Welcome to The Wise Guy,
Where we take cryptocurrency seriously, but we also know how to have a good time.
That’s why we’ve curated the crème de la crème from not one, not two, but FIVE newsletters.
MilkRoad, Defiant, Messari, Bankless, and CoinDesk Node.
Defiant’s Top Story
Recent on-chain analysis has revealed that the China-based mining pool F2Pool has been omitting transactions from wallets under U.S. Treasury sanctions since September. Meanwhile, bullish sentiment in the Bitcoin market proceeds unabated, propelled by renewed enthusiasm for an ETF.
In DeFi circles, PancakeSwap has announced a transition to “VE” tokenomics, empowering stakers with a say in the allocation of new token emissions. Also noteworthy is the Avalanche network’s activity spike of 2,000% following the introduction of ASC-20 tokens, reminiscent of Ordinals.
We also discuss whether Binance is financially equipped to handle its hefty $4.3B settlement with the U.S. Department of Justice, delve into the transformation of web3 user experiences by trading bots, and examine the burgeoning niche of modular blockchains.
📊 Market updates over the past 24 hours:
BTC is up by 4.17% at $37,465
ETH has risen 6.47%, reaching $2,066
The S&P 500 has seen a 0.41% increase, at $4,557
GOLD has slightly declined by 0.4% to $1,991
Arch WEB3 index is up by 0.13% at 1.12pts, with mixed subsector performance
🧑🚀 MARKET INSIGHTS
The Non-U.S. Miner F2Pool in the Spotlight for Shunning Sanctioned Transactions Summary: F2Pool named for filtering transactions from U.S. blacklisted wallets since early September, sparking debate on Bitcoin’s resistance to censorship. F2Pool co-founder, Chun Wung, has remarked that the pool is awaiting a community consensus on handling sanctioned deals.
Bitcoin Nears Top Annual Prices as ETF Buzz Intensifies Summary: Recent Bitcoin gains tied to speculative spot Bitcoin ETF innovations, with prices hitting new annual highs. Market optimism was fired up by SEC’s meetings with BlackRock and Grayscale, hinting at possible ETF approvals.
DEVELOPMENTS IN GOVERNANCE
PancakeSwap Votes In Favor of Scalable Tokenomics System Summary: PancakeSwap adopts Vote Escrow (VE) tokenomics, giving stakers greater influence on reward distribution pathways for liquidity providers. This new economic structure has contributed to a substantial price uplift for PancakeSwap’s native token, CAKE.
THE DEFI SECTOR’S LATEST
Avalanche’s Operational Volume Explodes with Debut of ASC-20 Tokens Summary: Avalanche’s network saw a drastic activity hike due to ASC-20, a new token standard inspired by Ordinals. Almost 6.4 million dealings were documented on a single day, showcasing the blooming interest in such token innovations.
BUSINESS BEAT
Binance Under Microscope: Sufficient Funds for $4.3B Payout? Summary: An in-depth look at Binance’s finances to evaluate their capacity to settle a $4.3B sum with the U.S. Department of Justice. Binance holds an ample on-chain reserve and is likely backed by additional off-chain assets, suggesting they can comfortably meet their obligation.
Messari’s Desk
- Key Takeaways
Enter the New Level-2: Blur’s creators are shifting gears, engineering a fresh L2, Blast, which vows to slash transaction costs while nurturing the growth of NFT perpetuals. - Capital Infusion from Paradigm: Boosted by a $20 million investment from heavyweight VC firms, including Paradigm, Blast is gathering financial steam, backed by Twitter and NFT influencers.
- Hefty Support in Initial Deposits: The new platform is off to a flying start, amassing around $200 million in Total Value Locked (TVL), with added perks like yield on stablecoins and a points system for user rewards.
The Launch Pad
Blur’s architects have made waves with their latest venture, the Blast L2, designed as a transaction fee oasis and breeding ground for NFT derivative products. To power this launch, they’ve scooped up a hefty $20 million from big-time investors.
Pacman, the brain behind Blur and Blast, envisions a new era of “institutional-grade” NFT products that are cost-effective. With Blur’s idle assets awaiting action, Blast plans to put this capital to work.
The Game Plan
Blast’s blueprint unfurls with reduced transaction costs embedded in its L2 DNA, coupled with a solid foundation for NFT perpetual platforms and lucrative yields for assets like ETH and stablecoins.
The Nitty-Gritty Details
With wallets flowing into the Blast ecosystem, its bridge contract is swelling, currently boasting a TVL that ranks it seventh among L2s according to Dune Dashboard reports.
While Blast keeps some cards close to its chest, here’s what’s unveiled:
The bridge operates as a one-way path till the mainnet premiere in February 2024, holding off withdrawals.
Not just another L2, Blast stands apart with:
- Yield-bearing stablecoins via Maker’s sDAI at 5%.
- ETH transforming into yield-generating stETH through Lido.
- App developers integrating native yields within their creations.
CSR-like features rewarding developers with a cut from gas fees.
Blast’s point system is primed for a potential token airdrop, accelerating growth via user referrals, and incentivizes ETH transfers to the platform.
Not to forget, BLUR token devotees can stake their assets for points, deepening their integration with the ecosystem.
More Than Meets the Eye
How does Blur blend with Blast? Blur’s booming NFT marketplace demands tools for risk hedging. Enter perpetuals, promising a space for market makers to balance positions, tightening spreads, and curbing price risks.
Currently, BLUR rewards keep price risks at bay, but this isn’t a limitless subsidy. This synergy should, in theory, boost liquidity on Blur.
The Subtleties
Dig beneath the surface, and it’s clear that Maker and Lido are reaping rewards, with a hefty share of stETH lined up in Blast’s contract. As the L2 blossoms, a cascade of stablecoins will likely follow to bolster liquidity.
On the NFT front, Blur’s dominance in trade volumes has been unwavering, snagging more than half of daily activity. Yet, the market has cooled from the frenetic billion-dollar days of 2021, now tallying between $5 – $20 million in recent months.
The pivotal belief that PFP NFTs act like semi-fungible equities has fueled the growth of financialization protocols. But this assumption is not set in stone, and NFTs are still in their design infancy.
The success story for Blast’s NFT perpetual offering will heavily lean on how NFTs evolve. Innovations like Future Primitive’s Token Bound Accounts (TBAs) can redefine NFT utility, steering clear of the semi-fungible narrative.
Regardless of the NFT market trajectory, Blast’s appealing incentivization strategies will likely keep the TVL soaring. Yet, without a spark to reignite NFT markets, an NFT perpetual product’s success may reach its zenith sooner than we think.
Bankless’ Desk
Binance Faces the Judiciary Music
This Tuesday, the formidable machinery of U.S. regulatory bodies convened in Seattle, delivering a historic judgment against Binance—the crypto behemoth. The charges? Flouting U.S. anti-money laundering statutes and the Bank Secrecy Act.
In a sweeping settlement with multiple federal bodies, Binance caps the criminal probe ignited in 2018 by agreeing to a massive $4.3B fine and instituting a three-year hiatus for their CEO, Changpeng Zhao, known as CZ.
Despite this seismic shift, Binance’s vast reserves seem poised to shoulder the financial burden sans liquidating any crypto assets.
Binance’s Legal Labyrinth
Did Binance stir the legal pot? The ledger shows Binance and its head honcho, CZ, did indeed sidestep American law. This isn’t a flimsy case of regulators targeting entities for vague compliance failures; Binance was pinpointed for what’s seen as explicit snubs to clear-cut regulations.
Evidence points to aiding U.S. customers to illicitly engage with its global platform and a history of transactions with nefarious undertones. And with officials purportedly admitting to misdemeanors in leaked discussions, Binance virtually handed regulators their case tied with a bow.
Forecasting Binance’s Horizon
Binance’s future trajectory seems dotted with formidable challenges. With a legacy as the crypto vanguard, the aftermath of the settlement presents multifaceted hurdles.
Operating licenses have already proven elusive across a spectrum of international locales, and the recent judgment might embolden other nations to impose their own punitive measures or bar Binance operations altogether.
Compounding this, the settlement ushers in stringent monitoring conditions, erecting a complex compliance maze for Binance’s once swift-footed operational style.
Crypto Seas Remain Calm
Surprisingly, the crypto markets have absorbed the shockwave with notable equanimity—there’s been no frenzied dash for the exits. Perhaps the greatest relief comes from the indication that the Department of Justice’s probe into Binance hasn’t unearthed any crippling liabilities that might spark a crypto meltdown—a beacon of hope as we approach Thanksgiving.
Barring any new investigative offspring from the Binance affair, one might argue that the crypto terrain now stands cleared of a significant hazard. Yet, despite today’s regulatory scuffle providing little illumination on the U.S. Government’s arcane crypto playbook, it brings into sharp relief the disjointed compliance antics some have played, marring the industry’s collective image.
The broader confrontation between crypto and regulators is poised to be an arduous uphill battle, marred by aggressive policy stances and regulatory encroachment. Nonetheless, the crypto sphere stands undeterred, with today’s events likely fully factored into market sentiments, allowing for a more unobstructed charge towards the next bull run.
MilkRoad SBF
1. Binance’s Billion Dollar Blues
What a day it’s been since…
Changpeng Zhao, aka CZ, stepped aside from leading Binance.
The U.S. government imposed a whopping $4B fine on the exchange.
The result? Binance faced $1.2B in net outflows, with users transferring their funds elsewhere. Meanwhile, rival exchanges like OKX and Kraken are seeing an uptick, absorbing these funds.
As always in the exchange ecosystem, one’s loss is another’s gain.
(Tweet by: @Hercules_Defi)
2. SEC’s Spot Bitcoin ETF Conversations
Enter James Seyffart:
A Bloomberg Intelligence analyst.
A guru on Exchange Traded Funds (ETFs).
The go-to for breaking news on spot Bitcoin ETFs – think of him as the Woj or Schefter for the crypto markets.
The headline du jour? Seyffart reports that the SEC is in talks with heavyweight firms about a potential spot Bitcoin ETF. The who’s who includes Grayscale, BlackRock, NASDAQ, among others.
We’re not wondering “if” anymore, but “when.”
(Tweet by: @JSeyff)
3. Mt. Gox’s Long-Awaited Reimbursements
The saga of Mt. Gox:
Once the titan of Bitcoin exchanges.
Robbed of 850,000 BTC (worth ~$32B today) back in 2014.
They declared bankruptcy shortly after the theft.
Fast forward nine years, about 140,000 BTC has been recovered. Now, it appears creditors are on the brink of receiving their long-awaited dues, with emails suggesting repayments may begin soon.
This resurfacing of “lost” Bitcoin has market watchers dividing into two camps:
The Red Pill: Sell now for a hefty profit, considering the stark jump in BTC value from $600 at the time of the hack to ~$37k today.
The Blue Pill: Keep holding. After nine grueling years, what’s a little longer?
Investors at this crossroads have a pivotal choice ahead.
4. DefiLlama Debuts Its Custom GPT
Remember the On-Chain Toolkit from last week’s Milk Road chit-chat?
DefiLlama featured as our analytical arsenal for metrics like TVL, liquid staking, and token unlocks.
Now for the latest upgrade: Kofi, a Milk Road insider and avid reader, engineered a unique GPT for DefiLlama.
That’s just a snippet of the bevy of information and innovation coursing through the crypto Twitterverse! Stay tuned for the next batch of quickfire updates.
CoinDesk’s Best Story
Bitcoin Hits a New Milestone:
On a rather tranquil day post-Thanksgiving, Bitcoin soared, briefly touching a peak of $38,000 not seen since May last year. It’s taken a slight step back but still stands strong with a 1.5% gain. Market chatter hints at another upswing, with trader Michael Van Pope hinting on Twitter that $40,000 might be Bitcoin’s next pit stop. Ether is riding the upward trend too, up almost 2% and currently priced near $2,100.
Grayscale Betting Big on ETF Conversion:
Over at Grayscale Bitcoin Trust (GBTC), wheels are turning with buys in the secondary market at rates substantially below their net asset value. Why? An ETF conversion on the horizon, seen as imminent by the SEC, has the market buzzing. JPMorgan’s Thursday report throws in a figure—around $2.5 billion invested in GBTC just this year, shooting up to $2.7 billion if we’re counting short covering.
Do Kwon’s Legal Saga Continues:
From the courtrooms of Podgorica, Montenegro, news broke of Terra founder Do Kwon’s approved extradition to South Korea or the U.S. Kwon, nabbed at an airport earlier this year with counterfeit documents, now sits on the cusp of a four-month jail term before the justice minister’s final call on the extradition. With U.S. fraud charges piled on top of South Korean investigations related to the terraUSD downfall, the legal web tightens.
Trading Spotlight: FLIP Token’s Stunning Debut
FLIP, the brainchild token of ChainFlip, didn’t just step onto the trading stage—it leapt, more than doubling its value on day one. The excitement is palpable with trading volumes soaring to $79 million. ChainFlip is staking its claim in the crypto-swap arena, promising a slicker, slippage-savvy approach with its “Just In Time” automated market maker.
USD Still Reigns in SWIFT Transactions:
The U.S. dollar continues its reign as the dominant currency in SWIFT transactions, despite murmurs of a dollar decline. The Euro, however, isn’t keeping pace, with its slice of the pie shrinking to a 13-year low, reports from Deutsche Bank suggest. Furthermore, the Chinese yuan holds its ground, but the dollar’s dominance in the financial transaction space doesn’t seem to be waning just yet.
Twice weekly crypto goodness, coming your way! Catch us every Monday, Tuesday and Friday. And hey, don’t forget to check us out on Wednesdays for all the latest AI news – because why limit yourself to just one kind of intelligence?
