MARKET WRAP

1. A Storm Like No Other – Hurricane Ian and Hurricane Inflation

CoinDesk – October 3, 2022 at 2:12am EST

Cryptos

The month of October has begun spookier than most crypto investors would hope for, given the month’s positive reputation as a boom month. $BTC most recently traded slightly above $19K, remaining at similar levels to its position last week, except for a short reprieve above $20K. $ETH, despite trading above this level for the weeks following the Merge, has most recently been trading below $1300.

Insights

Despite many interpretations of the current economic state being prevalent these days, by more traditional metrics, the US is knee-deep in a recession, as is evident by two consecutive quarters of negative GDP growth. The housing market also saw its third consecutive monthly decline in pending home sales, proving how quickly the market is slowing down. Not to mention, the personal consumption expenditure (PCE) rose to 4.9% in August from its previous 4.7% rating in July (measured year-over-year). By all accountable measurements, inflation is seeping further into the market.

Equities

For what is now the sixth week out of the past seven, the tech-oriented Nasdaq and S&P 500 are in the red. The DJIA joins these indexes as well, finishing 1.5% down at market close last week amid exacerbated market-related fears. Cryptos tracked equities throughout the end of September, leaving the start of October in bad shape. Worthy of note, however, is this analysis from Oanda Senior Market analyst Edward Moya. “A terrible week, month, and quarter for stocks was not exactly mirrored by Bitcoin,” referencing last week’s bond yield declines as providing some reprieve for crypto, as was seen last week. 

Takeaways

The US is in a tight spot as far as the markets go, given the malignant movement of inflation and its effect on all things… well, money-related. Housing, equities, GDP, and PCE are just the quickly accountable measurements of performance. On the other hand, Hurricane Ian is proving to be a rampant storm with devastating costs, economic and otherwise. The likelihood that this disaster will be “possibly one of the most expensive in US history,” as reported by First Republic Bank, is high.

2. Binance Backs Mysten Labs’ Sui Blockchain Project In Series B Funding

BSC News – September 27, 2022, at 9:55 am

Binance Labs, the exchange's venture capital branch, announced its participation in Mysten Labs' $300 million Series B fundraising round on September 26th. Mysten Labs is known more widely for its Sui project, a potential Layer 1 blockchain solution.

Founded by experts of the Move programming language and former research executives of the since-canceled Novi wallet and Diem blockchain projects by Meta (Facebook) Mysten Labs is the brain behind the Sui blockchain, which strives to be a new decentralized Layer 1 blockchain with high transaction speed and low latency, pitting it against other Ethereum-alternative competitors like Solana. 

 

Binance believes Sui can operate as a development environment over a variety of digital assets. Among the unique characteristics of the Sui blockchain are:

- Sui defines assets (such as NFTs or smart contracts) individually using the Move programming language.
- The structure of Sui permits the processing of several transactions simultaneously. The horizontal scalability of network throughput is theoretically limitless.
- Sui utilizes the sophisticated Narwhal & Bullshark consensus system, and storage costs are paid independently of transaction execution.

3. FTX Wins Voyager Digital Auction

Barron’s – September 27, 2022, at 11:57 am

FTX, founded by billionaire Sam Bankman-Fried, has won the asset auction of crypto trading platform Voyager Digital Ltd. According to Bloomberg, FTX's offer for Voyager is around $50 million, per the divulged information of individuals close to the matter.

 

Reportedly, the repurchase price suggested by FTX could rise even higher moving forward if the assets managed by Voyager reach certain milestones. Neither FTX nor Voyager has formally commented on this transaction as of yet, but according to a report from MarginATM, FTX and Binance led the auction of Voyager Digital's assets.

In July, Voyager filed for bankruptcy with the backing of Alameda Research, an investment vehicle supported by the CEO of FTX. Alameda established a revolving credit facility for the brokerage platform at that time. 

At the time, both FTX and Alameda declared their plans to buy Voyager in the same month. The corporation did, however, reject the offer, citing the purchase price to be too low and having the potential of harming some of the platform’s users. Alameda said in September that it will repay around $200 million in Bitcoin and Ethereum borrowed from Voyager.

Bankman-Fried has aggressively acquired many struggling cryptocurrency startups throughout the market decline. FTX bailed out the cryptocurrency lending company BlockFi earlier this year and was likely looking to acquire Robinhood Markets Inc. Bankman-Fried is thought to control more than fifty percent of FTX shares, seventy percent of FTX US shares, and almost all of Alameda.

4. Uniswap to Raise $100 Million in New Funding Round

Cryptoslate - September 30, 2022 at 1:00 pm

According to a Techcrunch newsletter, Uniswap Labs is now in negotiations with investors to boost the company's value to $1 billion with its next round of investment. Polychain, one of Singapore's renowned investment funds, is interested in this fundraising agreement.

Uniswap is the biggest cryptocurrency-related decentralized exchange (DEX). The platform contributes over two-thirds of the total trading volume of all DEX exchanges, according to statistics from The Block.

Uniswap accounts for nearly two-thirds of all Dex exchanges. Source: The Block.

The project announced last month that it will form the Uniswap Foundation. This independent group is responsible for embellishing the ecosystem surrounding the decentralized exchange. The first investment round for Uniswap Labs took place in early September and totaled $1.8 million.

 

Following this news, $UNI, the project's token, was up nearly 2% in the past 24 hours, trading at $6.45 on October 1st, according to TradingView.

5. Warner Music Group Partners with OpenSea to Release Music NFT drops

The Block – September 29, 2022, at 11:49 am EST

Entertainment giant Warner Music Group has partnered with NFT marketplace OpenSea to support musical artists signed with the record label. Under the agreement, the artists of Warner Music Group will have dedicated drop pages on OpenSea, where they can launch NFT collections and limited-edition projects. 

The partnership is aimed at helping WMG artists build new Web3 communities, which opens up new opportunities for fans to engage with music and artist within the Web3 community. 

Oana Ruxandra, chief digital officer and executive vice president of business development at WMG, stated, “Fundamental to music’s DNA is community – it's artists and fans coming together to celebrate the music they love. Our collaboration with OpenSea helps to facilitate these communities by unlocking Web3 tools and resources to build opportunities for artists to establish deeper engagement, access, and ownership.”

Shortly before WMG and OpenSea's collaboration, Universal Music Group partnered with the NFT platform Curio or the experiment with NFTs on the Spotify platform. This new partnership demonstrates the growing utility of NFT technology in mainstream music and entertainment industries for both artists and fans.

6. Disney Prepares to Jump into NFTs and the Metaverse

The Block – September 24, 2022, at 2:00 pm EST

Disney has begun a search for a talented transaction lawyer to exploit the potential technologies of web3 and develop strategic plans for a new global emerging technology project in Metaverse and DeFi.

This job advertisement on LinkedIn seeks a candidate who can “assist in performing due diligence for NFT, blockchain, third-party marketplace, and cloud provider projects, and negotiating and drafting agreements for those projects.”

Some weeks before this posting, the CEO of Disney, Bob Chapek, stated publicly at its D23 Expo event that the cartoon company is planning to begin developing its IP within the metaverse. Last year, Disney dropped the Walt & Mickey “Partners” NFT on the VeVe app for iOS and Android.

7. Solana Price Drops as Blockchain Experiences Another Outage

CryptoNews – October 1, 2022 at 12:33 pm EST

According to a tweet from crypto thought leader, Nick Valdez, and later confirmed on the official Twitter account of the blockchain, Solana underwent a huge outage yet again in the early hours of Saturday. Throughout the morning, Solana failed to process any transactions which is the fourth time Solana has gone kaput this year.

Laine Stakewiz, a blockchain company running nodes on Solana, indicated that some validators had stopped voting on Friday, which could be the reason. Some investigation showed that no new roots were being created during this time, resulting in a frozen appearance of the network. 

After 8 hours, the network became fully operational, but not without the price of $SOL seeing a not-so-insignificant dip.

8. Transit Swap Loses over $21M

CoinTelegraph – October 2, 2022 

Transit Swap, a multichain decentralized exchange (DEX) aggregator, is the latest project to undergo a massive attack, resulting in a loss of $21M. 

According to Transit Swap, the hacker capitalized upon an internal bug on a specific swap contract. 

Transit Swap has issued an apology to its users and is currently conducting a search to discern where the stolen funds were transferred.