TLDR CRYPTO 2023-06-27

HSBC HONG KONG NOW LETS CUSTOMERS TRADE BITCOIN AND ETHER ETFS

HSBC Hong Kong is now permitting its customers to trade Bitcoin and Ether ETFs on the Hong Kong stock exchange. With three different ETFs available, HSBC is the first platform to offer crypto exchange-traded funds in Hong Kong. This is just another step forward for the region in further opening up to crypto. Throughout the course of this year, Hong Kong has been introducing new regulations for crypto companies with an eye toward becoming a global crypto hub. Hong Kong’s banking regulator has even been pressuring major players to accept crypto exchanges for clients.

EXCHANGES

Staked ETH has surpassed ETH held on centralized exchanges for the first time, totaling almost $44 billion. Following the Ethereum network's Shapella upgrade in April, ETH held on exchanges began to decrease, while ETH staking surged. This trend, coupled with the new fee-burning mechanism that is core to ETH 2.0 is a fundamental shift in sell-pressure on ETH. While we have yet to see the full effect of this shift or where the balance between staked ETH and ETH on CEXs will balance out, it’s likely to create an interesting dynamic in the next bull run.

ECOSYSTEM

Azuki is releasing a new NFT collection, Azuki Elementals, featuring 20,000 NFTs based on the four Azuki elements: earth, fire, lightning, and water. The Dutch Auction for the collection starts at 2 ETH and will decrease by 0.1 ETH every five minutes. Some of the NFTs were airdropped to existing Azuki holders during the recent Vegas event, "Follow the Rabbit." With floor prices currently at 15.3 ETH and a potential mint proceeds of $40 million, this is likely to be one of the biggest NFT drops of the year.

SOLANA WELCOMES INSTITUTIONAL MPC WALLET

Fordefi, an institutional multi-party computation wallet company, is expanding to Solana and offering its wallet solution to applications and protocols on the chain. Fordefi's MPC wallets provide advanced security features and policy management tools tailored for institutions, allowing multiple parties to access the same wallet without revealing personal information. The platform uses transaction simulations and policy engines to define the approval process for institutions, accommodating the often-lengthy institutional approval process.

ORDER BOOK PERP DEXS

Nearly all current DEXs running perpetual contracts operate their order books off-chain, creating greater potential for manipulation and higher risk than frontrunning and sandwiching on AMMs. This thread explains how, for DEXs to provide fair and transparent trading, order books must operate fully on-chain, ensuring proper price-time priority and eliminating opportunities for manipulation by order book operators. On-chain order book execution will require fundamental infrastructure innovation and has yet to be massively adopted.

IMPLICATIONS OF EIP-4844

EIP-4844, an Ethereum improvement proposal introducing proto-danksharding, is expected to impact leading optimistic rollups on Ethereum. EIP-4844 adds blobs, raw byte strings attached to transactions, to store additional data alongside transactions temporarily. This separation of storage and computation fees allows for a more dynamic fee market, enabling a tenfold reduction in fees on leading L2s like Arbitrum and Optimism.

Despite the continued regulatory crackdown on the crypto industry in the US, some Japanese crypto sector players believe it presents an opportunity for Japan to strengthen its presence and become a hub for the sector. Japan already has an established legal framework, providing protection to investors while enforcing strict regulations on crypto exchange operators. With the country's forward-looking approach to stablecoins and its promotion of web3 - decentralized web services as they have coined it - Japan aims to create a healthy industry ecosystem while attracting businesses from across the globe.

TRENDS ACROSS THE LARGEST U.S. COMPANIES

According to a joint study between The Block and Coinbase, over 52% of Fortune 100 companies have made an attempt at crypto, blockchain, or web3 initiatives since 2020. The tech, financial services, and retail sectors have led the way in web3 adoption, with NFTs driving retail's recent surge in initiatives. Crypto financial services and B2B blockchain-related services are the most commonly invested categories, making up over half of all crypto venture deals. Citi Ventures, Google Ventures, Microsoft Ventures, and Goldman Sachs have been by far the most active Fortune 100 companies in the crypto venture scene.

BURDEN

Eric Wall’s Orb Land project tokenizes his time through a unique NFT offering personal consulting. The holder surrendered it due to a burdensome 300% annual Harberger tax. Orb Land aims to revise its mechanism for smoother ownership transitions.

MANAGEMENT STRATEGY'

Hut 8 Mining, a Canadian bitcoin mining firm, has received a $50 million credit facility from Coinbase Credit to support corporate needs and its Bitcoin treasury management strategy.

HOW MANY BITCOIN ARE FOR SALE?

This Glassnode analysis of crypto exchange fund flows suggests strong Bitcoin accumulation in Asia and weaker demand in the US in 2023 and walks through some of the current supply and demand dynamics that have been playing out lately.

FTX BANKRUPTCY TEAM SAYS THE EXCHANGE OWED CUSTOMERS $8.7B

The report on the failed FTX.com exchange reveals an $8.7 billion debt to customers due to the commingling and misuse of deposits. So far, $7 billion in liquid assets have been recovered. Senior executives are accused of hiding the issue since August 2022.