Weekly Newsletter – 2 Sep 2022

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Weekly Summary

  • Crypto markets tumble over the week as Fed dashes hope of a pivot
  • Singapore state-owned Temasek leads $100 million funding round for Animoca Brand
  • Long-defunct exchange Mt.Gox delays repayments until mid-September after court approval
  • Curve founder teases launch of crvUSD stablecoin as early as one month
  • Arbitrum implements its largest scaling upgrade by migrating Arbitrum One to Nitro

Industry Stories

Macro turns bearish as there are no indications of a Fed Pivot: Jerome Powell, Chair of the U.S. Federal Reserve, asserted that central banks would continue clamping down on inflation and a pivot is not expected anytime soon. It maintains the stance that restrictive policy will be here for some time, adding that failing to restore price stability would mean “greater pain” for U.S. households. The S&P index fell 5.5% after the speech and Bitcoin prices tumbled below the psychological $20,000 support with prices dropping more than -10% from the $21,800 to lows of $19,500 on 28 Aug 2022.

Investors see a future for metaverse gaming amidst the bearish sentiment: Animoca Brands received a fresh funding of $100 million from Temasek which will be financed through convertible bonds. The raise comes shortly after Animoca Brands Japan received $45 million from Japan’s largest bank, MUFG and a $360 million raise led by Sequoia and the Winklevoss twins early this year. Gaming continues to be a popular sector for investors worldwide despite the macro weakness, and Animoca Brands have plans to go public in the next 2-3 years.

Mt.Gox trustee releases repayment procedures updates: The rehabilitation plan for creditors has been accepted by the court and will officially start on September 15, after Mt.Gox’s collapse in 2014 due to the infamous hack followed by alleged insolvency. However, this does not imply that payouts will be immediate. Django Bits, an alleged operator for Mt. Gox’s creditors highlighted that the repayment process could drag on for months if not years due to extensive KYC procedures. This comes after fears that Mt.Gox will dump around 137,000 BTC to repay creditors; a rumour that was promptly dismissed by Mt.Gox creditors days later.

Curve announces release date of the protocol’s upcoming stablecoin launch: Curve founder Michael Egorov, commented on the Curve community Telegram channel that it is possible for Curve to introduce crvUSD, Curve’s over-collateralized stablecoin in the next month. In light of recent sanctions on Tornado Cash and the freezing of centralized stablecoins such as USDC, decentralized stablecoins are growing in popularity as other DeFi protocols such as Aave and Kujira are also moving along similar trajectories to launch their own stablecoins.

Arbitrum upgraded from Arbitrum One to Arbitrum Nitro: Arbitrum, one of the leading scaling solutions with the highest TVL across all L2 protocols, has deployed its upgrade from Arbitrum One to Nitro before the ETH merge. The Nitro upgrade will reduce transaction costs and increase network speeds through call data compression. The network is expected to resume its Odyssey incentive program after the upgrade, which was temporarily paused in June after gas fees spiked from high transaction volumes.

Matrixport Stories

Matrixport now supports BNB and DOT for Flexi-Staking, offering some of the most competitive rates in the industry with APYs up to 14% and 18% respectively. The platform’s Flexi-Staking product provides class-leading returns and with a variety of supported staking tokens including SOL, AVAX, MATIC, FIL, TON, and now BNB and DOT.

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Matrixport News

Matrixport will support the planned ETH Merge expected to take place at Mainnet Block Height 15,540,293 or at 08:30, 15th September 2022 (GMT+8). The platform will temporarily suspend ETH & ERC-20 token deposits and withdrawals for the system upgrade and distribute the forked coins after.

According to PwC, approximately one in three of traditional hedge funds surveyed are currently investing in digital assets, compared to one in five a year ago. Matrixport US CEO Anthony DeMartino discussed with Forkast.News Marketmovers about the reasons behinds this growth:
(1) Crypto market inefficiencies are very attractive for hedge funds.
(2) Hedge funds able to take more risks than traditional fund managers,
(3) Crypto specific hedge funds will continue seeing adoption despite the risk-off environment.

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