Chain Reaction - Issue 12 - 7th February 2022

Welcome to this 12th issue of the Chain Reaction newsletter for the week commencing 7th February 2022.


In the news last week we a major exploit on a blockchain bridge but subsequent recovery, a large investment into web3 projects by a local venture capital firm and more regulation updates across the world with India agreeing to legislate crypto assets.


In news closer to our association we saw a few members make the news with their participation in the ausbiz financial media show. First up was Alyse Su and her description of DAOs (here) and then later in the week was Arturo Rodriguez and Mark Monfort talking about their TradeFlows project as well as the Aus DeFi Association (here).


If you like what you see and you're interested in continuing these awesome DeFi conversations, join us on our Discord: https://discord.com/invite/ZRCTDdsVEF


What you can expect in this newsletter
  • In the News

  • Videos of the week

  • Charts and Data

  • Around the world of social media

  • Education


In the news
#Protocols

CoinDesk - Blockchain Bridge Wormhole Suffers Possible Exploit Worth Over $326M - Wormohole, a popular cross-chain portal, had the message “Portal is Temporarily Unavailable” on its website and $10m of reward has been offered to the perpetrators to return the funds. Days later there was an update with the funds replaced (https://twitter.com/JumpCryptoHQ/status/1489301013408497666?t=oKEiO3GbqOAW5BYylU3WLg&s=09). Watch this space closely.


#NFTs

Mumbrella - Marketers need to break down the NFT bandwagon - Much of the media, marketing and advertising space remains critical of the NFT boom, but have they taken the time to truly understand what’s going on? Andrew Knowles, cofounder of SKMG, gives a simple breakdown of how NFTs can build powerful communities, and what that might mean for the future of communication.


The Sydney Morning Herald - You can download art with a click. So what’s the point of owning an NFT, and why are they worth so much? - Great explainer piece from the SMH on NFTs starting with what they are and what you get for them as well as what benefits there are to artists and what is pushing them to somewhat exorbitant amounts. If you’re getting started, this is a good article to check out.


Coachella to sell lifetime festival passes as NFTs - The Coachella Valley Music & Arts Festival is hopping onto the NFT bandwagon in partnership with FTX US to launch a series of NFTs that will allow the owners to access lifetime tickets to their annual festivals.



#Investing

Announcing AirTree Web3 – For crypto projects just getting started -

Airtree makes it official. They raised a $700mn and have earmarked $50m towards web3 projects and protocols in Australia.


CoinDesk - Address Linked to Wonderland's Sifu Cashes Out $5.5M Worth of Ether - Last week we highlighted the issues at Wonderland with CFO 0xSifu having been doxxed and found to be a former fraudster. This week 1000 ETH from Sifu.eth was sent to a coin-mixer Tornado Cash. Not a cut and dry case that it’s them but likely is according to some.


CoinDesk - MicroStrategy Buys Additional $25M Worth of Bitcoin During Market Dip - lower levels of BTC acquisition by Michael Saylor and Microstrategy, but purchasing nonetheless with 660 bitcoin worth $25 million bought in January.


#Metaverse

CoinDesk - First Mover Asia: Crypto Prices Plunge Late After Weak Meta Earnings - The company formerly known as Facebook (now Meta Platforms) announced losses of $10 billion for its augmented reality division which ended up seeing its shares drop 18% on Wednesday which preceded a further drop in major cryptocurrencies.



#Education

MarketWatch - LeBron James partners with Crypto.com to teach kids blockchain technology - Crypto.com is again teaming up with sports superstars in this partnership with the Lebron James led I Promise School which will provide crypto education to kids and the job opportunities for their families.



#Regulation and #Government

CryptoNews - Russian Central Bank Still Wants to Ban Bitcoin & Crypto Mining, Despite Backlash - Despite Russian President Vladimir Putin’s support of crypto mining, the Central Bank or Russia still wants to ban it but perhaps not on trading. It calls mining a risk to the health of the energy network.


Tech Crunch - India proposes 30% tax on crypto and NFTs income - In their 2022 budget, the Indian Government plans to release a digital rupee through its central bank between 2022-2023. Crypto is now legally recognised in India – a 30% tax to be imposed on income from any virtual assets. Overall, a step forward for the crypto space, however regulatory uncertainty still casts confusion on the future of cryptocurrencies in India.



Videos of the week

ausbiz - WTF are DAOs | The future of governance - In this episode we get to feature another Aus DeFi Association member in Alyse Sue who breaks down what DAOs are and how they operate, right down to their very fundamentals (with some cool visuals from WhiteBoard Crypto). She goes through the 3 types of DAOs from Venture DAOs to Social DAOs and Product DAOs. 14mins


ausbiz - Building a DAO and solving real world problems - Following up from Alyse great work above we had members Arturo and Mark join the ausbiz Cracking Crypto series talks to share details about projects they are working on to bring the benefits of DAOs to real world problems as well as some details about web3 structures and tokenomics. 17mins


The Defiant - The line is not a line - the real problem with NFTs - This video is a short response from The Defiant to the Dan Olson hit piece on NFTs that came out recently (see here). In this response, Robin Schmidt discusses Dan’s video and highlights that whilst it was quite well researched it falls foul of being one-sided, the very thing he highlights as questionable from a journalistic integrity perspective. Whether or not the debate between the pair happens, this video was the perfect response. Short, sharp and sweet.


The Defiant - Camila Russo responds to Dan Olson - and in a follow up to the above video we see this from Camila, Ash and Robin from The Defiant. It was not all about the Dan Olson sag but they responded in a very positive way. There’s critiques to this space and The Defiant are amongst the crowd who look at things fairly objectively. This plus India’s crypto tax and more. 37mins


Bankless - Boys Club | Layer Zero with Natasha Hoskins & Deana Burke - In this episode of Bankless podcast, the team chat with Boys Club, which is a DAO-in-training building products to make the crypto space more welcoming for women. It covers onboarding women to web3, value adds and more. 1hr4mins


Coin Bureau - Crypto Mining Hearing: What Politicians Have Planned!! - In this video, Guy goes summarises the latest senate hearings on crypto in the US. This time it’s the ups and downs of mining from those who are pro PoW (proof of work) or PoS (proof of stake) to those who are not. 27mins



Charts and Data

CoinGecko

Top 10 cryptocurrencies by market cap as at the 6h February 2021 8:00pm AEST on CoinGecko. All coins are back in the green after the recent market moves over the last 7 days. Check out the glassnode video below for some underlying reasons why.


Glassnode - The Week On-chain: Levered Shorts vs Spot Demand - Week 5, 2022 (Bitcoin Onchain Analysis) - Last week it was network profitability. This week it’s measuring demand and leveraged futures (looking a little negative at the moment). It uses the funding rate to assess directionality of the market (e.g. being net long and positive or net short and sentiment being negative). Some data like the BTC Futures Perpetual Funding Rate shows more and more traders are viewing the market as a short as the price gets lower. 27mins


Dune Analytics - In this dashboard we see OpenSea trading volume and how far above the norm the month of January was for the platform. Nearly $5bn USD of volume compared with previous record of $3.4bn back in August 2021. Other metrics are available on this dashboard in the link above and search Dune for more community driven insights.


Social post of the week

Earlier this week, Twitter user larrylawliet.eth had their BAYC/MAYC (Bored Ape and Mutant Ape Yacht Club) NFTs stolen in a hack which has highlighted a question many asked in the tweet responses, ‘should there be safeguards in place to tag stolen NFTs?’. It’s a good question but a tricky one with some arguing the slippery slope that this goes down but others arguing for its need.Check out the thread here: https://twitter.com/iloveponzi/status/1488286811462205440


Adding to the story about India legalising crypto and NFT assets, taxing them at 30%, are these links from Balaji Srinivasan who is one of the most recognised faces in the world of web3. Worth a look and it will be interesting to see how other nations follow along https://twitter.com/balajis/status/1488460854018260992?t=0x63T8dNz8dy2-CKp6qUkg&s=08



Education

DAOs: Social networks that can rewire the world - This fantastic article explains what DaOs are, how they work, and how they have and will continue to reshape the world in the coming years.


Thanks again to our various newsletter contributors

If you're interested in contributing to these newsletters in future - please join us on Discord or reach out to us on info@defi.org.au

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