Thursday, 3 March 2022

Market Summary

Market Summary 3 March 2022

Bitcoin Price: US$ 43,892.98 (-1.19%)
Ethereum Price: US$ 2,947.30(-0.98%)


Fantom Gas Soars, Solidex Yields, & OSMO Outperforms

  • Gas prices on Fantom spiked to new highs as Solidly and Solidex launched last week. Yield farmers were rushing into Fantom to take advantage of the high yields. This led to higher demand in blockspace and more competitive gas prices.
  • The sum of daily transaction fees paid soared to over 500k FTM, or around $780K at the time.
  • Even as the initial hype cools, it’s clear average gas prices and daily transaction fees paid are still relatively higher than in periods prior to Solidly and Solidex launching.
  • Interestingly, veDAO and 0xDAO, which were initially launched to compete with each other, have partnered up. They will now serve as complements to each other, with 0xDAO building a Solidex competitor, and veDAO will be dedicating themselves to compounding Solidly voting power and helping build value for token holders. Let the $SOLID wars begin.
  • Solidex is a protocol to optimize yield, voting power, and liquidity provisioning on Solidly. Solidex is to Solid, what Convex is to Curve. Liquidity providers can deposit their LP tokens into Solidex to earn boosted SOLID rewards without having to lock SOLID themselves. SOLID lockers earn a portion of the protocol revenue in exchange for providing a boost to LPs. Although Solidex builds upon existing DeFi concepts, their codebase is built from scratch specifically to integrate with SOLID. 
  • Despite the latest market drawdown, OSMO has outperformed other major peers over the last few months by a substantial margin. OSMO saw a modest pullback between November and mid-December alongside the broader market but has since bounced back much stronger than major peers (and most crypto assets for that matter) over the last couple of months.
  • The impressive traction that Osmosis achieved within the Cosmos ecosystem is backed by strong fundamentals. One of the most anticipated features of Osmosis since launch has been interchain/superfluid staking, a concept unique to the Osmosis DEX.


Drawbacks of centralization: Moscow Stock Exchange remains offline amid ongoing Russo-Ukrainian war

  • As reported by local news outlet TASS, the Central Bank of Russia once again suspended trading on the nation’s leading Moscow Stock Exchange (MOEX) on Wednesday, and it will not open the exchange on Thursday. Trading on MOEX has been halted since Feb. 25, after Russia launched its ongoing military campaign in Ukraine. On a monthly basis, the exchange’s index has lost over 34% of its value (not adjusted for inflation), as Western leaders have imposed crippling sanctions on Russia in response to the conflict.
  • In addition, MOEX’s main website has been offline since Monday, with Ukraine’s “IT army” allegedly taking credit for the “hack.” Meanwhile, Russia’s Saint Petersburg Stock Exchange (SPB) also remains closed but will open for limited trading on Thursday. In the meantime, the Dow Jones Russia GDR Index, which tracks the value of Russian stocks listed on the London Stock Exchange, has lost 93% of its value in the last five trading days, implying disastrous losses ahead when Russian markets open. 


EU is ‘taking measures’ against Russia using crypto to bypass sanctions, say finance ministers

  • Economy and finance ministers representing nations in the European Union have said they will address Russia’s potential use of cryptocurrencies to evade sanctions imposed on it following its operations in Ukraine.
  • Speaking to reporters through an interpreter following an informal video conference of EU economy and finance ministers on Wednesday, France’s finance minister, Bruno Le Maire, said lawmakers had already worked to freeze “a significant amount of the assets” in Russia’s central bank as part of its efforts to financially penalize the country over its ongoing efforts in Ukraine. However, he added that the 27 member states of the EU had decided on additional measures aimed at stopping Russia from evading sanctions, including extending them to Belarus.
  • “We are taking measures, in particular on cryptocurrencies or crypto assets, which should not be used to circumvent the financial sanctions,” said Le Maire. “We will be taking stock on a daily basis with regard to the implementation of these sanctions, their effectiveness and any additional measures which may be needed. When it comes to economic and financial sanctions, we want to remain flexible and mobilized.”


US lawmakers and Fed chair push for crypto regulation in wake of Russia sanctions

  • Federal Reserve Chair Pro Tempore Jerome Powell and some members of the United States House of Representatives called for congressional action on crypto in response to discussions about Russia potentially evading sanctions.
  • In a Wednesday hearing of the House Financial Services Committee on “Monetary Policy and the State of the Economy,” California Representative Juan Vargas asked Powell if cryptocurrency could be a “way out” for Russia looking for financial transactions in the wake of the United States and European Union cutting the country off from the SWIFT payments network. The Fed chair said that the situation with Russia “underscores the need for really congressional action on digital finance, including cryptocurrencies,” adding:
  • “There isn’t in place the kind of regulation framework that needs to be there. […] What’s needed is a framework, in particular ways to prevent these unbacked cryptocurrencies from serving as a vehicle for terrorist financing and just general criminal behavior, tax avoidance and the like.”


EU will cut off 7 Russian banks from SWIFT, with ordinary Russians facing consequences

  • On Wednesday, the European Union announced that within 10 days, it intends to remove seven Russian banks from the Society for Worldwide Interbank Financial Telecommunication, or SWIFT, messaging system.
  • The list of sanctioned banks includes Russia’s second-largest bank, VTB Bank, alongside Bank Otkritie, Novikombank, Promsvyazbank, Bank Rossiya, Sovcombank and VEB. Without access to SWIFT, which is a Belgian messaging system that connects over 11,000 financial institutions worldwide, Russian banks and, by proxy, the Russian economy are likely to endure severe losses. For example, Iran lost 30% of its foreign trade after being banned from SWIFT in 2012.


DCG announces $250M share repurchase for Grayscale products

  • Grayscale parent Digital Currency Group, better known as DCG, announced that it intends to repurchase up to $250 million in shares for various Grayscale investment products.
  • The share repurchase program is centered around Grayscale’s Litecoin Trust, Horizon Trust, Zcash Trust and other Grayscale products, DCG confirmed on Wednesday. The pace and timing of the share repurchase are not fixed and will depend on several factors, “including the levels of cash available, price, and prevailing market conditions,”

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