July 31st, 2023 — 💣Curve suffers $70M exploit — Sequoia slashes crypto fund
Get an overview of crypto market liquidity from July 24th to July 31st, 2023.
Top crypto market headlines:
- Curve suffers $70M exploit, but damage contained — 7/31/23
- Sequoia Capital Slashes Crypto Fund as It Downsizes Amid Startup Crunch — 7/27/23
- Amazon Expands Web3 Reach With Cloud Tools That Help Blockchain Developers — 7/27/23
- ECB raises interest rates back to highest-ever level — 7/27/23
- Fed approves hike that takes interest rates to highest level in more than 22 years — 7/26/23
- Flashbots becomes unicorn after completing $60 million raise — 7/25/23
- Fidelity-backed crypto exchange EDXM expands institutional access with Talos — 7/25/23
- Bitcoin making way for ‘one of the most exciting decades’ of our lifetime: Tim Draper — 7/24/23
- Crypto Startups Raised $201.4M in Venture Funding Last Week, Led by Infrastructure — 7/24/23
Weekly Insights Report:
Welcome to the last weekly newsletter of July. The Barbie movie earned a spectacular $775 million globally just 12 days after its release, putting it on a path to becoming the first Hollywood movie in history directed by a woman solo to join the $1 billion club. The $775 million figure is, for one thing, way higher than the estimated $500 million of digital asset fund inflows into the crypto ecosystem at the half year mark, according to CoinShares.
Sequoia has cut the size of its crypto funds by more than half amid a broad startup downturn. Its crypto fund went from $585 million to $200 million, whereas its so-called ecosystem fund, which invests in other venture funds, went from $900 million to $450 million. Sequoia told fund investors in March that it decided to reduce the funds to better reflect the changed market. The cryptocurrency fund, for example, will focus more on backing young startups after an industry crash wiped out opportunities to back larger companies. The leading VC firm previously suffered enormous losses after FTX went bust last November.
The Fed raised interest rates last week to the highest level since January 2001, bringing rates into the 5.25%-5.5% range. This marks the 11th rate increase since March 2022 (when rates were near zero), and Chair Powell said one more rate hike is likely before the end of the year. The probability of this 12th rate hike depends solely on whether consumer prices show signs of cooling down. Across the Atlantic, the ECB also raised interest rates back to the highest-ever level, marking a 9th consecutive increase as it warns prices are still rising too fast. The ESB said it would ensure interest rates “will be set at sufficiently restrictive levels for as long as necessary” to bring inflation down to the 2% target. The Eurozone inflation is currently almost double the US figure at 5.5%.
Legendary investor Tim Draper did an interview with Fox, stating that the combo Bitcoin (crypto) X AI will make way for “one of the most exciting decades” of our lifetime. Coming from someone who has been heavily involved in the investment cycle over the last 4 decades, that’s something! He said Bitcoin and the internet have the same curve, reminding that at the beginning, governments were thinking about taxing internet usage or banning it altogether. He also made a bold forecast that Bitcoin will not only rise above other cryptos, it will also rise above fiat. He says having a centralized government in charge of currency is inefficient, and eventually, the rest of the world will realize this.
In other major news, a code bug left four Curve Finance pools vulnerable to over $70 million in theft, but all other pools are now safe, according to a spokesperson. Binance is set to launch in Japan next month after the exchange ceased operations in the country two years ago following a regulatory warning from Japan’s Financial Services Agency for operating without authorization. Ethereum infrastructure service Flashbots has raised approximately $60 million at a valuation of $1 billion.
On a weekly basis, BTC is down by 3% and ETH is down by 1%.
As usual, we look at the liquidity and trading patterns of BTC and ETH of last week, including bid-ask spreads and fragmentation index and take it a step further with a detailed report on market anomalies. Check out full reports:
Other major crypto headlines:
- Worldcoin Being Probed by French Privacy Regulator for ‘Questionable’ Practices — 7/28/23
- Meta sinks $3.7B in metaverse money pit as CEO eyes Threads user retention — 7/27/23
- Twitter ‘X’ rebrand spurs hype around potential crypto integration — again — 7/26/23
- Private Banking Firm With $14B Assets Starts First Crypto Fund of Spain — 7/26/23
- Stellar, Ripple and Solana-Based Investment Funds See AUM Spike in July — 7/26/23
- Binance to Reenter Japan in August 2 Years After Regulator’s Warning — 7/26/23
- Landmark crypto market overhaul bill advances past first committee — 7/26/23
- Avalanche Foundation allocates $50M investment to on-chain asset token purchases — 7/25/23
- Web3 can transform the internet, says Japan’s PM Fumio Kishida: CoinPost — 7/25/23
And in case you haven’t seen, here is a selection of our latest articles:
- Market Making Overview: TradFi vs Crypto NEW!
- Commentary notes on Credit Suisse’s rescue deal and recent banking turmoils (2/2)
- Commentary notes on SVB’s failure, Credit Suisse, implications for crypto, and where do we go from here (1/2)
- The Future of Trustless and Decentralized Cross-Chain DeFi — Focus on Interlay
- On Blockchain Interoperability — Focus On The Polkadot Ecosystem
- FTX Post-Mortem Analysis — Why Transparency Matters?
