TLDR Crypto 2023-07-10

Crypto exchange Gemini, founded by the Winklevoss twins, is suing DCG and its founder Barry Silbert for alleged fraudulent conduct. The lawsuit aims to recover $640 million that Gemini claims is owed to their Earn clients. Gemini Earn users’ assets, valued at $1.2 billion, have essentially been stuck in Genesis Global, DCG's subsidiary, since DCG’s troubles began. DCG, dismissing the lawsuit as a publicity stunt, says it's progressing with the mediation process. As a reminder, this all began when DCG's Genesis Global filed for bankruptcy earlier this year following significant financial losses.

Circle and Tether have frozen over $65 million in assets following suspected exploitation of the cross-chain router protocol Multichain. Information from 0xScope revealed three addresses that have now been blacklisted received more than $63 million in USDC from Multichain. The Fantom Foundation reported that over $2.5 million in USDT had also been frozen. This decision came after the unexplained withdrawal of $125 million in cryptocurrencies from various wallets. Michael Kong, CEO of Fantom protocol, suggested that this incident does not appear to be a traditional hack. Investigations are ongoing.

Uniswap's recent v4 announcement, including a feature known as 'inverse range orders', could revolutionize DeFi. Instadapp has been leveraging this new approach to create a concept for an advanced borrowing protocol with features including flexible liquidation threshold, adaptable borrow rate, increased income for Uniswap's LPs, an oracleless protocol, and no liquidation penalty. This technology leverages the use of Uniswap v4 LPs to create a lending protocol with unprecedented features and efficiencies.

In their aim to innovate on LLM tooling, Lightning Labs has launched a new suite of developer tools. These tools integrate Lightning Network and Bitcoin and are based on the L402 protocol. This protocol enables authentication and cost-effective, scalable micropayments for API use. Developers can use the tools to create agents that can hold a Bitcoin balance or interact with Bitcoin. This announcement accompanies the release of an updated version of Aperture, the Bitcoin Lightning Improvement Proposal spectroscopy, as well as LangChainBitcoin allowing LLM chains to make payments.

Coinbase Ventures, a $6 billion fund, has kept investing this year despite the regulatory challenges its parent company has been battling. Key investments include Maverick, a liquidity provider with a TVL of $56.1 million, ConnextNetwork, a developer of web3 interconnectivity tools, and DemoxLabs, creator of privacy-focused wallet LeoWallet. Other investments include infrastructure builder Hourglass, DeFi protocol Dolomite, EigenLayer, and Violet, a DeFi platform. Notably, Coinbase also funded AzraGames, creators of the upcoming NFT-themed game, Legions Legends, highlighting a potential interest in the gaming industry.

Bob Loukas is a market analyst that puts out in-depth videos walking through his analysis of where the Bitcoin market is and where he thinks it’s likely to go. This tweet provides a solid summary of his latest analysis - “Green Lights”. According to Loukas, the 4-Year cycle began around 6 months ago, and while some participants from last cycle are still exiting the market, smart money has been accumulating since the beginning of this year. The last two cycles have peaked at around month 35 of the 48 month cycle, which is Loukas’ base case for this cycle. He goes through how one might play this cycle to accumulate Bitcoin throughout but maintain position sizing that keeps them from getting shaken out during inevitable drawdowns.

This blog post is from the bear market phase of 2018 after the 2017 bull run. During this time, the conventional wisdom was that founders in web3 needed to be working on infrastructure, which is a similar refrain we’ve been hearing during this bear market. The reasoning for this approach is that the space needs the infrastructure to be ready for the next phase of consumer apps and consumer adoption. However, history shows that infrastructure is usually a byproduct of successful applications rather than the other way around. For instance, light bulbs preceded the electric grid, and planes preceded airports. History shows that successful consumer apps are created and then we figure out how to build the infrastructure needed for mass adoption. Founders need to double down on focusing on building consumer web3 apps, rather than pivoting to infrastructure.

Ethereum co-founder Vitalik Buterin recently commented on the rise of BRC-20 tokens and Ordinals as a revival of developer culture within the Bitcoin network. In a discussion with Bitcoin advocates Eric Wall and Udi Wertheimer, Buterin showcased his support for focusing on implementing various L2 solutions and optimizing the Bitcoin base layer. The discussion also analyzed the benefits of introducing zk rollups for Bitcoin, including the ability to execute smart contracts. Despite the opposition from strong Bitcoin proponents, Buterin, Wall, and Udi argued for increased development on top of the bitcoin network.

US-listed Bitcoin mining stocks have doubled in 2023, driven by increasing Bitcoin prices and diversification into high-performance computing and AI. However, the industry has continued to consolidate and only those with the healthiest balance sheets are likely to survive in the long-run.

The Bored Ape Yacht Club floor price has dropped precipitously as the overall PFP-focused NFT market faces intense selling pressure with little demand. Forced sell-offs have occurred as liquidation prices hit on NFT-backed loans, putting further pressure on prices.

TOKI and Noble are partnering with Progmat, supported by Japan's largest bank and other companies, to bring fully collateralized Japanese stablecoins to the Cosmos ecosystem in line with recent stablecoin legislation.

EIP-7281, or xERC20, proposes an ERC-20 extension to improve token sovereignty, fungibility, and security across domains. It’s aimed at improving the safety of token bridges.