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Top shelf
Bitcoin (BTC) is moving off exchanges, has been less volatile than TLSA and has broken its record for longest streak trading above five figures. Also: Bitwise's bitcoin fund has more than doubled in size, KuCoin was hacked and Jack Dorsey dropped a few more hints about his decentralized social media standard, Blue Sky. Accredited investor interest Bitwise’s bitcoin fund has brought in $8.9 million, the single-largest increase in assets raised in the fund’s two-year history, according to a recently amended filing with the Securities and Exchange Commission (SEC). The firm’s Bitcoin Fund provides accredited U.S. investors with exposure to bitcoin through a traditional product. In 2019, the fund attracted $4.1 million in investment, meaning the fund has more than doubled in size the past year. Bitwise executives pointed to fears of inflation and bitcoin’s role as a hedge as reasons for increased interest in their product. Bitcoin’s well-known volatility is often seen as a barrier to entry for institutional clients, but the cryptocurrency has in fact been more stable than Tesla’s (TSLA) stock. Enterprise solutions EY has unveiled a new Ethereum-based, enterprise-grade blockchain solution called the OpsChain Network Procurement. The platform is designed to enable companies to run private end-to-end procurement activities by allowing buyers and sellers to operate as networks, while automatically tracking volumes and spend and utilizing agreed terms and pricing. The platform utilizes open-source software including the Microsoft-backed Baseline Protocol and operates on the public Ethereum blockchain, CoinDesk’s Sebastian Sinclair reports. Twitter’s blockchain Jack Dorsey said blockchain is the future of Twitter and his latest initiative is looking to hire at least five new roles, while speaking at the virtual Oslo Freedom Forum 2020 on Friday. The CEO of Twitter and Square revealed details of the nonprofit Blue Sky initiative meant to create an open standard for social media. Under this vision, users can contribute to and access data from a decentralized version of Twitter instead of a centralized service where the social media platform hosts content on its website. “Blockchain and bitcoin point to a future, point to a world, where content exists forever,” Dorsey said. “We’re not in the content hosting business anymore, we’re in the discovery business.” KuCoin hack Over the weekend, a hacker breached KuCoin’s hot wallets absconding with some $150 million in crypto. KuCoin said in a statement that it detected large withdrawals of bitcoin (BTC) and ethereum (ETH) tokens to an unknown wallet beginning at 19:05 UTC time on Friday. The exchange’s chief executive Johnny Lyu said KuCoin has transferred the remaining funds from compromised wallets to new addresses and momentarily froze customer deposits and withdrawals. While other exchanges including Bitfinex and Tether have blacklisted the stolen funds. An investigation is underway and stolen customer money will be “covered completely” by an insurance fund, Lyu said. DeFi goes NFT The excitement in DeFi has shifted to the NFT market, CoinDesk’s Brady Dale reports. NFTs, one-of-a-kind tokens made possible by Ethereum’s ERC-721 standard, have not captivated investor attention until quite recently when people realized these digital collectibles could be used for yield farming. Platforms like NIFTEX have enabled NFT indices, Rarible has added a native token and Uniswap’s liquidity pools are creating new avenues for financialization – a trend Dale traces back to John Lyall’s MEME experiment.
Growing the pie Uniswap is now bigger than the entire decentralized finance space just two months ago, as the trading protocol becomes the first to pass the $2 billion milestone. Uniswap clocked the record figure just after midnight (UTC) Monday, according to crypto rankings website DeFi Pulse. The next biggest DeFi project, peer-to-peer lending platform Maker, trails slightly behind Uniswap at $1.96 billion in total value locked (TVL), according to DeFi Pulse. There's now more than $11 billion in TVL in the DeFi ecosystem, with Uniswap making up approximately 18% of that. Measuring UTXOs CoinDesk Research continues its webinar series on Bitcoin's fundamental metrics with two episodes on UTXO-based analyses. UTXOs, or unspent transaction outputs, are fundamental components of Bitcoin's distributed ledger that can shed startling light on investors' behavior and positions. On Sept. 29 at 10:30 a.m. ET, Lucas Nuzzi from Coin Metrics will present charts and insights on the market-value-to-realized-value (MVRV) ratio and the spent output profit ratio (SOPR). Register to join How to Value Bitcoin: UTXO-Based Fundamentals.
Market intel
Five digit streak Bitcoin closed Sunday at $10,793 setting a record of 63 consecutive daily closes above $10,000, according to market data aggregated by Messari. The bellwether cryptocurrency’s previous record 62-day streak above $10,000 lasted from Dec. 1, 2017, through Jan. 31, 2018, when bitcoin reached its all-time high of just above $19,900 on Coinbase, CoinDesk’s Zack Voell reports. Exchanges down? The balance of bitcoin on major exchanges has hit its lowest levels since November 2018, potentially signalling a bullish view from bitcoin holders, as they move to longer-term holding strategies, such as cold wallets. Additionally, a rise in new investors during the coronavirus pandemic has led to a growth in “white glove” services, meaning fewer bitcoin on exchanges and more in managed portfolios. Another possible explanation? Bitcoin is being moved to tokenization solutions for use in the DeFi ecosystem, CoinDesk’s Muyao Shen reports.
Op-ed
Stablecoin guidance Reading between the lines, CoinDesk Director of Research Noelle Acheson thinks the Comptroller of the Currency’s (OCC) latest stablecoin guidance is more than a nudge for the industry. “This could incentivize banks to actively seek stablecoin business, and in so doing, broaden both their client base and their stake in crypto markets... So, a bank could attract not just stablecoin issuers, but also their clients. It would then make sense to facilitate the transfers of stablecoins between clients, and (why not) even between banks. New payments networks could emerge, which in turn could give rise to a host of new banking services,” she writes.
Internet 2030
Joon Ian Wong, a member of the social token incubator Seed Club and former CoinDesk events organizer and reporter, writes about the future of media, as part of the Internet 2030 series. Substack won't save us... Media on the incumbent web is in crisis. It turns out that paying publishers for clicks, endless loops of “content” and ads, all served on platforms far beyond their maximum-viable scale is ideal for misinformation, disinformation and the decay of trust. The solution, according to various media innovation prognosticators, is the “passion economy.” The argument goes that, since anyone can create content now, it follows that the lumbering media institutions of the past will be unbundled and replaced with a swarm of individuals: Smart, sharp, upstart newsletter writers, podcasters and maybe even TikTokkers. Substack will save us… hopefully. But there’s just one problem. The tooling of the legacy web isn’t fit to usher in this new era of publishing. If we believe that first we make our tools, and then they make us – that aphorism so often misattributed to Marshall MacLuhan – we must examine each layer of tooling involved in creating and distributing our stories. This is the media stack, as the polymath provocateur Balaji Srinivasan calls it. And the media stack as it exists today is found wanting. The most powerful layers of distribution, payment and production remain entangled in oligopolistic platforms where the platform’s owners – not the creators fueling those systems profit the most. How to cut through those bonds? You guessed it, this is where I make an argument for cryptocurrencies. An open-source, internet-native monetary layer is the makeweight that could tilt value back in favor of writers, broadcasters and other creators, as well as the communities that support them. This is the notion of the “Renaissance creator,” as Jarrod Dicker of the Washington Post has called it. Every writer is also a publisher. The roles are flattened to optimise for agility and impact. But the model can be taken one step further. Sari Azout, of Level Ventures, argues for a “participatory economy” where fans benefit alongside media creators. We see an early glimpse of how cryptocurrencies can tie fans and creators together with a preliminary “lean token design” proposed by the Web 3.0 tinkerer and my colleague Brian Flynn. Media creators today can issue their own cryptographic token and design distribution and incentives around it to trigger a virtuous cycle for themselves and their fans. A simple token economics model could help media creators bootstrap funding for new projects, reward early fans and rally communities towards a common goal. In short, communities should be tokenized. But these are early days. Just as bitcoin has offered us a decade of permissionless value-transfer over the internet, years more of exploration for more equitable and more creative media products lies ahead of us. And that’s both a challenge and a gift. Have an idea for what the future of the internet will look like, reach out to [email protected].
Podcast corner
Stablecoins & power politics On the inaugural episode of Opinionated, a new podcast featuring CoinDesk’s leading columnists and contributors, CoinDesk editor Ben Schiller is joined by cryptoratti Nic Carter to discuss crypto’s biggest story: the $20 billion stablecoin boom. Money Reimagined: A new podcast by CoinDesk Imagination has always been a key part of what money is. That piece of paper in your wallet only has value because the payer and the payee have both invested belief in its value. The crypto community – and its many competing sub-communities – create that common meaning with their preferred form of money. We've launched a new podcast to explore these ideas and the technological, political and social forces reshaping our financial system. Listen to the Money Reimagined podcast, hosted by our Chief Content Officer and author of CoinDesk's Money Reimagined newsletter Michael Casey and Sheila Warren of the World Economic Forum, on Fridays at 10 a.m. ET.
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