GM Seedphrases 👋 We’re the pilot to your plane, the newsletter for your brain, keeping you entertained with crypto and web3.

📓 Today’s Agenda:

• 🔥 Hot Headlines

• 👨🏻‍🏫 Shapella Case Study

• 🤯 Unexpected NFT Use Cases

• 🏃🏻‍♂️ Blur Bidders Leave

🔥  HOT HEADLINES

📈 Market Headlines

• $BLUR rallied over the weekend and is up 32% - Check it out!

• Hundred Finance Hacked on Optimism - Read more

• Tax day is April 18th, The MilkRoad tested of the top crypto tax software - Check out the results

• $PEPE the newest meme coin has taken over Twitter - Learn More

🖼 NFTs

• Jimmy.eth (a OG BAYC) dumped a bunch of apes over the weekend and left a lot of ETH on the table - check it out 

• Winkelpepe card sells for 20.75 BTC ($630k) - Take a look!

• Moonbirds tease Legendary eggs hatching today! Take a look

🤖 AI

• 7 countries have now banned ChatGPT. Germany will be the 8th - See the full list

• The Japanese government is considering using ChatGPT in administrative work in an effort to reduce the burden on public servants - Read more

• AI listened to 20+ Nirvana songs and created a new song called "Drowned in the Sun" - Listen to it!

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👨🏻‍🏫 ETH BULLISH OR BEARISH?

It turns out the latest Ethereum upgrade was a rare case where an increase in supply was bullish news.

ICYMI: Ethereum successfully went live with the latest upgrade, Shapella, last Thursday. The upgrade allows holders who were staking their ETH to withdraw.

Expectation: Many expected the price of $ETH to drop after the upgrade because more people would be able to sell ETH that was previously locked.

If we revisit our ECON 101 textbook, we’ll remember an increase in supply without an increase in demand will drive the price of a good or service down (shoutout Professor Jeremy).

Reality: The price of ETH has held up EXTREMELY strongly and has increased about 6% since the upgrade.

We can see here there were some sell-offs when withdrawals went live followed by a huge amount of deposits.

One important note here is that a majority of the early sales were from Kraken who had reached an agreement with the SEC to shut down their staking program and withdraw their ETH as soon as possible. 

Why are people depositing? Once it was determined that withdrawals were successful, investors had increased confidence in the protocol. People now knew that if they staked their ETH, they would be able to withdraw it whenever they want.

Where are we today? We saw a large number of withdrawals Saturday which brought us to a net negative number of ETH staked since the upgrade. Overall, 18M ETH is staked which represents 15% of total ETH supply. This number is well below the average percentage of the native token being staked on a blockchain. For reference, 72% of Solana is staked.

Seedphrase Take: Although we’ve seen a large amount of ETH withdrawn, we haven’t seen a drop in the price of ETH. This makes us think that stakers aren’t withdrawing to sell, they’re withdrawing to use their ETH. We’re keeping a close eye on DeFi and NFTs over the next few weeks to see if we can find that withdrawn ETH getting deployed.

🤯 UNEXPECTED NFT USE CASES

We all hear about the most common use cases for NFTs. Digital identity, gaming, and ticketing come to mind, but there are also a lot of cool companies doing something completely different with NFTs.

Here are 3 companies using NFTs in a cool way:

GenoBank.io

• A customer takes a test swab and sends it to GenoBank. GenoBank then stores a reference to the customer’s results on a public ledger

• The customer can use AI to ask what their results mean.

• For example, GenoBank.io will search through peoples’ DNA and return how likely they are to develop a disease like Alzheimer’s

• Each user owns their own data as an NFT

This feels like the next version of college students earning money as ‘lab rats’

The Bee Girl Organization

• The Bee Girls is a nonprofit that created an NFT collection that raises money for the bees

• The cool part of the story is the founder, Brooklynn Bailey, is 14 years old and is naturally using this technology

• NFTs and crypto are going to be so much more natural for younger generations because they’ll have grown up with them

• This is a cool story about NFTs being used for good!

The Seven Love Stories

• The publishing industry is filled with regulation and Rionna Morgan decided to do something about it

• Her latest novel features art from 4 illustrators and each of them receives 25% of the sale of the books they worked on

• It’s all on-chain so there’s no need for slow royalty checks and every sale is transparent which leads to less dispute over money

Takeaway: We’re all guilty of thinking of NFTs as one-dimensional. But the reality is NFT use cases are endless. These 3 stories highlight the unique ways smart contract technology can be used.

We’re bullish on innovation!

🏃🏻‍♂️ BLUR BIDDERS LEAVE

The main story in NFTs the past 2 months has been Blur bidding. And there have been a couple of whales driving a lot of the volume:

• Machi Big Brother

• Franklin

Since February, Machi is down over 5k ETH ($10M) and on Friday he said he’s done with NFTs:

Franklin has fared better than Machi but is still down 510 ETH ($1.02M) farming the next BLUR airdrop. It gets worse for Franklin though. He lost 2k ETH on an investment in a separate project and was forced to sell some of his apes:

What does this mean for NFTs? It sounds like two of the biggest whales are stepping out of the game, which will dramatically change the depth of bids on Blur. It’s unlikely that we see other whales step in and provide liquidity in the same amount these two were.

Seedphrase Take: We’re less than two weeks away from May 1st which is when Blur will stop doubling points on bidding and listing. We expect to see liquidity on Blur starting to thin until we get to May 1st. From there it will take a new event to spark a run in the NFT market.

What that spark is, we’ll find out!

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DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.