Institutional Digital Asset Newsletter - August 2020

Newsletters Aug 30, 2020

Once a month, we summarize the best crypto news for Institutional Investors

🚀 Trakx is opening its exchange for Digital Asset Indices to a broader public after successfully launching in private beta with friendly institutional clients.

Trakx enables its clients to trade sophisticated digital strategies and indices on a secure and compliant platform. We hope that you will love trading with us, and we are looking forward to getting your feedback on the user experience and indices/strategies that we released. Please send comments to [email protected]

INVESTING

Coinbase Launches Bitcoin-backed Loans of up to $20,000 in the US with Plans to Expand

Coinbase is one of the largest and most regulated crypto exchanges to get into the lending business, and the exchange is setting conservative parameters on the product, capping credit lines at $20,000 per customer and offering an interest rate of 8% for bitcoin-backed loans with terms that are a year or less.

Customers will need to fill out a brief application but won’t have to go through a credit check, however, and borrowers will be able to receive their loans in two to three days.

Synthetix (SNX) surpasses $1B “TVL” as DeFi investor interest grows

Synthetix has reached the $1 billion in Total Value Locked milestone (assets locked in Synthetix smart contracts), following other DeFi protocols like Compound and Aave. Synthetix (SNX) has been one of the many DeFi tokens that has made substantial gains in 2020, having hit its all-time high of $7.32 on August 15 and rallied more than 400% year-to-date.

Most of the hype around the 2020 altcoin season has been focused around lending, liquidity, and yield farming (best yield return such as Staking) within crypto. However, Synthetix was able to make strides in the DeFi sector by offering crypto investors an inlet to the world of traditional finance.

NEW ASSET OVERVIEW

Yearn.finance

Yearn.finance is a decentralized ecosystem of aggregators that utilize lending services such as Aave, Compound, DyDx and Fulcrum to optimize token lending yields. When tokens such as USDc or other ERC-20 are deposited on the yearn.finance platform, they are converted to yTokens, which are periodically re-allocated to choose the most profitable lending service(s).

YFI, yearn.finance's governance token, is distributed only to users who provide liquidity with certain yTokens. With no pre-mine, pre-sale, or allocation to the team, YFI strives to be the most decentralized token. Although most of the ecosystem was built by Andre Cronje, control of YFI was transferred to a multi-signature wallet, which requires 6 out of 9 participants to agree on changes. As a truly decentralized protocol, any changes to the yearn.finance ecosystem are always done via on-chain proposals and voting.

PLATFORM

REGULATION

Historic: regulation is coming for cryptocurrencies in Europe

The European Commission, the legislative body of the European Union, is in the final stages of a proposal for the region’s first cryptocurrency and digital finance framework, according to a report by financial news outlet IFC Review.

Successful passage of the law and its subsequent adoption would provide for an optimal legal environment for crypto firms to build their business and add to the European economy, the report noted.

The Commission has spent the last year holding consultations with experts and defining cryptocurrencies. Some of these include recognizing digital currencies—both crypto assets like Bitcoin and stablecoins—as financial instruments and introducing a framework for blockchain-based tech platforms.

PEOPLE MOVE

Gary Rebibo

CMO @Trakx