OKX Ventures Q3 report: Still focusing on Bitcoin, Ethereum, and AI

1. Industry Insights

In terms of macroeconomic regulation, the Fed's interest rate cut has brought macro-level benefits, and major DeFi protocols have benefited from it. The Fed cut interest rates by 50 basis points in September, lowering the federal funds rate to between 4.75% and 5%, which brought short-term volatility, but Bitcoin's long-term prospects remain solid. As the global financial system's reliance on monetary expansion deepens, BTC, as a global asset independent of central bank policies, continues to gain more appeal, with a cumulative net inflow of $21.3 billion in spot ETFs.

Ethereum mainnet data remains stable, and the Pectra upgrade is expected to improve the network's functionality, security, and efficiency. The average daily active users on the chain are 480,000, with 1.2 million daily transactions. The combined utilization rate of USDC, USDT, and DAI on major lending platforms has soared to 87%, reaching the highest level since late June 2024. With the rise in DeFi yields, interest rate cuts are expected to restart the crypto credit market and promote the vigorous development of on-chain activities.

At the public chain ecological level, the data of major public chains represented by Sui are outstanding, and more innovations are yet to be discovered.TVL exceeded US$1.4 billion, and the daily trading volume of DEX reached US$180 million, and the daily trading volume and the number of active addresses both reached new highs. The TVL of liquidity protocols led by NAVI Protocol exceeded US$500 million, and the head DEX Cetus ranked in the top 10 of the entire chain DEX trading volume, with a single-week trading volume exceeding US$1 billion. The trading volume of mainstream assets in the SUI ecosystem has grown steadily, and the trading volume of Memecoin and community assets has also surged. Therefore, we are also optimistic about the parallel blockchain represented by Monad and its ecological project aPriori. The concept of Meme "super cycle" brings more attention, brings new variables to the development of AI, and attracts more attention to entertainment IP. The total market value of AI Memecoin has exceeded 2 billion US dollars, and the average transaction volume of Memecoin has increased by more than 5 times compared with last year. The craze of Terminals of Truth and GOAT has brought new use cases for AI-generated content, meme culture and speculative market behavior, while driving Solana to a peak of more than 4.5 million on-chain transactions and 6.9 million daily active users in a single day, and DEXs strongly related to Meme have set a new high in fees.

II. List of OKX Ventures’ Q3 investment projects

OKX Ventures’ investment tracks in Q3 cover Bitcoin ecology, Ethereum and other layer networks, as well as AI, blockchain data platforms and other directions, and participated in investments in zkLink, Monad, aPriori, Space and Time, Prodia and other projects. The following is the relevant information of the projects.

1、zkLink

zkLink is a multi-chain decentralized finance (DeFi) infrastructure based on zero-knowledge proof (ZKP) technology, which aims to solve the problems of decentralized liquidity and high cross-chain transaction costs in the current blockchain ecosystem. It achieves seamless connection and liquidity aggregation between Ethereum and its Layer 2 network by building an aggregated Layer 3 zkEVM network (zkLink Nova).

As the first aggregated Layer 3 zkEVM network, zkLink Nova solves the liquidity fragmentation problem on Ethereum L2, allowing DApps to be seamlessly deployed on multiple L2s. Provides a customized expansion engine for high-performance ZK applications, supporting a variety of application scenarios, including spot trading, derivatives trading, and NFT trading.

The main problems solved by this project:

• Cross-chain liquidity aggregation, seamless multi-chain interaction: zkLink connects different L1 and L2 networks through its protocol, simplifies the cross-chain transaction process, and allows users to trade freely on different blockchains without frequently switching networks or wallets.

• Rich ecological projects: zkLink has cooperated with multiple projects to form a rich ecological network, attracting a large number of users to participate in its DeFi activities.

• Innovative technical solutions: Combining ZK-Rollup and oracle network, zkLink provides an efficient and secure cross-chain interaction mechanism, greatly improving the efficiency of ecological integration.

• Improve user experience, promote the development of decentralized financial ecosystem, and become an important bridge connecting different blockchains.

2、Monad

Monad is a 1-layer blockchain designed to provide extremely high performance and scalability. It supports 10,000 transactions per second, with a 1-second block time and single-confirmation finality. Monad is compatible with the existing Ethereum Virtual Machine (EVM), allowing developers to easily migrate and use existing applications and libraries.

Monad's low hardware requirements allow ordinary consumer-grade hardware to run nodes, providing a viable path for decentralization. In addition, MonadDB is designed so that most of the state is stored in SSD rather than RAM, which reduces node running costs and improves scalability.

Project Features:

• High Performance: Monad provides 10,000 transactions per second to ensure a smooth user experience.

• Low Fees: Almost zero transaction fees, allowing applications to scale greatly.

• Fast Confirmation: 1 second block time and single confirmation mechanism to improve transaction efficiency.

• EVM Compatibility: 100% EVM compatible, supporting applications in the existing Ethereum ecosystem.

• Scalable decentralization: Low hardware requirements enable more users to participate in the network and promote the decentralization process.

• Innovative execution model: Adopt optimistic parallel execution and asynchronous execution to effectively improve transaction processing capabilities.

3、aPriori

aPriori is a MEV infrastructure and liquid pledge protocol built for the era of parallel execution, natively implemented on the Monad platform. The project aims to optimize the processing efficiency of blockchain transactions through an innovative block space auction mechanism, thereby reducing MEV-induced junk transactions. aPriori enhances user experience and the overall efficiency of the network by ensuring that block producers are aligned with network goals.

The main problems solved by this project:

• Block space auction: Due to the limited block space and the monopoly of block producers in transaction sorting, aPriori introduced a block space auction mechanism. This mechanism makes the real economic value of transactions transparent through competitive bidding, thereby improving the efficiency of resource allocation.

• Minimize junk transactions: aPriori's auction mechanism reduces the phenomenon of junk transactions caused by MEV by changing the dominant strategy of searchers. This design ensures the orderliness and predictability of transaction execution and improves the user experience.

• Incentive compatibility: In the post-MEV era, aPriori's auction mechanism ensures incentive compatibility, so that transaction fees are based on economic value rather than the private evaluation of block producers, thereby optimizing the user experience.

• Transparency and Fairness: By introducing competitive bidding, aPriori ensures transparency in the transaction processing process and reduces the possibility of unfair behavior (such as front-running).

4、Space and Time

Space and Time is a decentralized data warehouse designed for blockchain applications. Founded in 2022, the project aims to provide a next-generation data platform to meet the needs of decentralized applications (dApps), decentralized finance (DeFi), and other projects that require powerful analytical capabilities. Space and Time combines enterprise-grade SQL and APIs, allowing users to seamlessly integrate and analyze on-chain and off-chain data in a single query.

Supports multi-chain operations, allowing users to easily access and analyze data across multiple blockchains. By introducing SQL proof technology, Space and Time ensures the security, integrity and transparency of data without compromising performance.

Key features of the project:

• Decentralized architecture: Space and Time is the first Web3 native data warehouse, fully decentralized, ensuring the security and privacy of user data.

• Enterprise-grade SQL and API: Users can use familiar SQL commands and tools to query and load data, simplifying the data processing process.

• Multi-chain support: The platform allows users to seamlessly access and analyze data across multiple blockchains, enhancing flexibility and scalability.

• SQL proof technology: This technology not only ensures the security of data, but also maintains its integrity and transparency, providing users with confidence.

• Real-time data processing: Supports high-capacity real-time transaction processing while leveraging column storage and GPU acceleration for analysis of large-scale data sets.

• Customizable dashboards: The platform provides dynamic visualization capabilities, allowing users to customize dashboards according to their own brand needs and automatically generate charts and visualizations.

5、Prodia

Prodia is an innovative platform focusing on artificial intelligence and distributed cloud computing, designed to provide image and music generation services through its powerful API. The platform uses advanced machine learning models, especially Stable Diffusion technology, to convert text into high-quality images. In addition, Prodia has built a distributed graphics processing unit (GPU) network to provide efficient cloud computing services at a lower cost and support a variety of application scenarios. Prodia not only provides users with advanced artificial intelligence tools, but also promotes the innovation and development of cloud computing services.

Main features of the project:

• AI content generation capabilities: Prodia provides a variety of models, and achieves efficient conversion of text to images through APIs to meet users' needs for high-quality content generation.

• Distributed cloud computing: Using a distributed GPU network, Prodia is able to provide powerful computing power at a lower cost to meet the needs of projects of different sizes.

• Diverse application scenarios: The platform is not only suitable for image generation, but also extends to fields such as music generation, providing creators with more flexibility and choices.

• User-friendly API: Prodia's API is designed to be simple and easy to use, allowing developers to quickly integrate its functions and improve development efficiency.

• Web3 Infrastructure: Combined with Web3 technology, Prodia provides decentralized services, enhancing data security and user privacy protection.

III. Conclusion

From these changes in Q3, OKX Ventures is very optimistic about the market outlook. From a macro perspective, the interest rate cut is a major positive, Ethereum continues to innovate, some data on the chain has reached a new high, the public chain ecology represented by SUI and the cultural innovation brought by Meme have all provided continuous growth momentum for the industry. This quarter, we focused on projects with strategic potential, which not only fit the market growth opportunities, but also showed unique competitive advantages in their respective fields.

Whether it is the re-staking of Bitcoin and DeFi applications, cross-chain liquidity integration, or the improvement of blockchain performance and the optimization of data processing, these projects are promoting technological breakthroughs and the expansion of application scenarios. In addition, we continue to be optimistic about the prospects of AI-generated content and distributed computing, which will provide new momentum for the innovative development of the industry in the future.

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