Hotairballoon has selected important information on the crypto market last week, investment and financing status, as well as on-chain data on current popular tracks such as LSD and RWA. It also counts projects with relatively large unlock volumes in the near future for your reference.

1. Important information about the encryption industry last week
A quick look at important industry information of the week.
(1) Policy/Supervision
1. Head of the Innovation Center of the Bank for International Settlements: Whether central banks like cryptocurrencies or not, they need to be prepared
According to news on October 2, Cecilia Skingsley, head of the Innovation Center of the Bank for International Settlements (BIS), said at the New York Fed Fintech Conference: Artificial Intelligence and Digital Assets that the Bank knows that it must stay ahead of the curve and needs to practice it personally.

Hotairballoon has selected important information on the crypto market last week, investment and financing status, as well as on-chain data on current popular tracks such as LSD and RWA. It also counts projects with relatively large unlock volumes in the near future for your reference.

1. Important information about the encryption industry last week
A quick look at important industry information of the week.
(1) Policy/Supervision
1. Sichuan Province has officially issued a special policy for the Metaverse and plans to create a “Chinese Metaverse Valley”
According to news on September 18, according to the official website of the Sichuan Provincial Department of Economy and Information Technology, 16 departments including the Sichuan Provincial Department of Economy and Information Technology jointly issued the "Sichuan Provincial Yuanshi Industrial Development Action Plan (2023-2025)". This is the fourth provincial-level Yuanshi special policy after Shanghai City, Henan Province, and Zhejiang Province.

Hotairballoon has selected important information on the crypto market last week, investment and financing status, as well as on-chain data on current popular tracks such as LSD and RWA. It also counts projects with relatively large unlock volumes in the near future for your reference.

1. Important information about the encryption industry last week

A quick look at important industry information of the week.

(1) Policy/Supervision

1. G20 countries have reached a consensus on the rapid implementation of a cross-border framework for crypto assets and plan to automatically exchange crypto transaction information between countries starting in 2027.

According to Cointelegraph, G20 leaders recently held a summit in New Delhi, the capital of India, to reach a consensus on the rapid implementation of a cross-border framework for crypto assets. The framework will promote the exchange of crypto-asset information between countries starting in 2027. Under the proposed framework, countries will automatically exchange information on crypto transactions between different jurisdictions on an annual basis, including those conducted on unregulated cryptocurrency exchanges and wallet providers.

Hotairballoon has selected important information on the crypto market last week, investment and financing situations, as well as on-chain data on current popular tracks such as LSD and RWA. It also counts projects with relatively large unlock volumes in the near future for your reference.

1. Important information about the encryption industry last week

A quick look at important industry information of the week.

(1) Policy/Supervision

1. Many places in Sichuan have cracked down on virtual currency “mining”: One county has cleaned up 191 small hydropower-related equipment since 2021

According to news on September 4, according to The Paper, many regions in Sichuan continue to carry out investigation and rectification work on virtual currency "mining" to prevent the resurgence of "mining". Recent news from the official website of Liangshan Prefecture Financial Work Bureau stated that in early August, it had supervised and inspected the "mining" investigation and rectification work of hydropower stations, carried out re-examination of the virtual currency "mining" projects that had been confirmed to be shut down, and supervised the implementation of the townships and towns to which the hydropower stations belong. The rectification of virtual currency “mining” activities and the guaranteed responsibility system.

Hotairballoon has selected important information on the crypto market last week, investment and financing situations, as well as on-chain data on current popular tracks such as LSD and RWA. It also counts projects with relatively large unlock volumes in the near future for your reference.

1. Important information about the encryption industry last week

A quick look at important industry information of the week.

(1) Policy/Supervision

1. Indian Prime Minister Modi called for the establishment of a global cryptocurrency regulatory framework during the G20 Summit

On August 28, according to Cointelegraph, Indian Prime Minister Modi called for global cooperation to formulate cryptocurrency regulations during the G20 summit. As the G20 chair, India has taken on the task of advocating for a comprehensive global cryptocurrency regulatory framework.

1. Background

Compared with other tracks (DeFi, content, etc.), games are the key to the large-scale application of blockchain technology. Because games have a large audience, good token design is easier to be used and supported in games, and There is also relatively little regulatory impact.

However, games also have high requirements for blockchain technology, such as scalability requirements. If the scalability (TPS) cannot keep up, the game may freeze, which will seriously affect the user's gaming experience. For example, the CryptoKittie game that appeared in 2017 once caused serious congestion on the Ethereum network, which not only affected the user experience, but also further caused the gas cost of the entire Ethereum network to remain high.

1. What is Treasure?

Treasure DAO (Treasure for short) is the metaverse game ecosystem native to Arbitrum, aiming to bring games and players together through its ecological token MAGIC. Treasure started as an NFT project on the Loot ecosystem, and later independently became a decentralized game ecosystem that shares resources, community, and infrastructure.

The platform integrates applications such as NFT, DeFi and GameFi, and aims to support NFT and Metaverse projects to build their own ecology on the platform and achieve integration between projects.

Hotairballoon has selected important information on the crypto market last week, investment and financing status, as well as on-chain data on current popular tracks such as LSD and RWA. It also counts projects with relatively large unlock volumes in the near future for your reference.

1. Important information about the encryption industry last week

A quick look at important industry information of the week.

(1) Policy/Supervision

1. Singapore introduces regulatory framework for crypto stablecoins

The Monetary Authority of Singapore (MAS) issued a document on its official website stating that it has finalized the regulatory framework for stablecoins. The regulatory framework takes into account feedback received following a public consultation in October 2022. MAS said that when well regulated to maintain value stability, stablecoins can serve as a trusted medium of exchange to support innovation, including the "on-chain" purchase and sale of digital assets. MAS’s stablecoin regulatory framework will apply to single currency stablecoins (SCS) pegged to the Singapore dollar or any G10 currency.

According to Coinmarketcap statistics, the current total market value of cryptocurrency is US$1.17 trillion, while the total market value of the meme sector has reached more than US$18 billion, accounting for 1.5%. The total market value of the meme currency sector has even exceeded ADA, The market value of SOL, TRX, LTC, MATIC and other public chains.

Compared with other sectors in the crypto market, the Memecoin sector clearly has a strong wealth-based effect. For example, Shib has increased by 500,000 times, doge has increased by 400 times, etc. These wealth-making myths have also added a lot of new traffic to the crypto market. .

Moreover, Memecoin’s wealth creation myth continues, such as Unisat in this year’s BRC-20, and PEPE, which became a big hit this year.

1. Background

First of all, with the continuous development of the blockchain industry, various forms of chains have emerged, such as Layer1, Layer2, Layer3, side chains, Rollups, etc. There are homogeneous chains and heterogeneous chains, and each blockchain has , which is divided into many different protocols.

These different blockchains and different protocols have split the blockchain world into information islands. A large number of encrypted assets are distributed on these different chains and different protocols, which undoubtedly reduces the utilization of funds. efficiency.

The emergence of cross-chain bridges can build bridges between these different chains, and bridge assets on one chain to other blockchains.

1. Industry Trends and Current Situation

The emergence of blockchain technology has brought many advantages such as distributed ledgers and decentralization, but it has also resulted in each blockchain forming a relatively isolated ecosystem. Different blockchains cannot interact directly, which brings many limitations and challenges to the application of blockchain technology. Therefore, how to achieve interoperability between different blockchains has become an important issue.

In order to solve this problem, cross-chain bridge technology came into being. Cross-chain bridge is a technical means that can establish connections between different blockchains to achieve cross-chain communication and asset transfer.

1. Background

With the continuous development of public chains and Layer2 ecology, liquidity has been further divided. In the world of blockchain, fragmented distribution of liquidity has become the norm.

According to statistics from defillama, the amount of funds currently locked through DeFi has reached more than 70 billion U.S. dollars. This huge amount of funds has reached a peak of more than 200 billion U.S. dollars in TVL.

However, the amount of funds of more than 70 billion US dollars is not concentrated, but widely distributed in various public chains and various protocols. According to statistics from Defillama, more than US$70 billion in funds are widely distributed in more than 200 public chains.

1. Project introduction:

1. What is dYdX

dYdX is the world's first decentralized digital currency derivatives trading platform, which aims to build more open, transparent and secure financial products through decentralized technology.

In the dYdX platform, it mainly supports margin (leverage) trading and derivatives (perpetual contract) trading, and can support up to 20 times leverage.

2. Product architecture

1) Main trading modes

As we all know, AMM (Automated market maker) is one of the cornerstone protocols of DeFi. In the AMM model, the counterparty is a capital pool, and the capital pool completes the quotation in real time, which is equivalent to human-computer trading. There is no need to wait for the platform's transaction matching, so it can Complete transactions quickly, which is also the advantage of the AMM model.

This afternoon, Binance Launchpad announced that it will launch the token sale of Arkham token ARKM, and will follow the Launchpad subscription model and start recording user BNB balances at 8:00 on July 11, 2023, Beijing time, for a period of six days, a total of Sold 50 million ARKM.

This is Binance’s fifth recent Launchpad project following the Open Campus token EDU, Sui token SUI, Maverick Protocol token MAV, and Pendle Finance token PENDLE. It is also the first Launchpad project that only supports BNB mining.

So what exactly is Arkham? What might it mean if Binance selects it?

It’s worth noting that Binance.US’s USD trading pairs are currently trading at almost all negative premiums.

2/ Among them, the market price of Bitcoin is US$27,540, with a negative premium of 8.6% compared to the USDT trading pair on Binance.com; the market price of Ethereum is US$1,704, and the negative premium compared to the USDT trading pair on Binance.com is 8.4%;

3/ This negative premium is not normal for Binance US. Historical trading data shows that the price of the USD trading pair on Binance US has been similar to the price of the USDT trading pair. During the wave of FUD caused by regulatory factors last month, the prices of Bitcoin and other U.S. dollar trading pairs once experienced a positive premium. This should be the American users at that time who were worried that the U.S. dollar assets of http://Binance.US would be frozen, so they chose to convert the U.S. dollars in their hands into crypto assets, thus pushing up the price of the U.S. dollar trading pair.

Recently, Lido's wstETH surpassed ETH and became the largest mortgage asset on Maker - 530 million DAI generated by staking wstETH through Maker, which is higher than the 497 million generated by staking ETH.

2/ In addition, more and more people are minting crvUSD by staking wstETH. This is equivalent to creating additional application scenarios for wstETH: in addition to staking returns, further staking generates stablecoins to obtain liquidity.

3/ Among all the current Ethereum liquidity staking protocols and LSD tokens, wstETH is the undoubted leader - with a volume of US$14.2 billion, occupying about 75% of the market share.

Note: The crypto industry will usher in a reduction in Bitcoin production next year, and Hot Balloon predicts that there may be an optimal time for capital allocation at the end of this year. Therefore, the "High-Quality Crypto" series is launched to analyze and tap potential currencies in each track of the next cycle. Layout first.

In this issue, we will focus on DeFi veteran blue chip and “LSD rookie” Frax Finance.

Background of the project

basic situation

Frax Finance was launched in 2020 and was initially an algorithmic stablecoin system based on a partial mortgage mechanism. The ecosystem includes the non-stable fee token FXS and the stablecoin FRAX.

1/ How to judge the possible direction of short-term rise and fall of the market? Let me share a macro indicator that I have been using: changes in the number of stablecoins across the entire network.

2/ Because in the final analysis, as a semi-closed market with a relatively small volume, the ups and downs cycle of this small pool in the encryption industry generally depends on the changes in the volume of US dollar stable coins. With more stablecoins on the market, asset prices will naturally rise, and vice versa.

3/ Most directly, at the same time as the surge in June, corresponding clues can be found in the total amount and structure of stablecoins across the entire network. Beginning in June (especially in mid-to-late June), the circulation of USDC, BUSD, and DAI paused their downward trend, and the growth trend of USDT also began to slow down. At that time, the total market value of stablecoins across the entire network remained at around US$129.6 billion. constant.

1/ "The widespread use of stablecoins around the world is the best example of USD RWA" 👍

From this perspective, the current return that can be obtained from the stablecoin "USD RWA" in DeFi products is far lower than the 5% risk-free rate of return of directly buying and holding U.S. bonds.

2/ This may also be one of the macro-level reasons why the stablecoin market volume of the entire network has been declining in the past four months.

Thinking further, it is no wonder that MakerDAO and Compound are actively introducing US Treasury bonds to the chain:

The risk-free return on U.S. Treasury bonds is currently higher than the return on most DeFi products.