January 18, 2022       /       Unchained Daily       /       Laura Shin

Daily Bits ✍️✍️✍️

• OpenSea hit $3.5 billion in ETH sales volume for January, marking an all-time high only halfway through the month.

• Crypto.com (disclosure: a sponsor of my shows) briefly suspended withdrawals on its platform following “unauthorized activity” being reported by multiple users; PeckShield reports that the exchange lost $15 million in ETH.

• Binance burned 1.68 million BNB tokens (worth approximately $800 million) in its latest burn.

• Spain issued a release defining new rules for crypto influencer posts.

• Singapore’s Monetary Authority told crypto companies to stop advertising products to the public.

• Elliptic is developing a new data product for institutional crypto traders.

Today in Crypto Adoption…

• India’s Prime Minister called for global cooperation on regulating cryptocurrency.

• Binance is partnering with Gulf Innova Company to set up a crypto exchange in Thailand.

The $$$ Corner…

• Mechanism Capital launched a $100 million play-to-earn gaming fund.

• Burnt Finance, an NFT auction protocol, raised $8 million in a Series A led by Animoca Brands.

What Do You Meme?

What’s Poppin’?

OHMy Goodness, OHM Token Price Is Falling

OHM, the native token of Olympus DAO, crashed to an all-time low of $104.68 yesterday, marking a 91% decline from its all-time high in April of 2021 and a decrease of 50%+ in the past seven days. Based on data from DeFi Llama, OlympusDAO’s total value locked also took a significant hit, decreasing by over $1 billion since the start of 2022.

Olympus DAO is a decentralized reserve currency protocol. Each OHM token is backed by a basket of assets, like DAI or FRAX, in the Olympus treasury – giving each token a baseline value that it should not fall below. Essentially, the whole point of OHM is to act as a store of value that is not tied to USD.

More OHM tokens can be generated when users bond other cryptos to the Olympus DAO treasury, like DAI, FRAX, or WBTC. This allows Olympus DAO to own its liquidity.  In addition to the issuance of OHM based on its treasury, Olympus DAO allows OHM holders to stake OHM tokens in return for more OHM tokens. Due to the project’s popularity, OHM has often traded far above the treasury of Olympus DAO, allowing for Olympus DAO to print more OHM via staking rewards in an effort to dilute the value of OHM back to something more stable. As of writing time, the protocol offers upwards of 3,500% APY. This has created a somewhat virtuous cycle in the past, as users stake OHM to earn more OHM, which they then stake again.

The problem, however, comes when users stop staking their OHM and cash out. When this occurs, the positive cycle of staking is stopped, and the price of OHM can be wiped out quickly as trust in the system decays. That is precisely what happened on Sunday night, according to crypto reporter Colin Wu:

Colin’s tweet is backed up by a transaction on Etherscan that shows roughly $10 million in OHM being traded for DAI on SushiSwap that night. Based on Twitter interactions, it appears that @shotta_sk may have been the seller. Based on the calculations of Freddie Raynolds, who looks to be the first to flag the transaction, the $11 million dump caused 25% slippage on OHM trades across Ethereum and over $5 million in liquidations.

As of 9:12 pm ET, OHM is trading at $120.03 and is down 15.7% over the past 24 hours.

Recommended Reads

1. Politico on Bitcoin and the midterms:

2. Ethereum Foundation’s Josh Stark on Ethereum in 2021:

3. Galaxy Digital on Bitcoin mining in 2021 and 2022:

On The Pod…

Is Binance Smart Chain Being Run ‘Like the Project of a Stoned Teenager?’ Two BSC Execs Answer

Binance Smart Chain is the third-largest chain by TVL and its token, BNB, is the third-largest token by market capitalization. However, there are questions about hacks, centralization, lack of developer support, and sketch MEV transactions. On Unchained, Gwendolyn Regina, investment director of the Binance Smart Chain Growth Fund, and Samy Karim, ecosystem coordinator at Binance Smart Chain, give a candid interview discussing BSC, from its amazing growth in 2021 to some of the toughest questions surrounding the chain. Topics covered include:

• how and why BSC grew from 50,000 daily active users to about 7 million over the course of 2021

• what differentiates Binance Chain and Binance Smart Chain

• why Binance Smart Chain decided to design its blockchain with only 21 validators

• how Gwen and Samy envision BSC fitting into a multichain future

• what plans BSC has to scale its throughput

• why blockchain gaming is so important to BSC and how it will use its $1 billion growth fund to grow the gaming aspect of the chain

• how BSC’s relationship between Binance and BNB works

In the second half of the show, Sam and Gwendolyn respond to a few critiques, such as:

• is BSC really innovating, or is it just a copy and paste blockchain of Ethereum?

• • why are there so many failed transactions on BSC?

  • how is BSC addressing the numerous hacks on the blockchain?

  • why has BSC’s share of total value locked among smart contract blockchains fallen from 20% in May to 6%?

  • how is BSC attempting to help developers, who, according to some critical posts, are struggling to work with BSC?

  • why does it appear that some validators are front running without risk?

  • does BSC have a future if Ethereum scales?

  • what does BSC have planned for 2022?

Book Update

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