The Castle Chronicle: Is Bitcoin Losing Momentum? How Footballdotfun is Improving SportsFi
PLUS: How Pulse is bringing Fitness Onchain
Welcome to Edition 135 of The Castle Chronicle!
August is coming to an end, and so are holidays. But don’t fear, the Chronicle will follow you wherever you go, so sit tight and enjoy this week’s new issue.
Here’s what we have for you today:
🔍 Market Watch - Is BTC losing momentum?
🏃🏻♂️ How Pulse is bringing fitness onchain
⚽ Football is trending onchain again with Football.Fun
🏰 Castle Reads - All of Castle’s research you might have missed
📖 Recommended Reads - The best reads from the best researchers on CT
🔍 Market Watch
Gm frens! The sideways continues for another week, and lower timeframes are showing some weakness. Let’s decipher the charts! 👇
Price Action
The BTC weekly chart still looks great. EMAs are rising and price is going sideways above them - the definition of a momentum cycle. However, when zooming in, we do see some signs of loss of momentum.
Taking a look at the daily chart, this most recent sideways price action looks like a distribution to me, especially given the liquidity grab of the previous ATH and the subsequent sell-off. The momentum is definitely weakening here, and we might see some short- to medium-term bearishness.
With the higher timeframe (W) being bullish, we expect this distribution to be part of an overall larger re-accumulation. Either way, as true momentum followers, we are currently sidelined, waiting for demand to reignite.
Many things can happen here. This might just be a quick liquidity grab and a skyrocket higher. But my expectation is for something similar to early 2025, with the price slowly bleeding out, eventually accumulating, and then starting a new cycle.
Top Performers
With BTC bleeding out, it’s no surprise to see a calmer week in terms of gains. Most of the TOP 5 are seeing minor gains, except for OKB gaining an impressive +32%.
I talked about OKB last week, emphasizing that it’s in a really good context for continuation and that it makes sense to follow it on lower timeframes. Let’s see how this played out!
OKB has provided plenty of opportunities to get involved in this momentum cycle and has moved over 70% higher from the last high. This is what real momentum in a good context can do for us. Now, price has lost its momentum cycle and started moving sideways. The immediate expectation is re-accumulation. I am once again waiting for demand to re-ignite to potentially follow this higher.
However, when looking for relative outperformers, it is important to have BTC in a good context. I would argue that this is currently not quite the case.
Narrative Performance
This week, we once again see a relatively balanced narrative profile, with nothing standing out too much. DeSci gained a little over 15%, driven by BIO and CRYO, while Modular lost a little over 10%, mostly due to declines in AVAIL and DYM.
If you’re a long-time reader, I’m sure you can spot some patterns here. The most interesting times are when BTC is pushing higher or during pauses within the momentum cycle. During these periods, there are often strong relative outperformers that provide interesting opportunities.
Once BTC starts bleeding out for longer and loses its momentum cycle (like right now), things become much calmer, and narratives tend to stay flat. There are interesting opportunities every now and then, but they are few and unpredictable. That’s why, in my opinion, it’s a good idea to stay side-lined and wait for clarity.
Until that happens - risk responsibly, and I’ll see y’all next time!
Courtesy of 0x_Vlad - trend-based trader and MentFX student
Not following what I’m talking about? Check out my quick cheatsheet to understand how I approach a chart.
📱 Time for some Onchain Fitness?
I was doing some research last week on the nascent mobile ecosystem on Solana, covering the new Solana Phone and Gameboy for Castle. I stumbled upon a very interesting physical crypto product that is still largely unheard of: The Pulse Solana Wristband.
Simply explained, it is a wearable fitness tracker and decentralized health platform built on the Solana blockchain. This allows users to track their health data privately and earn crypto rewards for healthy behaviors. Like Garmin watches and other fitness trackers, it allows users to get real-time data on multiple biostatistics and adapt its behavior based on those datasets. The Pulse Watch uses medical-grade sensors to capture biometric data such as heart rate, sleep patterns, movement, and stress levels.
Unlike other fitness trackers, the Pulse protocol stores user data in an encrypted and decentralized manner using Solana's blockchain. Users maintain complete ownership and control of their information, using their Solana wallet as the key to access or share their data. Users can access their health dashboard through the Pulse app, which provides AI-powered analytics to generate personalized improvements and recommendations. Users can choose to share their encrypted data with trusted parties such as researchers or pharmaceutical companies. The platform rewards users for this contribution, flipping the traditional model where companies profit from user data.
I have not tried the product yet, but I intend to order it as soon as possible.
Looking at their most recent raise, we found some interesting investors focused on Crypto-Consumer products like Collab+Currency & Lemniscap.
IMO, an interesting product and showcase that Solana builders are innovating BIG TIME and that the chain is not just about crime and shitcoins.
Have a gud WEEK.
From CL with LOVE
⚽ Football is trending onchain again with Football.Fun
With the new football season starting (I hate anyone using the word “soccer”), a new platform has been rising quite significantly over the past two weeks, and all my frens have been talking about it on CT and Telegram. It’s called Football(dot)Fun.
Today we’re covering how it works, how to play it, and how to leverage its mechanics to win.
How FDF Works
Football(dot)Fun is an on-chain football manager game on Base. Here, you can build your team by buying and selling players and opening packs.
Players are like ERC-20 tokens and can be bought or sold using Gold (in-app USDC) in Uniswap V2-type pools, with a 5% buy/sell tax. Their price is mainly determined by supply and demand, with the most famous and valuable players in real life quickly rising in value.
Every player bought starts with 4 matches until their contract expires. When it does, or even before, the user can easily prolong it using Gold, whose price is based on the player’s market value.
Players can also be found in packs, which could originally be bought directly to fund the platform but now can only be redeemed with tournament points. They are credited to the user once the weekly tournament ends.
As we all know, during the season, teams compete to win matches and championships. For every match players take part in, users receive a score on FDF based on their performance. Their scores are summed and used each week, from Friday to the following Monday and from Tuesday to Thursday, to calculate the team manager’s (your) score for the weekly tournaments.
Tournament participants then receive a share of the prize pool in Tournament Points (TPs) proportional to the performance of their top players, which can be used to purchase packs.
Packs are another way to get players. You can get lucky and obtain highly valuable players from them, but they cannot be used or traded right away. After you find them in packs, they are sent to the development pool of your squad and can be redeemed for an amount of Skill Points (SPs). SPs are earned by users based on the top performers in their squad during every tournament. You can then use them to “promote” players, which is important to sell the most valuable ones, trade them for the players you want, or keep them for the next tournament.
How to Play
Here’s a quick tutorial on how to play:
Log in on the FDF website (lil ref attached).
Deposit USDC on Base from the Gold icon in the top right corner.
Purchase and eventually sell players with the Gold you obtained (1:1 with USDC) from the “Transfers” section.
Check your “Squad.”
Complete the missions on your profile to increase your reputation and earn a few starting packs. Reputation may become important in the future to access perks and benefits.
How to Win
There is no way you can actually crack the code, but a recent piece from Pixonchain and my knowledge about the topic helped me understand a few things:
Famous and strong players are the most expensive ones, but less expensive players should not be considered less valuable per se.
New players are added periodically and start from a “floor price” (e.g., Jude Bellingham still has to be added and will most likely reach a high valuation quickly). This means that entering early could generate serious $. However, with the latest 10-player addition, the site struggled to keep up, and many users couldn’t get their hands on them before it was already too late.
Top players by score each week earn you more tournament and skill points, which are important to open packs and promote players.
Rewards are distributed to holders in proportion to their share of players they own, so the “cheat code” is to hold less expensive players with fewer holders who also have a good chance of reaching the top of the tournament by score. The platform provides access to this data, so use those insights to weigh your decisions about who and how much to hold.
Closing Thoughts
I’m currently playing this game mainly because it’s the first football manager I actually enjoy, as it blends market dynamics, sports, and onchain all together.
At this stage, I think we are still early since retail users still cannot buy gold with a credit card, the total value on the platform is still rising every day, and there are still many players and teams yet to be added.
FDF is trying to fix Sorare mistakes to create a more enjoyable and sustainable SportsFi game.
FDF will continue to rise until diminishing returns start to kick in and speculators either quit or reduce their exposure to the game. When this happens, prices will drop significantly as the market searches for a new equilibrium. At that point, we will see if the game has what it takes to be sustainable and fun in the long run.
Edit: It seems like my prediction came true really quickly, as the value of most players is now down 30-40% on average in one day. However, FDF’s TVL is still in the range of a few million, and 10 new players have been added this week. There is still a lot coming for this game, and I’m excited to see how it will unfold.
Until next time.
milady
Courtesy of Matt
🏰 Castle Reads
Everything you need to know about Mantle’s future growth:
Scaling Onchain Culture with Base and Zora:
@chila_ct analyzing how our brains perceive new, shiny things, contextualized in market psychology:
📖 Recommended Reads
An interesting thesis on the AI privacy-preserving platform Flock, by @defi0xjeff:
Market thoughts and theses by @alpha_pls:
Ventuals, Pre-IPO stocks and secondary markets thoughts by @DiogenesCesares:
That’s it for today’s issue, we hope you enjoyed it.
You can check out our X for new research reports and weekly gigabrain content.
See you in the next issue,
The Castle Team
In our newsletter, we may discuss projects or tokens in which we hold positions. While we aim to provide informative content, our views are not financial advice. Please conduct your research and consult professionals before making investment decisions. Crypto markets are volatile, and past performance doesn't guarantee future results. Invest responsibly, and be aware of the risks. Your capital is at risk, and we do not accept liability for any losses.