Publications

Maven's Insight September

01 October 2021

In the previous edition of Maven’s Insights we provided a first update on the amount of ETH, the native currency of the Ethereum network, burned under the new economic structure of the network. While last month 100.000 ETH (~316M USD) had been burned, the amount of burned ETH is now closing in on 400.000 ETH and has thus passed the 1 billion USD mark. This week we again had multiple days where less ETH was mined than burned, making the currency deflationary on these days. Our next update will come after having crossed the 1 million burned ETH mark.

Gary Gensler, chairman of the SEC, has spoken out about a Bitcoin ETF again. He reiterated his statement that he believes a futures based Bitcoin ETF is most likely to be accepted. Currently there are over 10 high profile ETF applications outstanding. Since regulatory actions have been maturing our industry over the past years we tend to agree with Coinbase which stated that an ETF was: “only a matter of time”.

Bitcoin was officially made legal tender in El Salvador on September 7th. As a result, all goods and services must now be payable in Bitcoin. The country is the first sovereign state to legally adopt Bitcoin as legal tender, alongside their US dollar currency. All citizens have received access to a personal wallet containing some Bitcoin, and the El Salvadoran government  purchased 400 BTC for their reserves, to which they have actually started to add on volatile days as an investment.

On the side of adoption and regulation, this month saw multiple positive developments. Credit-rating giant Moody’s has shown to be hiring for research positions relating to DeFi, CBDCs and other digital assets, while the Turkish and Indian central banks announced further developments and trials relating to their national experimentation and subsequent implementation of CBDCs. Visa also announced it is working on a universal payments channel  to facilitate transactions between different stablecoins and CBDCs, which is likely to be built on Ethereum.

In other regulatory news, CACEIS, the European custody bank with almost 5 trillion USD in AUM and AUC, is working to get involved in the digital asset space by developing a crypto custody solution. The custody bank follows in the footsteps of BNY Mellon (24 trillion USD AUM), the largest custody bank in the world that announced in February that it would be offering custody of digital assets.

Coinbase made the news a few times this month. They shared their intention to conduct a 2.5 billion USD private debt offering, the capital of which will be used for continued investments in the crypto industry. In a move to further the adoption of digital assets, Coinbase has also announced they’ll be launching a service to have wages paid in crypto. Users will be able to have their direct deposit wages (partially) converted to whichever digital asset they prefer, removing some of the friction that currently exists for the part of the workforce that is interested in crypto.

Twitter has shown their support for digital assets by rolling out a new feature called ‘Tips’ that allows users to easily send tips to other users. The service not only supports stalwart payment services like Venmo and Cash App, but will also support Bitcoin tipping through the Lightning Network. Twitter also announced they’re exploring NFT authentication. Many users currently use images of their NFTs as profile pictures on their Twitter accounts, and the platform is now looking to provide authentication for these NFTs by connecting user wallets to their Twitter profile. These steps taken by the tech giant once more underline the growing importance of NFTs in our online social interactions.

Our participation in the Maple Finance protocol has also bore fruit once more this month. We have managed to grow the liquidity pool that we manage to 75 million USD, and have issued multiple additional loans at a cumulative amount close to 35 million USD this month. We remain very optimistic we’ll cross the 100 million USD mark this year while we continue to scale the pool and our activities in the protocol. For more information on our role as Pool Delegate in the Maple Finance ecosystem, have a look at our previous monthly update. If you would like to learn more about being a lender on Maple Finance, you can reach out to us directly.

This month our venture investment in Stardust was announced. Stardust is  an all-in-one platform that is streamlining the process of NFT implementation in games by helping game developers to easily integrate NFTs in their games and enables players to buy NFTs using fiat and crypto gateways. We continue to believe the concept of the metaverse will remain one of the sectors of the Web3.0 vertical with strong continued growth in the future.