The Defiant

🏠Real Estate-Backed Stablecoin Crashes 46%

The Defiant

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Real USD (USDR), a Polygon-based stablecoin backed by real estate, crashed 46% in the past 24 hours to last change hands for $0.54. USDR began losing value after the project’s DAI reserves were exhausted, leaving only U.K.-based rental properties and its issuer’s native token to shore up its value.

The ApeCoin community is pushing back against Polygon’s proposal to build the project a Layer 2 network for $200,000 per year. “The economics of this proposal are one-sided in Polygon's favor… There is no recognition of the value APE brings to the Polygon ecosystem,” one person said.

JPMorgan completed the first collateral settlement using its closed blockchain network. JPMorgan’s Tokenized Collateral Network was used to settle a trade between BlackRock and Barclays.

Gauntlet, Arbitrum’s seventh-largest governance delegate, cannot participate in Arbitrum’s ongoing vote to allocate grant funding due to a wallet incompatibility issue. The company commands the voting power for 12.6M ARB, equating to 1% of the token’s circulating supply.

Stars Arena has recovered $2.2M worth of stolen assets after offering a $250,000 bounty to its hacker. The incident precipitated Stars Arena crashing from $3M to $0 last week.

And Lido, the top liquid staking provider, suffered a 20 ETH slashing penalty after one of its validators, Launchnodes, went offline. Launchnodes launched an investigation into the incident.

✍️ In today’s newsletter:

  • USDR sheds close to half its value
  • Polygon proposal ruffles ApeCoin feathers
  • BlackRock and Barclays trade via JPMorgan's blockchain
  • Gauntlet unable to participate in Arbitrum grant voting
  • Stars Arena retrieves stolen funds
  • Lido slashed for 20 ETH

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📈 Markets in last 24 hrs:

TickerValue24h
BTC$27,392 -0.73%
ETH$1,567 -0.8%
S&P 500$4,377 0.43%
GOLD$1,873 0.63%
Arch WEB30.73pts +0.44%
FINANCE0.75pts 0.45%
INFRA0.73pts 0.89%
CONSUMER0.77pts -0.63%
Arch WEB3

Learn more about Arch Indices here.

🎬 WATCH

Watch our video looking at the recent disruptions suffered by Friend Tech and Stars Arena, the recently surging social trading apps. And check out our podcast with Aurora Labs CEO, Alex Shevchenko, who shares his thesis for why appchains will be the engine driving web3 adoption in the future.


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Stablecoins

Tangible’s USDR Stablecoin Crashes To $0.51

TLDR Real USD, a stablecoin primarily backed by U.K. rental properties, shed around half of its value after holders depleted its DAI reserves. USDR last changed hands for $0.53.

SO WHAT While real-world assets have enjoyed increasing DeFi integrations in recent months, USDR's depeg is the latest reminder of the risks associated with backing fiat-tracking tokens with non-fiat assets. Making matters worse, more than 20% of USDR reserves comprise the native token of its issuer.

READ MORE: Tangible’s USDR Stablecoin Crashes To $0.51


Layer 2

Polygon L2 Proposal Roils ApeCoin Community

TLDR ApeCoin's community has taken offense to Polygon's proposal to build a Layer 2 hosting its ecosystem products in exchange for $200,000 each year. Polygon also requested a "development fund" to build infrastructure and stimulate growth.

SO WHAT Although many ApeCoin supporters believe the project should migrate to its own chain, they accuse Polygon of undervaluing its ecosystem. "There is no recognition of the value APE brings to the Polygon ecosystem," said Bradley Zastrow of Dash. "Chains don’t bring in users — projects do.”

Read More: Polygon L2 Proposal Roils ApeCoin Community


Business

JPMorgan Executes First Blockchain Collateral Settlement in BlackRock-Barclays Trade

TLDR JPMorgan, the largest U.S. bank, leveraged its Tokenized Collateral Network to settle a trade between BlackRock and Barclays. JPMorgan's blockchain was used to convert shares as part of a collateral settlement deal.

SO WHAT The transaction is a milestone for blockchain adoption among legacy financial institutions. JPMorgan developed its TCN blockchain despite Jamie Dimon, the CEO of JPMorgan, sharply condemning crypto and DLT in recent years.

READ MORE: JPMorgan Executes First Blockchain Collateral Settlement in BlackRock-Barclays Trade


SPONSORED POST

Smart Contracts Now Live on Stellar Testnet

On Wednesday, September 20 at 1500 UTC, the Stellar Testnet successfully upgraded to Protocol 20, which introduces support for Soroban smart contracts. Developers worldwide can now access Soroban’s Turing-complete functionality to deploy and invoke DeFi protocols in a common, widely used sandbox environment.

The Stellar network has long been known for supporting connections to real-world financial infrastructure. With the Protocol 20 upgrade, the access those connections provide will combine with the innovation potential created by smart contracts to allow for something unique: cash to DeFi.

Many Stellar ecosystem projects are already poised to take advantage of the cash-to-DeFi opportunity. In a demo featured at Meridian, the annual Stellar conference, Beans, a user-friendly, consumer-facing Stellar network wallet, showed what it might look like to integrate with Blend, a Soroban-built lending protocol, to allow a user in Malawi to cash into a USDC balance via Moneygram and, in one click, deposit that balance into an interest-generating account. These types of interactions have the potential to open access to the next generation of financial infrastructure.

The Testnet upgrade is the last step before validators vote on a Mainnet upgrade, and if that vote goes through, the upgrade is immediate. The Stellar network will likely have smart contracts before the end of the year.


Governance

Major Arbitrum Delegate Gauntlet Unable to Vote in $40M Grants Proposal

TLDR Gauntlet, an Arbitrum delegate representing 1% of ARB's supply, is unable to participate in an ongoing vote to allocate $40M in grant funding. The issue results from Gauntlet's Safe wallet being incompatible with Arbitrum.

SO WHAT Gauntlet's dilemma highlights some of the challenges associated with coordinating governance across an increasingly multi-chain web3 sector. The company noted that it has largely unsuccessfully sought to contact token delegators.

Read More: Major Arbitrum Delegate Gauntlet Unable to Vote in $40M Grants Proposal


SocialFi

Stars Arena Recovers $2.2M Of Stolen Assets

TLDR Stars Arena has recovered $2.2M or 90% of the funds stolen from its platform last week. The recovery was negotiated with the hacker in exchange for a 10% bug bounty.

SO WHAT Stars Arena quickly rose to prominence as an Avalanche-based competitor to the recently surging SocialFi app, Friend Tech. However, its total value locked rapidly crashed to $0 following the exploit.

Read More: Stars Arena Recovers $2.2M Of Stolen Assets


DeFi

Lido Faces 20 ETH Slashing Penalty

TLDR Lido, the leading liquid staking protocol, suffered a 20 ETH slashing penalty after some of its validators managed by Launchnodes went offline. Launchnodes said the validators remain offline pending an investigation.

SO WHAT Lido will shrug off the fine, estimating 20 ETH equates to 2.25% of its daily rewards or 0.00023% of its TVL. However, the ease with which Lido can shrug off the loss will not help assuage critics of the project's sizable staking dominance.

Read More: Lido Faces 20 ETH Slashing Penalty


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🌍 ELSEWHERE

  • Court approves Genesis settlement of $175M to FTX, expunges billions in claims (Cointelegraph)
  • Platypus Finance suffers more than $2 million exploit on Avalanche: PeckShield (The Block)
  • UK FCA Working on Blue Print for Fund Tokenization Due This Year (CoinDesk)