Ranging and Contagion

With crypto contagion trending on Twitter, we take a look at some of the recent fallout. On the bright side, there have also been some positive, noteworthy NFT happenings this week!

Another gm to all our readers!

More weeks have gone by and the story from the last few weeks have been contagion. Contagion in the sense that a lot of the market got affected by the fallout from Three Arrows Capital (3AC). 3AC, Celsius, BlockFi, the fallout from UST and LUNA, SBF, and as of recent, Voyager have risen to the top of headlines the last few weeks. That said, each day that passes it seems like things get a little bit more stable; the heavy winds rocking the crypto-boat may have calmed just a bit but to say they have blown past might be a bit too early.

Trading activity and gas usage on ETH seem to have cooled down a lot since the last blog post, which could be considered a good thing. Gas fell back down to single digits—the network confirming lingering transactions that were sent well over a year ago! Who would have thought, we'd see that? After ETH's falling to three digits earlier last month, it seems to have recovered, trading around the $1000-1100 range as of late. BTC lost its well-known $20,000 support level, on a constant battle to try to reclaim it trading for the most part around the $19,500 level.

Chart from CoinDesk

Touching back to the opening of this post, Three Arrows Capital has been forced to enter the liquidation stage. Teneo is the firm appraising the remaining assets of the fund. 3AC seems to also have been caught having exceeded assets under management (AUM) thresholds set by the Monetary Authority of Singapore (MAS); the country in which it was registered as a fund. Entering the final stage, they have also filed for bankruptcy in the southern district of New York to try protect its US assets from creditors.

Zhu Su is also aiming to sell off a multi-million dollar mansion for $35 million USD; it seems like the estate was bought a little over a year ago. This is the part where we can see that people are down bad, remember what we wrote in the previous post; preserve that dry powder for the rainy days because you'll likely need it. Hopefully, you're not down as bad to have everything liquidated and having to file for bankruptcy.

Voyager Digital has been caught up in the heavy storm caused by the 3AC fallout. Contagion. Articles published in other news outlets have stated they had $661 million exposed to 3AC. As of the 1st of July, Voyager has suspended trading, deposits and withdrawals. Once again, another strike for users using these centralized providers. Remember the ol' sayin': Not your keys, not your crypto. Adios amigo. We're getting Mt. Gox'd again. Please do not keep large sums in centralized keepers, and if you choose to do so; it is recommended to keep them at tier-one players.

FTX has officially signed the option of buying-out BlockFi for the whopping sum of $240 million. This deal would also grant BlockFi a $400 million dollar credit line to help clear up some of the issues they're facing. Quite a turn of events, one we'll be talking about for some time I reckon. From a firm that raised $350 million in March last year (2021) valued at $3 billion at the time, to now getting sold to one of the leading exchanges for $240 million. I do not think anyone could have predicted we'd see such rapid shifts in the crypto landscape.

FTX Reaches Deal To Acquire BlockFi for up to $240M - Blockworks
The agreement also involves a $400 million revolving line of credit for BlockFi, bringing the acquisition’s total price tag to $620 million.

Europe has finalized MiCA, a new piece of regulation that will certainly impact the future of Europe's crypto competitiveness and how Web3 firms in Europe will operate. It seems to be that Europe is choosing to lead in regulation instead of taking this as an opportunity to allow innovation to blossom. Let your voices be heard (in a respectable manner) and communicate why web3 is and should be treated as the next innovation frontier! We still seem to be in a period of time where a lot of people do not have a good understanding of what the tech allows us to do, so attempt to guide people to see the positives and help them on their path if they have any questions.

Now the above may all seem a little grim, so let me sprinkle in some positive news and vibes. True DeFi protocols are writing wins in their books. With all this contagion going on OG DeFi users are looking and paying attention, and the consensus is that DeFi (actual DeFi) is working as intended. Liquidations are happening as intended, there's no excessive bad debt to be seen. Protocols remain operational and operate within their smart contracts. It's almost as if immutable code has its benefits. No human interaction, no human error, no overruling. Just code running and executing, governing the laws as the code intended to. There's only equality here, anon. As a DeFi user, I'll take this as a big win in the books. The system was put on a heavy stress test, and it seemed like everything worked as intended, at least if the contracts are exploit-proof. It's still healthy to keep in mind that DeFi is only 2 years old, infancy stage! It's shown it can do incredible things, and can be a powerful tool for the future of France (finance) yet we must remain grounded and remind ourselves that it is still quite young all things considered. The distant future still seems bright young padawan.

Check out this article from CoinDesk to see how DeFi keeps money honest:

No, DeFi Is Not a Repeat of the 2008 Crisis
Decentralized finance does not equal shadow banking and “too big to fail.”

NFT Rundown

Let's dive into the world of our beloved NFTs. While our non-fungible friends are mostly quiet, it seems there have been some movements here and there. Come with me, while we re-cap the happenings of the past few weeks.

In case you missed it (ICYMI):

Uniswap Labs has acquired the NFT aggregating platform Genie. Genie was the first NFT aggregator to market and competes with the well-known site Gem.xyz.

LooksRare added conditional listing support. Allowing users to list two NFTs of the same collection while giving them the opportunity to only sell one of the two NFTs. If a sale of one of the two occurs, the other listing will be canceled. Talk about a handy little feature for those who want to get some liquidity, but also want to hold that one NFT to stay in the community.

Gucci has invested $25 thousand into the NFT Marketplace SuperRare, seems like they are putting their foot deeper into the water of NFTs.

eBay acquired the NFT Marketplace KnownOrigin, web2 firms expanding their reach and entering web3. It'll be interesting to see what they end up doing with it.

RTFKT releases the 3D files of the well-known and current blue-chip collection Clone X along with commercial rights. Clone X holders are now able to download these files and use them in a way they see fit.

ENS Domains, feels like we're back to where we were just a couple months ago. Those crazy ENS sales, they're back. 000.eth sold for a whopping sum of 300 ETH. I should have registered a bit more domains when I had the chance. 😅

Moonbirds heat up. Quite a bit of activity happening in the Moonbird community. It was recently discovered that there was a trademark filed for Moonbird Ravens which covers a variety of uses related to digital tokens and the services they are to provide. In the document there was a mention of a marketplace, speculation leads us to believe that the Moonbirds are moving their nest to their own platform. The Moonbird airdrop, Oddities also saw some volume pick up, with their reveal itching closer (20th July).

Doodles 2 and the Genesis box mint, a week ago the doodles team held the open batch auction for the genesis box. Each box landing on a final price of just about 0.5 ETH, with the top 25 buyers purchasing 20% of the supply. The collection is a 24,000 unit collection and is said to hold new rare items for when doodles move onto their next stage. The current floor as of 7/7 is sitting around .35

Meka Rhinos topped the charts for a bit once more, showing that pixel art is still heavily loved within the NFT community. The price has come back down quite significantly, but the collection did have a run-up to 0.4E.

chart by icy.tools

WZRDS and heavy demand. It's weird sometimes. The network is mostly moving along at 30 gwei these days, and suddenly a heavily anticipated mint comes along and we hit those moments of 1,000+ gwei. Going to show that people are still waiting and tuned into what is happening. When the gwei spikes, you know there's demand or at least a lot of interest. It'll be interesting to see what comes out of this, as the team seems to be going for another community-driven storyline.

chart by icy.tools

Closing off with the volume and trading activity. It seems for the most part we're expected to continue with the current volume & activity. It seems like the curve has flattened off in NFTs traded. That said, in terms of USD volume we seem to still be on the down-trend. Would not expect this to reverse any time soon, and my best bet would be that it only settles if ETH continues crabbing; any shift in volatility in ETH will likely impact the NFT market.

That rounds up this edition of our blog, hope that caught you up to speed and that you enjoyed reading it. If you feel like we missed anything or think we should cover other topics, feel free to reach out to us on any socials. @icy_tools on Twitter, or belgio#7777 on Discord.