Overachievers: DeFi Week Feb. 19

What must they be thinking at OpenSea… For years, the NFT marketplace has dominated trading and then comes along a four-month upstart founded by a guy named Pacman, and bam! One airdrop later Blur takes 82% of the market volume.

Even worse, as Owen Fernau reports, OpenSea slashes trading fees to zero and Blur holds the line with promises of another airdrop. Suddenly, after months in the doldrums, it’s mano-a-mano combat in the NFT market. Can Blur hold on?

Strange Venture

This is just one of the killer features Owen wrote this week. Be sure to check out his weekend read on the strange venture that is Worldcoin, a mashup of hardware, tokens, crypto identity, and AI.

Meanwhile, on the regulatory front, Sam Haig wrote about a case that may define an NFT collection, NBA Top Shot Moments, as a security. Yikes. As The Defiant reported last week, the SEC and other regulators have established broad definitions of digital assets as securities, which is roiling the industry and augering a new era of crypto rules. Are NFTs next?

Overachievers

Blur wasn’t the only overachiever this week — Arbitrum, for the first time, eclipsed Ethereum in terms of processed transactions. As Aleks Gilbert reports, that bodes well for the Ethereum scaling project and Layer 2s. And Owen Fernau unearthed another growth story — Stacks and Ordinals are surging as the build-on-Bitcoin movement suddenly spiked.

In this week’s podcast, Tegan Kline spoke with crypto OG Kain Warwick, a founder of Synthetix, about a range of topics, including DeFi Summer Part 2, FTX, and more. And be sure to check out the latest videos on The Defiant’s YouTube channel, especially Aleks Gilbert’s segment on tokenization of real world assets. Rounding out the week are two fine opinion pieces on tokenization and how the European Union’s new crypto regulation law works.

Enjoy!

Podcast

Synthetix, DeFi Summer 2, FTX, 3AC, and Crystal Meth with Crypto OG Kain Warwick

Kain Warwick is the founder of Synthetix and a total crypto OG. Synthetix is a new financial primitive enabling the creation of synthetic assets, offering unique derivatives, an exposure to real world assets on the blockchain.

Today we dive into what’s next for Synthetix with the latest V3 launch, what will cause the next big leg up in DeFi – what we’re calling DeFi Summer 2, the differentiation between different perps that exist in crypto, how Synthetix made the decision to launch on a Layer 2 so quickly and burn all bridges behind them.

And it gets pretty spicy with some tea on FTX and 3AC. Before we dive into it, Kain is going to tell us what he’s been up to since we last spoke to him about what it takes to scale Ethereum last year.

Today’s Sponsors

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DeFi Alpha

DeFi Alpha: Earn 30% Annualized with Leveraged ETH Vaults by Notional Finance

Best of the Week

NFT Marketplaces

Blur Blows Away OpenSea and Wins 82% of NFT Trading Volume

OpenSea Slashes Fees to Zero in Vain Attempt to Counter Marketplace Upstart

By Owen Fernau

It’s a time-honored tenet of business — slash prices and the customers will come. Tell that to OpenSea. One week after the NFT marketplace scrapped the fee it collects on trades, Blur, its upstart rival, hasn’t missed a beat.

Read the full story in The Defiant

Crypto Identity

Worldcoin Edges Closer to AI-Driven Crypto Identity Device

Founder Alex Bania Says Orb to Be Released in First Half of 2023

By Owen Fernau

Worldcoin, an online community of devs and technologists, quickly garnered headlines in 2021 for its eye-scanning piece of hardware known as the Orb. After running silent for a year and a half during a testing phase, the project is, ahem, eyeing a full-blown launch in the first half of 2023.

And that raises a question: What is it? And do we need it?

Read the full story in The Defiant

Ethereum Staking

Plan to Boost ETH Staking Rewards May Grow $152B Sector

EigenLayer Releases Details of Staking Changes in Growing PoS Space

By Samuel Haig

In recent years, staking has quietly emerged as a wellspring of profit for the DeFi community. With more than $152B worth of crypto assets locked up to secure Proof of Stake networks, it’s attracting institutional and retail investors alike by offering new ways to earn returns from digital assets.

Read the full story in The Defiant

Crypto Regulation

NFTs Are Securities? All Eyes Turn to Top Shot Case

Judge Says It’s ‘Plausible’ NBA Top Shot Moments NFTs May Have to Be Registered With Regulators

By Samuel Haig

Now it might be NFTs. Even as U.S. regulators’ define virtually all digital assets as securities or investment contracts, a civil case may further establish that NFTs also meet the definition.

Read the full story in The Defiant

DeFi-on-Bitcoin

Stacks’ Token Doubles as Building-on-BTC Activity Surges

Ordinals Protocol Mints 150K Tokens in Three Weeks

By Owen Fernau

In a surprising development in crypto, building products on Bitcoin is surging this year.

Case in point: Ordinals, a Bitcoin-based protocol that allows people to attach digital content to small denominations of BTC. Over 150,000 of Ordinals’ tokens have been minted since the protocol launched on Jan. 31, according to a Dune Analytics dashboard.

Read the full story in The Defiant

Opinion

Crypto Regulation

Crypto Makes Its Peace with New EU Law, But What Does It Do?

Here’s How MiCA is Changing the Rules of the Road for Tokens, Stablecoins, and NFTs

By Slava Demchuk

The European Council is set to approve and implement the highly-anticipated Markets in Crypto-Assets (MiCA) law. Expected to come into force in early 2024, this is one of the first acts to bring crypto assets, issuers, and crypto-asset service providers (CASPs) under one regulatory framework.

Read the full op-ed in The Defiant

Tokenization

Tokenization Is the Force Multiplier DeFi Needs

Decentralization is a ‘Protective Feature’ for Financial Infrastructure

By Philipp Pieper

We all know web3 is the tokenization of everything. If we’re going to decentralize data ownership, then this makes a lot of sense. And this year, tokenization hasn’t become just a buzzword but a very real strategy employed by a number of DeFi players.

Read the full op-ed in The Defiant

Defiant Video

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Shorts

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Sponsored Video

Explainer

How to Use Lido on Arbitrum and Optimism

Shoutout

The future of on-chain perps is here with Synthetix Perps, now live on Optimism!

Synthetix Perps revolutionizes the on-chain trading experience by significantly reducing fees, improving scalability and capital efficiency for traders.

Introducing an off-chain oracle system, Synthetix Perps significantly reduces perps trading fees to as low as 5-10bps, while maintaining optimal performance and execution efficiency.

Synthetix Perps are fully decentralized, so users have complete control of their collateral and can trade on the front end of their choice. Trading is accessible via Kwenta or Decentrex, the decentralized front ends that use Synthetix liquidity and power Perps trading. Polynomial is the next integration, going live next month.

Friday

News

• Transactions on Arbitrum Leapfrog Ethereum The vision is coming to fruition. Carried by surging activity in its ecosystem, daily transactions on Arbitrum have surpassed those on Ethereum this week, marking a major milestone in the effort to scale the world’s second-largest blockchain.
• Worldcoin Edges Closer to AI-Driven Crypto Identity Device Worldcoin, an online community of devs and technologists, quickly garnered headlines in 2021 for its eye-scanning piece of hardware known as the Orb. After running silent for a year and a half during a testing phase, the project is, ahem, eyeing a full-blown launch in the first half of 2023.
• Uniswap Builds Out NFT Offering With ERC-20 Payments Uniswap, the No. 1 decentralized exchange, started letting investors buy NFTs with ERC-20 tokens, the protocol said Wednesday.

NFT News

• Blur Blows Away OpenSea and Wins 82% of NFT Trading Volume It’s a time-honored tenet of business — slash prices and the customers will come. Tell that to OpenSea.
• NFTs Are Securities? All Eyes Turn to Top Shot Case Now it might be NFTs. Even as U.S. regulators’ define virtually all digital assets as securities or investment contracts, a civil case may further establish that NFTs also meet the definition.

Opinion

• Tokenization Is the Force Multiplier DeFi Needs We all know web3 is the tokenization of everything. If we’re going to decentralize data ownership, then this makes a lot of sense. And this year, tokenization hasn’t become just a buzzword but a very real strategy employed by a number of DeFi players.

Thursday

News

• Plan to Boost ETH Staking Rewards May Grow $152B Sector In recent years, staking has quietly emerged as a wellspring of profit for the DeFi community. With more than $152B worth of crypto assets locked up to secure Proof of Stake networks, it’s attracting institutional and retail investors alike by offering new ways to earn returns from digital assets.
• Coinbase Jumps Into Ethereum Scaling Race With New Rollup Coinbase, the No. 1 crypto exchange in the U.S., is building a new Layer 2 blockchain to give its users easy access to faster and cheaper transactions on Ethereum, the company said Thursday.
• Polygon Lays Off 20% of Staff Amid Restructuring A year after Polygon Labs raised $450M to expand its web3 strategy, the Layer 2 provider is reducing its headcount by a fifth and will lay off 100 employees, the company said Wednesday.

Opinion

• Crypto Makes Its Peace with New EU Law, But What Does It Do? Worldcoin, an online community of devs and technologists, quickly garnered headlines in 2021 for its eye-scanning piece of hardware known as the Orb. After running silent for a year and a half during a testing phase, the project is, ahem, eyeing a full-blown launch in the first half of 2023.

Wednesday

News

• Stacks’ Token Doubles as Building-on-BTC Activity Surges In a surprising development in crypto, building products on Bitcoin is surging this year.
• Tokenization Picks Up Steam With On-Chain Tesla and Apple Shares In the latest effort to bring real-world assets onto the blockchain, retail and institutional investors will be able to buy and borrow crypto against tokenized stocks and bond ETFs this week.
• NFT Marketplace Upstart Blur Leapfrogs OpenSea After Airdrop It’s amazing what an airdrop can do. Four months after its launch and a week after a major airdrop, Blur, the NFT marketplace, has overtaken industry giant OpenSea in terms of trading volume, according to data from DappRadar.

Tuesday

News

• Aave and Maker Pull Back From Paxos Stablecoins Top DeFi protocols Aave and MakerDAO are distancing themselves from Paxos-issued stablecoins after New York state’s Department of Financial Services ordered the firm to stop minting new BUSD tokens on Feb. 13.
• Klaytn and Filecoin Defy Feds’ Crackdown With Big Gains Not all crypto sectors have been dampened by the recent barrage of regulatory action coming out of the U.S. this week.

Community Love

Thanking all the amazing Defiers for the support and love this week (and always)!

📢¡Atención, no te lo pierdas!📢

Twitter Space con @DiegoCabral__ de @DefiantNews + @lulacardellino + @albinmrc sobre el estado actual y el futuro de Ethereum

Únete ahora para aprender sobre las últimas tendencias en DeFi y descubrir un adelanto exclusivo de #ETHDenver2023

— WhiteChocolate.eth🦇🔊 (@WhiteChocoHashy) February 22, 2023

🏔️ The Defiant will attend @EthereumDenver next week, and we want to welcome you all to stop by our booth and hang out with our team. 😉

👀 We might even have a little gift for our #crypto frens! 💚 pic.twitter.com/BiEQUdZ8IW

— The Defiant (@DefiantNews) February 21, 2023

Take a break with #SignalPodcast this weekend 🛋️

In this episode, @CamiRusso discusses the @ethereum & crypto space from a journalist’s perspective. 📰https://t.co/rqbdoYT6mU pic.twitter.com/rpFWCFXAU3

— ConsenSys (@ConsenSys) February 17, 2023

"To create something big, you need a big vision. And you need to have that as a kind of guiding star in all decisions." –@CamiRusso, The Scoop w/ @fintechfrank (1.25.2023)

— Ariel (@goldrel) February 3, 2023