When it is less than 5%, we dare to talk about a subdivided track.

2. As a PR-type CEO, Kannan can attract the attention of VCs.

3. The Eth staking ratio is gradually increasing visibly to the naked eye, from 0 to the current 30% eth staking in 3 years.

4. Eigenlayer’s star ecological project is EigenDA. The story of restaking can later be combined with DA. The DA of the modular blockchain has become the best use case for restaking. one.

5. Because 1+2+3+4, VC is willing to pay. And this also meets the needs of Ethholders, which is to continuously increase leverage and improve capital liquidity.

10.Merlin: The core figure + wealth effect creates community unity, and the subsequent TVL volume is also very clever.

Merlin has basically taken off now. Let’s briefly talk about the factors:

1. The founder’s The background is very nice. Through many offline communications, I can understand my thoughts on entrepreneurship over the past 10 years. I have raised large amounts of money in the past, have high self-awareness, and have a deep understanding of the community. I will be very successful in the rising market. Very good team. In addition, the founder also has a very charismatic personality. He dived into the ordinals ecosystem in March 2023 and has been actively optimistic about it very early.

2. Community unity. The BRC420/Merlin community is indeed very united and has faith, but it also does make money on the blue box. The factor that unites the community is the consensus created by the Miracle Pull at the Blue Box. The subsequent blue crystals and music boxes have very good wealth effects. Use the wealth effect to complete a quick cold start and establish a user group.

3. Ecological support. With a certain building in Singapore as the core and several subway stations as the radius, a circle of ecological project parties has gathered, and everyone is supporting each other. Therefore, the ecological growth is very fast.

4. The method of selecting TVL is very clever. In addition to BTC staking, the head inscription + 420 NFT can be pledged to TVL, so the TVL book value is very large.

5. Because of 1+2+3, financing is fast. Moreover, the founder understands MKT and branding very well, so he launched it at the right time, creating the largest BTC L2 on the market.

11.Blur: I have thought through that the core of the NFT market is MM and giant whales, through continuous token incentives

To understand why Blur can grow from 0 to 1, you need to understand that there is only one core competitiveness of NFT Mktplace or exchange. It is not whether the product is good-looking or easy to use, but how to attract Makers. Only with Maker can we have Taker users and be able to talk about product experience.

So what did Blur do:

1. Use Maker and Bidding (Maker) Attract different makers and give them Token rewards. And only blue-chip NFTs can use token incentives. This is also easy to understand. The vast majority of NFT trading volume is blue-chip NFT, and the final destination of non-blue-chip NFT is zero. A large number of blue-chip NFTs are still in the hands of giant whales and MMs, and retail investors actually don’t have much in the hands. Therefore, the core is to serve the MM and whales of blue-chip NFT well. Retail investors are not important at all.

2.Token incentive mode is different from X2Y2 and Looksrare. X2Y2 Looksrare's direct vampire airdrop is a one-time use and really doesn't mean much. Continuously using token incentives to attract whales and MMs to provide liquidity is one of the core factors for Blur's success.

•3. Others are small things, product-related, such as being able to batch transactions, making an aggregator, etc., but this is not the key.

12.BAYC: The earliest NFT member club, building consensus through celebrity effect

BAYC can go from 0-1 in the last cycle It can be understood as:

1. People with BAYC NFT automatically become members of an exclusive club. This community provides a new way of socializing and creates a powerful a sense of belonging; the strong BD of the project party has attracted a large number of investors and collectors, including many celebrities, which further increases the exposure and appeal of the project; in the context of the NFT bull market, BAYC has launched a unique business model, Decentralize the IP rights of NFT owners, allowing holders to use their own apes to create and sell goods, further promoting BYAC; BAYC relied on its unique artistic style and strong community utility to gain popularity in the NFT market at that time in a short period of time status as a cultural icon.

2. BAYC was launched at the peak of the NFT craze and also took advantage of the market's high interest in emerging digital collectibles at the time. Subsequently, through social media and celebrity effects, BAYC quickly established strong brand recognition and community. Yuga Labs continues to expand the BAYC universe, including new NFT projects and game launches such as Mutant Ape Yacht Club and Bored Ape Kennel Club, further increasing revenue and continuing to increase membership value and community engagement; and partnering with Adidas to launch Adidas x BAYC NFT. However, some people believe that BAYC's model requires constant new additions and capital inflows to maintain its value. This has led some people to call it a monkey universe scam. However, this was also a dilemma that the currency market was gradually entering a bear market at that time, and NFT was difficult to break. one.  BAYC’s gradual decline in this cycle can be understood as: 1. The problem of what the use of NFT is still not solved. And during the bear market, Yuga Labs did not provide many airdrop benefits to the community.

13. Little Penguin: A combination of on-chain and off-chain marketing punch + pull plate to bring Little Penguin back to life

The little penguin can be reincarnated in this cycle can be understood as:

1. The project has already been reset to zero in 2022, but because The picture is really cute, so Lukaz decided to collect it

2. The NFT story at that time was mainly Onboarding web2 user to web3, hoping to replicate BAYC. Investors believe that Little Penguin can acquire a certain amount of outside users by using toy retail off-chain + NFT marketing airdrops on the chain.

3. Because Lukaz acquired Little Penguin, he has a lot of chips on hand. Combined with market makers, it is easy to pull the market and establish consensus.

4. Users outside the circle learned about crypto and Little Penguin through extracurricular toys, and users within the circle got to know Little Penguin again because of the pull offer/airdrop. Therefore, the little penguin came back to life in the second half of 2023 and once flipped BAYC.

4.Friend.Tech: Use tokens to quantify personal social value, an amazing brain circuit IDE

Friend.tech's growth from 0-1 can be simply summarized as:

1. Do what no one could do before Things - quantify personal social value. In the Web2 world, there is no way to launch/use similar products in large quantities due to payment channels and compliance issues (the crime of illegally opening casinos). But in the crypto world, the best way to make money is to issue new assets. Therefore, FT has solved the above shortcomings very well. Everyone can issue their own key and use E standard + quantitative curve to quantify a person’s social value. In the most simple and simple ICO, how many people can buy and sell the key depends entirely on the individual. branding. The brain circuitry of the product is amazing.

2. Although the product experience is not good, the website is often crushed, and creating an account requires gas, which is mutually exclusive within the circle, it is undeniable that this is a phenomenon. product.

Judging from the interaction volume in the figure below, FT has basically returned to zero. The reason is:

1. The model is not long-lasting and is completely cut off from each other within the circle. A considerable proportion of everyone’s gaming money has to be given to the FT project side. The rake is too high. Stepn can at least tell a story about positive externalities, but FT can't even tell a story about positive externalities.

2. No new features will be developed in the future. It will be over after making money. If the team can add some new gameplay in the future, such as placing ads on web2, , if we take some positive externality measures, there may be different outbreaks.

3. The Token mechanism is introduced too late. Without token incentives, it will be difficult to continue the mutual cut.

If we refer to blur’s continuous token incentive method, can FT be sustainable?