Data & Insights: Ondo Your Condo; Trench Fever

Bitcoiners Store But Not Move Value

• The 7-day moving average of Bitcoin network transactions has declined to 330,000, hovering around 12-month lows, a significant drop from the peak of 730,000 transactions observed earlier in the network's history.
  • This represents a roughly 55% decrease in network activity from peak levels, suggesting a notable shift in how the Bitcoin network is being utilized.
  • Transaction fees have stabilized around $500k in the last month, down from higher levels seen during periods of increased network activity before the end of 2024. 
• The decline appears particularly pronounced when examining the trajectory of Bitcoin-based protocols like Runes and Ordinals, which initially drove speculative attention and network activity.
  • These protocols, which function somewhat similarly to ERC-20 tokens and NFTs on Ethereum, now account for approximately 1% of total transactions.
  • Fee generation from Runes has dropped to less than $20k in the last 30 days compared to the $60m it generated on its launch day. 
• Market dynamics have shifted speculative trading activity toward other blockchain ecosystems.
  • Trader mindshare has notably gravitated toward networks like Solana, particularly for memecoin trading. Similarly, Base has been the primary home for AI agent tokens over the past months. 
  • This migration of activity indicates that while Bitcoin remains the largest cryptocurrency by market cap, other networks are capturing specific onchain niches and trading volumes.
• The current transaction levels could begin to raise questions about Bitcoin network utilization and fee sustainability.
  • With reduced protocol activity and stabilized transaction fees, the network appears to be returning to primarily monetary transfer use cases.
  • The sustainability of this trend may depend on whether new Bitcoin-based protocols can attract sustained user engagement once more. It is key for building out a robust ecosystem over the long term as block rewards continue to diminish.

Ondo Coming to Tokenize Your Condo

• Ondo Finance's TVL has reached $650 million following their inaugural Ondo Summit, marking substantial growth from $192 million a year ago.
  • This growth has helped push the total TVL across the top 15 RWA protocols to $7.68 billion, up significantly from $2.8 billion in the previous year.
  • The expansion reflects increasing institutional interest in bridging traditional finance with blockchain & crypto technology.
• The Ondo Summit is the latest of several announcements indicating deeper institutional involvement in the crypto sector.
  • Franklin Templeton, Wellington Management, and WisdomTree have signed on as advisors for Ondo Chain, a new Layer 1 blockchain focused on real-world assets.
  • Ondo Finance also launched Ondo Global Markets, aiming to bring traditional securities on-chain with a focus on accessibility and transparency.
  • Ondo becomes one of many projects hoping to tokenize securities with the primary objective of improving access, reducing fees, and hastening settlement periods.
  • These developments suggest a strategic shift as more traditional finance firms seek to leverage blockchain technology for existing financial products.
• The convergence of traditional and digital finance appears to be accelerating as major financial institutions explore blockchain integration. 
  • This trend extends beyond simple cryptocurrency exposure, with firms now actively participating in protocol development and infrastructure building. 
  • The involvement of established asset managers in Ondo Chain's development signals a potential shift in how traditional financial institutions view blockchain technology, not just as an investment opportunity, but as a tool for market infrastructure enhancement.
• These institutional partnerships could represent a significant source of growth for the entire crypto ecosystem. As traditional finance firms bring their expertise and regulatory compliance experience to blockchain projects, we may see increased standardization in how we approach crypto and digital assets. 
  • However, the success of these initiatives will likely depend on continued regulatory clarity and the ability to maintain the benefits of blockchain technology while meeting institutional requirements for security and compliance.

Percent of ETH Staked Plateaus

• The percentage of ETH staked has declined to 27%, returning to levels last observed in July 2024 and declining for the first time since the peak of 29% reached in late 2024.
  • Currently, 33.5M ETH is staked on the Ethereum network, highlighting the substantial portion of supply dedicated to network security.
  • While this decline represents approximately a two percentage decline from peak staking levels, this is the first time we’ve had a decline since staking began growing in popularity in May 2023.
• However, liquid staking derivatives (LSDs) continue to maintain their prominence in the Ethereum staking ecosystem.
  • Lido remains the dominant liquid staking protocol, controlling about 69% of the LSD market.
  • Binance's staked ETH holds the second position with approximately 15% market share, indicating significant concentration among major providers.
  • Lido generated $89 million in revenue in January 2025, consistent with its 12-month average of around $85 million.
• While Ethereum continues to serve as critical infrastructure for DeFi and NFTs, recent market attention has gravitated toward other protocols and ecosystems. 
  • This trend may reflect investors seeking higher returns in other ecosystems and protocols or reducing staked positions to participate in other market opportunities. 
  • Additionally, the maturation of the staking market following the initial enthusiasm post-Merge could be contributing to a more measured approach to ETH staking.
• The staking landscape's evolution presents both opportunities and challenges for the network. Despite the recent decline, the current 27% staking rate represents robust network security through proof-of-stake validation. 
  • However, the concentration of staked ETH among major LSD providers, particularly Lido's dominant position, remains a key point of discussion in the broader conversation about network decentralization. 
  • This concentration could become more significant if the staking participation rate continues its downward trend. 
  • As the Ethereum ecosystem continues to evolve, the dynamics between staking rates, protocol dominance, and network security will likely influence both protocol development and investor behavior.

Fever Hits The Trench Warriors

• The on-chain trading environment on Solana, often referred to as the “trenches”, has evidently cooled off in recent weeks.
• The trading volume across graduated pump.fun tokens averaged just $560 million per day over the latter half of last week.
  • This represents its lowest average daily volumes since Christmas 2024 and an 82% decline from its single-day record of $3.13 billion just 3 weeks ago.
  • pump.fun token graduations have also been declining, with an average of just 1.04% of tokens on pump.fun graduating to Raydium last week, compared to 1.54% and 1.59% in the previous 2 weeks, respectively.
• Meanwhile, the daily average amount of tips paid to Jito validators on Solana stood at 23.8K SOL or roughly $4.8 million last week.
  • In comparison, this figure averaged 42K SOL (~$9.9 million) and 68.5K SOL $~17.5 million) in the previous 2 weeks, respectively.
  • This reduction is a clear sign of declining trade activity among users, as this metric is often directly correlated due to how users tend to bribe Jito validators to speed up their transactions.
• It seems likely that the Solana “trenches” have been experiencing a euthanasia coaster of sorts.
  • A euthanasia coaster is a metaphorical reference to a roller coaster designed to provide a series of intense highs and steep drops, with each subsequent rise and fall becoming progressively smaller.
  • In the case of Solana memecoins, the first peak was the $TRUMP memecoin a couple of weeks ago, followed by various memecoin launches since, each with lower and lower market cap ceilings, from $MELANIA to $VINE and $jellyjelly and most recently, $JAILSTOOL.
  • For context, $TRUMP peaked at a fully diluted valuation of ~$75B. Its follow-up derivative, $MELANIA, launched shortly after and peaked at an over $13B FDV.
  • This was then followed by $VINE a few days later, a memecoin promoted by the founder of the Vine platform, which reached at a near-$500M market cap at its highest point.
  • A couple of days later came $jellyjelly, a pump.fun coin launched by one of the co-founders of Venmo, which peaked at a $250M market cap.
  • Most recently came $JAILSTOOL, a memecoin promoted by the founder of Barstool Sports, Dave Portnoy, which at the time of writing, has already peaked at a $220M market cap.

Alt Season Hopefuls Losing Faith

• Various sectors of the crypto market, based on the GMCI indices, have fully retraced its post-US election gains, as the market displayed its bearish wrath over participants in recent weeks.
  • Indices such as the GML2, GMMEME, GMDEPIN, GMGM, GMAI, GMSMALL, GMMID, GMSOL and GMSOLMEME were among those that fully returned to their pre-election levels.
  • For example, the GMMEME and GMAI indices are currently down 60% and 56%, respectively, from their peaks in December 2024, with the remaining previously-mentioned indices experiencing similar drawdowns.
• Meanwhile, some of the best-performing indices, relatively speaking, have been the GMUSA and GMDEFI indices.
  • The GMUS index is down just -29% since its peak in January 2025.
  • It represents protocols with a legal entity based in the United States, which includes SOL, XRP, DOGE, ADA, LINK, LTC and XLM, among others.
  • Meanwhile, the GMDEFI index is down -38% since its peak in December 2024, and while it is a steeper decline compared to the GMUS index, it has fared better than its meme and AI counterparts.
  • The GMDEFI index is composed of LINK, OM, UNI, ONDO, AAVE and MKR, among others.
  • The outperformance of these indices, relatively, since the US election is not surprising considering how US and DeFi-based protocols are likely to benefit from a pro-crypto government administration.
• The GM30 index, which represents a selection of the top 30 cryptocurrencies, has also performed relatively well, with it down just -24% from its peak in December 2024.
  • Though the majority of this “outperformance” can be attributed to just BTC, XRP and BNB, which have maintained roughly the same price levels they had since December 2024, with all the other coins in this list performing poorly since.
  • This is another evidence of the altcoin annihilation seen in the market over the past several months, with TOTAL2 down -28% since its peak in early December 2024, while BTC is down just -6% since the time of TOTAL2’s peak, with BTC.D up 13% since.