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- 🦧 Banks Implode, USDC de/repegs as Crypto pumps WDF is going on?!
🦧 Banks Implode, USDC de/repegs as Crypto pumps WDF is going on?!
plus Binances partner blocks the British, Euler Finance gets hacked for $200m and is Bitcoin about to break towards $31,000?
GM Legends,
US banks are in a state of crisis, stables have become less stable and CZ has pumped Bitcoin into a market rally. What the actual… is going on right now?!
This week is one of those “big weeks”. The kind that even Barry Silbert would be impressed by. So let’s take a look at how we got into this mess, the winners and most importantly WDF what happens next?!
Here's what's inside today.
🔥 The big topic. Banks Implode, BTC Pumps…WDF is going on?!🗞 Hot crypto news. HSBC buy Silicon Valley Bank UK for less than a Greggs steak bake, Binance blocks the British, Euler Fiance’s $200m flash attack AND MORE.👀 Updates across the bloc. Perpy Finance's public sale is on March 16th, GammaSwap’s testnet is live on March 17th, UniDex V3 goes live on March 17th AND MORE. 🛡 Chart of the day. $BTC, could it be… $31,000?
🧵 Thread of the day. CurveCap takes a look at how 8 of the top stablecoins reacted to the US banking crisis.
🔥 The big topic.
Banks Implode, BTC Pumps…WDF is going on?!
*cue music* Doom doom doom… another one bites the dust.
It’s a hat-trick of bank failures as Silicon Valley Bank gets shut down by the FDIC, Silvergate gets taken over by New York and Signature Bank gets the thumbs down from State Regulators.
All whilst USDC depegs, repegs and the crypto markets PUMPs a god candle of glory, completely ignoring the banking stocks dumping over 50%.
WDF is going on?!
And yes Arthur, we are all ready for the… ahem… bull run.
*PS excuse Arthur’s french above… this is a family-friendly newsletter BUT you get my point!
How did we get here?
The banks are in trouble.
Like… in proper trouble.
Yes, the same banks that we entrust to keep our real-life digital dollars safe are in a state of emergency right now.
Here's the story so far:
Inflation BOOMED, so;
The FED hiked rates, meaning;
Silvergate & SVB treasury bond investments were a BAD idea which;
Led to rapid bank runs with;
Silvergate liquidating & locking up shop whilst;
Top ballers at SVB dumped their stocks on;
Retail as regulators shut them down and;
Ultimately depegged USDC as Circle had $3.3bn stored in SVB
Quite ironic how J Powell’s continued hawkish stance on raising rates has crippled two of America’s most popular “crypto-friendly” banks.
Side note, rate hikes impact both newly issued and pre-existing treasury bonds that are legally required to be held as collateral by banks… you see where this could go, right?!
Let’s not digress as my bag of stablecoins became less stable!
The Great Depeg
“What about my USDC stablecoins, sir?!”
“Aren’t they backed 1:1 in cash by banks?!”
We learned that $USDC is backed by cash held in banks, except... banks don't actually hold that cash.
— Ignas | DeFi Research (@DefiIgnas)
Mar 12, 2023
Panic spread as we found out last Friday that Circle, the issuers of USDC, had $3.3billion of reserves locked up in SVB sending the “stable” price down to its low of $0.8371 on ByBit.
Yikes! Looks like all that USDT fud was for nothing and it wins the stablecoin battle once again.
0xJezza keeps it simple on who owns which stablecoin. Choose wisely!
usdc fed $
usdt mafia $
busd cartel $
lusd eth $
All others are simply wrappers/partially backed
choose wisely anon twitter.com/i/web/status/1…
Mar 10, 2023
Yesterday was the great repegging as USDC became whole again after the FED announced a new emergency Bank Term Funding Program which isn’t a “bank bailout” (lol) whilst CZ publicly announced he was buying a big ole bag of BTC, ETH and BNB.
Given the changes in stable coins and banks, #Binance will convert the remaining of the $1 billion Industry Recovery Initiative funds from BUSD to native crypto, including #BTC, #BNB and ETH. Some fund movements will occur on-chain. Transparency.
Mar 13, 2023
Ahhhh, order has been restored and CZ once again beats America.
Who’s winning so far?
Definitely not this guy.
With USDC insolvency fears rampant, users are fleeing to safety in other stables. Not all of them are going to make it there in one piece, however.
Here's how one unlucky user paid $2,080,468.85 to receive $0.05 of USDT.
— BowTiedPickle.eth | Solidity Shipper (@BowTiedPickle)
Mar 11, 2023
Or these guys, despite Biden trying his hardest to fill us with confidence that the banking sector is A… OK!
BREAKING: Trading is halted in numerous US banking stocks after Biden reassures that the “banking system is safe”😱‼️
— Bitcoin News ⚡ (@BitcoinNewsCom)
Mar 13, 2023
The top 3 winners (so far)
1) The Depositors
Funds are now SAFU as the FED steps in to plug the gap with Biden specifically stating that it “won't be taxpayers' money” but “wall street’s.”
2) Bitcoin
A 12% god candle is hard to fade as well as the idea of Satoshi's vision which, despite a few rocky weeks, might still be alive.
After all, Bitcoin was originally created as an expression of freedom and control over your own golden corns.
VIVA LA CRYPTO.
3) Decentralised stablecoins
They’re coming and they’re coming with haste and the last 72 hours have proved that they’re needed.
So I think people now understand why I constantly scream about "decentralized stables" being USDC wrappers.
Tuesday, March 14th, "The Novel Invention of a Stable Stablecoin" coming at ya pearl club!
Mar 12, 2023
But remember, despite all this Crypto is still, and will always be the bad guy… DUHHHH.
Significant chance that they blame the bank failures on crypto and not interest rates.
Biden's speech might include some aggressive rhetoric, if he doesn't just take a victory lap.
Mar 13, 2023
Our Take
What happens next?!
Get the bandaid box out as the FED may be about to short-term pivot as markets see a 60% chance of ZERO rate hikes next week whilst depositors are made whole again through the Bank Term Funding Program. Why couldn't they call it a BTFD?!
Rate hikes are possibly over.
Gold will be over $2,000 and at new ATH soon.
#gold#silver
GOLDMAN SACHS: “In light of recent stress in the banking system, we no longer expect the #FOMC to deliver a rate hike at its March 22 meeting with considerable uncertainty about the path… twitter.com/i/web/status/1…
— Wall Street Silver (@WallStreetSilv)
Mar 13, 2023
Now the FED becomes a liquidity provider (again) plugging the hole so that the big boys won’t need to panic dump their bags in times of stress to meet short-term liquidity needs.
Basically, the FED is now a loan shark gifting a short-term solution for a multi-decade problem of poor risk management that makes crypto investors look like absolute wizards in the art of investing.
Safe to say, I wasn’t expecting that.
🗞 Hot crypto news.
🐮 Bullish News
HSBC buys Silicon Valley Bank UK for £1.21 which costs LESS than a Greggs steak bake (IYKYK!) The move will see SVB customers’ deposits move over to HSBC safe and sound.
DeFiance Capitals’ $100m Liquid Token Fund is on the hunt for below-fair-price tokens to snipe up during the crypto winter stating: “We believe that multiple crypto startups would have listed tokens with extremely favourable risk-reward profiles.”
The CFTCs TAC squad. The Commodity Futures Trading Commission has added influential names from the likes of Circle, Ava Labs and Fireblocks to the Technology Advisory Committee. The TAC will help in “identifying and understanding the impacts and implications of technological innovation in financial services and markets.”
I'm thrilled to have been appointed to the CFTC's Technical Advisory Board. I'll do everything I can to move the space forward, inform regulators about the latest developments in crypto, and bring the benefits of blockchains to our financial system.
cftc.gov/PressRoom/Pres…
— Emin Gün Sirer🔺 (@el33th4xor)
Mar 13, 2023
🐻 Bearish News
Biden’s call for stronger bank regulations comes after two of the largest bank collapses in history happened on the same weekend. He stated that: “No one is above the law” and “Investors in the banks will not be protected,” he added. “They knowingly took a risk. And lost their money. That's how capitalism works.”
Binance blocks the British in a move that sees the crypto exchange halting its GBP on/off ramping due to its fiat partner PaySafe will no longer be providing these services from May 2023. The exchange has said they are working to find a solution.
Euler Finance & PeopleDAO Hacked for over $200m. Eluer Finance was hit by a flash loan with the team at Lookonchain breaking it down. As for PeopleDAO, well, they failed to lock Google Sheets that contained sensitive information.
An update on our work today to recover funds for Euler protocol users.
Here are a few actions we took immediately:
1. Stopped the direct attack as soon as possible by helping disable the EToken module, which blocked deposits and the vulnerable donation function
2. Engaged TRM… twitter.com/i/web/status/1…
Mar 14, 2023
👀 Updates across the bloc.
Project Updates
Cosmos is gearing up for the V9-Lambda upgrade featuring Interchain Security (ICS) which will be taking place on March 15th, allowing the multiple blockchains to share the same security.
Filecoin’s FVM (Filecoin Virtual Machine) goes live on mainnet today.
GammaSwap have just dropped their docs and announced that their beta testnet goes live on March 17th.
Perpy Finance public sales go live on March 16th. Find out how you can secure a whitelist spot and the “why’s, where’s and who’s” of the launch.
Radiant Capital is migrating to v2 very soon. If you are a holder, it would be smart to read up on their migration FAQ found here, launch date TBA.
Sei Network is launching the final version of its testnet, Atlantic-2, the final checkpoint before the official mainnet launch. This thread breaks down the details.
Synethix hit $100m daily volume across all Synthetix Perps. Synthetix V3 is coming soon, here is a detailed breakdown of why it’s important. Governance presentations are to be held in discord on March 16th.
Thena Finance enter valhalla with Floki Inu. Check out the medium here for full details on how you can earn with Thena and Floki.
Timeless Finance has had their proposal submitted to Redacted Gov to whitelist $FRAX $FXS $frxETH $LQTY $LUSD $LIT $MATIC, and more on Hidden Hand. Check out this tweet for the remaining 9 updates. BunniZap Audi Report coming soon!
UniDEX’s massive update in discord including SwapV3 goes live on March 17th. PerpsV3 will see its first public test on March 31st including stop & limit orders and finally, the app chain is set for March 31st.
Governance Updates
Level Finance’s part 2 of 3 governance proposal for “Leveling Up: 1.5 Upgrade Part 2” voting has ended with 99.82% in favour. This series of proposals look to further expand the utility of the LVL token.
Timeless Fi has a number of active proposals in voting including Enabling SGT/ETH Gauge, Reducing TRC to 4 days and directing all Bunni Protocol fees towards vote incentives on bribe markets.
MakerDAO’s Risk Core Unit (and in light of recent stablecoin depegs) have submitted an emergency proposal. The “Pegs Stability Module (PSM) Breaker” would “instantly disable additional borrowing from PSMs by reducing their debt ceilings to zero once.”
MakerDAO’s Risk Core Unit has submitted an emergency proposal for Executive Vote to implement a circuit breaker as a means to disable PSMs without a Maker Governance deployment delay.
1/
Mar 13, 2023
🛡 Chart of the day.
$BTC, could it be? Could it really happen?
BTC 1D | TradingView
Could it be? We’ve had 2 tests at $25,000 and with a little bit of help from CZ’s $1bn industry recovery fund yesterday, could we be on track for the final test before recovering the red vector candles up at the $31,000 mark?
Bull case. This is simple, we break through $25,000 with a retest before a (potentially) monster run to $31,000.
Bear case. We get our hopes up again as the macro environment comes crashing down on us faster than the US banking sector with a move back down to get the $20,000 zone again.
Coming up this week.
Big news coming this week which will likely whipsaw traders as market makers hunt for liquidation points in the chart as we have CPI & PPI numbers coming out over the next 24 hours.
This leads in to the FOMC meeting next week on the 22nd.
🧵 Thread of the day.
Not all stablecoins are built the same and the last 72 hours proved that. CurveCap breaks down how 8 of the most popular stablecoins reacted to the recent series of bank runs.
CRV might be the winner in all this after seeing a record-setting $8bn in volume with those fees trickling down to veCRV holders.
March 13, 2023: SVBF 🏦🏃
How various tokens reacted to the recent bank run
Effects of the weekend turbulence on $USDC, $USDT, $CRV, $DAI, $FRAX, $MIM, $LUSD, and $TUSD
🧵1/10👇
Mar 13, 2023
And on that note, thanks for reading, catcha apes in the next edition!
blocmates team 🫡
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