In this issue:

• Introducing the Neo Tokyo News-Letter

• This Week in Neo Tokyo (by ZeHI)

• NFT Market Update (by Flower83)

• Alternatives to USD-Backed Stable Coins (by Koko of NGMI Lab)

• Web3 Builders Unite (by DamonNeedsToCreate)

For almost two years, the team at Neo Tokyo News has been working hard to bring you up-to-date reports from one of the premier, big-brain communities in Web3 while also helping you stay ahead of the game in the wild world of crypto and NFTs.

Our legendary, OG pdf newsletter - with its potent combination of alpha, news, and entertainment - was once an exclusive perk to holders of Neo Tokyo Citizens.

Now, our team is back and ready to provide first-class free content to the public.

Who Should Subscribe?

S1 & S2 Neo Tokyo citizens - We’ll be providing weekly updates from around The Citadel, with contributions from Project Manager Firestorm, each of the major Divisions, and citizen project Founders directly to your inbox.

Crypto / NFT enthusiasts and traders - Not only will we provide you with a glimpse into one of the premier communities of Web3 builders, but you will get insightful and informative articles about the Web3 news and projects that this alpha community is following, building, and investing in.

It may seem quiet within The Citadel these days, yet anyone paying attention can feel the atmospheric pressure building as whispers of a storm of activity brewing on the horizon permeate our data streams. Firestorm and Becker have dropped some hints and announcements that big things should be expected in the coming weeks and months. For now, all we can do is report on the recent events and speculate on what is to come.

Sources have informed us that Firestorm, Thrasher (Byt), and Tim (SuperVerse) met this week to finalize plans for the Neo Tokyo collection migration and the launch of Bytes2.0 / Staking. It has been a running joke for over a year that the launch of the next generation of NT’s native token is “only two weeks away,” yet insider reports are now confirming that this long-awaited hurdle is indeed imminent. Further details about how exactly this launch and migration will be handled are expected to be posted within the week.

Earlier this week, one of our undercover reporters was able to intercept a cryptic transmission from Citadel Tower that appeared to include an invitation for a secret meeting to plan the next Hand of The Citadel competition. We’ll be sure to investigate this further and provide any updates as they become available.

Neo Tokyo’s elite citizens have been galvanizing their forces, doing what they can to hold onto their status and power through regular meetings and activities. This past Thursday, Firestorm hosted an Elite VC to discuss the gaming narrative, Apple Headset rumors, and gaming token strategies, as well as picks for the next bull run.

The Founders’ Roundtable events have been the talk of the town these past months. The last one, on Thursday, May 11th, was the first time in NT’s history that both Overlords - Becker and Ellio - interacted live with the community in an alpha-packed VC session.

There was no Roundtable this past week, yet that didn’t stop the metacity’s builders and founders from gathering to network and share resources. DamonNeedsToCreate tapped into his old incubator session roots and hosted a PRP call with founders on Wednesday to exchange advice and strategies on marketing. To learn more about the PRP, check out Damon’s article below.

Block_editor began a series of spotlight articles on the NT Dev team. Check out the first entry which features the inside scoop on dev extraordinaire Splunkerin.

Neo Tokyo’s “Angie” logo also was featured in the background of KarateCombat’s Fight Night Live broadcast. Could this be a sign of a coming partnership with this martial arts initiative innovating the integration of blockchain tech with sports??

In the week to come, citizens should look out for news about the collection migration and plan to attend the Community Town Hall. It is currently set for Monday, yet the word on the street is that the Town Hall will likely be postponed to Thursday, 5pm ET.

After weeks of downtrend in the NFT market, this week looks to be a green one. So far, collectors of our precious JPEGs rejoice, since most top collections are up double-digit percentages on the weekly time frame.

Let’s quickly skim through some notable price movements. Punks and Apes are still below 50 ETH, but they’re actively trying to retake that mark.

Pudgy Penguins are now sitting firmly above 5 ETH due to the bullish announcements from their team.

Similarly, Milady’s are also above 5 ETH, not because of actual building, but because Elon gave them a shill on his timeline recently.

Azuki is climbing back towards their 15-ETH floor not due to hype, but rather consistent growth and regular updates from the founder and brand ambassadors such as wale.swoosh, Aez and Elena.

The weekly volume has been subsiding for weeks now, currently sitting just slightly above 50k ETH on blur.io and around 20k ETH on OpenSea and LooksRare, with X2Y2 not that far behind.

Let's dive into some topics which are at the forefront of the NFT space currently:

• Pudgy Penguins Continues To Build

One of the most impactful NFT news of this week has certainly been centered in the Pudgy Penguins ecosystem. A few weeks ago they managed to raise $9 million dollars in funding which they will use to produce and distribute pudgy toys in the future, in efforts to expand their brand’s reach to web2 audiences. They came out with their announcement on May 18th and accompanied it with a short YouTube video detailing their path forward.

The updates were generally well-received in the NFT space, and endorsed by non-holders as well. This resulted in people buying their NFTs which naturally translated into a small but noticeable increase in their floor price as well.

Here are some community highlights:

• Amazon Entering The NFT Space

Rumors are circulating about Amazon's upcoming NFT marketplace, known as the "Amazon Digital Marketplace."

Set to launch in June 2023, the platform aims to attract newbs to the world of NFTs by offering a user-friendly experience. Users will be able to buy and sell NFTs using their Amazon accounts as wallets and pay with fiat currency, eliminating the need for dedicated crypto wallets.

Amazon's approach, however, is raising concerns about centralization and ownership, as it plans to use a private blockchain for the marketplace. The private blockchain may limit transferability across different platforms and poses questions about the decentralized nature of their NFTs.

Despite these concerns, Amazon's entry into the NFT space is seen as a significant milestone that could contribute to the widespread adoption of NFTs and the Web3 ecosystem.

To keep up with the fast-paced NFT space, Neo Tokyo News has you covered. Join us as a speaker or listener on our weekly NFT Market Monday (5pm ET) show where we go in depth on some of these and many more topics.

Our last Twitter Space:

https://twitter.com/Neo_Tokyo_News/status/1658215746936385536

Tune in to our next Space:
https://twitter.com/i/spaces/1dRJZMLoboaGB

And most recent article:

https://neotokyo.codes/posts/news/nft-tuesday-shitcoin-drama

The world of crypto is a hotbed of innovation, teeming with projects that propose new ideas and challenge traditional norms. One such project that has recently caught our attention at NGMI Lab is the GSU Protocol. It boldly presents a new type of stablecoin, claiming superior stability than even the USD. The twist? This stablecoin isn't tethered to any specific fiat currency but derives its value from the broader equilibrium of the global economy. As intriguing as this sounds, the burning question is: can this innovative approach weather the inherent turbulence of the crypto ecosystem and navigate the regulatory storm ahead?

To assess GSU's potential and impending challenges, it is important to first dissect the established landscape of stablecoins. Firstly, there are four main types of stablecoin: commodity-backed (eg. gold-backed PAXG), fiat-backed (eg.USDT/USDC), crypto-backed (eg. DAI backed by Ethereum and Bitcoin), and algorithmic (FRAX/ UST).

Commodity-backed stablecoins are anchored to assets such as gold. Fiat-backed ones are pegged to traditional currencies like the USD or Euro. Crypto-backed stablecoins are collateralized by other cryptocurrencies like Bitcoin or Ethereum. Lastly, algorithmic stablecoins are bound to an on-chain protocol or crypto asset that determines its value through a computer algorithm based on supply and demand dynamics.

This variation in stablecoin types, however, doesn't translate into diversity in the market. The stablecoin sector is overwhelmingly dominated by fiat-backed, USD-denominated offerings. As of January 31, 2023, USD stablecoins hold a whopping 98.9% share of the market, amounting to $137 billion in value. This dominance points to a market that is highly exposed to the dynamics of a single fiat currency – a precarious position if there ever was one.

On top of that, USDC and USDT lead the pack in market capitalization. During the recent banking failures, the de-pegging of USDC threatened the very existence of the DeFi ecosystem and exposed a heavy reliance on stablecoins intrinsically tied to the traditional financial system.

Another recent development in the stablecoin arena is the emergence of institutional stablecoins, highlighted by the introduction of Societe Generale's new stablecoin, EUR CoinVertible (EURCV), launched in April of this year. This stablecoin, pegged to the euro and based on the Ethereum blockchain, stands out as the first such asset issued by a banking institution on a public blockchain. Unlike the stablecoins issued by companies outside Europe like Tether's EURT and Stasis's EURS, EURCV is a certified European bank's effort to respond to client demand for crypto assets. This trend could prompt more traditional banking institutions to venture into issuing their own on-chain assets, completely reshaping the stablecoin market dynamics.

Given these dynamics, it's hard not to see the urgent need for a more diversified and decentralized stablecoin market. Indeed, the over-reliance on a single currency-based stablecoin not only leaves the market vulnerable to the economic fluctuations of that particular currency (for example, a government inflating supply) but also stifles competition and innovation. Furthermore, this concentration in one specific currency raises regulatory concerns, as any legal changes impacting that currency could reverberate throughout the entire stablecoin market. The introduction of GSU Protocol offers a compelling alternative. But as with all things crypto, it comes with its own set of risks and challenges. Let's dive into it.

Global Standard Unit, or GSU protocol is a new over-collateralized, crypto-backed stablecoin built off a fork of Maker Dao. It offers a novel approach to creating a stablecoin by basing its value on a calculation called the ‘Global Point of Balance (POB)’, rather than a single fiat currency like USD. GSU uses an algorithm that examines capital flows between over 30 countries and their trading partners to represent a broad picture of the global economy. By reflecting this holistic economic landscape, the value of GSU stablecoin becomes less vulnerable to the economic fluctuations of any single country, offering a more stable and diversified option for users.

While GSU's innovative approach is undoubtedly noteworthy, the potential risks should be carefully considered. Though not technically an algorithmic stablecoin, GSU does rely on a very experimental algorithm to arrive at its value. In general algorithmic stablecoins have recently been under fire due to the collapse of Terra's UST, causing widespread distrust in this particular type of stablecoin. This reputational risk raises the bar for GSU to educate the masses and establish credibility and ensure user adoption.

Next, the complexity of GSU's mechanism adds an extra layer of risk. The task of maintaining a consistently accurate and updated index of the global economy is a herculean task. Any slip-ups in this process could potentially destabilize the coin. Moreover, the need for users to collateralize their assets to mint GSU coins exposes them to additional risk if the value of their collateral takes a downturn.

Finally, the rapidly changing regulatory landscape presents another significant challenge. As cryptocurrencies attract more mainstream attention, they're also drawing increased regulatory scrutiny. GSU, with its unique structure, may face regulatory hurdles that are yet to be clearly defined. These regulatory risks could have a considerable impact on its adoption and functionality.

While the risks of GSU and similar decentralized stablecoin solutions are apparent, it's crucial not to lose sight of the potential opportunities they present. In fact, the need for such innovation in the stablecoin market might be more pressing than ever for several reasons.

As some governments around the world become more adversarial towards cryptocurrencies, there's a growing need for stablecoins that can withstand potential attempts to dismantle the current crypto infrastructure. Decentralized stablecoins like GSU might offer a vital buffer against such regulatory hostility.

The over-reliance on a single currency or company forms a monopoly, which poses its own set of risks in the market. In a monopolistic scenario, a single point of failure could potentially destabilize the entire system. Diversification and decentralization could help in averting such risks, underscoring the importance of alternatives like GSU protocol.

Moreover, fostering competition and innovation is the cornerstone of any thriving market. If we standstill with the current stablecoin options, we may risk missing out on potential breakthroughs that could enhance stability, security, and inclusivity in the crypto market. As such, even as we remain aware of the risks, it's essential to continue supporting and scrutinizing novel stablecoin models like GSU protocol.

The ongoing innovation in the stablecoin space could lead to more resilient financial systems. Decentralized finance (DeFi) has already shown its potential in offering alternatives to traditional banking systems. Novel stablecoin models could further this cause, making financial systems more democratic, accessible, and resistant to single points of failure.

Indeed, the road ahead for stablecoins like GSU protocol is filled with challenges and opportunities. It's clear that the market needs to diversify away from the dominance of USD-backed stablecoins to mitigate risk and encourage healthy competition. As crypto gains momentum worldwide, more scrutiny and regulation will inevitably follow, necessitating robust, decentralized solutions.

In assessing GSU Protocol or any stablecoin, it's not just about the stability it promises, but also about the adoption it can inspire. The GSU team's main task lies in convincing the DeFi ecosystem about its unique value as a stable safe haven against currency volatility. Their success depends on their ability to penetrate diverse DeFi protocols, moving from theoretical innovation to practical utility. As we evaluate the potential of GSU protocol and similar projects, we must remember that a stablecoin's effectiveness is ultimately judged by its acceptance in the marketplace, regardless of its inherent design.

NGMI Lab members can find the full analysis of GSU Protocol at https://ngmilab.com/reports/55

Most blockchain communities meet in Discord servers to chat about the project that brought them together. They share ideas, discuss speculation, talk crypto alpha, and bond over games or other shared interests. This is usually organized and structured around a founder and a small band of team members, including a couple of mods.

That community follows the lead of the founder and his team; guiding them through AMAs, game nights, and other community style events that are meant to entertain, educate, and sell opportunities to the members. The momentum rests on the shoulders of the founders.

Sometimes you will find two or three project founders on a Twitter Space together, cross promoting on a podcast where their communities want to hear their opinions about events taking place in the larger market.

Last night I participated in something that was a bit odd for the typical metaverse gathering. Within the Neo Tokyo server, the Project Resource Program (PRP) hosted a conversation with almost thirty founders working together to discuss their experiences, and share their combined wisdom on marketing and community building.

What was the oddest bit behind this gathering was that it was organized by a department formed within NT by a collection of members, or Citizens as we call them. So the community was organizing for the founders. Tail wagging the dog, so to speak.

For the last year and a half, those of us in NT have not spoken out about the resources and the people creating within the walls of the Citadel. However, after attending NFT.NYC and speaking to a fair amount of project builders outside of Neo Tokyo about what we are doing for the project leaders, I believe it is time to start sharing a bit behind the curtain.

If you know someone looking to build a project, or already leading a project, and they are interested in conversations with other smart leaders trying to add value to the Web3 space, it might be time to lead them to https://neotokyo.codes/ to begin their research.

Once you have found your way in, scroll down to the bottom of the server and check out the PRP Intro channel for more info.

That’s it for our initial Neo Tokyo News-letter. Be sure to subscribe and share with your friends so you don’t miss out on future content. You can also follow us on Twitter:

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