July 13, 2022       /       Unchained Daily       /       Laura Shin

Daily Bits✍️✍️✍️

• Celsius paid off its debt to Aave and reclaimed $410 million in stETH.
• STEPN, a project in Solana, announced it would use a portion of its Q2 earnings to buy back tokens.
• Arbitrum Nova, a new chain inside L2 scaling solution Arbitrum, is now live.
• The US Treasury is requesting public comment on its digital asset policy.
• CBDCs would reduce bank runs, according to a US Treasury report.
• Regulators in California are investigating crypto lending companies.

Today in Crypto Adoption…

• Shanghai wants to build a $52 billion metaverse industry by 2025.
• The head of Banque de France announced stage two of its CBDC experiment and is ready to launch officially by 2023.

The $$$ Corner…

• The Macalinao brothers, formerly Solana developers, launched a $100 million VC fund.
• Multicoin Capital, a VC firm, launched a $430 million fund to invest in web3 projects.
• Animoca Brands, the company behind The Sandbox, raised $75 million.
• Safe, formerly known as Gnosis, raised $100 million led by 1kx.
• DeFi lending protocol Morpho raised $18 million led by a16z.

What Do You Meme?

What’s Poppin’?

Su Zhu Finally Speaks as NY Court Allows Subpoenas

By Juan Aranovich

Su Zhu, cofounder of Three Arrows Capital, finally broke his long silence on Twitter Tuesday morning. His last tweet had been almost a month ago, around the time his company started to collapse.

3AC has been one of the biggest failures of this crypto bear market and is now facing insolvency. The crypto fund suffered massive losses during the Terra meltdown and was liquidated by many of its lenders. (If you want to understand what happened with 3AC, don’t miss this amazing The Chopping Block episode). A week ago, the company filed for Chapter 15 bankruptcy.

The Singaporean entrepreneur posted two screenshots of emails from Advocatus Law LLP, the law firm handling the 3AC situation.

In the first one, it argued that creditors of 3AC did not engage in the process of liquidation in good faith. “Sadly, our good faith to cooperate with the Liquidators was met with baiting,” said Zhu. However, court documents in the Chapter 15 proceedings showed that Davies and Zhu had “failed to cooperate” during the process.

The second screenshot has to do with an exercise right to buy StarkWare tokens. StarkWare is a startup that provides scalability and privacy solutions to Ethereum with the use of zero-knowledge proofs.

“Our clients, besides being former directors of the company, are also investors, and shareholders of the company (…) In these capacities, they are extremely concerned by the Liquidators’ failure to exercise StarkWare’s token purchase offer,” wrote Christopher Anand Daniel, managing partner of Advocatus.

In other 3AC news yesterday, a judge in the Southern District of New York granted an order for provisional relief. This means that Teneo, the firm behind the attempt to recoup 3AC assets now has the ability to serve subpoenas to 3AC founders Zhu and Davies, whose whereabouts are still unknown. They are also now in control of known assets.

Furthermore, according to The Block, Teneo will host the first meeting for 3AC’s creditors on July 18. It is not entirely clear what the agenda of the meeting will be yet. The details of these meetings will be posted on a website that was created by Teneo to provide updates to 3AC creditors.

Recommended Reads

1) VivekVentures on the Merge:

3) Bloomberg on the Three Arrows Capital collapse:

On The Pod…

Ryan Berckmans, Ethereum investor and community member, and Alexandre Bergeron, Bitcoin investor, discuss Lido’s dominance as a liquid staking provider, whether that issue can be resolved, and how it could be a centralizing force for Ethereum. Show highlights:

• what stETH is, what the uses cases are for stETH, and why it is important
• how Lido had a first-mover advantage and how that kicked off network effects
• whether the liquid staking derivatives system is one of a “winner-take-all”
• how much of the staked ETH will be turned into a liquid staking derivative
• how Lido might have a huge MEV opportunity after the Merge
• what the proposer-builder separation is
• whether Lido’s dominance will increase over time
• whether other competitors have been competitive with Lido
• why Lido is a natural monopoly because of the incentives and MEV opportunities
• what the implication of Lido’s monopoly is for Ethereum’s censorship resistance
• whether Lido is effectively a single entity despite having multiple node operators
• whether there could be a long waiting period for becoming a validator after the Merge
• how Lido is moving its staking derivatives to other chains
• how Lido’s new dual-governance proposal works, why it might be useful to decentralize Lido and whether it reduces the power of LDO token holders
• how Lido’s centralization is the biggest threat to Ethereum in the long term and what are the possible solutions
• why Ryan believes the value of ETH comes from its credible neutrality and whether Lido’s centralization may jeopardize that
• whether finding solutions around MEV opportunities is a good way to reduce Lido’s monopoly
• whether Lido’s competitors could form an alliance and build a tokenized basket of their staking derivatives to compete with Lido
• whether Lido could airdrop the LDO token to all ETH holders to decentralize its governance token

Book Update

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