August 26, 2021 / Unchained Daily / Laura Shin
Daily Bits ✍️✍️✍️
- David Marcus, head of Facebook Financial, told Bloomberg that Facebook is looking to get involved with NFTs.
- NBA Top Shot plans to launch a set of WNBA moments this week.
- 1 in 10 people in the US have invested in crypto, according to a recent survey of over 5,000 Americans.
- Liquid Global, a Japanese crypto company that was hacked last week for over $90M, signed a debt financing deal with the crypto exchange FTX for $120M.
- Chainlink price oracles went live on Solana yesterday.
- DeFi lender Euler raised $8M in a Series A led by Paradigm.
- eToro’s Q2 crypto income increased by 23 times compared to last year.
- A supervisory notice from the FCA (the UK’s regulatory body) says that Binance is “not capable” of being supervised by the agency.
- Entertainment giant Fox invested in Eluvio to “accelerate the adoption of Eluvio’s blockchain/NFT platform.”
What Do You Meme?
AVAX is poppin’. The native token of the scalability-focused blockchain Avalanche is up ~100% over the past seven days, which is the largest price increase for a top 100 token by market cap. (AVAX also holds the crown for the best performer over the last 30 days.)
The token’s price surge coincides with the recent launch of “Avalanche Rush,” a $180M liquidity mining incentive program spearheaded by the Avalanche Foundation.
What’s a “liquidity mining incentive program?”
It’s a DeFi native marketing technique that networks and dapps can apply to entice users to join their platform.
Avalanche, for example, is a layer 1 smart contract platform that describes itself as “blazingly fast, low cost, and eco-friendly.” Essentially, Avalanche is one of the many networks seeking to disrupt Ethereum through low fees and fast transactions. Solana and Binance Smart Chain have taken a similar approach to Avalanche.
However, the problem with building an Ethereum competitor is that you have to convince users to, well, use your platform. There is no DeFi or NFT culture without users.
This is where liquidity mining incentives come in. It’s a way for platforms such as Avalanche to pay users for switching to the Avalanche network.
Avalanche Rush set aside $180M in AVAX that will be used to reward different types of users on the Avalanche network.
“Phase 1” of the Rush program began with a partnership with two blue-chip DeFi protocols — Aave and Curve. Over the next three months, $20M in AVAX rewards will be going to Aave users and $7M in AVAX will be reserved for Curve users. Essentially, Aave and Curve users who provide liquidity to Aave or Curve on Avalanche will be rewarded with AVAX for their troubles, along with the yield they already receive from putting their tokens into a liquidity pool in the first place. Otherwise, the protocols act like normal. Users will borrow money from Curve or Aave’s liquidity pool at a certain interest rate, while contributors will earn passive income on their crypto.
Since the original announcement, the Avalanche Foundation has also added the decentralized exchange Sushi to the incentive program, setting aside $7.5M in AVAX for future Sushi liquidity providers on Avalanche. In addition to the AVAX incentives, Sushi will also be rewarding Avalanche-based LPs in SUSHI tokens, matching Avalanche’s promise of $7.5M in AVAX with $7.5M in SUSHI.
While it remains to be seen whether Avalanche can pull actual users onto their platform through the liquidity mining incentive, it appears dapp creators are interested in the platform’s quick and cheap settlement time, rather than the incentive program.
“Avalanche consensus is well suited for building DeFi applications due to its scalability features, particularly its high throughput and near-instant finality. The deployment of the Aave Protocol on Avalanche will allow users to leverage low transaction costs without compromising the security of the network,” said Stani Kulechov, founder of the Aave Companies, which developed the Aave Protocol.
“As DeFi becomes more and more popular, it becomes clear that Ethereum blockchain is currently struggling to fit all the activity. Thus, it is important to expand to other chains and L2s. We find Avalanche offering an excellent opportunity with its unique decentralized consensus mechanism, high throughput and low transaction fees,” said Michael Egorov, chief executive officer at Curve Finance.
Going forward, Avalanche Rush will continue onboarding “blue-chip DeFi protocols” to the network. It has also set aside AVAX rewards for current and future Avalanche native applications.
- Nic Carter on Bitcoin and energy:
- 23 “meta” innovations on Ethereum:
- Forbes on Chelsea Manning’s new Bitcoin-based privacy startup:
On The Pod…
BitGo CEO Mike Belshe and COO Jeff Horowitz talk about one of the hottest topics facing the crypto industry today: regulation. They discuss…
- what BitGo does
- why Jeff left his successful TradFi career to go crypto
- how crypto compliance and custody differs from the traditional finance world
- the state of crypto education amongst regulators
- why Jeff and Mike think the infrastructure bill is a win for the crypto industry
- what FinCEN is doing to regulate crypto
- why they think the infrastructure bill’s goal of raising billions in crypto taxes could only bring in millions
- what FATF guidance regarding VASPs requires of crypto companies
- why the travel rule could lead to US customer data being shared overseas
- how digital assets change the implications of the travel rule
- how regulators are attempting to deal with DeFi
- what the FATF guidance means for FATF countries, like the US
- why DeFi is not ready for strict regulations
- Jeff’s views on Brian Brooks’s departure from BinanceUS
- the Galaxy Digital acquisition of BitGo
- what security issues a trillion-dollar wallet presents
- why BitGo refused to put a “freeze” function in its WBTC contract
- why Tesla and MicroStrategy purchased BTC and why other companies have been slow to follow suit
- whether BitGo will offer NFT solutions going forward
My book, The Cryptopians: Idealism, Greed, Lies, and the Making of the First Big Cryptocurrency Craze, is now available for pre-order now.
The book, which is all about Ethereum and the 2017 ICO mania, comes out Jan. 18. Pre-order it today!
You can purchase it here: http://bit.ly/cryptopians