Welcome to this 31st issue of the Chain Reaction newsletter published on the 15th June 2022.
What you can expect in this newsletter
In the News
What we're reading/watching
Editor's Note (from Captain DeFi)
GM everyone! What a crazy few days. Another market crash with the Celsius network looking horrible and a collective groan heard across the DeFi/web3 ecosystem. If you missed it, Celsius network has been down and a lot of people with money in that protocol not being able to withdraw it. Its the equivalent of a bank run and they had to halt trading. Binance did too for around 3 hours. It's not a great sign but the calls for the death of DeFi are unwarranted and Numbers and I discussed this on ausbiz - https://www.ausbiz.com.au/media/finding-the-positives-in-the-crypto-crash?videoId=22049
Speaking of ausbiz, we also saw member Camx on the show too last week talking about the Ethereum Merge - https://www.ausbiz.com.au/media/the-merge-the-implications-of-ethereums-transformation?videoId=21985
Away from the crash there was also news of something called Web5 (thanks Jack Dorsey!). What happened to Web4 and what about getting more people onto Web3? Well apparently there’s new math Jack saying he wants his new proejct TBDex to be the best of web2 and web3. We’ll see what happens but my bet is that the term will go by the wayside like the GMAEN term instead of GM (GM is good morning, GMAEN is Good Morning, Afternoon, Evening, Night). Anyway, I digress. It’s been a big week. Read more about TBDex here https://www.tbd.website/
Also this week we saw some great videos out from CoinDesk at Consensus festival in Austin Texas and we even had an Aussie contingent of around 80 people. Such a vibe. Much FOMO.
Check out some of the social posts from the Aussie web3 community at Consensus here
Finally, it’s worth having a look at this debate on Soul Bound Tokens versus off chain credentials between Evin McMullen and Vitalik Buterin - https://youtu.be/TbyVyVNsyys
Have a great week!!
In the news
The following comes from BetaShares weekly crypto focused newsletter - check it out in full over here for more data analysis and other insights: https://www.betashares.com.au/insights/merchants-getting-ready-for-crypto/
Also check out Justin's latest article on Livewire here:
Merchants surveyed plan to enable crypto payment
A recent survey conducted by Deloitte. in collaboration with PayPal titled ‘Merchants getting ready for crypto’, which polled a sample of 2,000 senior executives at retail organisations with annual revenues ranging from below $10 million to over $500 million across the U.S., found that the majority of merchants surveyed plan to enable crypto payments. The survey was completed within a two week period in December, 2021. Survey respondents were optimistic about digital currencies in the consumer market, reporting broad agreement that accepting digital currency payments is already a point of differentiation, and are expecting to see broad near-term adoption. The report details: “More than 85% of the organisations are giving high or very high priority to enabling cryptocurrency payments, while roughly 83% are doing the same for stablecoins.”
Building a better mousetrap
One of the largest financial firms in the world, Citadel is reportedly getting into bitcoin and cryptocurrencies by building a crypto trading marketplace with Virtu Financial with the help of Fidelity Investments and Charles Schwab. The product is early in development but could be available late this year or early next year. An unidentified source told the website Coindesk: “The current crypto market structure is deficient and inhibits wider adoption from a lot of investors, which is what Citadel Securities’ trading consortium is addressing. It’s more of a crypto trading ecosystem or marketplace than an exchange. It’s going to take on the exchanges by building a better mousetrap.” A spokesperson for Schwab, commented: “We know there is significant interest in this cryptocurrency space and we will look to invest in firms and technologies working to offer access with a strong regulatory focus and in a secure environment.”
App to allow access to decentralised and traditional finance
One of the largest crypto exchanges by total volume in Australia, Swytfx, and share trading and superannuation platform Superhero announced a merger to create a “$1.5 billion financial services giant.” The merger will allow customers to access through an app both decentralised and traditional finance by enabling investment in crypto, retirement funds and equities, according to a statement. “The proposed merger represents a significant step for both businesses in terms of their evolution from disruptive tech players into a single, major financial institution that can grow across domestic and international markets,” Swyftx co-founder, Alex Harper, said.”
This week we asked our community the following question:
what does everyone else here think about SBTs?
Here's some of the responses from our Discord
Soul bound tokens are good in my opinion. Web3 is being built primarily by the people for the people. Soul bound tokens will be able to proceed proof of what the person has been up to and will be associated only to the person and cannot be bought or sold. It will be beyond just monetary value, basically it shows the ‘soul of the person’ holding these tokens. This is beautiful but as Evin Mcmullen explained in a recent podcast there is a possibility of unintended data leakage which can lead to bias and data security concerns. If we can balance and manage both this it will be something to really look forward to.
From Dr. Mitch
Every marketing company / marketer in the world are licking their lips right now hoping that SBTs become a thing.
In 2019, Kevin Hart lost his job hosting the Oscars because of tweets in 2010. I'm not saying that scenario it was the right or wrong call, but there's an example of someone being punished for their past (but in this instance, it could have been deleted). Imagine the ramifications of an immutable history - even in circumstances where you did nothing wrong, but it could be interpreted that you did. "Senior Marketer @ TerraLuna"? - probably 95% harder to get a job even if you did absolutely nothing wrong, and were as out-of-the-loop as anybody else. People could find themselves in holes they can never escape from. One great example that comes to mind is how barbaric the US felony system is - that you're essentially shunned from sections of society because of a crime you served time for.
Opt-in only might sound good in theory, but what happens if a centralized entity states that unless you use SBTs, you're restricted from certain venues/locations, etc. (think COVID vaccine mandates)?
Just my opinions, but my Web3 is one that is as decentralized as possible, which starts at anonymity.
Data as at 14th May 2022 - 8:41pm
Market Moves (from CoinGecko)
NFT Moves (from CoinGecko)
What we've been watching/listening to
[Video] Bankless talking to Vitalik Buterin on Ethereum/Bitcoin maximalism and taking both sides of the argument (for and against maximalism) - a worthwhile listen/watch - https://www.youtube.com/watch?v=AsGubNtWeSo&ab_channel=Bankless
[Video] CoinDesk TV and their various Consensus, Austin videos here - https://www.youtube.com/c/Coindesk
Get in touch
If you would like to dig deeper into why and how is the blockchain relevant to international matters and to get more insights on regulations and Defi knowledge, join us on our Discord: https://discord.com/invite/ZRCTDdsVEF