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🏦Crypto Crackdown Cleared the Way For BlackRock’s Bitcoin ETF: Custodia CEO

The Defiant

DeFi Daily

GM Defiers!

In today's newsletter, we delve into Wall Street's latest venture, EDX, a non-custodial crypto exchange launched by Fidelity Digital Assets, Charles Schwab, and Citadel Securities. The move has raised questions around regulatory favoritism and the timing of the launch.

Across the pond, France's financial markets regulator, AMF, is warming up to DeFi, indicating support for globally coordinated regulation - a stark contrast to the U.S's stringent regulatory stance.

Optimism has launched a third Retroactive Public Goods Funding round, a novel approach that incentivizes contributions to the Ethereum-based Layer 2 network. Finally, we cover BNB Chain's unveiling of opBNB, a Layer 2 rollup set to enhance its competitiveness in the rapidly evolving blockchain space.

✍️ In today’s newsletter:

  • Caitlin Long says it isn't a coincidence that TradFi is making moves in crypto right after the SEC's crackdown
  • French regulator publishes DeFi paper
  • Optimism unveils $40M grants program
  • BNB Chain launches opBNB Layer 2 testnet

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📈 Markets in last 24 hrs:

TickerValue24h
BTC$27,705 0.42%
ETH$1,864.6 0.14%
MKR$688 -0.29%
SPY$412.07 0.08%
UNI$5.451 0.41%
LDO$2.081 0.19%

🎬 WATCH

Watch our video on Binance's regulatory woes. And check out our podcast with Yehuda Lindell, Coinbase's head of cryptography.


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TradFi

Crypto Crackdown Cleared the Way for Fidelity-Backed Exchange and BlackRock’s Bitcoin ETF, Custodia CEO Says

TLDR Major U.S. financial firms including Fidelity Digital Assets, Charles Schwab, and Citadel Securities have launched a crypto exchange, EDX. This move follows recent regulatory crackdowns on companies like Coinbase, leading some to suggest these Wall Street giants are stepping in after such actions weakened competition.

SO WHAT The concern is that regulators may be favoring these traditional players over native crypto firms, which could centralize and potentially stifle innovation in the crypto industry. Despite the concerns, this entry of traditional finance firms also signals mainstream acceptance of cryptocurrencies.


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In less than two months, the Asymetrix team has successfully attracted a substantial TVL of $18 million to their protocol. The project has been under development since 2022 and was finally deployed to the Ethereum mainnet at the end of April 2023.

Asymetrix is a DeFi protocol for asymmetric ETH staking rewards. Users deposit their stETH (Lido’s staked ETH) into a common pool. This pool grows daily at the rate of liquid staking rewards, which is around 5% per year. Than instead of distributing these earnings among all participants, Asymetrix makes a weekly random draws. This mechanics rewards some participants with a significantly high APR on their deposit, thereby adding an element of chance to the traditional reward model. However, the original deposits of all users remain untouched, regardless of the rewards distribution.

The team emphasizes transparency and security within the protocol. That's why they incorporate top-tier solutions to ensure these aspects - Chainlink VRF serves as the provider for randomness, and a thorough security audit of the code has been performed by the leading company, Hacken.

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Regulation

France DeFi Paper is Latest Sign of Global Regulators Warming Up to Crypto

TLDR While US regulators are increasing scrutiny on cryptocurrencies, countries like France and regions like Asia are seeking to provide a more balanced regulatory environment. France's Autorité des Marchés Financiers (AMF) has published a paper defining DeFi and encouraging global regulatory coordination. In Asia, Hong Kong has implemented crypto-friendly laws and Japan is considering easing restrictions on crypto trading.

SO WHAT Countries providing a more conducive regulatory environment could attract crypto businesses that are seeking to escape restrictive regulations in jurisdictions like the US. This could lead to significant changes in the crypto landscape and competition between jurisdictions to become attractive destinations for crypto businesses.


Layer 2

Optimism Unveils $40M Public Goods Funding Round

TLDR Optimism, Ethereum's second-largest Layer 2 network, has announced a third round of its Retroactive Public Goods Funding (RetroPGF) to reward ecosystem contributors. The program will distribute 30M OP tokens to developers, creators, and educators.

SO WHAT By rewarding past contributions, Optimism is creating an incentive for developers to contribute more to the ecosystem. The resulting enhancements could drive network growth, making Optimism more appealing to users.


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Binance

BNB Chain Launches Testnet For Layer 2 Network

TLDR BNB Chain, Binance's Layer 1 blockchain, has launched opBNB, a Layer 2 rollup based on Optimism's technology stack. The testnet launched on June 19. The move towards scaling solutions is an attempt by BNB Chain to better compete with Ethereum's growing Layer 2 ecosystem, where average transaction fees on Optimism and Arbitrum are now lower than on BNB Chain.

SO WHAT With opBNB, BNB Chain is aiming to alleviate network congestion and drive down transaction costs, making it more efficient and attractive for users and developers.


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🌍 ELSEWHERE

  • Bitcoin Jumps on Speculation BlackRock ‘May Know Something’ ( Bloomberg)
  • German Intelligence Agency Releases NFT Collection to Recruit Talent ( Coindesk)
  • Deutsche Bank reportedly applies for digital asset custody license from BaFin ( Cointelegraph)