The L2 track is a continuous narrative track, backed by the largest public chain ETH. As long as the ecosystem develops more and more, this sector can become a perennial segment. For the upcoming ETH Shanghai upgrade, the sectors that will benefit the most, besides LSD, are L2. Currently, this track is divided into three factions: zkSync, OP, and Arb.
zkSync is undoubtedly the most anticipated, but its narrative cycle is too long. I believe temporarily focusing attention and funds on Arb and OP will yield faster results, as these two already have a first-mover advantage in their ecosystems.
Due to the large number of projects in the L2 sector, I have selected some well-performing and high-odds native DEFI projects for everyone to参考.
Arbitrum System:
$GMX: As mentioned earlier, one of the reasons Arb leads OP is GMX. GMX is a decentralized spot and perpetual exchange and currently ranks first in TVL within the chain ecosystem. The most important point is that GMX can provide users with a high APR. You can think of GMX as a decentralized joint betting protocol where you deposit money into this protocol to earn betting dividends, as there are many gambling-like leverage contracts in the crypto space.
So the growth of GMX is also an inevitable result. Currently, GMX has not only integrated with Arb but also Avalanche. The brand has been well established. With the development of the Arb ecosystem or the future launch of more chains, the project's growth should not be underestimated. Like OP, as the leader in perpetual DEX, the current circulating market value of over 600 million is not considered much for the future. The recent small bull market since the end of last year has not seen much increase in GMX. The specific holdings are also inclined towards long-term holding, which is worth paying attention to and accumulating.
$VELA: Vela Exchange is a decentralized trading platform for perpetual futures launched on Arbitrum. The biggest highlight of Vela is the intermediary-free leveraged trading. Users can trade by depositing with a private key signature, with leverage up to 100 times. In addition, its VLP liquidity model allows every user to become a market maker. It can be said that VELA's competitive target is GMX.
Also having an eToken system, staking the VELA token to earn eVELA, as long as eVELA can earn dividends from VELA, transaction fees, USDC, and other rewards. The VELA token has been steadily growing since its launch a month ago, with a current circulating market value of around 43 million. From a long-term investment perspective, if you are optimistic about the development of perpetual DEXs, VELA is a good target.
$GRAIL: Camelot is also one of the native DEXs on Arb. It currently ranks 7th in TVL among the DEFI ecosystem on Arb, and its monthly TVL growth rate is also quite considerable. Compared to other DEXs, Camelot offers higher rewards for some LPs by launching the Nitro Pools, while also charging fees based on dynamic and directional swaps on each trade, helping to stabilize volatility during extreme events.
The GRAIL token is currently in a slow downward trend after a rapid increase last month, with a circulating market value of around 21 million. You can keep an eye on it and enter with small funds when the opportunity is right.
In addition to the above projects on Arb, there is also MAGIC, which I held previously. I won't elaborate much here. It is also a key focus project in the gaming sector.
OP System:
$OP: Although OP's ecosystem still lags behind Arb, part of the reason is the collaboration between Arb and GMX, which has brought a lot of funds and traffic to Arb. In terms of native projects, OP is not significantly different. Furthermore, Arb has not issued a native chain token, while OP is the only public chain token in the L2 sector. Investing in infrastructure is always better than anything else.
OP has formed a unique advantage in the secondary market segment. After this wave of increases, OP's circulation is around 800 million, which is not considered high from a long-term perspective. Accumulating in batches and holding long-term is undoubtedly a good investment strategy. I made a small batch purchase near 2.1 in the middle of last month and have not added to my position yet. I will consider adding more depending on the situation.
$VELO: Velodrome is the largest DEX on OP, and also the native DEX of the OP system. Its highlight is that it uses Solidly as a model, integrating features such as veToken and game theory, and optimizing the rules for token distribution, release, and incentives to help direct liquidity to the most valuable ecosystems. The core function of VELO is to allow users to exchange digital assets with low fees and low slippage, with trading fees only between 0.02% to 0.05%.
Since Velo launched the OP token incentive measures last August, the TVL has skyrocketed and has remained at the top of the OP ecosystem TVL leaderboard. Because of this, VELO will be able to attract more protocols to cooperate with it in the future. For example, STG plans to migrate the USDC/STG pool to Velo recently. Currently, the circulating market value of the VELO token is around 30 million, and it is in a rapid upward trend. Those seeking stability can wait for a pullback to accumulate in batches.
$SONNE: SonneFinance is the first OP native lending protocol, providing a completely decentralized, transparent, and non-custodial peer-to-peer lending solution. The SONNE token staking offers two types of vTokens, sSONNE and uSONNE, with different vTokens earning different rewards. Stakers can initially receive 100% of the mining rewards from the protocol, and SONNE has consistently been one of the top bribers on Velodrome.
Although SONNE's TVL currently ranks 7th in the OP DEFI ecosystem, the growth rate in the past month is still quite reasonable. The current circulating market value of the SONNE token is around 11 million, but it has seen a high increase in the past two weeks. You can wait for a pullback opportunity to accumulate in batches.
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