August 11 2022       /       Unchained Daily       /       Laura Shin

Daily Bits✍️✍️✍️

• Ethereum is one step closer to the Merge as the Goerli Testnet successfully switched to Proof of Stake.
• Ripple may be purchasing the assets of bankrupt crypto lender Celsius.
• Binance has not ruled out support for the Ethereum Proof of Work fork.
• Sam Bankman-Fried revealed that he is not convinced about his investment in Voyager.
• A criminal investigation caused crypto exchange Hotbit to pause trading, deposits and withdrawals.
• Four Democratic senators want to restrict banks engaging with crypto.
• A joint proposal from the SEC and CFTC intends to make hedge funds report crypto exposure.
• Aave Companies requested $16.6 million in retroactive funding for its work on the development of Aave v3.

Today in Crypto Adoption…

• Paxos, a blockchain infrastructure platform, partnered with fintech app PicPay to launch its crypto trading feature.
• World Table Tennis (WTT) is pursuing Web3 initiatives and partners with NFT startup.

The $$$ Corner…

• Jump Crypto led a $40 million funding round for DEX protocol Injective.
• The BitDAO community voted in favor of providing $20 million to AfricaDAO to boost web3 adoption in Africa.
• Unstoppable Finance, a DeFi wallet startup, closed a $12.8 million series A funding round.
• SaaS startup Heirloom raised $8 million to create tools for Web3 developments.

What Do You Meme?

What’s Poppin’?

Crypto Prices Soar as Inflation Comes In Lower Than Expected

by Juan Aranovich

As per a new press release by the US Bureau of Labor Statistics, the consumer price index (CPI) rose 8.5% in July from a year ago, whereas core CPI, which excludes food and energy, remained at 5.9%

Inflation turned out to be lower than expected, as analysts’ estimates were put at 8.7%. The markets took this number as great news and crypto prices jumped significantly. The total crypto market cap increased by $40 billion yesterday. The two biggest cryptos, BTC and ETH, were up 6% to $24,300 and 12% to almost $1,900 respectively.

ETH outperformed BTC by more than a 3x factor yesterday. With the Merge coming, it looks like ETH investors are more confident than ever. “Ethereum is my highest conviction trade at the moment. I think the enthusiasm that the Merge is happening will continue to draw money into Ethereum,” said Mike Novogratz, CEO of Galaxy Digital, on CNBC. “The stage is set for a move to ~2k region by end of week,” wrote Hal Press, founder of North Rock Digital.

U.S. inflation slowed during July mainly due to energy costs dropping. This was seen as good news by the markets because this report will be weighed by the Federal Reserve, along with other macroeconomic data, to decide how much it will raise the interest rates in the September meeting.

With inflation coming in lower than expected, the Fed may imply that the markets don’t need such a high hike in interest rates. Consequently, money would be cheaper, and all risk-on assets benefit in such a scenario.

If you want to better understand how inflation affects crypto, listen to this highly educational episode with Lyn Alden and Mauricio Di Bartolomeo.

Coinbase was one of the major winners of the day. Its stock, which was down heavily two days ago after reporting a $1.1 billion loss in the second quarter of the year, was up 7.37% yesterday.

Recommended Reads

1. Jerry Brito and Peter Van Valkenburgh on the Tornado Cash sanctions
2. Olimpio on Eth PoW
3. Onchain Wizard on real yields

On The Pod…

Welcome to The Chopping Block! Crypto insiders Haseeb Qureshi, Tom Schmidt, and Robert Leshner chop it up about the latest news in the digital asset industry. In this episode, Hasu, the gourmand of governance and Rune Christensen, chief mischief maker at MKR, discuss how to manage a DAO, their respective visions for MakerDAO, and much more. Show topics:

• What MakerDAO is, how DAI works and whether it is the “central bank” of DeFi
• How the visions for MakerDAO of Hasu and Rune differ
• Whether Maker should only hold highly liquid collateral assets
• Hasu’s mental model of DAI as eurodollars
• The role of real-world assets in backing DAI
• What the purpose of a DAO is and how it differs from a legal entity
• Whether people behave in their purest form within a DAO
• How DAI can create positive externalities and make a better world
• How crypto holders are not only in it for the money but also for the philosophy
• What the “decentralized stablecoin trilemma” is
• Whether there’s a need for dollar-denominated collateral for DAI to work
• What “clean money” is according to Rune
• Why Rune thinks having a single council is not viable due to the political risks and whether the solution is to have multiple councils
• How to keep the principal-agent problem in check, according to Hasu
• Why Hasu believes council members wouldn’t pursue their own interests and go against the benefit of MKR token holders
• Whether a council would be corruptible and the dangers that it entails
• What kind of interests should be represented in the council
• Whether Maker can create more synthetic assets
• The iron law bureaucracy and how it relates to governance
• How to design the DAO to be steered in alignment with the token holders
• Whether ossification is a feature to be pursued, and where innovation happens
• How complexity is very expensive for an organization

Book Update

You can purchase it here: http://bit.ly/cryptopians