Welcome to our third DeFi Weekly Update! We’ll have another article posted soon with some exciting new information about Plexus updates and changes — in this article we’ll take a look at last week’s most important crypto and DeFi news, and the impact it had on crypto as a whole. The biggest themes in the news last week centered around NFTs, widespread crypto adoption, and stablecoins.
DeFi News from 8/22 to 8/28
Visa Buys a CryptoPunk
On Monday the 23rd, global financial services giant Visa announced that they had acquired CryptoPunk 7610, their first-ever NFT purchase. According to CoinDesk, Visa’s Head of Crypto Cuy Sheffield announced that the purchase was meant to help Visa understand the NFT market and how people interact with its infrastructure, to better understand it and serve Visa’s customer needs in the growing space in the future. Sheffield said that Visa expected NFTs and crypto to be a tremendously important space in the future, going so far as to write that “we can envision a future in which your crypto address becomes as important as your mailing address”.
Deloitte: Majority of Financial Professionals Think Crypto Will Rival or Replace Fiat in 10 Years
A new survey from major accounting firm Deloitte showed that a strong majority of polled financial professionals believe that crypto adoption will continue to grow stronger in the next decade. Deloitte’s 2021 Global Blockchain Survey polled over 1000 global financial professionals, and found that 76% believed that crypto would become a major alternative or even a replacement to fiat worldwide within 10 years. While a majority of respondents also agreed that there are a number of noteworthy threats and challenges to global crypto adoption, a noteworthy portion of respondents (44%) also said that they expect that crypto would also allow their organizations to access and use DeFi.
ENS Service Integrates DNS for Sending Crypto to .com Addresses
Ethereum Name Service (ENS) announced on Thursday that owners of DNS addresses (regular .com/.org/.net etc. website domains) would be able to import them to ENS, without having to pay an ENS fee. According to the ENS blog post, this plan was first envisioned in 2017 soon after the initial creation of ENS, and is the culmination of 4 years of work from the ENS team.
USDC Reserves to be Held 100% in Cash and Treasury Bills
Circle and Centre.io, overseers of the USD Coin (USDC) stablecoin, announced in a blog post on Sunday the 22nd that USDC reserves would be held entirely in cash and treasury bills in the future. Citing this as an important step forward for reserve transparency and global adoption of crypto, Circle wrote that community demand for a trustworthy and transparent stablecoin asset was an important driver in their decision to integrate these changes expediently. With a market cap over $27 billion, USDC is the 9th biggest crypto asset, and the move allays old fears from July when news came to light that the coin was only 61% backed by cash and cash equivalents.
NASDAQ Announces Bitcoin Futures ETF
Valkyrie Investments, a “specialized alternative asset management firm at the intersection of traditional finance and the emerging cryptocurrency sector”, was announced by a NASDAQ filing on Tuesday to be applying for a Bitcoin Futures ETF with NASDAQ as their partner exchange. This announcement marks a major move forward in the Bitcoin ETF race, as Valkyrie partnering with an exchange means the SEC can now move forward with consideration of the product, with Coindesk speculating that the unique Futures ETF may be more likely to be approved than the many other potential ETFs that would be trading the underlying asset itself.
Budweiser Acquires Beer.eth ENS and Announces Support of Tom Sach’s Rocket Factory Budweiser NFT
In another major moment for corporate adoption of NFTs, Budweiser acquired the Beer.eth ENS domain for 30 ETH (roughly $97,000 at time of writing). In further support of NFTs, Budweiser also purchased a Tom Sach’s Rocket Factory NFT emblazoned with their logo, announcing their support for the project and the greater NFT community at large. In correspondence with Coindesk, a Budweiser spokesperson said “Budweiser is taking its first steps into the NFT universe, […] We’re excited to support Tom Sachs and his Rocket Factory project and join this incredible community.”
Sushiswap Announces Plans to Build on Avalanche
The Avalanche network and many of its ecosystem protocols found major market traction in the last week, spurred in part by Avalanche’s new $180 million incentive program Avalanche Rush. In addition to other major DeFi protocols like Aave and Curve, Sushiswap announced this week that they plan to build on Avalanche as well. According the Coindesk, “The incorporation of SushiSwap in Avalanche’s Rush program will allow SushiSwap and the Avalanche Foundation to each allocate up to $7.5 million worth of AVAX and SUSHI tokens to liquidity mining incentives over the next three months”. Avalanche AVAX market cap has grown tremendously in the last two weeks, up almost 300% from the lows to a peak token price of over $57 on August 24.
Key Takeaways
We’ve come a long way since the market-wide crypto crash in May — only three months later, many protocols are back to or even exceeding all-time high valuations, major companies are supporting and even purchasing NFTs, and financial services sector sentiment seems to be turning the corner on crypto adoption.
NFTs continue to capture much of mainstream media’s crypto attention, continuing a trend that held true for most of August. Thankfully for DeFi users, though, NFTs can be a notably DeFi-related topic as well, with fractionalized NFTs like Crytopathic’s NFD coin and NFT vaults like NFTX being major vehicles for speculation and investment in the last few weeks.
While the NFT craze still continues to push incredible transaction volume through OpenSea and other marketplaces/chains, the explosion of activity on Avalanche is a strong reminder to DeFi users that traditional DeFi use cases like AMMs and lending protocols are still building and expanding.
