📌 An opinionated recap of the most interesting news in crypto
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Notes from the Multicoin Summit, by Cambrial
Our friends David and Ha from Cambrial headed over to the Multicoin Summit in NYC this week and were kind enough to share some of their notes from what sounds like a super insightful event and a top notch set of speakers.
Lots of interesting topics were (hotly!) debated, including portfolio construction, the evolving role of investors, ZK-proofs and obviously...stablecoins!
The most engaging discussions, from an investor perspective at least, seem to have sparked from a post that MC published ahead of their Summit on the "Evolving role of crypto investors". While we've covered the topic extensively in the past, as in every playbook that's been written in front of our eyes additional nuances keep surfacing, like that MC runs these bootstrapping activities at a loss (initially at least) and accounts for the investment in them effectively as a follow-on financing:
"Just as a traditional VC firm would set aside capital for follow on rounds, we believe that crypto investors who typically invest in protocols will find it’s a best practice to also set aside capital for supporting the network."
The post also triggered Fred Wilson, one of the speakers at the Summit, to share his views on "Engaging in cryptonetworks". He makes the point that there's a whole new industry emerging to provide such services to investors, which we are definitely seeing.
We're finally able to write about Continuous Organizations, a concept developed by our friend Thibauld.
Try to say the following sentence to a friend who was away for the past 2 years: "The Decentralized Autonomous Trust (DAT) is a specific immutable smart-contract that implements a bonding curve contract with sponsored burning to automatically mint, burn and distribute fully digital security tokens that we call FAIR securities (FAIRs)." - or for that matter, to anyone still living in a non crypto word.
We're really traveling at a different speed here.
COs and DATs tie two very specific focuses of mine: new organizational structures and fully digital security tokens.
COs, specifically have the following features: - Continuous Fundraising. Anyone can contribute anytime to the the DAT. - Fully liquid. With a reserve fund to provide it and a bonding curve to set the price. - Securities. FAIRs are a claim on the future cash-flows handled by the DAT. Automatically. - Permission-less, friction-less & supra-national. Although offline proxies are very much needed. - Governance agnostic. You could use something like Aragon or DAOstack to provide the rest of the infrastructure.
This is where the cool stuff happens for me. New types of organizations. New models for fundraising. Permisionless organization, commerce and innovation.
As we approach Bitcoin's 10th anniversary, you don't want to miss out on Dan's series of 4 posts in which he looks back at the origin of Bitcoin through the biology lenses, framing the crypto currency as the most advanced species of money:
"Bitcoin’s origin is akin to planting a tree. It wasn’t just Satoshi’s selection of the species (code), but the season (timing), soil (distribution), and gardening (community) that were essential to its success. It had to grow to be strong, mighty, and huge. It had to survive droughts, storms, and predators. Its deep roots had to support the weight of becoming a new world reserve currency."
If Dan's post left you hugely optimistic, here's a very pragmatic post as a follow up, concluding that the utopian dreams for Bitcoin (e.g. be your own bank, death of fractional banking and credit card companies, banking the unbanked etc.) may in fact be a long way off.
The author is actually very optimistic on a version of these outcomes becoming reality in the future, but thinks it will take a lot longer than the bull in all of us tends to believe.
Another insightful deep dive on privacy technologies in crypto and the trade offs made by various implementations, outlining a useful framework to compare them based on what pieces of information are private vs public (identity, tx data, state) and what techniques they use (Layer 2, tumblers, ZK, etc).
Looking forward to the author's next post on ZK-snarks/starks, where I think we'll see a lot of exciting privacy-related developments.
Some really fascinating stats on DEX usage from Alethio, a ConsenSys company and makers of DEX explorer "Dex Watch".
The numbers across the 17 tracked exchanges are still small in the grand scheme of things, which just over 200k unique addresses executing trades, but may be enough to spot some early signs of adoption, loyalty and maybe even cases of wash trading.
The main benefit of 'wrapped BTC' (WBTC) is that it should generate incremental liquidity for token pairs on DEXs, who until now only had ETH and maybe a stable coin to trade against.
The side benefit is that smart contracts and dapps can now integrate bitcoin transfers, so it will be interesting to see applications of that (e.g. lending it on Bloqboard or Compound, minting DAI out of it etc).
The downside is that it's clearly not as trustless as the real thing, or as an atomic swap, having to rely on Bitgo (a regulated custodian) for the custody of the collateral. Since it all lives transparently on-chain it should be fairly simple to verify the 1:1 backing in real time. This feels like the right trade off to make at this stage.
The decentralized finance space is where it's at in the beginning of the revolution.
Dharma has released Lever, a globally-accessible, trustless margin solution.
It's a Dharma Underwriter that originates loans and prices their default risk so investors can make informed decisions. Once a loan has been requested, Dharma Lever scans Dharma relayers to find an interested counter-party - thus leveraging the full liquidity of all the Dharma protocol users.
- Coinbase and Circle announce the launch of USDC — a Digital Dollar. Coinbase's support of USDC is a massive boost for the currency, which is of the USD-backed type (compared to the crypto-backed ones like DAI for example). Also cool to see former (and current?) competitors work together.
- Truffle, the popular Ethereum development framework, has probably crossed the 1M downloads mark in October (10x over the last 5 quarters). 🚀
- On that note, demand for blockchain engineers has never been higher and bears no resemblance to the shape of market prices.
- Trezor has added Changelly and ShapeShift support natively in its wallet.
- New Aragon Nest grants are out. They include Decentralized Design Lab, Level K for a cool Aragon Futarchy App, and Wetonomy for a suite of tools such as Tasks, Time Tracking, Members, Token Manager App.
- If you care for such things, the Exodus 1 is here. This is HTC's blockchain phone, which has a secure enclave for crypto keys.
Binance has raised an undisclosed amount of money from Vertex Ventures China and Vertex Ventures Southeast Asia & India (not from Tamasek as it was originally reported), with the strategic aim to open a base in Singapore and launch new fiat to crypto ramps in the broader South-East Asian markets.
Just six months after its $4M seed round, the MIT-linked Algorand project scores another $62M in funding.
They're not announcing where the funding came from, but it seems clear USV and Pillar are participating.
Additionally, they're getting some heavyweights in the executive team: Steve Kokinos, co-founder and Chairman at Fuze, and W. Sean Ford, co-founder of uPromise and former CMO of LogMeIn, will join Algorand as CEO and COO, respectively.
Synthetic Minds is a fascinating company that is applying some of the formal verification and program synthesis techniques used by the likes of NASA in order to build more trust in mission critical smart contract code.
As more and more value gets managed by smart contract, demand for this sort of services is bound to grow.
The company has closed a $5.5M round of funding after completing YC W18 batch, led by Khosla Ventures and Pantera.
The Australian regulator is also hard at work policing the local ICO market.
After suspending 5 ICOs from April this year, they have required a crypto trading platform, who somehow intended to raise up to $50M via a token sale with the endorsement of a famous cricket player, to halt the sale and refund investors.
Japan's self-regulatory body for the crypto exchange industry, which formed in the aftermath of the Coincheck hack earlier this year and counts 16 licensed domestic cryptocurrency exchanges, has received formal accreditation by the Financial Service Agency.
The purpose of the Japan Virtual Currency Exchange Association (JVCEA) will be to "create guidelines for domestic exchanges including strict measures to curb insider trading and money laundering while implementing security standards to safeguard customer assets".
It will be fascinating to see the effect of self-regulation in this market and whether other regulators will be inspired by it.