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Happy Friday!

Hopefully, it’s been a relaxing week — it certainly hasn’t been a quiet one. 

We’re looking at today’s Empire podcast to bring you some insights on cybersecurity ahead of the bull market, and what’s next for memecoins.

We’re also curious to know if the subject of crypto popped up at your Thanksgiving table; let us know below!

Go forth and score some Black Friday deals, and we’ll see you bright and early Monday morning.

🧬 Technical evolution

As we ramp into the next cycle, one of the biggest challenges will remain the same as the last go-around: cybersecurity. 

I spoke with Forta’s founder, Andy Beal, about the industry’s next era.

“I think security always becomes more important during a period of growth,” he told me. “The bag available to attackers is bigger.”

We’re more likely to see new faces (including retail) entering crypto in a bull market phase. Some of those newcomers who aren’t as aware about security could be easy targets for bad actors. Statistically, Beal added, you’ll see more end user attacks because of it.

Beal wouldn’t be surprised if the crypto cybersecurity space starts to reflect some of the basics that we’ve seen in general cybersecurity. Though to be fair, part of his belief may be centered on the fact that Forta unveiled Forta Firewall — basically the Web3 version of a classic firewall that uses custom AI to secure transactions and block potential malicious actions before they occur.

“And I think we're going to see a lot more sort of traditional kind of cyber tools and services, like firewalls, that are applied to Web3 because, at the end of the day, the industry as a whole is actually really good at detecting these things now, the one gap has just been stopping it. So that's what we're trying to enable,” he explained. 

Admittedly, as someone who’s not extremely well-versed in cybersecurity, I was curious about the re-emergence of older cybersecurity methods and how that works in a Web3 environment. And, honestly, if Beal was surprised by the evolution. 

“I think it's not surprising at all that all of the things that have been proven to work in Web2 security … a lot of those are going to be adopted in Web3 [because] we're still building on the internet. We're just sort of introducing a financial layer to it … A lot of the same concepts apply, especially with respect to security, right? And so, firewalls have been around since the [1990s], they've gone through a lot of different evolutions over the last 30-plus years,” Beal explained.  

“They're just now being introduced in Web3. But like we have 30 years of designs and learnings and innovation that we just get to copy and sort of use and adopt the best practices of so … I think we'll see a lot more of it.”

Looks kind of like another use case for AI and crypto, no?

— Katherine Ross

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Blockworks co-founder Mike Ippolito, in a post on X earlier this week, noted that memes looked “vulnerable.”

Despite a potential temporary peak, memecoins aren’t going away, Santi argued on this week’s Empire Roundup. 

“…Temporarily, are we going to cool off a bit? Maybe, but…I would take the opposite of that. I don't think they're going to go away. I think they're going to continue to be important elements of this industry from an onboarding perspective,” Santi argued. 

Because of the volatility, it’s hard to read into what’s next for this particular category of crypto, but the interest won’t disappear. 

And now you know.

While memecoins may be (temporarily) hurting, altcoins are getting more and more interesting. 

Last week we talked about the necessary levels to really see an altcoin season take off, and I’m focusing on a similar vein here with the chart below: 

Right now, altcoins have only hit a year-to-date peak of $1.16 trillion, which — as K33 analysts Vetle Lunde and David Zimmerman noted — is 23% below the all-time high that took place back in November 2021. 

“Only seven tokens within the top 20 cryptocurrencies reached all-time highs in 2024; three of these did not exist in 2021. Among the majors, the most notable performers have been BTC and SOL, both reaching all-time highs this year. Meanwhile, ether trails 31% behind its 2021 ATH,” the K33 analysts wrote.

It’s not going to be an easy climb up for some of the altcoins. DOGE, XRP and AVAX are down double digits from their all-time highs. 

While ETH is lagging, there’s one thing to watch, according to K33: “ETH/BTC was very recently pushed to new lows but has seen a solid recovery and remains an interesting play alongside DeFi tokens and alternative layer-1s to position for a potential regime change. Recent CME activity suggests traders are leaning toward increased ETH aggression lately, which might suggest that the tide is about to turn.” 

This CME activity shows that ETH’s open interest has “nearly doubled” since the election. This could mean that traders are betting on ETH outperforming and are looking to get long exposure. 

Perhaps it’s ETH’s moment to shine.

— Katherine Ross

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