The Weekly Airdrop: 0x81
September 8, 2023 // Overall Market (+0.07%): Flat market for 3rd week straight, ARK files spot ETH ETF, Visa taps Solana, and onchain US Treasuries cross $630M in TVL
MARKET UPDATE
After yet another week where volatility evaded the markets and trade volume continued to drop, markets were flat (+0.07%) for the third week in a row. Volumes on CEXs hit lows not seen since 2019. Partly responsible is the “good news / bad news” trend:
September 6th 2023: Ark Invest along with 21Shares files for the first spot ETH ETF
September 6th 2023: FASB votes to use fair-value accounting standards for BTC & other crypto assets
September 8th 2023: The CFTC issues orders against DeFi protocols Opyn, 0x, and Deridex
Looking onchain, things were much more interesting this week. MakerDAO’s founder posted a governance proposal for using a fork of Solana to launch Maker’s own appchain, a proposal that caused some controversy among Ethereum evangelists. Slighted by this, Vitalik promptly sold all of his MKR tokens.
DEFI OVERVIEW
Onchain Activity
PERP (+158.2%) was a major outperformer this week, but most signs of the rally suggest that it is likely going to be a short lived one, and is more a function of the low liquidity environment that exists vs a reaction to fundamentals. Both trading volume and fees are down -20.1%, with annualized revenues barely even crossing $1.2M
SYN (-17.4%) suffered this week as one of their liquidity partners, Nima Capital, withdrew $40M in stablecoin liquidity, and market sold 9M ($2.3M) SYN tokens in two transactions onchain (which they had received in exchange for providing the $40M in “locked” liquidity), taking over 7 figures of slippage and violating the agreement between the two parties.
Offchain Activity
Solana got some huge news with Visa announcing they will use the chain as a settlement layer for USDC payments with its millions of merchants. This is a big deal as it further cements the notion of crypto payment rails as the cheapest and most efficient in the world.
The CFTC issues orders against DeFi protocols Opyn, 0x, and Deridex for offering unregulated digital asset derivatives trading. The orders request that Opyn, ZeroEx, and Deridex pay civil monetary penalties of $250,000, $200,000, and $100,000, respectively, and cease and desist from violating regulations
WEB3 OVERVIEW
Onchain Activity
Akash’s GPU network went live early last week, and it has already contributed to a +28.3% increase in the network’s overall compute capacity. Akash is already able to offer the most competitive price for high grade GPUs (Nv H100s and A100s), over 70% cheaper than AWS
Offchain Activity
SWIFT and Chainlink partnered to test out the tokenization and transfer of real world assets, and the outcomes were deemed a success. Chainlink’s CCIP (cross-chain interoperability protocol) was used to transfer tokenized assets between multiple private and public blockchains
Grab, one of Singapore’s most popular superapps, with over 130M users, has integrated with Polygon, and will offer users crypto payments and Web3 services including utility NFTs, in a move approved by the Monetary Authority of Singapore
TREND HIGHLIGHT:
Tokenization of T-Bills
Over the last 18 months, the Fed Funds rate has been hiked to 5.5%. According to Circle, USDC has seen over $26.2B in redemptions over the last 365 days. With the average stablecoin yield ranging between 2% and 3% over the last year and more, it is understandable that investors looked to move their liquidity offchain, and into money markets.
We see the tokenization of RWAs (including USTs) as a clear path to bring a lot of that liquidity back on chain. Since the start of the year, USTs brought onchain have crossed $630M. Overall RWA TVL has crossed $3.3B.
Dive in deeper here.
THE NEWSROOM
About M31 Capital
M31 Capital is a global investment firm dedicated to crypto assets and blockchain technologies that support individual sovereignty.
Website: https://www.m31.capital/
Twitter: https://twitter.com/M31Capital