DigitalX Funds Weekly Wrap (17-24 March 2023)
DigitalX Limited (ASX:DCC)
Transparent investment management at the intersection of technology and finance #Web3 #DigitalAssets
Weekly Price Action?
*All figures below are in USD unless otherwise specified.
Week in review
The Shift List
Market Updates
Macro/Regulatory Updates
Investments & Funding
In the spotlight?
Google says it wants to disrupt itself to serve the needs of the crypto community. Rather than trying to sell what it already offers to the industry, the search giant instead says it is trying to innovate.
"Can we add some new products to that suite that actually addresses the specific needs that the crypto community has [and] that maybe other companies will have in the future?" James Tromans, head of Google Cloud Platform for web3, said on The Scoop podcast with Frank Chaparro this week at Paris Blockchain Week, referring to the company's thinking on the matter. "But right now it's sort of the bleeding edge of where people are building."
"There's a lot of progress that we can still make, but there's a lot of opportunity," Tromans said.
Altcoins
Solana (SOL) - The Render Network Foundation on Monday proposed building its new burn-and-mint equilibrium (BME) model on the Solana blockchain, according to a post on the network’s blog. The BME model, which the community approved last month, requires users to burn a predetermined amount of RNDR, the network’s native token in exchange for non-fungible work credits distributed through node operators.?
Aave (AAVE) - The community of Aave, the leading DeFi lending protocol with $8.5B in total value locked, is rallying behind a proposal to deploy the protocol’s v3 iteration on Metis Andromeda, an Ethereum Layer 2 network. An initial temperature check published on Saturday has received near-unanimous support. The poll will close on Thursday. The poll reaffirms Aave’s commitment to supporting Ethereum’s burgeoning Layer 2 ecosystem. V3, Aave’s latest iteration, is currently live on seven chains, including top L2s Arbitrum and Optimism, and the Polygon sidechain.
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Maker DAO (MKR) - Lending protocol and stablecoin issuer MakerDAO passed a proposal on March 16 to increase its portfolio holdings of United States Treasury bonds by 150%, from $500 million to $1.25 billion. The proposal aims to increase the protocol’s exposure to real-world assets and “high-quality bonds,” following its Dai stablecoin losing its $1 peg during market volatility on March 11. The $750 million debt ceiling hike was approved by 77% of Maker’s delegates.
Uniswap (UNI) - Uniswap is set to launch its V3 iteration on Avalanche, an Ethereum-compatible Layer-1 blockchain with over $1.5B in total value locked. LayerZero has been chosen as the bridge for the Avalanche deployment as it supports both the Ethereum and Avalanche networks. LayerZero investors include Uniswap Labs, a16z, and Coinbase.
?itcoin (BTC)
Bitcoin miners are finally getting some good news thanks to the rally in cryptocurrencies this year. The first three months of this year are "shaping up to be a better quarter" than the previous one, investment firm Stifel said in an analyst note on Monday. Hashprice, which measures how much miners earn based on a number of factors, is up 36% compared to March 12, at $0.08 per terahash. Bitcoin price appreciation is happening at the same time miners are finally seeing a slump in power prices — essentially reversing trends that squeezed their margins last year and drove some to bankruptcy.
The number of Bitcoin transactions waiting to be confirmed by the network reached its highest point since Terra imploded last year — a sign of renewed interest in the premiere blockchain. On the afternoon of Mar. 9, nearly 81,000 transactions briefly sat in Bitcoin’s “mempool” — a data structure that stores valid transactions yet to be added to the blockchain. Mempool spikes like these can occur when there is a surge in network usage, although a sudden drop in mining power can have the same effect.
Notional open interest on the largest centralized crypto derivatives exchange hit a record high Wednesday, with demand for Bitcoin options leading the way amid a turbulent time for the traditional finance industry. Deribit’s notional open interest on the platform exceeded $20 billion Wednesday, according to the company. Most of that was attributed to $11.7 billion from bitcoin options — also an all-time high — and $6.9 billion from ether options. The record comes after the fall of Silvergate Bank, Silicon Valley Bank and Signature Bank in recent weeks, which some said has shaken trust in financial institutions.?
Ethereum (ETH)
Ethereum core developers are targeting April 12 at 10:27 a.m. UTC, to release the highly-anticipated Shanghai-Capella upgrade, or Shapella, on the mainnet. The main feature of the upgrade is Ethereum Improvement Proposal (EIP) 4895, which aims to enable validator staking withdrawals on the main network. This critical function was not introduced during Ethereum's switch to a proof-of-stake consensus in September to ensure a safe transition.?
Fintech and single family-focused sales company Roofstock has sold off a Georgia home to RealT via a tokenized Ethereum-based NFT, representatives for both companies told Blockworks on Tuesday. The first round of the transaction was facilitated by OpenSea, with RealT imposing “heavy restrictions” around the float of the initial fractionalization offering, according to Remy Jacobson, the co-founder at RealT and one of two chief executives at the businesses. A second round will follow later.
CEO Comment
Another volatile week with bailouts, interventions, takeovers and rate hikes all in the mix. Markets took global financial uncertainty in stride this week with further rate hikes causing rallies, as markets are calling the end of this rate rise cycle. Most importantly for us, the Gap continued to close to 40% this week, tightening another 5% as the narrative around Bitcoin being designed for this purpose gained momentum - click here for the AFR article where we were featured.?
It is worth noting the SEC are still relentlessly pursuing crypto companies, this week it looks like they will go after Coinbase which will be interesting as Coinbase are stating they have documented evidence of engagement with the SEC.
We have some big moves in the shift list this week from mainstream finance/commerce to the Web3 infrastructure rails:
Lisa Wade (she/her), CEO
About DigitalX
DigitalX Ltd (ASX:DCC) is a leading ASX-Listed Bitcoin and digital asset funds management business. The Company has a 9 year track record mining Bitcoin, blockchain and smart contract development. DigitalX Asset Management is the investment manager of digital asset investment products that provide qualified investors with highly secure and streamlined access to digital asset exposure. To learn more contact the team at?[email protected]?or visit our website?https://digitalx.fund/.