Thursday, 21 April 2022

Market Summary

Market Summary 21 April 2022

Bitcoin Price: US$ 41,358.19 (-0.33 %)
Ethereum Price: US$ 3,076.04 (-0.83%)


Aave on AVAX, Delta One Farming, & veToken Alternatives

  • Aave V3 is a new and improved version of the blue-chip money market. Aave V3 introduces two modes to the high-efficiency mode (“eMode”) and Isolation mode.
  • eMode will unlock utilization amongst a category of assets, allowing for higher LTV of up to 95% to 98%. According to Aave,  -” A “category” typically refers to a set of assets pegged to the same underlying asset—for example, stablecoins pegged to USD, assets pegged to ETH, etc.”
  • Isolation Mode will isolate risk for certain assets deemed to be riskier while still unlocking their capital efficiency. Isolation Mode allows select assets to be used as collateral up to a certain debt ceiling. However, borrowers can only borrow stablecoins and may not use another asset as collateral simultaneously. To list an asset as “isolated collateral,” it will be required to go through a governance proposal before being listed.
  • With the launch of liquidity mining on Avalanche, capital started flowing into Aave V3 on Avalanche to take advantage of the lucrative yields. TVL spiked from $67M yesterday to $537M today at the time of writing. This is expected to continue going up as the mining rewards are still attractive. Do take note that when supplying USDT and USDC, only the native version is allowed as deposits and the bridge version (USDT.e and USDC.e) are not allowed as deposits.
  • Delta One aims to democratize sustainable yield to the next wave of DeFi users through yield generating structured products and a delta-neutral stablecoin. These delta-neutral and impermanent loss-free farming markets allow users to price their risk, and hedge away unwanted exposure.


Simplify files with SEC for Bitcoin Strategy Risk-Managed Income ETF

  • Asset manager Simplify has filed a registration statement with the United States Securities and Exchange Commission to list shares of an exchange-traded fund linked to Bitcoin futures, Treasury securities, and options.
  • In a Wednesday filing, Simplify applied with the SEC for an investment vehicle based on a Bitcoin (BTC) futures strategy, an income strategy, and an option overlay strategy. The Bitcoin Strategy Risk-Managed Income ETF, to be listed under the ticker MAXI on Nasdaq, is a series of exchange-traded funds from the asset management company.
  • The fund will indirectly invest in BTC using crypto futures and, as part of its income strategy, hold short-term U.S. Treasury securities and ETFs that invest in Treasury securities. For its option overlay strategy, Simplify said it would purchase “exchange-traded protective put options” and write “exchange-traded call options on Bitcoin futures and/or a Bitcoin related ETF or ETFs.”


US Treasury Dept lists crypto mining firm in latest sanctions against Russia

  • The United States Treasury Department has added Russia-based crypto mining services provider BitRiver and several subsidiaries as firms facilitating the evasion of sanctions. 
  • In a Wednesday announcement, the Treasury Department’s Office of Foreign Assets Control, or OFAC, said it was taking action against BitRiver AG as well as 10 of its Russia-based subsidiaries, naming the companies as ‘Specially Designated Nationals’. Firms and individuals listed as such by OFAC have their assets blocked and “U.S. persons are generally prohibited from dealing with them.”
  • According to the U.S. Treasury, the actions against BitRiver and its subsidiaries were based on them allegedly facilitating “sanctions evasion for Russian entities,” hinting crypto may have played a role in helping Russia’s government circumvent U.S. economic measures leveled in response to the invasion of Ukraine. The government department said BitRiver operated server farms selling crypto mining capacity internationally, which helped Russia “monetize its natural resources.”


Shiba Inu blacklists user for drawing hate symbol with metaverse land

  • In a statement posted by Shiba Inu (SHIB) Metaverse developers late Tuesday, it appears that a user’s wallet address has been blacklisted for drawing a swastika using the project’s Metaverse land. The team at Shiba Inu wrote:
  • “SHIB: The Metaverse will place the the wallet identifying the [hate symbol] violation on a blacklist, meaning it will never be able to participate in any and all areas of the platform.”
  • The ordeal began on April 12 with the launch of the Shiba Inu Metaverse land sale, with approximately 36,000 out of 100,000 plots up for grabs. Via, crypto enthusiasts who locked LEASH (the ecosystem token) and Shiboshi nonfungible tokens were able to bid on Metaverse lands, which were square plots, for 0.2 to 1.0 Ether (ETH) each. Each time a user bid on a piece of land, it turned the color from “grey” to “black” when viewed from the map.
  • On April 15, however, members of the Shiba Inu Discord community discovered that a malignant user was bidding on land in a way that formed a swastika. Yet, when the news broke out, SHIB holders quickly dug into their pockets and began bidding on land around the symbol (thereby shading their color) until it eventually turned into a “window” shape.


Blockchain games are leading the DApp industry, says latest DappRadar report

  • Market tracker DappRadar and the Blockchain Game Alliance, or BGA, published the Blockchain Games Report for Q1 2022 on Wednesday. After citing that $720 million was invested into blockchain games and infrastructures in February in a previous report, the latest number for total Q1 investment is $2.5 billion. Venture capitalists and other investors raised $4 billion in 2021.
  • The biggest deals listed in the report include Animoca Brands raising $360 million, bringing its valuation to $5 billion and becoming a leading Web3 brand. Sequoia Capital led a $450 million investment in Polygon (MATIC), while Yuga Labs, the studio behind Bored Ape Yacht Club (BAYC) nonfungible tokens (NFTs), received a $450 million investment led by Animoca Brands, with The Sandbox, FTX and Coinbase to launch its Otherside metaverse with play-to-earn (P2E) games.
  • According to DappRadar, Blockchain games attracted 1.22 million unique active wallets (UAW) in March, and more than half of the industry’s activity came from game decentralized applications (DApps) or gaming applications with play-to-earn incentives. Splinterlands is named the number one play-to-earn DApp. And Polygon is the layer-2 (L2) sidechain with the top played P2E games, such as Crazy Defense Heroes, Pegaxy, Arc8 and Aavegotchi. 


DeFi token AAVE eyes 40% rally in May but ‘bull trap’ risks remain

  • A sharp rebound move witnessed in the Aave (AAVE) market in the last three days has raised its potential to rise further in May, a technical indicator suggests.
  • As noted earlier, rising wedges are considered bearish reversal patterns by many traditional analysts. It indicates that AAVE’s run-up to $280 might not transform into a full-fledged bull run. Instead, the likelihood of the token correcting lower appears higher.
  • But the flag setup indicates that AAVE’s long-term bias is to the upside. Hence, the pair could rebound from the lower trendline to a roughly $900 bull flag target in 2022-2023, up about 400% from April 20’s price.
  • Conversely, a decisive break below the 200-day EMA could expose AAVE to further selloffs, with the next downside target sitting near $72, a historical support/resistance level.


Coinbase announces beta of NFT marketplace with social engagement

  • Crypto exchange Coinbase’s nonfungible token (NFT) marketplace has moved into beta more than six months after the company announced it planned to open a waitlist for the site.
  • According to a Wednesday blog post, the crypto exchange said beta testers for Coinbase NFT would be able to create online profiles as well as buy and sell NFTs. In a Tuesday press briefing, Coinbase vice president of product and ecosystem Sanchan Saxena hinted the design of the marketplace would be a cross between a social media platform and other NFT marketplaces like OpeaSea.
  • “While it is true that buying and selling NFTs is a big part of the ecosystem today, what we have learned by talking to many customers and creators is that there is more to it than just buying and selling,” said Saxena. “There is the community aspect of it.”
  • According to Saxena, the platform will have opportunities for engagement between users as well as creators. Like many social media platforms, Coinbase NFT will allow users to follow profiles of creators and others, comment on artwork and monitor a personalized feed to discover new NFTs based on engagement and purchases.


Russian tax authority proposes using crypto as a foreign trade payment tool

  • Russia’s Federal Tax Service (FTS) has joined the debate around crypto regulation in Russia with an unexpectedly blunt proposition — to let Russian companies use digital currencies as a payment method when transacting internationally.
  • On Wednesday, local newspaper Izvestia reported that the FTS left its official feedback on the draft of the crypto bill prepared by the Ministry of Finance. In its remarks, the fiscal agency proposed to let Russian companies use crypto for certain operations:
  • “To let corporate entities pay for goods and services according to foreign trade contracts and to receive revenue from foreign entities in digital currency.”
  • The initiative could fundamentally alter the spirit of the proposed framework, which previously excluded any other role for digital currencies than that of investment assets. As Izvestia noted, the current draft contains a clause according to which the ban on using crypto as a payment method is in effect “in all cases where this law does not specify otherwise.”
  • The FTS proposed to act on this reservation to diversify payment options available to Russian companies engaged in international trade amid severe financial sanctions imposed on the country.


ApeCoin: APE price climbs 55% in three days as a ‘BAYC land drop’ rumor goes viral

  • ApeCoin (APE) price has exploded higher on anticipations that it would become a de-facto payment token in an upcoming metaverse land sale.
  • A rumor circulating across social media platforms since April 18 suggested that the owners of the Bored Ape Yacht Club (BAYC) and Mutant Ape Yacht Club (MAYC) NFTs may receive virtual lands on the Yuga Labs’ much-anticipated “Otherside” metaverse platform.

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