Sydney Web3 - O Week
News Update
Infura Ban
MetaMask and Infura, two core elements of the Ethereum ecosystem including NFTs, have stopped serving users in "certain jurisdictions due to legal compliance," according to a MetaMask page that was updated on Thursday.
The company tweeted, “In response to the concerns we have been hearing, we want everyone to know that we corrected the problem that so many of you have pointed out. In changing some configurations as a result of the new sanctions directives from the United States and other jurisdictions, we mistakenly configured the settings more broadly than they needed to be. This was our oversight, and we are grateful that it was pointed out to us. Once we determined what happened, we were able to fix the problem, and service has been restored.”
Yuga Labs (Bored Ape Yacht Club) has acquired MeeBits and CryptoPunks from Larva Labs.
This deal was estimated at over $100million. One of the reasons why this deal was completed as of late, might have been because of the market cooling recently. That is, Feds are hawkish - interest rates in the year might be rising continuously to curb inflation - market is taking a risk-off approach. NFT sales should be high recently.
As per acquisitions, more value gets added onto the acquiree. Volume traded and floor prices have risen by 17.37x and 2 eth, respectively, for MeeBits (NFTScoring, 2022). For CryptoPunks, volume increased 5x, on average; past month, with no change to floor prices (Opensea, 2022).
CryptoPunks:
“Whats good for Punks is good for Apes…”
Following the acquisition, BAYC also announced that all Meebits and Cryptopunks holders will get full commercial rights to their NFTS. What does this mean? Create your own business using the rights you have! Could we also expect cryptopunks & meebits to have their own line of merch?
Central Bank Digital Currency (CBDC)?
Joe Biden has issued an executive order in the urgent research of the U.S digital dollar also known as Central Bank Digital Currency (CBDC) (CBSNews, 2022). What is CBDC? You might have heard of stablecoins such as USDT or USDC but have you heard about CBDC(s)? Stablecoins are digital currencies backed by non-government organizations. For example, USDT is controlled by ‘Bitfinex’, and USDC by ‘Circle’. These stablecoins lack transparency as to whether one USDT is truly backed by one dollar. There have been speculations that the owners of USDT actually leverages the USD in issuing Chinese commercial papers (CoinDesk, 2021). Stablecoins are also decentralized. With CBDC(s), like the Chinese E-CNY, each currency that is issued, will be backed by the government itself. They are centralized and by no means cryptocurrencies.
There are several reasons as to why the government is interested in moving towards CBDC. One of the main reasons is to reduce the cost of cross-border transaction fees and extend services to individuals who use less of our banking systems (Fortune, 2022). Other reasons include the cost of storage, production and counterfeits (CNBC, 2021). With the emergence of CBDC(s), we could expect lower transaction fees from the elimination of intermediaries (Visa/Mastercard/AMEX, etc).
Terra
Terra is a blockchain network which offers a suite of stablecoins such as UST (Dollar) and KRT (Korean Won). These stablecoins on the Terra blockchain share liquidity with minimal transaction costs. On Terra’s “Anchor” protocol, UST currently yields a stable interest of 19.43% APR, which is a very high rate for stablecoins (Anchor, 2022). As of Mar 13, total UST locked into the protocol has increased by 26% to $9,984.2m over 2 weeks. Total UST transaction volume has been up 28% over the past 2 weeks; $73.4bn (Aliens, 2022). Amidst possibly higher interest rates, investors are turning to a safer approach. Lending on the protocol has also increased by 21% over 2 weeks. As one of the main income sources to finance its “20% APR”, a divergence in deposit and lending growth could be a signal for risk that we should monitor (Coindesk, 2022).