May 20, 2022 - 4 min

Macro Overview

  • The Chinese Central Bank’s 15-basis point rate cut on 5-year loans buoyed futures, with the Nasdaq and S&P500 up almost 2% in overnight trading. However, the initial optimism seems to be fading, as global recession fears (sparked by the need for rate cuts) led stocks to give up gains this morning.
  • Yesterday, while broad equity markets dipped, Bitcoin exhibited relative strength by maintaining a critical level of $30,000. However, at the time of writing, Bitcoin is trading close to $29,000, which could mean a retest of lows around $25,000, if not more.
  • The U.S. government recorded a $2.8 tril­lion GDP deficit, the sec­ond largest since 1945, for the fiscal year ended September 30, 2021, as a result of pandemic-related expenditures.

Daily News 🚨🗞🚨

  • Despite current bear market predictions, BTC and ETH miners are pumping computing power into block production. On May 13, Ethereum’s hashrate peaked at ~1,126 terahashes per second, while Bitcoin’s hash rate peaked two days later at over 254 million terahashes per second.
  • Tether, the 3rd largest crypto by market cap, reported today that it had reduced its commercial paper to $19.9 billion from $24.2 billion the previous quarter, a 17% decrease. It also added U.S. Treasury bills, increasing them to $39.2 billion from $34.5 billion. The company said that it planned to cut its commercial paper by another 20%, which would be reflected in its second-quarter report.
  • Meta, formerly Facebook, has submitted five trademark applications in the United States for what appears to be a new digital platform dubbed Meta Pay. The trademark applications, filed on May 13, described Meta Pay as an “online social networking service for investors allowing financial trades and exchange of digital currency, virtual currency, cryptocurrency, digital and blockchain assets, digital tokens, [and] crypto tokens.” Apart from payment and trading, Meta Pay could also include digital asset lending and investment services, per other details in the trademark filing.
  • Limewire announced a partnership with the Universal Music Group earlier this week. Using LimeWire, artists signed to UMG will be able to offer audio recordings, audiovisual content, backstage footage, and any artwork and images as NFTs on the LimeWire marketplace and sell them directly to fans and collectors.
  • The Frax community passed a governance proposal with 99.98% support in favor of creating a $100M Goldfinch AMO to provide liquidity to the Goldfinch Senior Pool. The move will help Frax weather the bear market by earning the protocol yields uncorrelated to the rest of crypto. Goldfinch’s Senior Pool represents a diversified senior position on all outstanding loans on Goldfinch and is protected by a significant buffer of Backer capital.

Web 3.0: DeFi and GameFi ♦️🎮♦️

  • The NFT markets, especially “blue chip” collections (BAYC, Doodles, Clones, Azuki), have generally held up well over the last few months and are trading above January floor prices. However, transaction volume has started to dry up on Ethereum, which hosts the largest marketplaces such as OpenSea. Current volumes are $20 million/day compared to $128 million/day averages in January. This volume reduction is reflected in fractional marketplaces (which allow you to purchase a portion of NFTs), which are now returning 20% from initial offerings compared to 37% from a week ago, the first significant move since March. However, some of the transaction flow may be moving over to Magic Eden, a Solana-based OpenSea alternative with cheaper transaction costs. While OpenSea continues to lead in sales volume ($ amount), data from DappRadar shows that in the past 24 hours the Solana marketplace had 350,000 transactions across 47,000 unique addresses while Opensea only had 90,000 transactions in the same timeframe.
  • Sandbox, one of the largest metaverse games, announced a partnership with Studio Dragon, a premium storyteller group in South Korea, to introduce their drama content in the metaverse. Studio Dragon’s past titles include ‘Sweet Home’, ‘Crash Landing on You’, ‘The Uncanny Counter’, ‘Yumi’s Cells’, ‘Hometown Cha-Cha-Cha’, ‘Misaeng — Incomplete Life’, ‘Mine’, ‘Vincenzo’, ‘Hotel del Luna’, ‘Stranger’, ‘Another Miss Oh’.
  • The Uniswap Community is currently voting on whether the protocol should deploy on two new chains: Moonbeam and Gnosis Chain. If both chains are approved, Uniswap will officially be active on seven different chains – the majority of which are currently Ethereum-based.

Regulatory Updates 👮‍♀️👮‍♀️👮‍♀️

  • House Republicans sent a letter to Fed Chair Jerome Powell, advocating for a private-sector approach to a central bank digital currency (CBDC). The letter requested that the Fed conduct a “detailed analysis” on how a CBDC might impact the stablecoin market and impact the Fed’s decision-making.
  • On Thursday, finance ministers and central bankers from G7 nations urged the swift and comprehensive regulation of cryptocurrencies following turmoil that has seen the demise

Deals and Investments 💸💰💸

  • Questbook, an on-chain Web3 grants platform aimed at developers, raised $8.3 million led by Lemniscap. The startup has partnered with blockchain networks including Polygon, Solana, Harmony, NEAR and AAve to help developers secure grant money. It helped them provide more than $1.5 million in grant money to developers.
  • Saga, a protocol focused on carving out dedicated blockchain space for gaming and entertainment developers, raised $6.5 million in a seed round. Similar to Avalanche’s subnets, Saga seeks to provide chainlets that will provide sandboxed blockchains to meet developer needs.
  • Pine Protocol, an NFT-backed crypto loan platform, has raised US$1.5 million in a seed round. Pine is a lending and borrowing protocol built on multiple blockchains to facilitate asset-backed financing. It enables users to put their assets, represented on-chain via NFTs, as collateral to borrow cryptocurrencies from lenders in real time. Currently, the platform supports OpenSea and LooksRare.
  • Andreessen Horowitz is leading the Series A for Metatheory, a web3 games and interactive media company. Their primary project, DuskBreakers, a “Play-to-Mint” sci-fi-inspired game, will allow holders to shape the development of a shared story across various games and media experiences.

From the Twitterverse (and Linkedin) ⭐️🐦⭐️

Pete Huang on LinkedIn: #blockchain #crypto #nft | 25 comments
When the UST situation was going down (and as USDT was sort of under threat in the following days), the crypto world had its eyes glued to Curve. What... 25 comments on LinkedIn