The G Code triple double is our weekly snap newsletter covering everything bitcoin, crypto, trading and G code community related. Each week we cover 3 critical market insights and 2 DeFi projects we are keeping tabs on as well as share some trades our community have executed during the week.
Crypto market insights:
Our first market insight for 2023 this week, which is well overdue, covers the sleeping dragon which is of course the residual risk from the potential implosion from Genesis and Digital Currency Group (DCG). To the amusement and worry of many we’ve been watching the Genesis vs DCG debacle play out right in front of us on Twitter and crypto news platforms. If the balloon pops for DCG, the risk is that we see this nice little pump we seen in the crypto market get destroyed due to the massive selling that would ensue. Just to be clear DCG owns a range of crypto companies, some significant ones being Genesis, Coin Desk and Grayscale. Genesis has been significantly affected by the 3AC and FTX saga’s. As a result of these two implosions and being undercollateralized Genesis has been left with a 1.2 billion dollar hole! So they have filed for bankruptcy. From the beginning of this year this has been playing out reasonably publicly on Twitter here with large crypto identities going at each other – Letter 1 and Letter 2. Feel free to scour the details yourself. The long and short – DCG is desperately trying to raise capital which means portfolio selling which could mean heavy downside risk for some alts. Worst case, the Grayscale fund has to unwind and all the BTC being held in the trust has to be sold, which would kill the price of Bitcoin and the rest of the market.
Our second market insight has a quick look at the potential risk from USDT. Seemingly under the radar is Crypto.com's delisting of USDT for its Canadian users effective 31 Jan, at which point it will be converted to USDC. This is off the back of the Ontario Securities Commission who banned USDT from being traded in August 2021. The word is that USDT was not sufficiently backed in the Canadian banks. This under-collateralization is a worry and could be (speculation) the headwinds for what may happen to USDT if there were to be a regulatory clamp down in the US.
In a bit more current news our last insight this week, we bring your attention to the latest update from Uniswaps v3 proposal to deploy Uniswap on the BNB Chain. The vote which was held between Jan 17 and Jan 22 revealed that 80% of token holders supported an expansion to the BNB Chain. The reasons this is bullish for the Uniswap ecosystem as it would get access to an additional 1 billion dollars of TVL, possibly 1 to 2 million more users and massive trading volume.
Two DeFi projects we are keeping tabs on this week:
Optimism (OP): Significant upgrades coming to the project with its much anticipated Bedrock upgrade aimed to make Optimism the cheapest optimistic rollup on Ethereum. With the Ethereum Improvement Proposal (EIP) 4844, transaction fees on L2s were expected to decrease even further.
Magic (MAGIC): Treasure just announced its plans to launch its MagicSwap v2 NFT automated market maker (AMM) in Q2 2023. Treasure has designed the new and improved exchange to be the “first AMM in crypto to support pools for ERC-20s and NFTs through a single router.
Our trading community has picked up some nice gains over the last week: