๐Ÿš€ Tether reach new ATH again!

All Things Flooz newsletter is for innovators, creators and traders.

Flooz

6 min read โ€ข Aug 2, 2023


Talking points

  • ๐Ÿ”“ Curve Finance hacked

  • ๐Ÿš€ Tether reaches new ATH again

  • ๐Ÿ‘€ Coin-BASE taking off?

Market Outlook ๐Ÿ‘€

It seems that every week there is barely any change in the markets and any climb or drop we have seems to revert itself pretty quickly. However, are we now finally getting closer to that changing?

Here's some insight into what we might be seeing in the short term:

It seems we could be heading down further before seeing a nice climb up and past that $31k zone that is proving a difficult level to beat. But if this does occur, it means that there is more opportunities to get into positions and DCA (Dollar Cost Average) ๐Ÿ””

What else should we look out for?

With there being some hype around meme coins and the added fact that Elon has renamed Twitter... It seems we could see some nice moves forming for

But wait... there's more!

It seems could also be looking for a nice move up but be careful as if the current level is lost... we could see a drop instead.

๐Ÿ”“ Curve Finance hacked

Curve Finance, a prominent decentralized exchange operating on the Ethereum blockchain, fell victim to a hack caused by vulnerabilities in specific pools built using the Vyper programming language. This incident had significant repercussions for the price of Curve DAO , which experienced a sharp decline of 20%, hitting a two-month low of $0.58.

The following day, CRV's downward trend continued, reaching a seven-month low of $0.48. Concerns about the liquidation of substantial loans, amounting to $100 million, taken by Curve Finance founder Michael Egorov against CRV as collateral ๐Ÿคฏ contributed to the apprehension in the market.

However, amidst the challenges, several positive developments have emerged, suggesting potential short-term rallies for

Notably, there have been partial repayments of loans and notable negative bets in the derivatives market.

To address the liquidity concerns, Egorov took action on August 1, selling 39.25 million CRV tokens to notable decentralized finance investors like Justin Sun, Machi Big Brother, and DWF Labs for a total of $15.8 million, as reported by Lookonchain data. The buyers were able to acquire at a discounted rate of $0.40 per token, representing a 25% discount from the prevailing market price at the time.

Additionally, Egorov has made partial repayments on his Tether loans through the Aave platform. The principal amount owed has been reduced from $63.20 million to $54.1 million, according to data from DeBank. This partial repayment demonstrates a positive step in mitigating the risk of liquidation, providing some relief to investors and the DeFi community.

Nevertheless, it's important to note that the situation remains sensitive. The risk of Egorov's loans being liquidated on Aave persists if the price drops to $0.36 or lower, as indicated by DefiLlama.

Despite the challenges faced by Curve Finance, the DeFi community is rallying to support CRV. Egorov's actions to repay loans and the involvement of notable investors signal a willingness to address the situation and find solutions to stabilize the price.

However, despite the concerns and being significantly down, it has seemed to recover back up to around $0.59 during the early hours of 2nd August.

As the situation unfolds, stakeholders are encouraged to stay informed and remain vigilant while the DeFi community comes together to navigate the aftermath of the hack and support the stability and growth of Curve Finance and remember to always protect your capital.

๐Ÿš€ Tether reaches new ATH again

Stablecoin issuer Tether has recently released its consolidated reserves report for the second quarter of 2023, revealing impressive financial figures.

According to the report, Tether now holds approximately $3.3 billion in excess reserves, showcasing the company's robust financial health. Moreover, profits have surged by 30% from the previous quarter, exceeding $1 billion.

This has been audited and attested by the reputable accounting firm BDO, highlights Tether's commitment to transparency and financial stability. It reveals that the excess reserves constitute nearly 4% of the total assets backing all Tether tokens in circulation, offering additional security and reassurance to its user base.

Tether's "extremely liquid" reserves are primarily comprised of 85% cash and cash equivalents. Additionally, the company holds a substantial amount of $72.5 billion in US Treasury bills, further bolstering its financial position.

Overall, Tether's asset holdings amount to an impressive $86.5 billion, while its liabilities stand at $83.2 billion. This data underscores the company's solid financial standing, affirming its capability to maintain a healthy and reliable financial ecosystem.

Tether's management views the excess reserves as the company's retained profits, emphasizing that these funds are not distributed to shareholders. Instead, Tether has chosen to hold onto these reserves in addition to the 100% reserves already maintained to back all outstanding tokens. This decision exemplifies Tether's dedication to prudent risk management and care for its community of users.

Furthermore, Tether reported a noteworthy share buyback worth $115 million. The buyback initiative is seen as a positive step to consolidate the company's position and strengthen its shareholder base, reflecting a forward-looking approach to sustainable growth.

Tether's token, pegged to the US dollar, has also reached a new milestone during this quarter. The circulating supply of surpassed its previous all-time high of $83.6B, showcasing the stablecoin's increasing popularity and demand in the market.

In addition to the US dollar-pegged stablecoin, Tether issues stablecoins pegged to other currencies, including the euro (EURT), Chinese yuan (CNHT), Mexican peso (MXNT), and even gold (XAUT). This diverse range of stablecoins further enhances Tether's relevance and accessibility in various global financial markets.

To conclude this continued positivity for the crypto world, Tether's Q2 2023 reserves report presents an encouraging outlook for the stablecoin issuer. With substantial profits, excess reserves, and a commitment to transparency, Tether is poised to play a crucial role in shaping the future of the global financial ecosystem. As the demand for stablecoins continues to rise, Tether's solid financial foundation positions it as a reliable and secure choice for participants in the digital financial landscape.

๐Ÿ‘€ Coin-BASE taking off?

Base, a layer-2 blockchain backed by Coinbase, has garnered significant attention and investment ahead of its official launch. Despite not being open to the public yet, the platform has witnessed remarkable activity, with over $200 million in trading volumes and a surge in transactions surpassing established networks like Arbitrum.

Traders and investors have flocked to Base in search of lucrative returns, particularly from meme coins. One such example is the meme coin BALD, which experienced an extraordinary surge, skyrocketing by approximately 4,000,000% from its initial issuance to its peak price. This momentum resulted in over $100 million in trading volume within just 24 hours.

The news of these impressive gains quickly spread across social media, attracting even more traders eager to capitalize on the opportunity for quick profits. However, the token's meteoric rise was followed by a sharp drop of more than 78% from its all-time high. This downturn occurred after a developer executed a "rug pull" on the BALD meme coin by removing all liquidity on Ethereum layer-2 network Base.

Despite this incident, traders continued to invest in Base, with meme coins like brian (BRIAN), toshi (TOSHI), and basedbot (BOT) witnessing substantial gains and subsequent losses. This influx of capital into Base created a breeding ground for exploitative practices, with opportunistic developers deploying numerous tokens, only to execute rug pulls later on. Some traders even unknowingly purchased imitation tokens that lacked exit liquidity.

While the lack of a functional two-way bridge did not deter traders, caution is warranted given the hyper-speculative nature of meme coins. Jeff Mei, the Chief Operating Officer of crypto exchange BTSE, highlighted the opportunities for profit but also emphasized the importance of not getting swept up in the frenzy.

Notwithstanding the hype surrounding Base, skepticism remains about its long-term prospects. Mikolaj Zakrzowski, a Web3 analyst at on-chain analytics tool CryptoQuant, expressed doubts about the blockchain's fundamentals. He pointed out that one address alone bridged over $17 million worth of Ether, suggesting that the rise of Base may not be entirely supported by solid foundations.

Base, built on the OP Stack, opened its doors for developers to test applications and blockchain-based products in July. As the platform gears up for its official launch, the excitement and interest surrounding it continue to grow. However, investors are advised to tread carefully and assess the risks associated with the speculative nature of meme coins and the emerging blockchain ecosystem.

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