Links to items discussed:
Links to items discussed:
Hi I'm Conor Svensson, founder and CEO of Web3 Labs and this is your Week in Blockchain on Monday 19th of April 202. Highlights in this week's issue include Coinbase's IPO, another roller coaster week for cryptos, ConsenSys closing a major funding round, Binance continuing to grow their influence in DeFi and Sotheby's big NFT sale. Coinbase this week went public. It wasn't in fact by an IPO, it was via a direct public offering. This meant that instead of investment bankers investing in the first set of shares and then selling them to the markets, Coinbase sold their shares directly on the market. It was a very successful listing, their closing price for the stock was just shy of $330 which gave an implied valuation of just under $86 billion. The Binance exchange also listed a COIN based stock token shortly after this to allow people on their platform to get exposure to tokens that track the price, much like they've done previously with Tesla. Other beneficiaries of the Coinbase listing also include its 1700 employees who were all given 100 shares right at the last minute, which was a nice windfall for them, the rapper Nas who was one of the early investors alongside some of the more familiar names you see in this space like Andreessen Horowitz and Union Square Ventures. With all of the activity that we saw happening here, there was also a lot of movement in the crypto markets too with Bitcoin and Ethereum hitting new all-time highs just beforethe Coinbase listing:
Bitcoin going up to just shy of $65000 per Bitcoin and Ether over $2500. However, there was a significant drop in the the last few days with Bitcoin's price dropping down to $52 000 and Ether to $2100. There's been some funny movements though with Dodgecoin which has continued its rapid ascent recently. Earlier on in the week it actually eclipsed UniSwap and Litecoin to become the eighth largest cryptocurrency by market capitalization. Now it's gone even further and is up at number six. The returns that we've seen with Dodgecoin, it's up over 6000% this year to date. Mark Cuban's also come along and said that his Dallas Mavericks basketball team is planning to hold Dodgecoin on their balance sheet so one-upping Elon Musk with the Bitcoin on Tesla's balance sheet. Another really big piece of news this week was ConsenSys closing a $65 million funding round which was backed by JP Morgan, Mastercard and a number of others. It's fascinating that this has happened now because for a number of years ConsenSys have been investing very heavily in a number of different products and projects across the blockchain ecosystem. Getting this serious funding really is the signifier that they've now got a very clear strategy that they've been able to get good institutional buy-in. If you remember back to August last year, ConsenSys acquired JP Morgan's Quorum technology team and allegedly took an investment from JP Morgan but there wasn't really much public information about this. Then in October of last year there was an announcement by ConsenSys and Protocol Labs, the creators of IPFS and the Filecoin platform which is a decentralized file storage platform, to be partnering together in terms of bringing decentralized file storage technologies and bridging the gap between IPFS, Filecoin and Ethereum. When you look at the people who are involved in this investment, you've got UBS and Mastercard (we've seen that Mastercard have announced their own payments cryptocurrency technology), other investors included Protocol Labs as well and the Maker Foundation. Given that you have JP Morgan and others involved in this there's clearly a focus on the DeFi angle here and ConsenSys certainly believe very heavily in the opportunity that it presents, especially when you've got some very well established players like UBS and Mastercard here alongside some of the pioneers and the decentralized landscapes like Protocol Labs. So it's no doubt setting them in a really good position to continue to grow and scale and continue to execute on their vision of building out the Ethereum ecosystem. It's really big news and a significant milestone for the team. We've also had MicroStrategy announce that it's now paying its board of directors in Bitcoin. Then HSBC, the bankers, have come along and said that they won't support trading in MicroStrategy shares on their platform because HSBC has got no appetite for direct exposure to virtual currencies. This also took effect as well with the Coinbase listing earlier in the week and HSBC doesn't allow their clients to hold it via their platforms either so although this is legislation, that's kind of been in place for a number of years since going back to 2018, with HSBC they're certainly taking a far more conservative stance about cryptocurrency and cryptocurrency exposure than we're seeing with a lot of the other banks out there that are looking to find ways to leverage from it. Grayscale have added another billion to their portfolio, assets that they actually hold, so it's taking their overall assets under management to over $50 billion. They've expanded to include Litecoin, Stellar, Zcash and Bitcoin cash. Time has also followed suit after Tesla announced that they were keeping Bitcoin on their balance sheet. Time magazine now plans to as well, they've also announced the partnership with Grayscale where they're going to be working together on a new video series that's going to come in the summer explaining the crypto space. The Swiss insurer AXA now allows its customers to pay in Bitcoin however, they're not planning to hold these Bitcoin on their balance sheet. When customers pay in Bitcoin it goes to a broker, Bitcoin Swiss who will then convert them into Swiss Francs for AXA. But, AXA have really embraced this because they had feedback from a significant number of customers who were surveyed that they're interested in cryptocurrency so they thought they'd experiment and see if it would change things if they accepted Bitcoin. Turkey's central bank has banned the use of crypto currencies for payments so it's a significant blow to those individuals and companies working on these services. It hasn't actually banned the holding of cryptocurrencies but you're not allowed to use them for payments anymore. On the Ethereum network, we're now up to having almost nine billion dollars worth of Eth staked on the Eth2 network and also we saw the Berlin hard fork go live this week which really lays the foundations for reducing the very high gas fees which we've discussed in previous editions. So the EIP1559, which is somewhat controversial between miners versus the broader Ethereum community supports this, it's core planning is in place so to speak, so that come July as long as they can get the general support, it'll be able to go live as planned with the hard fork. There were some issues with the Open Ethereum client which is one of the many different Ethereum clients that's used and this impacted Coinbase, Ledger and other crypto services. They stopped people being able to withdraw Eth during this period just as a safety measure. We've also seen Ticketmaster, the owner of Live Nation, partnering with a blockchain ticketing firm subsidiary which is partnered with a ticketing service called Fan Dragon Technologies to use TixTo.Me, which is a blockchain based digital entertainment wallet. Behind the scenes Live Nation have been using Ethereum but they've hit issues with the transaction fees being prohibitively expensive for a ticketing application so they made use of what's called the Aventis network which is a layer 2 scaling technology that runs on top of Ethereum, Artos Systems is the company that that created this. In the first stage of this partnership it will enable thousands of Live Nation France tickets to be purchased through the platform and they will be processed through this underlying Aventus network as a combination of fungible and non-fungible tokens. There isn't anything yet about secondary market trading, of course one of the key issues that a lot of ticketing providers have is the inability to prevent resales and also fraudulent tickets so no doubt that is going to be factoring in but there haven't been any announcements about this just yet. Another piece of significant news this week has been Ethereum's Gitcoin Network raising an $11.3 million round, actually being spun out of ConsenSys. Gitcoin's a fascinating project and company because what they do is fund individuals to contribute to open source projects. One of the big challenges facing open source developers is how to sustain the funding for their projects and this is something that I personally can relate to with Web3j, which is an open source library I've written, in that people will happily use these things but it's hard to get funding for ongoing bug fixes and maintenance and so on. Gitcoin provide a model for this and they've been very successful with it and testament to this is who they've got behind this funding round as well which which includes the former Sequoia Capital partner but they've also got Naval Ravicant in there as well as some some other big names. The Linux Foundation has also launched a blockchain based platform for insurance. The Linux Foundation announced this platform called the Open Insurance Data Link platform and the idea here is that it reduces the cost of insurance reporting and creates a standardized data repository using DLT. This open IDL platform is a joint initiative of the Linux Foundation and the American Association for Insurance Services and it's making use of the Linux Foundation's open governance model which means that the network is built on a number of different nodes run by multiple organizations using a shared ledger. So this common ledger provides an industry utility platform for recording transactions and automating business processes. Having these bodies behind this initiative is certainly very powerful to help establish this kind of standardized consortium type of blockchain networks. Lockheed Martin have announced that they're adopting a blockchain platform for their supply chain management in Switzerland. They've signed an agreement with a company called SyncFab, which has come out of Silicon Valley, which is a distributed manufacturing problem to streamline their supply capabilities across the Swiss market. Within aerospace, being able to track the provenance of parts that are being used in supply chains for airplanes is a really big and important problem and so it's another really nice fit for the technology there. Specifically in this instance, the platform connects the original equipment manufacturers or OEMs to the Swiss members to match the two up. In the DeFi market it's been a big week, well a number of big weeks really for Binance. The Binance Smart Chain platform continues to grow with regards to supporting the DeFi landscape. Pancake Swap, the UniSwap clone, the value locked in DeFi on the platform has actually gone up to $7.87 billion which more than eclipsed UniSwap which was the original DeFi platform. Off the back of this increase in traction as well over the last few weeks, the Binance coin has really shot up in its market capitalization with the price of Binance's coin jumping more than 16x increase just during this quarter alone. Off the back of this, Binance had to execute their largest ever token burn, which is something that they do quarterly. They're also funding projects building on top of the platform so the decentralized finance startup called Mound which is known for its yield farming aggregator Pancake, has raised $1.6 million in seed funding to build out a range of DeFi use cases including farming, lending and swapping. In the world of NFTs there's continued to be more and more activity here. This time, the exchange operator NYSE is getting in on the action releasing collectible NFTs commemorating notable IPOs. These NFTs each individually celebrate the first trades that happened on their platform for the IPOs of Spotify, Snowflake, Unity, Roblox and Coupang, which was the largest US IPO in 2021. The well-known card maker Topps partnering up with the Major League Baseball to issue official NFTs. The range of cards will vary in their degrees of rarity, from common to legendary, limited edition and platinum anniversary cards and so on. Given how well established Topps is in the physical collectible card world, it will be fun to see how they get on as a slightly later entrant to the digital NFT market but certainly there's still plenty of space for the market to expand. The United States Postal Service have also certified Case Mail for the first blockchain generated e-postage platform. What this means is Case Mail provides a non-fungible token mail technology that can be used to pay for postage and USPS have certified this. In the art world, the digital artist PAK had their first NFT sale on Sotheby's that wrapped up this week. PAK was selling these cubes and a total of $17 million was actually made through this sale. Off the back of this, the artist PAK has launched a new token that can be obtained by burning NFTs. This platform is called burn.art and the token is dubbed 'ash'. The idea is that someone can take their, however valuable it is, NFT and choose to burn it in return for the token. Of course, the inevitable question here is what do people value more? The artwork or the token so it's a fun innovation to see. Binance has also popped up again in that they're working with the publisher of Vogue in Singapore to launch an NFT platform which is expected in Q3 of 2021. It would allow users to mint auction and trade NFTs. Edward Snowden has created and sold an NFT for $5.4 million which was to benefit the Freedom of the Press Foundation. Finally, the NFT startup Dapper Labs have announced they're doing another funding round. They just closed the $305 million funding round at the end of March but now they're planning to do another one which once closed will give them a valuation of $7.5 billion. They've obviously got their original plans for this year but they clearly weren't bold enough and they've got no doubt even more ambitious plans for growth. That brings us on to the metrics for this week. We've seen the crypto market capitalizations actually down 4.5% percent from last week of $1.95 trillion. The assets locked in DeFi is up over 16% at $60.16 billion and the NFT sales volume in the last seven days has been over $52 billion which is down 16.5% with an average price of just over $1700. That's all we have for this week. If you like what you hear please subscribe to our podcast and our YouTube channel. Links to all items discussed are available in the show notes and at our website weekinblockchain.com. We also host a weekly Clubhouse room every Monday at 12 p.m eastern 5 pm GMT, if you'd like to discuss any of the items we've covered here. Thanks and I'll see you next week.