Issuers of stablecoins like Tether (USDT) and USD Coin (USDC) may soon be required to work under the same regulations as banks, but that seemingly doesn’t frighten the CEO of the USDC-issuer Circle.
Commenting on the ***** administration’s proposal to work on a bank-like regulation for stablecoin issuers, Circle CEO Jeremy Allaire took a supportive stance for the recommendation. He highlighted that the proposal’s aim to regulate dollar stablecoin issuers in the United States financial system as banks at the federal level by the Federal Reserve represents significant progress for the industry’s growth.
Allaire noted the current steps would upgrade the current money transmission-focused regulations “to a much more fundamental infrastructure at the core of what potentially the future of banking and capital markets look like.”
“There’s a real recognition that as these payment stablecoins grow, they could grow at internet scale relatively quickly,” Allaire commented. When the stablecoin market grows into the hundreds of billions in circulation and trillions in transactions, the risks to financial markets and financial stability become much more significant, he added.
As Cointelegraph reported, the ***** administration’s proposal aims to create a new “special-purpose charter” for stablecoin issuers, putting them in the same category as banks. Allaire believes that the details on a bank charter for a crypto company might need to get worked out over time with both the FDIC and other agencies that oversee banks.
When it does, new all-time highs are due, Decentrader believes.
“We remain bullish on high time frames and continue to expect the price to rally up to the $85,000 –$90,000 region in the coming weeks, which aligns with the 1.618 fib retracement level,” the update stated.
An accompanying chart showed the target as well as nearby support levels, the nearest focusing on an area around $59,000, which separate research believes could act as a strong line in the sand for bulls.
“When we compare this cycle from the most recent halving date to previous cycles, we can see that so far we have not experienced a final parabolic run-up,” Decentrader continued.
While not specifically identical with either the 2013 or 2017 bull runs, Bitcoin is still in the process of laying the foundations for a “parabolic run-up.”
“When we overlay the cycles like this, we can see how the current cycle is not directly like either of the previous cycles but is in fact a combination of the two. With a more muted potential double-top playing out compared to 2013, and less consistency than 2017,” the update read.
“As we attempt to break out of the previous all-time high from May this year, it is setting up the prospect of a potential parabolic run-up as we saw in the late stages of the previous bull runs.”
While short-term fallout from an ETF rejection may hurt BTC/USD, 2017 proved that major protocol upgrades have a cathartic effect.
Segregated Witness (“SegWit”) launched four months before that year’s $20,000 cycle highs, and Taproot represents the largest upgrade since.
“The last time Bitcoin had such a major upgrade was the Segwit upgrade in Aug 2017. At that time, the price of Bitcoin was at $4000, it then went on to rally up to nearly $20,000 in the following four months,” Decentrader commented.
“Will we see a similar rally this time around? Given how bullish many macro indicators are looking right now, and the rush of new money entering crypto, it is certainly possible.”
Coinbase’s NFT offering will significantly boost the exchange’s operations, as the NFT platform could potentially flip Coinbase’s entire existing cryptocurrency business. Armstrong made the statement speaking on a conference call on Tuesday, Bloomberg reported.
“We are very excited about NFTs, this is going to be a very large area for crypto in the future, and it already is today,” the Coinbase CEO said, adding that it “could be as big or bigger” than Coinbase’s cryptocurrency business.
Coinbase officially announced plans to launch its own NFT platform in mid-October, intending to allow its users to create, purchase, discover and showcase Ethereum-based NFTs. The service will provide a social media-like experience, enabling users to follow different profiles and receive updates.
As Coinbase expects to launch its NFT platform later this year, a wide number of people have already expressed willingness to try the offering. A few days after Coinbase started its NFT waitlist in October, more than 1 million people had signed up for the platform.
The number of applicants has continued to grow rapidly, with Coinbase reportedly receiving over 2.5 million emails seeking to sign up for the marketplace so far. This is just a tiny portion of Coinbase’s total 68 million verified users and 8.8 million monthly active users as of Q2 2021.
OpenSea, the largest NFT marketplace in the world, processed over $1.7 billion worth of transactions over the past 30 days, with over 230,000 users interacting with its smart contracts over the period, according to data from industry metrics provider DappRadar.
Coinbase is just one of many global crypto exchanges that plan or have already launched their NFT platforms amid the parabolic growth of the NFT industry. In September, Sam Bankman-Fried’s crypto exchange FTX became the latest crypto platform to announce the launch of a native NFT marketplace. Binance, the world’s largest crypto exchange, debuted its own NFT platform in June.
Tether (USDT) has gone from being a renegade cryptocurrency to becoming the industry’s primary crutch during the last seven years, according to a new report.
Essentially, USDT is a bridge between traditional currencies like the United States dollar and decentralized digital currencies operating on open blockchain networks.
Independent crypto outlet Protos provided an in-depth insight into the most common stablecoin and the liquidity providers who supply it to cryptocurrency platforms.
According to the report, issued USDT is primarily acquired by just two market makers. Between 2014 and October 2021, Alameda Research and Cumberland received a projected $60.3 billion in USDT, accounting for almost 55% of all outbound volume ever. According to Protos, the closest competitor minted a few hundred million USDT.
Source: Protos
Alameda Research, which is led by 29-year-old cryptocurrency billionaire Sam Bankman-Fried, acquired $36.7 billion or nearly a third of all Tether produced. Cumberland Global, the world’s largest crypto liquidity provider, comes in second with $23.7 billion received. Cumberland is a DRW Holdings subsidiary, which was founded in 1992 and is regarded as one of the world’s major financial traders.
Protos states that Tether’s Treasury transferred $36.7 billion in USDT to Alameda Research, with $31.7 billion (86%) of it received in the last 12 months. This number equals approximately 37% of all outbound USDT volume.
According to the report, Tether sent over $30.1 billion (87%) of Alameda’s USDT to its cryptocurrency and derivatives exchange, FTX. However, Alameda also has wallets on a variety of different cryptocurrency exchanges. The company received $2.1 billion (6%) on Binance, $1.7 billion (5%) on Huobi, and $115 million on OKEx. The remaining $705 million was transferred to non-exchange addresses.
Cumberland, on the other hand, received $23.7 billion in USDT. In the previous year alone, $17.6 billion in USDT (74%) was received from Tether’s Treasury. This figure accounts for 22% of all outbound USDT volume ever recorded.
Protos notes Cumberland’s importance as a liquidity source and market maker for Binance, having been on the exchange since at least early 2019. Tether issued Cumberland $18.7 billion (79%) in USDT to Binance, with the rest going to other exchange platforms.
The liquidity provider received $131.5 million (less than 1%) on Poloniex, $9 million on Bitfinex and another $30 million on both Huobi and OKEx.
Tether remains the world’s largest stablecoin by market capitalization. However, the company’s token has been under scrutiny by regulators in recent times. As reported by Cointelegraph, the U.S. Commodity Futures Trading Commission levied fines totaling $41 million and $1.5 million against sister crypto firms Tether and Bitfinex, respectively, for breaches of the Commodity Exchange Act and a prior CFTC order, respectively, on Oct. 15.
Users who registered Ethereum addresses, such as Cointelegraph.eth, were granted a sum of ENS tokens dependent on the date of domain registration and length of renewal fees, in addition to other engagement parameters. The claiming window for tokens lasts until May 4, 2022 to allow the maximum opportunity for applicable claimants. All details on claiming can be read here.
In the days following the announcement, major cryptocurrency exchanges Binance, KuCoin, Uniswap and SushiSwap, among others, started accepting the token on their platforms for an array of trading activities.
The ENS token has experienced major volatility since launching as a flurry of investors seek to secure their unrealized profits. The asset reached an all-time high price of $85.70 but has since fallen to $54.19 at the time of writing.
Cointelegraph spoke to Brantly Millegan, director of operations at Ethereum Name Service, for an exclusive insight into the protocol’s privacy details:
“ENS is an open public protocol. The core components of ENS are decentralized and self-running, but there are a few things that require some human discretion.”
DAOs promote a decentralized, open-source model of governance that is owned and managed by the active individuals within the community, rather than a handful of signatories. Projects emerging within the nonfungible token, or NFT, space are adopting the model to encourage their holders to stake assets in a bid to increase the floor price of their collection.
SEC commissioner advocates for greater DeFi regulation
United States Securities and Exchange Commission Commissioner Caroline Crenshaw published an opinion piece this week outlining the “panoply of opportunities” in the DeFi space, alongside expressing a level of caution regarding the lack of regulatory clarity and foreshadowing the challenges that DeFi is expected to pose.
Titled “DeFi Risks, Regulations, and Opportunities” and published in the debut edition of The International Journal of Blockchain Law, the piece argues that investors in the digital asset industry require greater legislative protection akin to traditional markets, a sentiment echoed in Crenshaw’s speech at the “SEC Speaks” conference in October.
Despite being a core pillar of decentralization since the inception of Bitcoin (BTC) in 2009, Crenshaw also argues that participants in the DeFi space tend to prioritize financial gains over pseudonymity:
“In moving to DeFi, I suspect most retail investors are not doing so because they seek greater privacy; they are seeking better returns than they believe they can find from other investments.”
She continues on to suggest that projects that adhere to the SEC’s regulatory framework can expect a higher probability of success going forward.
DeFi protocol Moonbeam close to $1B raised in Polkadot parachain auction
DeFi protocol Moonbeam is in pole position to claim victory in Polkadot’s inaugural 10-project parachain auction. The bidding, which commenced on Nov. 11 and is scheduled to run until Nov. 18, has attracted approximately 75,000 participants, who have staked over $2.5 billion in DOT tokens.
Polkadot parachains are distinctive layer-one blockchain networks operating in parallel to the main network, in addition to being connected to the Polkadot Relay Chain. They can be implemented across a number of sectors from decentralized finance to smart contracts.
Earlier this week, Acala was leading the way in the auction but has since been overtaken by Moonbeam in what has become a two-horse race. The two protocols have accumulated 20.3 million DOT and 17.2 million DOT, respectively — equivalent to a colossal $980 million and $797 million.
Polkadot’s first parachain has been added
Referendum 41 has passed registering the Shell parachain on Polkadot, to ensure block production, inclusion, and finalization. The Shell parachain has extremely limited functionality: it does not even have the notion of accounts.
In early October, Polkadot council members passed a governance proposal in a unanimous decision, following confirmation from Polkadot founders Gavin Wood and Robert Habermeier that the network could support such initiatives.
Token performances
Analytical data reveals that DeFi’s total value locked has increased3.85% across the week to a figure of $174.76 billion.
Data from Cointelegraph Markets Pro and TradingView shows DeFi’s top 100 tokens by market capitalizationperforming considerably wellacrossthe last seven days.
Loopring’s LRC secured the podium’s top spot with a seismic 179%.Basic Attention Token (BAT) came in second with16.5%, while Avalanche’s AVAX came third with 7.95%. The fourth and fifth places were claimed by Chainlink’s LINK and Wrapped Bitcoin (wBTC), with 5.23%and 3.8%, respectively.
Thanks for reading our summary of this week’s most impactful DeFi developments. Join us again next Friday for more stories, insights and education in this dynamically advancing space.
