Institutional Digital Asset Newsletter - September 2020

Newsletters Sep 27, 2020

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

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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]


Uniswap hits $2 billion in Total Value Locked (TVL)

Top non-custodial exchange Uniswap has become the first decentralized finance (DeFi) protocol to cross $2 billion in total value locked (TVL).

Uniswap's TVL, or the total value of all assets deposited in the protocol, stands at $2.03 billion at the time of writing, according to tracker DeFi Pulse. Ether (ETH), Tether (USDT), and Wrapped bitcoin (WBTC) are Uniswap's top three tokens by liquidity.

Uniswap's dominance, among other DeFi protocols, is about 18% market shares. The combined TVL of all protocols has hit more than $11 billion as the yield farming trend continues.

Decentralized lending protocol MakerDAO is not too far away to hit $2 billion in TVL. The builder of DAI stablecoin has $1.95 billion in total deposits. Aave follows next with $1.54 billion in TVL.

DeFi tokens TLV
DeFi tokens TLV

MicroStrategy Buys More BTC

The large NASDAQ-listed company providing business intelligence, mobile software, and cloud-based services purchased its first batch of $250 million worth of Bitcoin in August. Merely a month later, MicroStrategy doubled-down on its investment by buying $175 million more of BTC.

Along with the massive purchase, the company’s founder and CEO, Michael Saylor, completed a one-eighty transformation. Back in 2013, he predicted (wrongly) Bitcoin’s death, while in 2020, he named the primary cryptocurrency a “legitimate investment asset.”


WBTC (Wrapped Bitcoin)

WBTC stands for Wrapped Bitcoin and is simply an ERC20 token (token implemented on the Ethereum blockchain) that represents Bitcoin. One WBTC equals one BTC. BTC can be converted into WBTC and vice-versa. Being an ERC20 token makes the transfer of WBTC faster than normal Bitcoin, but the key advantage of WBTC is its integration into the world of Ethereum wallets, dapps, and smart contracts.

Wrapped BTC launched on Ethereum mainnet in January 2019. Wrapped Bitcoin was brought to the world as a collaborative project between major players in the DeFi ecosystem such as BitGo, Ren, Dharma, Kyber, Compound, MakerDAO, and Set Protocol in an effort to bring more liquidity into the Ethereum network by dipping into Bitcoin. The project is now controlled by a Decentralized Autonomous Organization (DAO) called the WBTC DAO.



Europe unveils plans to regulate cryptocurrencies

The European Commission has unveiled “ambitious” proposals to regulate crypto assets—and while it’s set to deliver legal clarity to exchanges and stablecoin issuers, the measures will bring tougher requirements for the sector.

Under the new rules, a fintech company that obtains a license to operate in one EU nation will be able to provide services in the trading bloc’s 26 other member states automatically. But it might be a little too early to crack open the champagne yet. The paper adds: “At the same time, the proposal imposes more stringent requirements on ‘stablecoins’, which are more likely to grow quickly in scale and possibly result in higher levels of risk to investors, counterparties and the financial system.”


Gary Rebibo

CMO @Trakx