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We’re nearly at the end of October — or should I say Uptober, specifically, for bitcoin. Unfortunately, other parts of the market didn’t catch the memo.

Anyway, the US election is around the corner which means we’ll finally have some much-needed clarity and maybe we’ll see the Crypto Go Up effect that so many folks have teased. 

For now, everyone’s battening down the hatches and preparing to ride out the last full week before the US elects its new president. 

So take the time to enjoy your weekend, and we’ll see you bright and early Monday.

— Katherine Ross

 🪖 Blockspace marines

If you think the Ethereum L2 space is overcrowded, perhaps you’re not thinking big enough.

Granted, there’s now more than 100 different satellite blockchains orbiting Ethereum mainnet, per L2Beat. 

Kraken is preparing to launch one more, Ink, which it aims to deploy on Optimism’s Superchain. It will be the Superchain’s 24th fully participating network.

L2s generally process transactions offchain — where it’s much cheaper — and periodically transmute them to Ethereum for proper settlement. 

The low fees and speed free developers to build apps that are otherwise too unwieldy if run on Ethereum directly. Swapping tokens on Ethereum right now costs $5.48 in gas fees compared to only $0.18 for OP mainnet. 

The Superchain is a meta-network intended to make the Ethereum ecosystem more cohesive. Optimism Labs offers a standardized tech stack which developers can use to customize their blockchains, either as general purpose networks or something more app-specific.

Superchain networks — operating alongside Optimism’s own layer-2 — agree to share the fees they generate, either 2.5% of chain revenue or 15% of onchain profit, whichever is higher.

So, if Kraken were indeed to make a big splash with Ink, it would work to the benefit of the two dozen others on Superchain.

Users of those networks have in total forked out $180 million in ETH, valued daily, since OP mainnet launched in July 2021. 

And while Ethereum’s blobs cut L2 fees significantly in March, almost 38% of Superchain’s lifetime total came after Dencun.

Base is largely to thank for that. Coinbase’s layer-2 — with which Kraken’s Ink will ultimately compete — is currently bringing over 80% of all OP Superchain fees right now, or between $620,000 and $1.23 million per week in October, with transaction counts and profitability at record highs.

Uniswap, memecoin launchers and trading bots like Banana Gun are contributing the bulk of Base gas spend right now, per Blockworks Research data.

Whether Kraken really intends to loosen Base’s grip on the memecoin corner of the Ethereum space is moot, even if it would come with bragging rights. Uniswap Labs is gearing up to launch its own Superchain network, Unichain, next month, which could throw an even bigger spanner in the works.

It does however say something about where we are headed: a blockchain for every company, app, game and community. Build the blockspace and they will come.

— David Canellis

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B3 is revolutionizing how users play and discover games onchain.

Founded by core members behind the launch of Base, we’re bringing back the nostalgia of Miniclip and Addicting Games with bsmnt.fun — the new homepage of onchain gaming. bsmnt lets players find and start games without the hassle of setting up a wallet. By simply playing, you can earn a new type of XP that you truly own.

bsmnt runs on the B3 chain, a Base L3 we think of as “The Gaming Layer” — but it’s also chain-agnostic, featuring games from all networks. We’re here to win together.

This is your power-up, your cheat code to the future of gaming. Play today.

Speaking of L2s, Empire co-hosts Jason Yanowitz and Santiago Santos dove into Ink.

To sum it up: Yeah, there are a ton of L2s, but Yanowitz wouldn’t be surprised to see even more launches over time. Basically, his theory is that everyone will have their own L2 at some point. Meaning Nasdaq, BlackRock, and even Robinhood could join the foray. 

“All of these things will get a chain,” he told Empire listeners. “...Not just crypto companies.”

Santos thinks it’s “inevitable” that we continue to see more and more L2s. 

“We're going to continue to see a proliferation of it,” he added.

But none of this makes Yanowitz excited about owning ETH despite the sheer volume of L2s. 

He noted that you could once put $1,000 towards ETH, but times have changed.

“…Now it's like, okay, do I buy Ink token? Do I buy Base token? Do I buy Optimism? Do I buy Arbitrum? Do I buy ZKSync? Like, do I buy the L2s on top of it? Do I buy the Maker and Aave and Uniswap tokens on top of Ethereum?” It just causes what Yano called fragmentation.

And now you know.

Earlier this week, I attended a Chainalysis webinar focused on the bull run in the Americas based on the firm’s latest annual geography report.

Obviously, we’ve talked about the lack of retail attention in the US so far this cycle a few times here on Empire. However, I should note that Roinhood told us they’re seeing an uptick in attention from that particular crowd. 

But it’s really interesting to see the institutional attention and growth since January. 

Take a look at the chart above, which focuses on transaction volume in different regions. 

North America has an easy lead when it comes to institutional volume — but small retail is practically nonexistent. 

The report noted that this shows a “maturation” in the industry, and we’ve heard similar takes from folks but one has to wonder: how much further can we go without a retail presence? And what brings retail back?

That’s the question on my mind this fine Friday.

— Katherine Ross

Last week, we asked: “How do memecoins make you feel about crypto?”

44% of you replied: “All cryptocurrencies are memecoins.” How brave. 31% otherwise said they loathe them. 

This week, we want to know: