Issue #50

Market Overview

As of the time of writing (Monday 5pm), the total market cap of the crypto asset market is $US1.26T, up (3.9%) from last week.

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

News Headline Highlights

• A mid-year 2023 Chainalysis report indicates crypto-related crime has declined 65% from the same period in 2022. The analytics firm notes that daily crypto inflows into illicit services are down relative to the broader market downturn, "Transaction volumes are down across the board, but declines are much less severe for legitimate services, which have seen just a 28% drop in inflows … In other words, there’s been a market pullback, but illicit crypto transaction volume is falling much more than legitimate crypto transaction volume."
• The value of tokenised U.S. Treasuries have surpassed $600m. This implies that crypto investors effectively lend $614m to the U.S. government via different tokenized Treasury products.
• A recent PWC hedge fund report revealed that traditional hedge funds with current crypto investments plan to either maintain or increase exposure, regardless of market volatility and ongoing regulatory uncertainty that have challenged the sector. Confidence in the value proposition and long-term sustainability of crypto assets "appears robust", per the PWC report.
• Google has updated its mobile software marketplace policy to allow application developers to integrate digital assets like NFTs into their games through its Play app store.
• Celsius founder and CEO Alex Mashinsky was arrested and charged with seven counts that include securities fraud, wire fraud and conspiracy to manipulate the price of CEL token. The charges have been brought by the U.S. Departmenr of Justice (DOJ), U.S. Securities and Exchange Commission (SEC), Commodity Futures Trading Commission (CFTC) and Federal Trade Commission (FTC). Magnet Quick take - this does not come as a surprise given the manner in which Celsius, a retail facing crypto depository business, operated and failed.

 Crypto Asset Project Updates

• Aave, a decentralised liquidity protocol, has received the go ahead to launch its native US Dollar stablecoin GHO on Ethereum mainnet. Approval for developers to launch GHO followed a community governance vote, which received close to 100% approval from the 424 addresses that participated. 
• Polkadot founder Gavin Wood proposed his vision for Polkadot 2.0 at a recent conference. Wood explained his vision for the ecosystem’s evolution as a network of sovereign chains connected by treaty-like “accords.”
• Arkham Intelligence, a US based crypto company that incentivises its users to deanonymize blockchain users, is holding their public token sale on Binance. Magnet quick take: Running a public token sale, especially when based in the  US seems highly risky. I would not like to be their legal council when the SEC catches wind of this public sale…

Regulation Station

• A New York Federal Court Judge, Analisa Torres, ruled that Ripple Labs did not violate federal securities laws by selling XRP on public exchanges. This is a landmark legal victory for the crypto industry and a major blow to the US Securities and Exchange Commission’s (SEC) war on crypto. This will impair the efforts of the SEC who have claimed most crypto tokens are securities in recent months. The ruling did state that the sales to institutions were securities. Coinbase has since re-enabled XRP trading on its platform.
• US Senator Tommy Tuberville (R-AL) and several members of Congress wrote an open letter to Attorney General Merrick Garland and Securities and Exchange Commission (SEC) Chair Gary Gensler asking them to investigate Prometheum, a special-purpose broker that recently secured federal permissions to offer crypto trading services.
• Representative Richie Torres (D-NY) wrote letters to the Inspector General and Comptroller General of the USA, urging them to investigate the SEC and specifically Gary Gensler, for putting forth Prometheum as an example of how to be regulatorily compliant. “Prometheum appears to be nothing more than a Potemkin platform, operating as a timely talking point for crypto critics rather than a true trading platform for crypto customers”, writes Torres.
• Senators Cynthia Lummis (R-WY) and Kirsten Gillibrand (D-NY) re-introduced their comprehensive bill, the Responsible Financial Innovation Act, on digital asset regulation.

The Weekly Deal Room

• Sound, a web3 music platform, raised $20m in a Series A led by a16z.
• Xterio, a Web3 gaming platform and publisher, raised $15m in a funding round from Binance Labs.
• Alluvial, a liquid staking protocol, raised $12m in a Series A co-led by Ethereal Ventures and Variant. 
• Ambient Finance, a decentralised trading protocol, raised $6.5m in a Seed Round led by Block Tower.
• Gondi, an NFT lending protocol, raised $5.35m in a Seed Round led by Hack.vc.
• LunarCrush, a social analytics platform, raised $5m at a $30m valuation in their Series A led by Draper Round Table and Ince Capital.
• GET Protocol, an NFT ticketing platform, raised $4.5m in a Seed Round led by Flow Ventures. 
• Olympix, a startup that aims to bring scalable security to Web3, raised $4.3m in a Seed Round led by Boldstart Ventures.
• Narval, a web3 wallet usage platform, raised $4m in a Seed Round led by BlockTower.