🗑️ Institutions Offload Crypto Exposure

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Institutions are unloading their exposure to digital assets, with crypto exchange-traded products suffering $726 million in outflows last week.

Markets rallied on Tuesday ahead of Kamala Harris’ debut debate as traders wait to see if she will reveal her stance on crypto. BTC and ETH rallied 2%, trading at $56,763 and $2,335, respectively. SOL climbed 3%, while DOT dipped 1%.

Aave launched a v3 iteration dedicated to facilitating stablecoin loans against EtherFi’s weETH liquid restaking token. The move marks Aave’s second deployment dedicated to a single asset.

Andreessen Horowitz, a leading web3 VC firm, announced its Q4 2024 crypto accelerator cohort.

Plus, PayPal and Venmo integrate ENS, Polygon taps chip builder to accelerate ZK proofs, SwissBorg launches first CeFi Morpho Vault deployment, and VC-backed L1s lead TVL growth.

✍️ In today’s newsletter:

Institutions shed $726M from crypto ETPs
Markets rally for a fourth day
Aave ships EtherFi v3 instance
a16z announces crypto accelerator participants
ENS boasts PayPal and Venmo support
Polygon turns to hardware chips to boost ZK proofs
Morpho scores first CeFi integration
Core, Sei, Sui, and Aptos top DeFi growth rankings

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️🗑️ Institutions Sold $726 Million of Crypto Last Week, Highest Since March

Institutional investors reduced their exposure to crypto en masse last week. Digital asset ETPs posted $726 million in outflows to post a seven-month low. Bitcoin ETPs accounted for 88.5% of the bearish flows.

🚀Bitcoin Price Surges as ETFs Record Inflows After 8-Day Slump

Cryptocurrency markets traded higher on Tuesday morning as spot Bitcoin exchange-traded funds (ETFs) posted inflows after eight consecutive days of outflows. Analysts believe the market will be closely watching Kamala Harris’ policy cues in her debut debate today.

🆕 Aave Launches EtherFi-Dedicated V3 Deployment

Aave, the largest web3 lending protocol, launched a new deployment of its v3 iteration dedicated to hosting stablecoin markets for EtherFi’s liquid restaking token, weETH. The move follows Aave deploying a Lido-focused instance in July, with the project’s governance currently reviewing a proposal for an Ethena-dedicated deployment as well.

🏎️ a16z Unveils New Cohort of Crypto Startups

Andreessen Horowitz announced that 21 startups from 11 countries will participate in its Q4 2024 crypto accelerator program. Each project will receive a $500,000 investment from the firm, with the protocols spanning AI, DeFi, infrastructure, and consumer-facing apps.

🔁 PayPal and Venmo Integrate Support For ENS Names

PayPal continues to deepen its web3 presence, with both PayPal and its subsidiary, Venmo, integrating support for Ethereum Name Service domains. Users can now send digital assets to ENS domains, bypassing the need for cumbersome web3-native wallet addresses.

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🖥️ Polygon Taps Fabric Cryptography’s VPU Chips To Lower ZK Proof Costs

Polygon Labs will leverage Fabric Cryptography VPU chips to improve zero-knowledge proof generation. Polygon said Fabric’s VPU hardware will unlock real-time ZK proofs and reduce generation costs, accelerating the rollout of Polygon’s AggLayer ecosystem.

🤝 SwissBorg Leverages Morpho Vaults For USDC Earn Product

SwissBorg launched a Morpho-powered USDC Earn product on its app, marking the first CeFi integration of Morpho Vaults. The move follows Centrifuge leveraging Morpho’s permissionless vault infrastructure to launch the first real-world asset lending markets on Base.

🚀 ‘VC Chains’ Lead DeFi TVL Growth

Networks with heavy VC-backing are topping the rankings by DeFi TVL growth, with Core, Sei, Sui, and Aptos, posting TVL gains of between 21% and 130% over the past 30 days. The trend comes despite investors recently expressing resentment towards “low-float, high FDV” tokens.

🌍 ELSEWHERE

Crypto ETFs from State Street and Galaxy Digital begin trading (The Block)
Americans lost $5.6 billion last year in cryptocurrency fraud scams, the FBI says (AP News)
Solo Bitcoin Miner Wins Big After Securing an Entire Block Reward (CoinDesk)
Starknet’s STRK Up 15% In Past Week Ahead of First Community Governance Vote (Unchained)