The Rise of the JPEG, Regulatory Machinations & DeFi Delivers the Goods
EDITION N°1 | 26 August 2021
Hello and welcome to the flagship edition of the brand new weekly newsletter, DeFi Insights by Alkemi Network, discussing the top 3 events in DeFi and the digital asset ecosystem each week. Please feel free to share this with anyone who might find it interesting! Introduction aside, let’s move along:
With the breakneck speed of building taking place in Cryptoland & The Metaverse, a week often feels like a monster-month. AWGMI? Hoping so. The biggest events this week? Read on…
1. VISA buys a CryptoPunk for $150k in ETH
The best way to stay relevant whilst the innovation curve is trailblazing ahead of you? Buying a punk. Not just for status but as an ingratiating statement of intent. VISA was the first major payments network to settle transactions in USDC using the Ethereum blockchain and this is an astute ‘flex’ in more ways than one. Not only does it secure VISA an appreciating asset [gg] and position them as protagonists in the metaverse, it also bestows a corporate endorsement for NFTs [early]. Who knows, one day VISA might follow the OGs and put on legit metaverse exhibitions like this and this.
2. Regulators be regulators
The levels of FUD [fear, uncertainty, doubt] sloshing about in the bows of our beloved Crypto Vessel have been rising for a while, but the voyage continues. This week, we discovered the $1 trillion infrastructure bill may pass unamended [constricting for US crypto businesses] and SEC Chair G. Gensler has [vehemently] stated DeFi is not immune to regulation. However, the industry is listening and accommodating best practices accordingly; Binance just stepped up its KYC practices, Coinbase is covering reimbursements just like TradFi institutions and DeFi protocols are beginning to build with / integrate KYC/AML layers. The necessity for handholding and education is still evident, as demonstrated by Neel Kashkari’s recent statements, but the 30k ft view indicates the ‘understanding’ chasm is slowly being bridged.
3. DeFi holds her ground
In spite of the aforementioned regulatory concerns, DeFi continues to flourish. Avalanche just confirmed SushiSwap to build on their chain after initially landing Aave and Curve and the total value locked in the DeFi ecosystem is close to ATH, currently ~$145bn, with 2/3 of that being on the Ethereum chain [according to DeFi Llama]. Decentralized finance is the set of structured financial products built on-chain for digital assets and the recently released Deloitte Blockchain Survey offers some positive perspective. Almost 80% of Global Financial Services leaders see digital assets as ‘very/somewhat important’ to their respective industries and 90% of FSI pioneers said they will be very important for DeFi. So institutional adoption of digital assets looks set to continue; it’s just a matter of time before those assets are ‘put to work’ in the burgeoning DeFi ecosystem.
And now for something same same, and similar…
This compellingly creative masterpiece aired during Julian Bouteloup’s presentation at EthCC last month. Combining renaissance art with ominous darkness and a hauntingly sober English voiceover packs a powerful punch of a message. This is top-notch content at its DeFi degen finest…
ALKEMI NETWORK
Alkemi Network is building an on-chain liquidity network with a suite of tools and products that serve as onramps for everyone to participate in decentralized finance.