Weekly Crypto/DeFi/NFT Update from Synchrony
The top news last week:
- The ETH Merge
Let’s start with the bubble of the internet, The merge!
This eagerly awaited occasion has arrived. If you need a refresher course on the ETH Merge timeline, it is projected as follows:
- First order of event — the Bellatrix Hard Fork — September 6th
- Second order of event — reaching Total Terminal Difficulty (TTD)
- Third order of event — the Paris Hard Fork — September 15th
- Fourth order of event — the Difficulty Bomb
The Ethereum miner balance reached a four-year high just weeks before the Merge, indicating that additional ETH should be stored in preparation for price increases and forked PoW coins. It’s obvious that market players have been and are still setting themselves up for the next significant move in one way or another. Remember that the current deprecated PoW chain and the new PoS chain will arise from the post-Merge. Only traders and speculators will seek to profit from the PoW work fork, and most serious companies will only favor PoS ETH.
The Merge has already received extensive coverage, but it is important to bear in mind the big picture. Considering that the Merge could be negative, a sell-the-news event might come into play. Inflation is out of control, the macroeconomic situation is grim, and the recent hawkish Jackson Hole conference suggested that the Fed is stepping up its interest rate increases to hit its 2% inflation objective. Risk assets are still not prepared to move on. It’s possible that the Merge won’t be able to get past all of these external factors.
Crypto Leaks, an anonymous publication, claims that Ava Labs, the entity tied to the Avalanche (AVAX) blockchain, has engaged the law firm Roche Freedman to sue competitors. Videos and leaked documents have prompted the crypto community to pressure Ava Labs into responding. Emin Gün Sirer, the founder of Ava Labs, dismissed and responded to these allegations.
Ava Labs rejected the accusation as “conspiracy theory nonsense,” and the whistleblower himself replied, calling it unsourced false statements and illegally obtained, highly edited video clips that are not presented with accurate context. Ava Labs founder Emin Gün Sirer also released a statement refuting the crypto leaks’ “lies.” Kyle Roche ended up withdrawing from several class action suits, including Tether, Bitfinex, TRON, and BitMEX, in the wake of this recent scandal. Tether later requested the entire firm remove themselves due to possible implications.
The entire story feels like it has holes in it, and it’s one big, “he said, she said,” and so for now, we just wait to see if more details eventually come to light. And if you’re wondering if this little drama affected the price of AVAX, when you zoom out, it doesn’t look that bad compared to the mountain slope journey it’s already taken this year along with several other alts.
DigiDaigaku and Free-to-Own
You may have observed that the NFT project DigiDaigaku has been surging, rising recently from the 1 ETH floor up to 14 ETH, with an airdrop for DigiDaigaku holders expected on Friday, September 2. Limit Break, the company behind Digis, announced a $200 million investment from Paradigm and other notable VCs. The anticipation surrounding this new “Free-to-Own” mechanism are two noteworthy factors that have contributed to the buzz.
The first community receives NFTs free of charge, and those NFTs then produce additional NFTs (for gameplay and cosmetics). It is mostly being promoted by Gabe Leydon, who invented free-to-play mobile games at Machine Zone, which AppLovin acquired in 2020 for $300 million. Here you can learn more about him and why people are so intrigued. People have criticized the free-to-own approach as they quickly have everything else in this market.
SEC: XLM, ZEC & ZEN may be securities. Crypto asset management firm Grayscale has revealed that the SEC has been asking questions about Stellar (XLM), Zcash (ZEC), and Horizen (ZEN). These questions were concerning Grayscale’s “securities law analysis.” Combined, the three tokens only account for $40M of Grayscale’s $18 billion+ in assets under management.
OpenSea adds Polygon support to its Seaport protocol implementation to expand features, and it will be accepting MATIC — another win for the Polygon business development team, which has been killing it with partnerships all bear market long
Tether Won’t Ban Tornado Cash Addresses. The issuer of the world’s largest stablecoin has publicly stated that it won’t ban any Tornado Cash-related addresses, despite sanctions. Citing potential disruptions, Tether says they would only do so if asked by government officials.
Facebook Joins Instagram in Supporting NFTs. Instagram-oriented NFT integration began in May and is now available on both Meta-owned platforms and across more than 100 countries. Users can now link their crypto wallets directly to Facebook and Instagram to post and show off their digital assets.
Coinbase Adds Nano ETH Futures. Coinbase expands its derivatives product offerings with the launch of nano ETH futures. This move will allow traders with smaller capital to speculate on the future price of ETH as the Ethereum merge approaches.
Synthetix Proposes Capping Token Supply. Synthetic’s Founder Kain Warwick has proposed capping the SNX token supply as the protocol increasingly gains revenue from newer products. The proposed cap would be set at 300 million. Kain cited that the initial inflationary token supply model was implemented to bootstrap the Synthetix ecosystem.
Compound on Ethereum Freezes for 7 Days. Compound, one of the largest lending-borrowing DeFi platforms, executed a chainlink price feeds update that contained faulty code. While the error didn’t result in any lost funds, the Compound DAO will require additional governance proposals to rectify the situation, likely taking around seven days.
Sui Announces Full Node and Validator Selection. Sui, a new Layer 1 blockchain platform, has decided to register 500 Full Node Operators from a pool of 28,000 applicants. This is part of the first wave of Sui’s efforts to select validators and node operators to decentralize the network. The selected entities will help Sui maintain a full node through the testnet.
Coinbase Announces cbETH Wrapped Ethereum Staking Token. Coinbase, the largest staked ETH validator after Lido, has launched its own liquid staking derivatives for staked ETH. Called cbETH, they represent ETH stakers’ ownership of their staked ETH and the yield they will receive. The price of cbETH is not 1:1 to the price of ETH, but will be dependent upon secondary market liquidity.
Trader Joe Introduces Version 2. The Avalanche blockchain’s largest DEX has launched its v2. Joe v2 introduces concentrated liquidity to improve capital efficiency, similar to Uniswap’s v3 model. Liquidity providers on Trader Joe’s can now capture more fees with less liquidity. A liquidity book designed to minimize the slippage experienced by traders was also announced.
More news coming up this week, Stay Tuned!