Volatility Lows and DeFi Setback


Market Overview: 

Crypto round up:

Current market conditions continue to exhibit subdued activity, with Bitcoin (BTC) and Ethereum (ETH) experiencing 10-day realized volatility at the 23rd and 18th period moving averages, respectively, reflecting their lowest levels since the beginning of the year. Amidst this environment, the absence of a compelling narrative to drive price action is evident, following the XRP (lawsuit getting dismissed in part) news and pending review of ETF applications. Investors are keenly awaiting updates from the courts regarding Grayscale and the impending Mt Gox distributions; however, positioning for these events remains challenging, resulting in a cautious approach from market participants.



Over the weekend, Curve, the second-largest decentralized exchange (DEX), faced a substantial exploit, resulting in approximately $50 million being drained from several of its pools. This incident poses a potentially significant setback for the DeFi space and we believe is likely to reduce liquidity in the short term. Consequently, the Total Value Locked (TVL) on Curve witnessed a decline from $3 billion on Sunday to $1.7 billion on Monday, as investors withdrew capital from the affected pools. Consequently, the CRV token suffered a decline of 16%.



Flows in major cryptocurrencies have displayed relative equilibrium, with both buyers and sellers engaging in passive trading– with no clear appetite to move prices in one direction. Furthermore, the market sentiment towards altcoins has shifted towards better selling prospects; however, the overall trading activity in this segment remains subdued.


NFT Market News:

Vera Molnár Releases NFT Project

99-year-old artist Vera Molnár’s computer-generated non-fungible tokens (NFTs) were sold for $1.2 million total. The NFT collection, named ‘Themes and Variations,’ was a collaboration with artist Martin Grasser and featured 500 unique digital artworks. The auction was conducted by Sotheby’s, and each NFT was sold for 631 ETH (equivalent to $1,178,520). Vera Molnár, a pioneer in computer art, explored letters in this project, adding a personal touch to her generative art. The NFT collection is a testament to her groundbreaking work in the art world.



Latest News:

WELCOME FRIENDS: Hundreds of institutions and prominent individuals have invested directly in crypto, adopted the value thesis, or started building technology to support digital assets since Wave started tracking these developments in late 2020. Now the rise of the Metaverse, Decentralized Finance (DeFi), Non-Fungible Tokens (NFTs), and Decentralized Autonomous Organizations (DAOs) is driving mainstream adoption of blockchain technologies everywhere we look. We’re continuing to keep track of it every week here:

  • Singapore’s High Court has deemed crypto as property in a case involving crypto exchange Bybit and a contractor. A court judgment published Tuesday declared crypto assets are property capable of being held on trust. 
  • Amazon Managed Blockchain (AMB) now offers expanded Access and Query functions, providing users with faster application development using provisioned blockchain infrastructure. AMB Access allows serverless, scalable access to blockchains through standard remote procedure calls, while AMB Query enables access to blockchain data across multiple chains, starting with Bitcoin and Ethereum, via APIs. Potential use cases include custodial and wallet crypto applications, along with Web3 consumer engagement campaigns utilizing non-fungible tokens (NFTs).
  • Worldcoin, the controversial crypto project co-created by OpenAI’s Sam Altman, announced the launch of its WLD token last week, following the project’s completed migration to the OP Mainnet. The project is among the crypto sector’s most divisive. Its focus is on helping people prove their identity online with credentials verified in person by iris-scanning orbs. More than two million people — the bulk of them in the Global South — have already been verified, and all of them stand to receive their share of the WLD token. The project aims to function as a fairly distributed cryptocurrency using biometrics as the basis of its distribution scheme.
  • Lacoste is opening up a new virtual store for the summer. Created by retail technology developer Emperia, the digital rendition combines a more traditional immersive retail experience with elements exclusive to holders of Lacoste’s UNDW3 NFT passes.
  • Ducati has announced the launch of its first-ever digital collectible on the XRP Ledger. The Bologna-based motorcycle manufacturer’s digital collectible will consist of a video sequence of Ducati logos on tanks of motorcycles produced since 1946.
  • The Celo Foundation announced that Google’s computing cloud service, Google Cloud, is running a validator on the Celo network, joining Deutsche Telekom and other ecosystem contributors. 

REGULATORY ROUNDUP: We’re living through the era of regulatory recognition of digital assets. The legislation, litigation, and regulation happening today will dictate the entire future of our industry, and we have a historic chance to shape those changes by staying informed and providing public commentary.

  • The House Financial Services Committee advanced a set of crypto bills after a landmark markup last Wednesday. Though the fallout from crypto exchange FTX loomed large over lawmakers as they worked toward ironing out the details of bills designed to provide a unified legal framework for crypto and address blockchain-related issues, a majority of lawmakers ultimately voted in favor of the Financial Innovation and Technology for the 21st Century Act and the Blockchain Regulatory Certainty Act after a day-long markup session, referring both bills to the full House of Representatives for a vote. The bills would allocate more power to the CFTC in regulating crypto, in addition to recognizing that “digital assets that are not inherently securities may be offered as part of an investment contract but that does not make them securities.” While the bill faced several objections from committee members on both sides of the aisle, the committee’s chair praised the legislation noting it was the first time a committee was marking up crypto-specific legislation necessary to prevent the US from falling behind other countries in regulating crypto markets.


Disclaimer: The views and opinions expressed herein are those of the author alone and do not represent Wave Digital Assets LLC or any of its affiliates (collectively, “Wave”). The author and/or Wave may hold investment positions in some of the assets discussed. Nothing in this material or linked information should be interpreted as an offer or recommendation to buy, sell or hold any security or other financial product. This material is not intended to provide accounting, legal or tax advice. Certain information contained herein has been obtained from third-party sources, has not been independently verified and should not be viewed as being endorsed by Wave. Such information is believed to be accurate as of the date of its publication. No representation or warranty is made, express or implied, with respect to the accuracy or completeness, and readers should not place undue reliance on the information contained or linked to herein. Certain statements in this material provide predictions and there is no guarantee that such predictions are currently accurate or will ultimately be realized. Past performance is not indicative of future results.

Wave is federally regulated by the US Securities & Exchange Commission as an investment adviser. Registration with a federal or state authority does not imply a certain level of skill or training. Additional information including important disclosures about Wave Digital Assets LLC also is available on the SEC’s website at www.adviserinfo.sec.gov. Or, learn more information about Wave at www.wavegp.com.

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