There is truly never a dull week in the world of Ethereum.

This week, I cover the rise of Layer 2s, a comeback in total value locked (TVL) on Ethereum and the SEC making its way into DeFi.

While NFT mints and trading are keeping gas prices high, we’ve been able to get a glimpse of the real effects of EIP 1559. The most notable takeaways from the upgrade are that gas fees are consistent, even if consistently high, and the burn mechanism works. As of Tuesday afternoon, over 228,000 ETH has been burnt, with a dollar value quickly approaching $1 billion.

Feel free to reach out with your thoughts and ideas for the newsletter by responding to this email or commenting on Twitter.

Welcome to another edition of Valid Points.

–Teddy

A message from Masterworks.io

As deep as a puddle, as wide as an OpenSea

With OpenSea’s NFT sales spiking to $3 billion last month, the art world is officially exploding. Big names like Jay-Z, Naomi Osaka, and even Tom Brady are launching their own NFT collections. Woooow.

An NFT collector even paid over $335,000 for a FAKE Banksy NFT on OpenSea last week.

It really do be like that sometimes

NFTs have ushered in a new era for collecting art. But few know about the one startup that’s at the center of something even bigger. An investment platform is securitizing the $6 trillion physical art market for the first time ever.

Here’s why:

Contemporary art prices outperformed S&P returns by 174% from 1995–2020
61% of billionaires collect physical art
Scarcity: Picasso isn’t producing any more works unlike NFT creators

We partnered with the premier art investment platform that lets you invest in multimillion-dollar works by artists like Banksy and Warhol for a fraction of the cost.

Bonus: Valid points subscribers get priority access to their offerings today*

*See important disclosures

The U.S. Securities and Exchange Commission reportedly opened an investigation into Uniswap Labs, the developer of decentralized exchange Uniswap. BACKGROUND: The SEC claimed it is investigating how investors use Uniswap and how it is marketed. Uniswap is a DeFi cornerstone, having the highest trading volume and being responsible for popularizing decentralized exchanges. Uniswap Labs delisted synthetic equities tokens this past summer in a move to avoid this type of oversight.

Coinbase plans to integrate Polygon’s Layer 2 scaling solution to reduce high gas fees and settlement times. BACKGROUND: Coinbase users will soon be able to withdraw funds to Layer 2 scaling solutions, which will make DeFi more accessible to the masses.

Ethereum hit a new all-time high for total value locked in DeFi platforms after a three-month bear market. BACKGROUND: Data from Glassnode shows that DeFi TVL broke a previous all-time high of $155 billion. A much larger percentage of the value locked comes from stablecoins than the previous high, as governance tokens have yet to fully recover in price.

High gas prices on Ethereum have pushed users to Layer 2 solutions, which processed more transactions than Bitcoin last week. BACKGROUND: The launch of Arbitrum and Optimism brought light to the demand for cheaper transactions that still use Ethereum’s base-layer security. Users are now able to reasonably transact with small amounts of capital and interact with most of the popular applications built on Ethereum.

Gas price volatility has slowed post-EIP 1559, bringing stability to Ethereum’s fee market. BACKGROUND: EIP 1559 was not aimed at lowering gas prices, but more at adding a measure of predictability to transaction costs. High-demand blocks are followed by a 12.5% increase in the base fee and the opposite is true for low-demand blocks, removing the possibility of drastic base fee changes throughout the day.

A message from Messari

Mainnet is an immersive, agenda-setting annual summit hosted by Messari taking place September 20-22 in NYC. The summit gathers crypto leaders, operators, builders, and investors for three days of future-focused collaboration, networking, and programming. Attendees should expect interactive discussions, hands-on product demonstrations, and one-on-one meeting opportunities with leaders in the space. Learn more by visiting mainnet.events and receive $450 off your pass using offer code coindesk at checkout.

Offer Code: coindesk

Valid Points incorporates information and data about CoinDesk’s own Eth 2.0 validator. All profits made from this staking venture will be donated to a charity of our choosing once transfers are enabled on the network. For a full overview of the project, check out our announcement post.

You can verify the activity of the CoinDesk Eth 2.0 validator in real time through our public validator key, which is:

0xad7fef3b2350d220de3ae360c70d7f488926b6117e5f785a8995487c46d323ddad0f574fdcc50eeefec34ed9d2039ecb.

Search for it on any Eth 2.0 block explorer site!

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