January 07, 2025 | Read Online

More bull market things today: ZKsync turns its liquidity tap on while Eclipse pumps in usage. Then we look at Grass, a promising DePIN project at the intersection of AI and data.

Eclipse is cooking:

Source: Flipside

My simple mental model for thinking about the Eclipse L2's value prop is: ETH holders that want to use Solana with less trust assumptions.

The SVM-based Ethereum L2 Eclipse has been punching out an average 100k-150k daily transactions in the last few weeks, an impressive feat considering its mainnet went live only two months ago. That's nowhere near the few million daily transaction numbers on the most active L2s like Base and Arbitrum, but puts it in competitive range with L2s like ZKsync, Starknet and Scroll, which have been live for years. For more on how Eclipse is bringing SVM innovation to Ethereum, see our previous coverage.

— Donovan Choy (X: @donovanchoy | Farcaster: @donovan)

A Grass retrospective

Before "AI" came to be synonymous with "agents," there were far humbler AI projects with functional use cases. Grass was one such DePIN project on Solana.

The Grass elevator pitch: Big Tech bad because it scrapes your data on the internet for their profit, Grass good because you can now use it to activate your idle internet bandwidth to sell that access.

Rather than buying it from Big Tech, AI companies (or businesses that find it useful to track media sentiment) that want your textual data can now purchase it from you via Grass as an intermediary.

Grass blew up mid-2024, growing to more than 2 million+ active nodes in less than a year. These nodes scrape about 90TB of data daily (about 445x less than Google), which is then sold to AI companies.

The GRASS token airdropped in October, with multiple major CEX listings and a 380% appreciation since.

That's impressive considering most tokens see a down-only trend on TGE. It's even more particularly impressive since GRASS farmers don't suffer an opportunity cost, i.e., staking capital. The more costless it is to farm something, the higher tendency for a token to dump aggressively, but that hasn't been the case for Grass.

Based on @Daveeemor, Grass generates about $33 million in annualized revenues, which it plans to eventually share with its node operators and GRASS stakers.

At a $702 million market cap today, that gives GRASS a 21.3x MC/F multiple. If one believes Grass can continue to scale as it did in 2024, that suggests a very attractive token valuation relative to other fee-generating DePIN protocols, like Helium or Akash, which trade at a much higher 265-334x MC/F multiple.

In Q1 2025, Grass plans to introduce the ability to better capture real-time data with its "Live Context Retrieval" technology, enabling more performant and specific AI models that depend on time-sensitive information such as market trading.

For more on Grass, see our previous Blockworks research report by Boccaccio.

— Donovan Choy

ZKsync begins "Ignite" liquidity mining campaign:

Source: DefiLlama

Bull market season is here, and farmers are dusting off their pitchforks and assembling at the ZKsync fuel station.

As of yesterday, ZKsync kicked off a three-month liquidity mining campaign to distribute up to 300 million ZK ($666 million at today's prices) for LPs on 15 different lending, DEX and perpetual protocols. On a per week basis, that's about $60.5 million in sweet helicopter money. TVL on ZKsync doubled overnight to $309 million.

ZKsync Ignite @ZKsyncIgnite

ZKsync Ignite Season 1 is Live! 🔥

The ZKsync Ignite program kicks off with 300M ZK tokens allocated over 9 months to turn ZKsync Era into the liquidity hub of the Elastic Network.

Start earning 👇
zksyncignite.xyz

2:32 PM • Jan 6, 2025

1.27K Likes 2.02K Retweets

118 Replies

Liquidity mining campaigns give speculators a reason to come onchain, and that has typically led to aggressive price action. This has been demonstrated multiple times, like with Avalanche's $180m campaign in 2021, or Sui's recent spending of $139m (my estimate) in liquidity incentives over two months.

With ZKsync's liquidity tap turned on even harder, I'd expect big things to come for ZK's price action.

— Donovan Choy