Issue #15

Market Overview

As of the time of writing (Monday 5pm), the total market cap of the crypto asset market is $US841B, down 22.1% from last week.

Below is the weekly performance of the top crypto and NFT assets. 

News Headline Highlights

• Crypto markets have had one of their toughest weeks in history, after the implosion of popular retail and institutional crypto exchange FTX and related hedge fund, Alameda Research. In the fallout:
  • It appears FTX lent Alameda up to $10B of customer deposits that remains unpaid. Reports are the hedge fund has since lost these funds placing risky venture bets and market making on FTX.
  • FTX, FTX US, Alameda Research and all other FTX related entities have filed Chapter 11 (bankruptcy) in the US.
  • After filing for bankruptcy and whilst in the process of handing over to administrators, FTX exchange wallets were hacked, with over $600m in assets stolen. 
  • Both the US Securities and Exchange Commission (SEC) and Department of Justice (DOJ) have launched investigations into FTX following its collapse.
  • US regulated crypto lender BlockFi has suspended withdrawals and ceased operations. BlockFi were receiving a line of credit from FTX US and are reported to have many of their assets on FTX’s exchange.
    
    
• Binance CEO, CZ, announced plans to form an industry recovery fund, to help projects who are otherwise strong, but in a liquidity crisis as a result of the FTX fallout.
  
  
• The US Department of Justice seized over 50,000 bitcoin (worth $3.4B) in connection with a Silk Road hack from 2012. Magnet Quick Take -Bitcoin is often mistakenly thought of as a useful tool for illicit activity. As this case demonstrates, the fact that Bitcoin is a permanent and transparent ledger means that criminal activity can be easily identified and litigated years after the fact.
• SBC announced plans to launch HSBC Orion, a blockchain based bond tokenisation platform. In the announcement, it was mentioned that the European Investment Bank (EIB) may use it to issue a GBP cond under Luxembourg law.

 Crypto Asset Project Updates

• Circle, the issuer of popular stablecoin USDC, has commenced moving its USDC reserves (US dollars) into an SEC-regulated money market fund run by BlackRock Advisors. 
• Ethereum has officially turned deflationary since the merge, as fee prices spiked after a flurry of on-chain activity post FTX’s implosion.
• Vitalik Buterin has revealed an updated Ethereum roadmap which includes a new section, The Scourge. The goal of The Scourge is to “ensure reliable and credibly neutral transaction inclusion and to avoid centralization and other protocol risks from MEV.”

The Weekly Deal Room

• Bakkt, a digital asset platform owned by the Intercontinental Exchange (ICE), has acquired crypto trading  infrastructure firm Apex Crypto for up to $200m. Bakkt will initially pay $55 million in cash at the closing of the deal, and up to $145 million in Bakkt stock and seller notes upon achievement of some financial targets.
• Crypto payments infrastructure, Ramp Network, raised $70m in a Series B led by UAE sovereign wealth fund Mubadala Capital and Korelya Capital. 
• Financial Conduct Authority-licensed digital asset exchange, Archax, raised $28.5m in a Series A led by Abrdn (one of the UK’s biggest asset management firms). 
• Impact Project, a blockchain platform seeking to streamline the carbon credit acquisition process by making it more retail-focused, raised $12m in their presale. 
• Estonian crypto exchange Coinmetrico raised $7m in a strategic funding round to bridge them to their series A early next year.
• Web3 gaming infrastructure startup, Xternity, raised $4.5m in pre-seed funding led by NFX.

Metric of the Week

The percentage of bitcoin that has remained inactive on-chain (i.e. has not transacted) in the last 180 days or 1 year is at all time highs. 78% of bitcoin has not moved in the last 180 days and 66% is unmoved in the last year.

Source: Coin Metrics