What's Driving Token Prices? June 12, 2024

LDO (-22%) - Yesterday, Liquid staking project Lido announced the introduction of "Restaking Vaults" as a competing solution to Eigenlayer, which siphoned off TVL from the project over the last several months. Lido partnered with Symbiotic and Mellow Finance to offer these services, which act as the restaking protocol and liquid staking protocols, respectively. While Lido may not directly benefit from this new product integration, Symbiotic will probably benefit as they will have access to $33B in TVL from Lido.
OP (-16%) —This week, Layer-2 project Optimism launched Fault Proofs, reaching a significant milestone in its decentralization roadmap. In recent years, Optimism has been frequently criticized for not having a decentralized way of proving the accuracy of transactions on-chain. Essentially, when users deposited assets into Optimism (or any other chain built using the OP Stack framework), they had to trust an external “security council” that their funds would be available to be withdrawn if assets were moved back to Ethereum. Fault Proofs is the technology that allows users to trust that their assets will be sent back to them, without using a third-party intermediary.
MATIC (-13%) —Yesterday, Layer-2 project Polygon announced it would allocate 100M tokens yearly for the next ten years towards a Community Grants Program. These tokens, which will be part of the Polygon treasury, will come from annual inflation introduced as Polygon changes its token from MATIC to POL over the coming months. Already, 35M tokens are available today for builders to apply to.
FRIEND (+26%) - This week, SocialFi project, Friend.tech, announced that it will migrate off of Base, Coinbase’s L2, and build its own chain, Friendchain. The new chain will use the recently launched FRIEND token for gas on the network. The move comes as a surprise as Friend.tech was one of Base’s early successes seeing lots of early traction with its launch last summer. However, activity fell off sharply with the rise of copycats and as the market turned its attention to other narratives. Furthermore, the FRIEND token launch was disappointing, with no ability to trade the token outside the Friend.tech app.

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