Following the Crypto Narrative: Learn about 5 Protocols Upcoming Major Updates

These catalysts will change the fundamentals of the protocol and the token.

Written by: Thor Hartvigsen

Compilation: Luffy, Foresight News

Catalysts create narratives, and narratives are what drive cryptocurrencies up. So, how do you go about trading with crypto narratives? This article will introduce 5 upcoming catalysts.

Catalyst

On January 1 this year, Gains Network launched the Arbitrum network; subsequently, gTrade's daily transaction volume, fees and users more than doubled.

Listing on Arbitrum improved the fundamentals of GNS, causing the token to rebound sharply, and reached a peak on the day of listing on Binance (a common top signal).

This is a catalyst that will ultimately improve the fundamentals of the underlying protocol and token. The opposite situation is often referred to as "buy the rumor, sell the news".

For example, the price of ADA rose sharply before the launch of its smart contract (the long-awaited launch of the ADA smart contract). But after the function was actually launched, the expected large-scale DApp ecosystem did not appear, and the day of launch became the highest point, because the enthusiasm of investors led to a valuation that could not be supported by the actual product.

Similar examples include Polkadot and parachain startups.

But the impact of catalysts isn't just based on whether they improve fundamentals. It also largely depends on overall market sentiment. When Gains Network launches on Arbitrum:

• Overall market starts up more than 80%
• Arbitrum narrative becomes popular

The prices of ADA and DOT both reached their apex in the previous encryption bull market. Timing is of the essence, and catalysts are far more influential in a bullish environment. When no new capital comes in, "buy the rumor, sell the news" is more common.

Another catalyst is the release of major version upgrades.

• Matic rebrands to Polygon and launches Ethereum sidechain
• Gambit rebranded to GMX and launched on Arbitrum and Avalanche
• Pendle launches V2 with a new set of features

In each of these cases, the protocol has been completely revamped, and the price has increased significantly. These agreements try to get the product into the market, and if you catch these early, you can make a lot of money.

Now let's take a look at 5 protocols that are about to welcome catalysts👇

GMX

GMX V2 is rumored to launch in June and will include the following updates:

• Added a lot of new trading assets
• Isolate the liquidity market to reduce the risk faced by liquidity providers

This makes it easier to add new assets to the protocol.

Other features include integration with Chainlink's custom low-latency oracles, separate fee structures for trading pairs, automatic deleveraging, and more.

The decentralized perpetual contracts space is highly competitive, but GMX V2 looks unique and promising. Learn more here.

EIP-4844

EIP-4844 (proto-danksharding) introduces several features to Ethereum, including the introduction of a data layer via transaction blobs. EIP-4844 prepares Ethereum for real Danksharding.

While Ethereum mainnet fees will not decrease until Danksharding, Rollup fees will be significantly reduced.

I expect the biggest beneficiaries of this narrative will be Rollup tokens (ARB, OP, etc.) and their native ecosystem project tokens.

EIP-4844 is scheduled to go live in Q3 or Q4.

dYdX

Whenever I talk about dYdX I get criticized, it is indeed one of the most controversial protocols due to its unfriendly token economics and previous protocol centralization issues.

But dYdX is building one of the most innovative products in DeFi.

dYdX will release V4 on their own Cosmos Lisk later this year.

Some of the features of the new version include: a decentralized order book, validators to confirm transactions on the chain, and DYDX fee sharing.

Please refer to for more information.

Frax Finance

Frax Finance is moving to a more secure V3 model.

The main updates of the new version include:

• FRAX fully collateralized

• Borrow-AMM providing liquidity to FRAX

• Scale frxETH through frxETH basepool on Curve

frxETH is growing and hitting new all-time highs almost every day.

sfrxETH provides the highest staking yield, and protocols like Pendle can help users further increase their yield.

Curve’s native stablecoin, crvUSD, also recently went live, and sfrxETH is currently the only token that can be used as collateral.

Synthetix

In the past week, Synthetix had the highest trading volume of all on-chain perpetual contracts (except dYdX), almost double that of GMX.

While volume growth is being driven by the OP and KWENTA incentive schemes, it's also worth watching.

Synthetix acts as a liquidity layer, and protocols such as Kwenta, Lyra, Polynomial, etc. use this liquidity for their own protocols.

The main updates of Synthetix V3 are:

• Multi-asset mortgage (not only SNX, but also ETH, etc.)
• No licensed pool (quarantine risk)