Thursday, 14 October 2021

Market Summary

Market Summary 14 October 2021

DeFi 2.0: New Guard vs. Blue Chips

  • Bitcoin tumbled below 55k in the Asia session after Binance announced it will halt yuan-denominated crypto trading and restrict access for mainland China customers, but it has since recovered and is trading back above $57k at the time of writing. 
  • Potentially in an effort to soften the blow, Binance launched a $1B crypto growth fund a day prior to support project teams and developers building on Binance Smart Chain as well as liquidity incentives for users; the Fund is the largest incentive program to boost ecosystem usage to date.
  • The “DeFi 2.0″ narrative has taken Twitter by storm in recent days, and DeFi 2.0 tokens have seen an impressive run-up in price over the last month compared to DeFi blue chips (SUSHI -15%, UNI -0%, AAVE -14%, COMP +24%, MKR -15% etc).
  • SPELL, an exemplar of the DeFi 2.0 wave, surged 15x in the last 30 days and significantly outperformed the rest of DeFi; the SPELL token is part of the Abracadabra Money ecosystem.
  • SPELL’s outperformance was catalyzed by several factors including a governance proposal to burn 20% of tokens in circulation, an anticipated and eventual token listing on FTX, and founder Daniele buying out a core contributor notorious for selling his vested SPELL.
  • Abracadabra Money and Rari Capital are the flavor of the month in the money market vertical as they offer leverage opportunities on higher-risk assets.
  • Abracadabra allows for interest-bearing tokens to be collateralized into their stable coin “Magic Internet Money” or $MIM. Users may access the liquidity of their yield farming tokens through collateralization, allowing for higher capital efficiency and leveraged yield farming opportunities.
  • Rari Capital’s Fuse protocol has also seen a lot of traction lately as its isolated lending pools allow for $sOHM to be used as collateral. This allows for increased degeneracy (i.e. collateralizing sOHM to borrow stablecoins for purchasing and staking more sOHM, elevating the famous (3,3) OHM meme up to (9,9)); as you can probably tell, these strategies carry quite a significant amount of risk.
  • OlympusDAO’s controversial bonding mechanism and (3,3) user strategy has inspired a number of new forks, with copycats such as Wonderland, KLIMA and Temple DAO adopt its bonding and staking mechanism.
  • USDT is once again receiving some FUD regarding the collateral used to back its value. Some speculated that USDT has Evergrande commercial papers backing it, but that has been refuted. Furthermore, in an ominous move, Tether’s CEO recently deleted his Twitter following an investigative report by Bloomberg on USDT, which stoked fear among holders.
  • USDC, on the other hand, has been the preferred 1:1 backed stablecoin, as evidenced by its notable supply increase over the past few weeks, which surpassed all others. This follows Circle’s commitment to hold USDC reserves only in safe assets like Cash and Treasuries.


Ethereum Rival Polkadot Marks Parachain Milestone With 25% Price Surge

  • The price of DOT rose 25% over 24 hours—part of a 36% gain over the last week—to zoom past $42 today. That’s the most expensive the asset has been since May, when it reached an all-time high of $49.35, according to CoinGecko. As of publication, the price sits at $41.50.
  • After five years of development from Parity Technologies  (the engineering team behind Polkadot), the project announced yesterday it was ready to launch what it calls “parachains.” The Polkadot leadership group subsequently voted to begin auctions for parachain slots starting November 11. 


Olympus DAO chases a new ATH after fresh bond offerings and partnerships

  • Olympus (OHM) is a rebase project that has caught the attention of many in the crypto space over the past six months — in large part thanks to the high yield offered to OHM stakers, which is currently above 7,000%.
  • The main way Olympus users increase the value of their portfolios is through staking OHM on the protocol to earn rebase rewards.


Raydium and Magic Eden Join Forces to Boost Solana NFTs

  • Raydium users will be able to trade NFTs natively on the Raydium website, powered by Magic Eden
  • All projects who list NFTs will be dual-listed on Raydium & Magic Eden, doubling liquidity and engagement
  • Magic Eden will integrate Raydium’s Swaps, allowing any token to be used as payment for NFTs on the platform.
  • Raydium DropZone projects get priority verification on Magic Eden. They can onboard and list new projects in less than 10 minutes.
  • Raydium’s partnership with Magic Eden will feature a dual-pronged marketing approach and increase the reach of the Solana-native NFT marketplace. We envision this cross-platform partnership will make NFTs more accessible to users in the ecosystem, increase NFT demand and bolster NFT liquidity.


Decentralized finance is now a $200 billion industry

  • There’s now $200 billion tied up in decentralized finance (DeFi) protocols, according to tracking site DefiLlama. That number has doubled since late June.
  • This metric is known as the total value locked (TVL) in these protocols. It refers to the dollar value of the tokens held in smart contracts within DeFi protocols, such as lending or trading platforms. It’s worth noting that these estimates are not perfect, since such trackers can count the same coins more than once.


DApp Staking is LIVE on Shiden Network #Build2Earn

  • dApp staking is finally live on Shiden Network. This is the most important update over the past 2 years.
  • To make the long story short, developers in our ecosystem can earn tokens while making smart contracts or infrastructure. 


UK Gambling Commission opens inquiry into fantasy NFT soccer game Sorare

  • The Gambling Commission in the UK has opened an inquiry into Sorare, a popular NFT fantasy soccer game that raised $680M in a funding round last month
  • “The Gambling Commission is currently carrying out enquiries into the company to establish whether requires an operating license or whether the services it provides do not constitute gambling.”
  • However Sorare — which closed a $680 million funding round for its NFT trading card platform in September — denied it was involved in anything approaching “regulated gambling”.

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