Weekly DeFi Digest - July 29

Market: Hot Take

📈 Market Summary

The “bear rally” is still going strong as we wrap up our third consecutive week in the green. Total Market Cap is looking good too, sitting comfortably over the USD$1tn mark and proceeding to climb.

Crypto pumped on Wednesday, following confirmation from the US Federal Reserve of yet another 75 bps interest rate hike. Prices have since stabilized somewhat but all eyes are on Ethereum as ether ($ETH) continues to steal the show ahead of September’s merge. ETH dominance is fractionally up where BTC is down, prompting the question; will ETH prove to become “the largest deflationary currency” post-merge?

News of the Week

👮🏼 Policy & Regulation

US Representative, Maxine Waters, confirmed on Wednesday that processes to define bipartisan stablecoin regulation will be put on pause until Congress returns from recess in August. In a statement, Rep. Waters stressed, “it’s critical that we continue moving the ball forward on this so we can have a regulatory framework that protects consumers, while allowing for responsible innovation”.

In a scathing Op-Ed, Ripple’s ($XRP) General Counsel, Stuart Alderoty, has accused the US Securities and Exchange Commission (SEC) of failing to provide clear regulatory guidelines and instead of “bullying” the crypto sector. While the Ripple lawsuit drags on, the SEC has broadened its sights to include crypto exchange, Coinbase, for alleged irregularities in listing securities.

The European Central Bank (ECB) released findings on Thursday that suggest the need for introducing a cap on the amount of Central Bank Digital Currency (CBDC) that an individual could hold. The cap, which is tentatively being proposed at 3,000 euros (USD$3,045), would be to prevent a run-off from the traditional banking system; an issue which could potentially impact lending.

💻 Technology & Exploits

The latest in a long line of shadow forks and testnet launches ahead of the Ethereum merge ($ETH) has been executed without a hitch. Dates have now been set for the Goreli testnet transition, which is being described as a final dress rehearsal before the official merge. According to developers, this final transition period will run between August 6th – 12th.

Last week, we reported that crypto Singapore-based exchange Zipmex had apparently resumed withdrawals and deposits after freezing clients’ accounts. Despite what appeared to be a return to normalcy, this week it was forced to file for bankruptcy.

A flash loan exploit drained Solana-based DeFi Protocol, Nirvana, of its liquidity during the early hours of Thursday morning (EST). USD$3.5m was locked into the protocol at the time of the attack. Its native $ANA token and stablecoin have since plummeted by over 83%.

🏪 Market & Ecosystem

A cryptocurrency exchange that caters exclusively to institutional clients launched this Thursday in London. Zodia Markets, in collaboration with Standard Charter, seeks to address what it saw as a “gap in the market when it comes to a crypto trading firm with the backing of a bank”.

Snapchat is the latest social media app to unveil plans to launch NFT-compatibility. The news follows hot on the heels of similar moves by Meta, Spotify and Reddit.

Brazil’s largest challenger bank, Nubank, has hit the 1 million mark for users on its brand new native crypto trading platform. Appetite for crypto wildly surpassed the company’s projections after it reached 1 million new users within its first month instead of the one-year benchmark it had originally set.

Brazil continues to make the crypto headlines, this time over soccer. Sao Paolo Soccer Club has become the first Latin American team to sign a new player using crypto – in this case, the USDC stablecoin. Giuliano Galoppo was transferred from Argentina’s Club Atlético Banfield for a reported USDC $8m that was settled via the Bitso network. Goal!

💰 Funding & Acquisitions

Crypto venture fund, Variant, has raised USD$450m to be spread across two funds. The fund revealed on Thursday that it will prioritize investments across four strategic pillars: Financial empowerment -through DeFi, network development, consumer-focused web3 products and tokenization.

The web3 domains company, Unstoppable Domains, has officially reached crypto unicorn status. Valued at USD$1bn, the platform closed a Series A funding round on Monday with USD$65m. Led by Pantera Capital, investors include Polygon, Coingecko and Mayfield amongst others.

Fitness app, Sweat Economy, is making the transition into web3 after receiving USD$13m in funding and partnering with Near Protocol. Sweat Economy is the latest app to break into the move-to-earn ecosystem. Free to use, players will be rewarded with $SWEAT for registering steps on the app.

Center, an NFT indexing company, raised USD$11m this week. The index has so far catalogued 120 million NFTs, across 12 chains. Ultimately, it aims to “index and organize every NFT on every chain”.

Crypto 101 - Cybrid Sandbox

Instead of learning about another acronym, the 101 spotlight this week is on our Sandbox Portal, which is now available for any developer with a Google or GitHub login.

The Sandbox is the starting place for those looking to build using our platform. Once logged in, create an organization and bank, generate API keys and download the OpenAPI 3.0 schema. 

How do you get to the portal? Well, a website we recommend to bookmark would be our Linktree - on it you can find the Sandbox link, along with more Cybrid material. 

Don't miss the UI SDK component repositories on GitHub - web and Android are live now, with iOS launching very shortly. Inside the SDK repositories you'll find components, like the one below, that you can utilize in applications to quickly introduce crypto without the heavy technical uplift.

If you're a developer, we highly recommend you head to the GitHub repositories and our Sandbox Portal. We do have some guides to integration available. If you need any help, let us know!

If you haven't done so yet, head over to the Cybrid blog to check out our latest articles!

• Crypto Banking as a Service: Embedded Finance’s Newest Use Case: Crypto has many exciting possibilities, this blog post focuses on the power it can have when being embedded as a financial service.

• Why a Crypto Bear Market is the Time for Fintechs to Build: While the “crypto winter” is officially upon us, now is not the time to abandon crypto but rather to build in prep for the next bull run.

• Making your card “top of wallet” for your customers: Why you should add crypto rewards to your card program. This piece explores why you might want to rethink your standard cashback offerings in favor of a far more exciting - yet accessible - alternative.

Helpful Guides

You might find the following two guides helpful on your learning journey in Crypto.

• Crypto Tech Primer: Get an understanding of the basics of blockchains, cryptocurrency and decentralized finance

• Fintech Guide to Crypto Products: This is the "Hitchhicker's Guide to Crypto" for fintechs looking to launch cryptocurrency based products

How Cybrid Can Help

Cybrid enables FinTechs and Neobanks to unlock crypto-led growth with an array of crypto products including crypto trade, earn, rewards and more. Book a sales demo, or access the sandbox.