Category: DeFi

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Australia Cryptocurrencies DeFi

Australia Needs to Embrace Crypto Says Fund Manager Mark Carnegie

Mark Carnegie, venture capitalist and co-founder of the investment bank M.H. Carnegie & Co. has recently spoken publicly about how important cryptocurrencies could be for Australia. According to Carnegie, traditional Australian funds have “screwed up” and failed to recognise the current situation.

Carnegie admitted that it took a long time for him to fully accept cryptos but now admits that “it took too long, but I now believe that crypto is here to stay”. He says his portfolios “have a giant hole in them because they don’t include Bitcoin and Ethereum”.

Source: mhcarnegie.com

Crypto Might Be The Only Answer For Australia

The national Reserve Bank keeps rates on hold, a move that affected the Australian Stock Exchange negatively. Some analysts even argue that the housing market could be at risk of overheating.

Carnegie argues that while inflation, economic collapse, and possible bubbles like the housing market are a reality that the banks and traditional funds in Australia have failed to recognize. While this happens, Carnegie states that Crypto might be “the only answer” to address these issues, not only in Australia but globally.

Crypto is currently a sideshow for Australia, but as an effective protection from expropriation in many other countries where hyperinflation and economic collapse are potential realities, it might just be the only answer.

Stated Carnegie for Financial Review

DeFi is Coming

Moreover, Carnegie spoke about the current role of Decentralised Finance (DeFi), and what it can bring to the digital economy, and how it can potentially reshape the way people view finance as well.

While DeFi has a number of challenges to take care of, the decentralization and the independence from third parties and bankers are the main attractive feature of DeFi, but the main challenges rely on friction in human relations:

Will the promise of decentralised finance and smart contracts revolutionise transaction friction in human relations? The first place that this question is being answered is in payments and money transfers.

Stated Carnegie for Financial Review

Carnegie mentioned the outstanding growth of fintech and DeFi platforms in Australia, the number of crypto fintech and DeFi platforms have grown at least 16% in January, following the bull run for Bitcoin and DeFi-related tokens.

DeFi Will “Take Off” as Soon as People Use it Like Credit Cards

Not only Mark Carnegie is one of the traditional investors that spoke in favor of the crypto and DeFi space – Mark Cuban recently compared the boom of DeFi to that of the internet in 2000.

According to the magnate, DeFi can address several issues mentioned above, as well as the typical problems related to bankers, transaction speed, and effectiveness.

While it does present several challenges, Cuban believes once people can use DeFi as freely as they use their credit cards it will “take off” massively.

Categories
Banking DeFi

Mark Cuban Calls DeFi the Start of Personal Banking

In a recent video interview, the billionaire entrepreneur Mark Cuban has been digging deep into DeFi and has come to the conclusion that it could revolutionise the way we will do banking in the future.

During the interview he touched on a number of DeFi subjects including the introduction of personal banking, removing the friction of bankers, and the current highly-frustrating lengthy processes which will get replaced by DeFi platforms.

Customers Will Take the Path of Least Resistance

Cuban claimed that customers will always take the path of least resistance – when they can use DeFi just as easy as credit cards, then it will take off in adoption. We saw the same thing happen with the internet. He also mentioned that DeFi is currently very complicated to understand and has a long way to go in becoming simple enough for everyone to use.

Yield Farming: a Risky Game?

The co-host of Shark Tank believes that DeFi yield farming is a dangerous place for small investors – mainly due to the high transaction fees. He compared DeFi yield farming to a game of musical chairs, many players are liquidity chasing but the situation may be challenging when the music stops (and no one seems to know when it will).

Smart Contract Protocols Will Revolutionise the Way We Do Business

Cuban also explained that once standard DeFi protocols are established and set in place, smart contract systems can then be built, and will disrupt many industries. For example: once royalties can be managed by smart contracts then you’ll see an explosion in industries including healthcare, music, movies, photography sport and many others.

Categories
Australia Crypto News DeFi

Aussie Unido Partners TRON Network Fork for Institutional-grade Crypto Custody

Aussie Unido Partners TRON Network Fork for Institutional-grade Crypto Custody

It’s no longer news that the institutions are beginning to throw in support for cryptocurrencies amid the massive upticks in their value since the last quarter of 2020. Also, many investors are resorting to cryptocurrencies like Bitcoin due to the fear of inflation. 

Thus, in preparation for the incoming wave of new institutions in the crypto space, LGCY, a fork of the TRON network, has collaborated with an Australia-based digital currency custody service and DeFi platform to enable secured crypto storage support for investors.

Crypto Custody and DeFi Service for Enterprise

Institutions in the cryptocurrency space are looking for an all-in-one solution that can provide access to a secured crypto-asset storage facility and decentralized finance (DeFi) applications, according to LGCY. The partnership with the Australian crypto custody platform will enable the company to provide such a solution for institutions to securely store their digital currencies. 

To achieve this, LGCY will integrate a white-label version of Unido’s wallet, per the announcement on Thursday. The developers on the LGCY network will equally be able to leverage Unido’s Core API to develop decentralized applications (Dapps) designed for enterprise solutions. 

“LGCY and UNIDO are excited to announce that both platforms will be working together to deliver the security of the Unido EP multi-sig platform to LGCY enterprise clients users. The integration of the LGCY blockchain into the Unido platform will be completed as LGCY approaches mainnet launch,” the companies noted. 

Interest in DeFi Keeps Growing

Interest and activities in the decentralized finance industry have been increasing notably since the start of the year. At the moment, there is more than US$41 billion worth of digital currency locked in the DeFi industry. Interestingly, more Bitcoin is being tokenized on Ethereum for DeFi protocols, which indicates BTC also has a strong demand in that market. 
There are currently over 172k Bitcoin locked in DeFi, according to data from Dune Analytics.

BlocDesk BTC on Ethereum
Categories
Australia Crypto News DeFi

Synthetix Raises $12 Million as VC Confidence in DeFi Grows

Synthetix pattern.

Synthetix has successfully raised $12 million from major VC firms, including major names like Coinbase Ventures, Paradigm and IOSG.

Synthetix co-founder Jordan Momtazi, made the announcement via Twitter.

What makes this capital raise particularly interesting is that VCs didn’t directly send funds to Synthetix’s Australian founders. Instead, they made a purchase of the platform’s native token directly from the synthetixDAO treasury.

Who is Synthetix?

Synthetix is a decentralised derivatives platform that features the native SNX token, as well as its own stablecoin called sUSD.

The reincarnation of Australian crypto project Havven, they have since rebranded as Synthetix and launched a new suite of crypto-backed synthetic asset tokens.

Synthetic assets are financial instruments in the form of ERC-20 smart contracts known as “Synths” that track and provide the returns of another asset without requiring you to hold that asset.

Recent price action has been encouraging for the bulls, as the launch of the Synthetix Staking dApp has propelled price higher, breaking out of key resistance.

VC Interest a Double Edged Sword for DeFi Projects Like Synthetix

The current popularity surge in DeFi projects has not been lost on the VC industry. But with DeFi being decentralised in its very nature, skepticism around centralising a project around a set of private investors remains the concern of aspects of the community.

DeFi is supposed to be decentralised finance, featuring open and public protocols after all. For this reason, questions around centralised VC money coming in and having the ability to exert control, should therefore definitely be asked.

New DeFi Synths now available for trading

There is a Place for VC Money within DeFi

But in the case of this particular announcement, the significance of the $12 million raised is not so much the dollar value, but mainstream belief in both the Synthetix project and wider DeFi industry itself.

In the grand scheme of things, $12 million is barely a drop in the Synthetix pool. The synthetixDAO is currently pushing $3 billion USD in its treasury!

But what this announcement does show, is there is still an appetite for industry knowledge and connections, which only working with the right VCs can offer.

SNZ Market cap is over US $5 billion

Money Continues to Enter the DeFi Space

While we don’t have a crystal ball to tell us the exact direction the DeFi industry is going to take over the next few years, the projects aligned with smart money are certainly going to be front and centre.

One thing for sure is that this won’t be the last piece of exciting news that we hear coming out of the Synthetix camp. If things continue on their current trajectory, the $2.8 billion USD locked in its treasury is just the beginning.

The future of finance is coming faster than we ever anticipated. It’s decentralised and permissionless, while running anywhere and everywhere 24/7.

Categories
Cryptocurrencies DeFi Institutions

DATA Token Soars 115% as the EU Uses a DeFi Network to Bring New Financial Technologies

The DATA token —the native-currency of Streamr— soared over 100% in value, as the Ethereum-based DeFi protocol is joining a European Union program called ATARCA, in a new project that seeks to implement new financial technologies for data and market research.

The European Consortium granted $2.5M to this research program, a fusion between Streamr and ATARCA —Accounting Technologies for Anti-Rival Coordination and Allocation— to develop an open-source project and bring in a new token called the “anti-rival” token, which will work with the Ethereum ecosystem.

The project proposes a new market category —accordingly, both companies are creating an exchange platform where the value of goods relies not on supply and demand, but on abundance. This means that the more the goods are share, the more valuable they are.

A New Kind of Money

These”anti-rival” tokens are DLT-based —distributed ledger technology — and according to ATARCA, they will set a new category for financial technologies by helping markets globally to organize data and digital goods through community-driven currencies.

The new token will be tested in Barcelona using the REC —Real Economy Currency— a local currency in Spain backed by NOVACT, —Institute for Nonviolent Action—.

The interesting feature of these tokens is that they work as stores of value, collectibles, and a unit of account. But the value relies on sharing, instead of exchanging.

These distributed ledger technology (DLT)-based tokens are used to instantiate a new ‘substance’ of quantified anti-rival value, a medium of sharing. The smart tokens will enable efficient, decentralized, market-style trading and ecosystems for anti-rival goods.

Pekka Nikander, Professor of Aalto University in Finland, will lead ATARCA. According to the professor, the 21st century needs a new economic system that can solve the old problems that the current one still struggles with:

In ATARCA, we create cryptographically protected anti-rival tokens and test their applicability to governing industrial data markets and fostering cooperation in community-driven currencies. If successful, this technology will not only help to properly organize the markets for data and other digital goods but provide the structural fundamentals of a new type of economic growth. This will allow the societies at large to more widely explore structurally new incentives for systemic sustainability and scalable systemic intelligence. 

Recently, we have also seen other bullish news for DeFi such as Federal Reserve Bank Researcher Suggests DeFi May Lead To A More Robust and Transparent Financial Infrastructure. As this DeFi market continues to grow it will become harder to ignore as it attempts to reshuffle global economics as we know it today.

Categories
Blockchain Crypto News DeFi

Top Blockchain Dapps by 30-day Transactions Volume

Binance Australia Tops BTC Market in Bitcoin and Ether 24-Hour Volume

The decentralized finance (DeFi) industry is gradually peaking into the mainstream. There has been a massive increase in participation, users, and new decentralized protocols. This is evident as the total value of assets locked in these protocols has significantly increased to almost $40 billion, per DeFi Pulse. As of February 11, 2020, this same industry only had a valuation of about $1 billion. 

The lending protocols dominate the entire DeFi space, with a total valuation of $17.9 billion. Maker might be the largest decentralized finance protocol by TVL, but not the top protocol in terms of transaction volume over the past 30 days.

Leading Dapps by Transaction Volume

According to data curated from DappRadar, the top ten decentralized applications by monthly transaction volume include

  • Venus
  • dYdX
  • Compound
  • Uniswap
  • Curve Finance
  • SushiSwap
  • Yearn Finance
  • Autofarm
  • Aave
  • PancakeSwap

As per DappRadar, Venus (XVS) is the top decentralized protocol by monthly transaction volume. The algorithmic money market protocol for BEP-20 assets gained US$54,520 million in volume in the past 30 days. dYdX, a decentralized cryptocurrency trading platform, sees about US$32,970 million within the same period, followed by the leading protocol, Compound, with a US$32,690 million transaction volume.

Image

The largest decentralized exchange by TVL, Uniswap, follows the list with more than US$28 million. Curve Finance and SushiSwap recorded about US$26,700 million and US$16,910 million, respectively. SushiSwap has been the biggest competitor for Uniswap when compared to the value of assets locked. Uniswap has a TVL of US$3.93 billion, while SushiSwap closes in with US$3.63 billion. 

SushiSwap almost overtook Uniswap during the end of its liquidity incentive program last year. Since that period, it has been neck and neck battle for both DEXes. 

Aside from Yearn Finance, which sees US$12,780 million, other Dapps have less than $10 million in transaction volume. These include Autofarm (US$8,610 million), Aave (US$3,170 million), and PancakeSwap (US$2,900 million).

Categories
Blockchain Crypto News DeFi

Decentralized ICOs (DAICOs) Could Enable Blockchain Startups To Raise Funding Securely Through DeFi

A new technology called DeFi (Decentralized Finance) is trying to solve the participant risk problem in startup investing, which was a fatal flaw in ICOs. Hopefully we can now use technology to protect early investors.

You may have heard of ICOs during the 2017 crypto boom. Thousands of ICOs we’re started and abandoned as early investors lost their money.

Decentralized projects such as PAID Network and Polkadot are trying to innovate solutions that can allow people to participate in crowdfunding early technology startups with lower risk by introducing:

  • Decentralized escrow
  • Smart contracts to release funds at specific dates
  • Community voting to determine project milestones and audits
  • Return of funds to investors upon dispute resolutions

What is a DAICO?

DAICO stands for Decentralized Autonomous Initial Coin Offering. DAICOS may offer a most robust solution to protect investors and lower risk through community voting, reputation scoring and dispute resolutions.

Startup Crowdfunding Using Smart Contract Mediation

The PAID Token whitepaper mentions use cases for DAICOS to enable blockchain startups to launch crowdfunding on the PAID Network DAICO Platform, where the funds are locked in escrow smart contracts and released on set dates.

Community Voting To Access Funds

The PAID community investors can vote to release funds to the startup or raise issues, which the startup would need to rectify or the funds would get redistributed back to the token sale participants.

Ignition Platform

PAID’s Ignition platform will allow token holders the opportunity to participate in public token auctions. Blockchain-based token projects to offer their private and public auctions to participants, leveraging both PAID Network and Polkadot technology.

Mockup of the Ignition Platform – Similar to Polkastarter

Ignition will initially support Ethereum based projects and then offer multi-chain through Polkadot. The project recently raised $150,000 in January 2021.

Polkastarter

Polkastarter is a protocol built for cross-chain token pools and auctions, enabling projects to raise capital on a decentralized, permissionless and interoperable environment based on Polkadot.

Polkastarter Investment Pools – powered by Polkadot

Conclusions

DeFi could revolutionize how we do global finance, but is an early technology that has not been fully tested and regulated. We have seen hackers take millions recently from DeFi platforms.

As always, be diligent when participating in early investment opportunities, do your own research and seek expert financial advice.

Categories
Blockchain DeFi Institutions

Federal Reserve Bank Researcher Suggests DeFi May Lead To A More Robust and Transparent Financial Infrastructure

In a recent research paper published by the Research Division of the Federal Reserve Bank of St. Louis (regarded as the top 1% of all economic research departments worldwide 1), suggests that Decentralised Finance (DeFi) could potentially lead to a paradigm shift in the financial industry.

The research includes an in-depth, highly technical analysis of the main areas of DeFi technology including smart contracts, the use of stablecoins and opportunities and risks.

What is DeFi

The paper explains DeFi as “The term generally refers to an open, permissionless, and highly interoperable protocol stack built on public smart contract platforms, such as the Ethereum blockchain. It replicates existing financial services in a more open and transparent way. In particular, DeFi does not rely on intermediaries and centralized institutions.”.

We have recently seen the DeFi marketcap surpass $10 Billion and some DeFi coins go parabolic in price during our market analysis news articles.

Opportunities

DeFi may increase the efficiency, transparency, and accessibility of the financial infrastructure. Moreover, the system’s composability allows anyone to combine multiple applications and protocols, thereby creating new and exciting services.

Risks

DeFi also has certain risks, namely, smart contract execution risk, operational security, and dependencies on other protocols and external data.

DeFi Applications

The paper explains DeFi applications: “DeFi already offers a wide variety of applications. For example, one can buy U.S. dollar (USD)-pegged assets (so-called stablecoins) on decentralized exchanges, move these assets to an equally decentralized lending platform to earn interest, and subsequently add the interest-bearing instruments to a decentralized liquidity pool or an on-chain investment fund.”

DeFi Architecture

DeFi uses a multi-layered architecture, as seen below.

The DeFi Stack

The paper then goes onto explain the following topics in great detail:

  • Decentralized Exchange Protocols
  • Smart Contract-Based Reserve Aggregation
  • Peer-to-Peer Protocols
  • Decentralized Lending Platforms
  • Collateralized Debt Positions
  • Decentralized Derivatives
  • On-Chain Asset Management

Conclusion

It’s great to see this type of research being done, as it explains everything in tremendous detail. And also takes into account both sides of the risks and potential use cases of DeFi in the future. Find out more about Economic Research at the St. Louis Fed.

[1] As determined by the citation ranking tracked by the independent, volunteer-run RePEc service

Categories
Australia DeFi Stablecoins

Aussie Programmer Refinances His Property Loan With DeFi In A Single Day, Following Red Tape From Banks

A software engineer has paid off his mortgage to the Commonwealth Bank of Australia and refinanced it through fixed-rate lending protocols, after finally having enough of getting nowhere with traditional banks.

Offsetting Loans

According to the software engineer, he decided to – quite literally – become his own lender after going around in circles with banks.

As a self-employed professional, he believes banks took advantage of this in order to deny him even a credit card for multiple years – especially seeing as the world is currently going through a period of economic turmoil.

In order to do so, the software engineer first paid off his loan in AUD – after which he borrowed USDC from Notional, using liquidity he already owned in order to avoid high fees.

He then added about $1 million in wrapped Bitcoin and Ethereum as collateral for a new 500,000 USDC loan.

Although the borrowing rates requested by Notional are around 6% some of that can be offset – provided you provide liquidity that you can earn money off of.

The newly (and self)made one man banking system stated that everything went much faster than it would have, had he stuck to traditional banks.

“I feel like I’m in full control of my situation. People should be all over this stuff. It felt like it would’ve taken months of applications, finding tax returns and bank statements for the bank to refinance me, but I was able to do it all in one day, under my own agency.”

Although the whole procedure took quite a bit of forethought, it paves the way for more transactions of the sort – AAVE, in particular, have hopped on the mortgage train recently following their marked increase in popularity.

Although this may be a one-off thing, it’s not improbable that in the future we will see plenty more early bird investors buying a new house due to a bitcoin faucet they used a decade ago.

Categories
Crypto News DeFi

Value of Assets in DeFi has Risen by Almost 70% Since 2021

Value of Assets in DeFi has Risen by Almost 70% Since 2021

The value of cryptocurrencies locked in decentralized finance (DeFi) has been gradually increasing since the start of the new year. The increase can be attributed to the recent rally in the crypto market that saw Bitcoin and Ether soar to a new record level, although both coins are currently trading below the new all-time high. 

However, it’s also worth noting that the number of Bitcoin locked in DeFi protocols also increased within that period, while Ether remained flat, according to the data provided by DeFi Pulse.

DeFi Reaches new High in Asset Valuation

The total cryptocurrencies locked in decentralized finance protocols are worth US$26.26 billion, as per DeFi Pulse. This is quite a significant growth given that there was only US$15.4 billion worth of assets in DeFi on January 1, 2021. So, following the new all-time high, DeFi TVL is currently up by almost 70 percent, and this valuation is dominated by the decentralized Lending platform.

The Lending protocols account for US$12.41 billion of DeFi market valuation, followed by decentralized exchanges with a total asset valuation of US$9.22 billion. The Derivatives protocols see a market valuation of US$2.16 billion, followed by the Payment and Assets protocols with US$199.7 million and US$2.28 million, respectively. 

Top DeFi Protocols

The decentralized lending platform, Maker, is the largest protocol on the decentralized. It accounts for 17.97 percent of the entire DeFi market cap with US$4.71 billion. Aave has a market valuation of US$3.83 billion, followed by Compound with US$3.15 billion in TVL.

Other protocols with a valuation greater than US$2 billion are as follows: Uniswap (US$3.15 billion), Curve Finance (US$2.71 billion), and SushiSwap (US$2.04 billion).

DeFi Outlook

The increasing concern with centralized finance platforms regarding censorship and central authority is promoting/emphasizing the need for decentralized finance. Especially, the ongoing case of GameStop is causing many industry players to preach DeFi as a solution, including the co-founder of the Gemini exchange.