📜Stablecoin Regulatory Ramping Up - TWJ #143
While Arthur Hayes published a Bitcoin-backed stablecoin idea.
In today’s issue:
The crypto market is down with the total market cap sitting at ~$1.2-1.3 trillion. Frax Share (FXS) is the worst performer in the top 100 in the past 7-d (excluding UST). The Fed will persist with 50 bps rate increases in the next two meetings.
In other news, Yellen said the stablecoin market is still too small to pose systemic risk, Celsius pulled ~$500M from Anchor amidst Terra chaos, and David Marcus launched a new startup on BTC-Lightning technology.
We’re continually improving our content, please reach out if you have ideas or would like us to recap another segment of the market.
- Curated by Marco Manoppo (@manoppomarco)
📰Market News
⎆Yellen: Stablecoin Market Is Still Too Small to Pose Systemic Risk
Treasury secretary Janet Yellen commented on stablecoin amidst the UST-LUNA chaos, stating that (despite what happened), the stablecoin market is not big enough to pose any systemic risk to the US financial system (yet…?)
Yellen’s statement here is true and hopefully will hinder reactionary regulatory pieces from lawmakers that have seen how the LUNA-UST chaos played out. Innovations around stablecoins are necessary and good, it just needs to be done in a much more sustainable way.
⎆Celsius Pulled ~$500M From Anchor Amidst Terra Chaos
One of the largest crypto lending firms, Celsius, had approximately $500M of funds in Terra’s Anchor Protocol. The firm appears to have successfully pulled out all of it amidst the chaos, sending over 220,000 ETH on May 11, before the Terra blockchain was halted.
Managing yield positions in DeFi is a full-time job. Remember that every time you park your capital in one of these CeFi/CeDeFi firms, you’re trusting a team of people (or/and algorithms), to decide the future of your funds. Yield is never free.
⎆David Marcus Launched a New Startup on Btc-Lightning Technology
The former head of Meta’s crypto arm has announced his new startup named Lightspark. Backed by giants such as a16z, Paradigm, Coatue, and others, Lightspark aims to expand the use cases of Bitcoin via the Lightning network. “Lightspark will not focus on building its own stablecoin or cryptocurrency”.
There have been many efforts to build decentralized applications on top of BTC to expand its use cases outside of being just digital gold. That said, there’s also the argument that BTC needs to be simple, and just be hard money, that’s it, without carrying the risks of being a smart contract platform, and or a stablecoin tied infrastructure layer (LUNA).
👨🏻💻Decentralized Finance (DeFi)
LUNA Chain is Halted and Go Forward Proposal
Venus Protocol Exploit because of LUNA’s Price Oracle
Drift Exchange Outage Incident & Smart Contract Bug
LIDO New Curve Pool for stETH:ETH
LIDO Increases Liquidity Incentives as stETH Trades at Discount to ETH
Tether Chain Swap
Chainalysis: Almost All $1.7B Crypto Stolen In 2022 Has Come From DeFi
PancakeSwap Governance Proposal Set to Cap CAKE Supply at 750M
Teller Finance Diversifying DeFi With Travel Insurance
Terraform Labs Launches 3 Emergency Actions to Save LUNA, UST Stablecoin
🏛Governance - Active Proposals
Compound - Risk Parameter Updates for 7 Collateral Assets
Compound - Grant request for launching Compound with Aztec Connect
Uniswap - Deploy Uniswap V3 on Moonbeam
🦮NFT & Metaverse
Chainsmokers Share New Album Royalties With Fans via NFT
Sorare to Launch Major League Baseball Ethereum NFT Fantasy Game
Azuki Update
Top Sales (Last 24-h); Source: https://dappradar.com/nft
📈Deal Flow & Capital Raise
Solidus Labs - $45M Series B
Soluna - $35M From Spring Lane
Lightspark - Undisclosed $ Unknown Round
Icy Tools - Undisclosed $ of Acquisition by QuickNode
Aurora - $90M Developer Fund
6th Man Ventures- $145M Crypto Fund
⚖️Regulatory Update
New York Man Charged With Fraud in $59M Crypto Pyramid Scheme
FTX Chief Plan to Cut Out Middlemen Fights Derivatives' Old Guard
Global Crypto Regulatory Body Is Coming Soon, Says Top Official
SEC’s Hester Peirce Says New Stablecoin Regs Need to Allow Room for Failure
US Senate Confirms Jerome Powell for Another Four Years as Fed Chair
Shanghai Court Affirms That BTC Is Virtual Property
📚Noteworthy Reads
Arthur Hayes’s Read on Luna Brothers, Inc.
Tom Schmidt’s Read on To All Dragonfly Founders and Friends
Spencernoon’s Thread on Stablecoin Designs and Risk
Feel free to reach out to manoppomarco@gmail.com — feedbacks and constructive criticisms are much appreciated.