Snapshot Web3

November 14, 2023

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Regulatory Updates

APEC finance ministers to share perspectives on crypto at meeting in San Francisco

At the Asia-Pacific Economic Cooperation (APEC) summit in San Francisco, finance ministers discussed digital assets, including cryptocurrencies, as part of their broader economic focus. U.S. Treasury Secretary Janet Yellen highlighted the importance of sustainability and mentioned unbacked crypto assets, stablecoins, and central bank digital currencies. However, Yellen's views might contrast with Asian perspectives, as Asia is seen as leading in blockchain development, with significant advancements in the metaverse, crypto trading, and adoption​

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Innovation and Launches

Stablecoin firm Tether minted 4B USDT in 4 weeks: Data

In the past four weeks, Tether has minted 4 billion USDT, significantly contributing to the total of 22.75 billion USDT issued in 2023. This recent issuance includes 1 billion USDT on the Tron blockchain and 1 billion on Ethereum. Over the year, Tether actively minted new USDT, notably 9 billion in March and 3.75 billion between June and July. Concurrently, Tether has also been burning USDT, including 1.2 billion on the Tron blockchain in August

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Scams and Hacks

DeFi vulnerability leading to $6.7M exploit ‘not detected’ by auditors

The DeFi protocol Raft, which offers a U.S. dollar stablecoin, experienced a $6.7 million exploit due to a smart contract vulnerability. Despite multiple security audits by Trail of Bits and Hats Finance, this vulnerability was not detected. A hacker borrowed 6,000 Coinbase-wrapped staked Ether (cbETH) on Aave, transferred it to Raft, and then exploited a smart contract glitch to mint 6.7 million R tokens, Raft's stablecoin. The unauthorized funds were swapped through decentralized exchanges, netting $3.6 million. Following the attack, the R stablecoin depegged

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NFT and Metaverse

NFT market revives as major collections soar in sales and volume

The NFT market is showing signs of revival, with major collections experiencing a surge in sales and trading volume. As the crypto market rebounds, the NFT sector is also gaining momentum, with top collections like Bored Ape Yacht Club (BAYC) seeing a significant increase in floor prices and trading volume. BAYC's floor price rose over 70% in a month, and its 24-hour trading volume increased by 51%. Another notable collection, Captainz from Memeland, saw its 24-hour trading volume soar by over 680%. Data from Dune Analytics indicates that NFT trading volume across major marketplaces in November reached the highest levels since July, with Blur accounting for a major portion of the trades. Sales volume leaders include CryptoPunks, with a 373% weekly sales increase, and BAYC with a 42% rise. Overall, weekly NFT sales on Ethereum and Solana networks increased by over 60%, with Bitcoin’s BRC-20 collections also showing increased demand. Despite these positive trends, the NFT market still remains below its 2021 peak

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Resource of the Day

What is Gresham’s law, and how does it relate to cryptocurrencies?

Gresham's Law, an economic principle, states that when two forms of money coexist, individuals tend to spend or trade the money they perceive as more valuable while hoarding the one considered less valuable. In terms of cryptocurrencies, this law suggests that more volatile digital currencies are often used for speculative investments, while stable and established digital currencies are chosen for everyday transactions. For example, Bitcoin, regarded as relatively stable and valuable due to its scarcity and widespread use, is often hoarded as a hedge against inflation or financial upheaval, akin to how precious metals are used. In contrast, more volatile cryptocurrencies are more likely to be used in speculative trading, aligning with the concept of "good money" and "bad money" under Gresham's Law.

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Interesting Reads

Bitcoin institutional inflows top $1B in 2023 amid BTC supply squeeze

In 2023, Bitcoin's institutional investment vehicles have witnessed over $1 billion in new inflows in less than two months, marking a significant increase in capital being deployed to crypto investment products. This surge has brought the year-to-date inflows to $1.14 billion, the third highest yearly inflows on record. Moreover, with the next block subsidy halving approaching in five months, the amount of Bitcoin stored is now outpacing the amount mined by 2.4 times​

History tells us we’re in for a strong bull market with a hard landing

The current economic climate, marked by high inflation and rising interest rates, mirrors past cycles that led to significant market growth followed by downturns. Despite the highest interest rates since before the 2008 crisis, historical patterns suggest potential for a strong bull market. For example, the U.S. saw substantial growth in the stock market between 1995 and 1999 following an increase in interest rates. Similarly, the current situation in crypto, with potential U.S. Bitcoin spot ETF approvals, could lead to a surge akin to the dot-com boom. However, concerns arise from high U.S. household debt and rising credit card delinquencies, hinting at a possible hard landing following the bull market

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Quick Links

Elon Musk AI project-inspired memecoin ‘Grok’ falls 74% on creator scam claim

The memecoin 'Grok', inspired by Elon Musk's AI project, saw its value drop by over 70% following allegations by blockchain investigator ZachXBT. These claims suggested that the social media accounts and websites associated with Grok were recycled from previous scam projects, including a defunct memecoin named ANDY. After these allegations surfaced, Grok's price plummeted 74% from its peak of $0.027 to a low of $0.007, later stabilizing around $0.011. In response to the price drop, Grok's development team reportedly burned about $1.7 million worth of tokens (90 million GROK) in an attempt to reduce supply and regain investor confidence. Furthermore, it was claimed that all tokens from the deployer address, totaling approximately 180 million GROK (worth about $2 million), were burned

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The information provided in this newsletter is for informational purposes only and should not be interpreted as investment advice, endorsement, or recommendation. Cryptocurrency investments carry significant risk due to their volatility. You should consider your financial situation, investment goals, and risk tolerance before making any investments. We strongly recommend consulting a qualified financial advisor before making any investment decisions. Past performance is not indicative of future results.