Last Week’s Top 5 in DeFi/NFT News — February 28, 2022

Weekly DeFi/NFT news is a collection of major weekly events/announcements brought from the most trustworthy data sources, such as The Defiant, Spencer Noon, Week in Ethereum News etc. with comments and extra insight from the Bulldax DeFi labs.

Swiss index provider launches new product tracking 10 DeFi tokens — Cointelegraph

• Switzerland-based fund manager Compass Financial Technologies has launched an index for 10 decentralized finance (DeFi) tokens dubbed the “Compass Crypto Basket Fundamental DeFi Index” (CCBFDEFI).
• A group of 10 DeFi tokens that are individually weighted based on “ liquidity, market capitalization and protocol revenue metrics” and on-chain data.

• Compass Financial Technologies CEO Guillaume Le Fur emphasized the institutional appetite for crypto exposure is “growing significantly” as firms seek out ways to invest in the sector in a compliant manner:

“Incorporating fundamental metrics in index creation offers investors the possibility to allocate in the most efficient DeFi tokens based on rational economic indicators.”

Source: https://cointelegraph.com/news/swiss-index-provider-launches-new-product-tracking-10-defi-tokens

Jump and Three Arrows Lead $1B LUNA Buy to Secure UST Against Black Swans — The Defiant

• Terra’s stablecoins, primarily UST, will now be backstopped by Bitcoin.
• A billion dollars worth of BTC will be set aside by the Luna Foundation Guard (LFG) to act as a backstop for UST and other Terra stablecoins in case they lose their pegs, as first reported by The Block.
• LFG sold $1B in LUNA tokens, the governance token of the Terra blockchain, to Jump Crypto, Three Arrows Capital, DeFiance Capital and other investors.

• “One common criticism of algorithmic stablecoins is their reflexive nature and the hypothetical risk of a ‘bank run’ scenario where demand to sell the stable outstrips supply in a way that causes compounding price decreases in both native tokens,” the Terra account tweeted later in the same thread.
• While the mechanics weren’t spelled out, it seems that the idea is that if there were a run on UST (or another stablecoin minted by Terra), LFG could buy it off the market using its BTC reserves as a way to prop up demand.

Source: https://thedefiant.io/luna-sale-ust-bitcoin/

Gaming Guild YGG Pulls Out the Stops to Weather a Brutal Bear Market in GameFi — The Defiant

• Many players also use play-to-earn, or P2E, to supplement their income and are not solely reliant on GameFi revenues to support themselves.
• But like everything else in crypto, GameFi has tumbled since those November highs. And AXS has lost 60% of its value. Meantime, Smooth Love Potion, its in-game coin that drives much of its tokenomics, has crashed 95% since July.
• The YGG guild has invested $9.7M into 48 different projects including Axie Infinity, Illuvium, and Monkey League. YGG estimates the deals allowed it to accumulate in-game assets and NFTs at an average discount of 91%, meaning that most of its investments remain in profit despite recent bloodshed in the GameFi markets.
• Looking forward, the YGG DAO said the guild plans to “double the size of its core team in the coming months” through new hires. YGG also predicts that more than 10M million crypto wallets will have interacted with crypto games before the end of 2022. It’s even expanding regional sub-DAOs.

What is gaming guild?

• Gaming guilds are play-to-earn collectives that connect in-game asset owners with P2E gamers. Revenues are shared among members, with players taking the majority of profits. Many guilds’ primary revenues are generated playing Axie Infinity, with The Sandbox, Star Atlas, and Splinterlands also gaining popularity among guilds.
• Data from DappRadar shows that the number of unique active wallets (UAW) interacting with crypto-powered P2E games overtook that of DeFi protocols during the second half of 2021. Axie Infinity also solidified its position as the leading P2E title last year, with daily active users surging from 20,000 in March to more than 2.5 million during December.

• YGG’s core roles include “scholars,” gamers that utilize YGG’s assets to generate revenue from P2E games, “managers,” members that are “responsible for recruiting and onboarding scholars,” and investors.

• YGG collects 10% of all revenues earned, with 70% going directly to scholars, and the remaining 20% being distributed to community managers.
• In its report for 2021, YGG states that the guild grew to span 10,786 scholars after beginning the year with just 159. The players generated more than $11.3M in total, suggesting average per-capita earnings of roughly $733.35 for scholars.

Source: https://thedefiant.io/ygg-play-to-earn-bear-market-gaming-guilds/

Artist blows up Lamborghini to make NFTs — in protest against get-rich-quick culture — The Block

• An artist called Shl0ms, with the help of an explosives expert, blew up a Lamborghini worth just shy of $250,000. They are now turning the charred parts into a collection of 999 NFTs — to protest crypto’s get-rich-quick culture.

“This technology is incredibly promising, there are so many good things we could do with it but there are so many terrible things being done with it,” Shl0ms tells The Block

• The team spent two weeks prior testing the explosions, including blowing up another car. Plus, in order to handle such firepower, they had to hire a federally licensed explosives engineer (who said this was his most challenging detonation to date).
• Following the blast, the team picked up the pieces and documented them. They shot a rotating video of each piece in 4K definition (although the NFT quality might be lower).

• The collection is going live on February 25 and at this point the full video of the explosion will be made available. It’s made up of 999 NFTs, with 888 for sale and the remaining 111 for the team and the initial investor.
• Yet while the NFT collection seems inherently contradictory — destroying a real-life object to sell NFTs in criticism of using crypto to make a quick buck — Shl0ms is fully aware of it. Plus, they plan to use the funds to build a DAO that won’t have financial goals but will be more ethically minded.

Source: https://www.theblockcrypto.com/post/134923/artist-blows-up-lamborghini-to-make-nfts-in-protest-against-crypto-culture

Solana hits 299k daily active users — Spenser Noon

• Solana’s unique daily active signers (a good proxy for users) have increased by ~300% since the last update in late September. Unique signers peaked at 299k in late January, but tapered off a bit to 232k after the network’s most recent bout with degraded performance.
• Solana’s long-term uptrend has recently been bolstered by its two top wallets — Solflare and Phantom — launching their own iOS mobile apps, along with strong consumer participation in the Solana NFT market.

• The Solana NFT market exploded into relevance in the second half of 2021, and carried that momentum into 2022 with a market cap just shy of $1b and 7-day volume of $46m. Since Metaplex protocol went live on Solana, cumulative unique NFT owners grew from 28k to almost 2.5m today.

• The number of NFT launches on Solana has skyrocketed, with more than 8m total NFTs being minted using Metaplex. Since September, there’s been a significant increase in the number of wallets with more than one NFT, which recently surpassed 500k.

Source: https://ournetwork.substack.com/p/ournetwork-issue-110