The Weekly Waffle Sep 11

Markets had a good week. Equities and digital assets rallied despite the EU’s 75 bps hike (the ECB promised continued high liquidity, which will send the Euro even lower) and Powell’s reassertion to hike until necessary (i.e. until there is mass unemployment). US markets snapped their long losing streak on Friday with a 400-point DOW rally, and?Bitcoin?was up +10% and flirted with the 22k mark by Sunday.?

Pundits on social media and television took to their irate pens about the “White House?ban on Bitcoin”. It is no such thing. It is a statement the WH had to make following Biden’s ESG executive order from May. All it said was “Congress might consider legislation…” If they United States wants to reduce emissions, ban lights on Times Square, outlaw paper production??(300x emissions), stop driving ridiculously oversized cars (1500x) or ban private jets for the rich (6000x). Bitcoin’s PoW concept is inherently a feature and not a bug because it preserves the “G” – governance – in ESG.?

Notably, this week, a former top?US banking regulator?said what the EU and UK have been saying very clearly since June: digital assets (correct term, unlike “cryptocurrencies,” which Gensler defiantly continues to use) belong in the banking system and are a welcome development, not a threat. Gene Ludwig spoke at the Bank Policy Institute: “Instead of experimenting with CBDCs”, regulators should “allow banks to play more aggressively in the crypto market.”?

We observed some more selling of ETH, underlining our perception that many large holders may use The Merge as an excuse to dump more?Ethereum?before the roadmap becomes clearer. The pruning of the code is by far the more important event, and it won’t happen anytime soon. Sharding is next, probably by early November. Users should be wary of?scams?around the time of The Merge, especially those asking you to move your ETH for security reasons or promising airdrops. Don’t fall for it. If you hold ETH, simply do nothing.?

We are extremely worried about governments embracing?stablecoins. This is a power grab. But the stablecoin wars are also continuing since the digital asset universe: Binance, the biggest player in crypto, announced it would henceforth only allow BUSD, its own stablecoin, rather than USDC (of which Coinbase wants to buy over a billion). This is a ploy to strengthen its brand and influence, nothing else.?

Binance also announce its first “soul-bound” token. Take away the esoteric language coined by Vitalik and his philosopher mates; it is nothing more than an?identity token bound to a wallet. It is badly designed and an inefficient way to decentralize and guarantee self-sovereignty. It will doubtless gain adoption and start another speculative craze.

In-depth research on all these and more topics are available on request. We are covering specifically:

• Aptos and Sui — the new game in town. Why modular chains are the future
• Digital assets - utility and use cases in real estate & IoT - turning houses into energy-neutral money printers; building tokenization and smart cities on-chain
• Avalanche chain use cases in DeFi, banking and film finance post-scandal
• Digital assets and a drone delivery / aviation (DISC, HBAR)
• Digital assets and biometric identity solutions: what are the obstacles
• Gambling and sports betting gain traction in the States - and crypto
• Ethereum’s post-Merge prospects: what is on the map?
• Project profile: AZERO - a hypergraph for privacy, growing in importance
• CBDCs - why public digital money must be private
• Quant’s new chain-agnostic NFT standard: a revolution
• Changes in Law: what does the UK’s classification of NFTs as property mean
• Trade law and finance: real economy use cases of XDC in global trade
• Film finance and tokenization?
• Helium Network: Why oh why Solana?