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Stablecoin

Accenture and Digital Dollar Foundation to trial United States CBDC this year

Fortune 500 company Accenture has teamed up with Digital Dollar Foundation to conduct Central Bank Digital Currency, or CBDC, trials in the United States.

Announced on Monday, May 3, the newly formed Digital Dollar Project will carry out five CBDC pilot programs over the next 12 months. The project’s objective is to generate data to inform U.S. policymakers on how to develop a domestic digital currency.

The Digital Dollar Project will launch three pilot programs in the next two months, generating data on the functional, sociological, and business benefits of a digital greenback.

Al Jazeera reports that former chair of the Commodity Futures Trading Commission and co-founder of the Digital Dollar Foundation, Christopher Giancarlo, emphasized the lack of U.S. data regarding CBDC:

“There are conferences and papers coming out every week around the world on CBDCs based on data from other countries. What there is not, is any real data and testing from the United States to inform that debate. We’re seeking to generate that real-world data.”

However, the Fed is taking a cautious approach as the guardian of the world’s reserve currency, the report added, with chairman Jerome Powell responding that it is far more important to get a digital dollar right than it is to be fast.

Giancarlo countered that Powell was correct to be cautious, but warned that the U.S. could fall further behind as China pushes ahead with its own CBDC testing and deployment.

While the U.S. Federal Reserve has been conducting research into the technology and applications for a CBDC, the United States lags behind the digital currency initiatives currently ongoing in numerous other jurisdictions.

China’s central bank and leading state banks have recently been preparing to test the digital yuan for a shopping festival on May 5.

Accenture has also worked on a number of CBDC projects in other countries, including Canada, Singapore, France, and Sweden — which has already completed the first phase of its pilot.

According to a study by the Bank for International Settlements, 80% of the world’s central banks are already researching central bank-issued digital currencies.

Accenture and Digital Dollar Foundation to trial United States CBDC this year

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DeFi adoption on the Binance Smart Chain reaches new highs

Decentralized finance (DeFi) has taken a well-deserved break from the spotlight over the past couple of months after being one of the hottest sectors at the start of 2021, but recent growth on several top platforms may hint at another DeFi run in the near future. 

While projects that operate on the Ethereum (ETH) network continue to deal with wild fluctuations in gas fees and transaction times, several that operate on the Binance Smart Chain (BSC) have seen an uptick in protocol activity and token value over the past week.

XVS/USDT vs. CAKE/USDT vs. LINA/USDT 4-hour chart. Source: TradingView

Three projects on the BSC that have seen increases in trading volume, price and activity within their DeFi protocols are Venus (XVS), PancakeSwap (CAKE) and Linear Finance (LINA).

XVS/USDT

The Venus protocol is an algorithmic money market and synthetic stablecoin protocol that provides a lending and borrowing solution for DeFi on the BSC.

Recent bullishness for the project began to increase around April 20 when it was revealed that a proposal was submitted to add Dogecoin (DOGE) to the Venus money market.

Following an initial price surge and pullback, momentum and price activity for the project saw another surge on April 29 following the announcement of the Venus Reward Token (VRT) and Venus nonfungible token (NFT) airdrops.

The announcement of the airdrops combined with the listing of XVS on the Crypto.com exchange helped spark a 70% rally in the price of Venus from a low of $72 on April 29 to a new all-time high at $124 on April 30.

XVS/USDT 4-hour chart. Source: TradingView

At the time of writing, the total value locked (TVL) in Venus is nearing $10 billion.

CAKE/USDT

PancakeSwap is a BSC-based automated market maker (AMM) similar to Uniswap (UNI) that allows users to exchange tokens and earn a portion of fees through yield farming.

Data from TradingView shows that the price of CAKE rallied 102% over the past week, going from a low of $21.90 on April 23 to a new record high at $44.28 on April 30 as token holders engage with the low fee, high yield protocol.

CAKE/USDT 4-hour chart. Source: TradingView

Price action for CAKE has seen a steady rise over the past week following the launch of V2 farms on April 23 and the successful completion of token migration on April 24.

Since the migration and launch of the new liquidity pools, the TVL on PancakeSwap has spiked to $9.873 billion making the protocol the second-ranked DeFi protocol by TVL.

Total value locked on PancakeSwap. Source: Defistation

According to data from Cointelegraph Markets Pro, market conditions for CAKE have been favorable for some time. 

The VORTECS™ Score, exclusive to Cointelegraph, is an algorithmic comparison of historic and current market conditions derived from a combination of data points including market sentiment, trading volume, recent price movements and Twitter activity.

VORTECS™ Score (green) vs. CAKE price. Source: Cointelegraph Markets Pro

As seen in the chart above, the VORTECS™ Score for CAKE began to pick up on April 24 and reached a high of 7 around 14 hours before the price increased 62% over the next five days.

LINA/USDT

Linear Finance (LINA) is a decentralized delta-one asset protocol that enables the creation of synthetic asset tokens to represent traditional assets like commodities, forex, market indices and other thematic sectors which can then be traded on the Linear exchange.

Data from TradingView shows that the price of LINA has climbed 70% over the past week, rising from a low of $0.069 on April 23 to an intraday high of $0.1164 on April 30 with $196 million in 24-hour trading volume.

LINA/USDT 4-hour chart. Source: TradingView

The recent momentum for the project began to build ahead of the April 27 ask-me-anything session with the Moonbeam Network, which calls itself the “easiest on-ramp to Polkadot” thanks to Ethereum-compatible smart contracts on a Polkadot parachain.

Cross-chain interoperability has been one of the major themes of the 2021 bull market, so the prospect of being able to operate LINA on the Polkadot network as well as the BSC and the Ethereum network may have helped to spark a new round of interest in the protocol.

As the pool of retail and institutional investors participating in the cryptocurrency ecosystem continues to grow, DeFi protocols on BSC are well-positioned to see significant gains thanks to low fees and high yield opportunities.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

DeFi adoption on the Binance Smart Chain reaches new highs

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2 key Ethereum price metrics prove pro traders are behind ETH’s new highs

As Ether (ETH) made a $2,800 all-time on April 29, so did its futures open interest. The $8.5 billion figure marks a 52% monthly increase and shows robust trading activity behind the meteoric price rise.

Some analysts might dismiss Ether derivatives, considering CME’s future has $355 million in open interest compared to Bitcoin’s $2.4 billion. However, Ether contracts were only launched a couple of months ago. Both FTX and Deribit require 100% full-KYC for their clients, and these markets hold a combined $2 billion in ETH open interest.

Ether futures aggregate open interest, USD. Source: Bybt

To this in perspective, the open interest on silver futures currently stands at $22.6 billion. The precious metal has decades of trading history and a $1.4 trillion market capitalization. However, a simple analysis of the number of outstanding contracts isn’t really helpful as these can be used for hedging.

Growth in futures is positive but not a guaranteed bullish indicator

To assess whether the market is leaning bullish, there are a couple of derivatives metrics to review. The first one is the futures premium (also known as basis), which measures the price gap between futures contract prices and the regular spot market.

The 3-month futures should usually trade with a 10% to 20% annualized premium, which should be interpreted as a lending rate.

24-hour average OKEx 3-months ETH futures basis. Source: Skew

As the above chart depicts, ETH’s futures premium went berserk in mid-April, peaking at 45% annualized. Although traders’ FOMO played a role, this also signaled extreme optimism. While professional traders most frequently use monthly futures contracts, perpetual contracts are the go-to instrument of retail investors.

Retail investors are flat at the moment

Perpetual contracts are also known as inverse swaps, and these contracts have a funding rate usually charged every 8 hours. This fee increases as longs (buyers) use higher leverage, so their accounts get drained little by little. When a retail buying frenzy occurs, the fee can reach up to 5.5% per week.

Ether perpetual futures 8-hour funding rate. Source: Coinalyze.net

As the above chart displays, the 8-hour funding rate recently peaked at 0.18% on April 14, equivalent to 3.8% per week. While this certainly contributed to the highly optimistic monthly futures’ basis, the impact has completely faded as the funding rate has been negligent over the past couple of days.

This data suggests that, compared to retail investors, professional traders are more bullish on Ether as the 3-month basis currently stands at 25% per year. This rate is higher than most stablecoin lending services offer, meaning longs (buyers) are willing to pay a premium to keep their positions open.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.

2 key Ethereum price metrics prove pro traders are behind ETH’s new highs

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100 fascinating facts about crypto’s last 100 days

Crypto data aggregator CoinMetrics has compiled a list of 100 insights into the recent performance of the digital asset markets — and the figures add up to a very bullish picture for the ecosystem. 

Released to celebrate the 100th issue of its State of the Network report, the list notes that a $100 investment made into Dogecoin 100 days ago would be worth $2,742 today — outperforming the same $100 investment in Bitcoin (which would be valued at $135 today), Ethereum ($186), and Uniswap ($401).

Price performance of BTC, ETH, UNI, and DOGE over past 100 days: CoinMetrics

The report states that Bitcoin has seen $14.5 billion worth of “trusted trading volume” in 100 days, alongside $6.1 billion worth Ether, $2.4 billion worth of XRP, $2.3 billion worth of DOGE, and $1.3 billion worth of Cardano (ADA) over the same period. 

When looking at recently active addresses, veteran networks appear to still be the most popular — with nearly 611,000 active daily Ethereum addresses over the past 100 days, and 1.12 million active Bitcoin wallets. Bitcoin set a new record for daily activity on April 14 with 1.36 million wallets engaging with the network.

Over the past 100 days, a total of 1.4 million addresses have engaged with the top DeFi protocols — Uniswap, Aave, Compound, MakerDAO, and Synthetix — while the Litecoin network has hosted 24.4 million active wallets.

Users are paying to access the Ethereum mainnet at an accelerated pace, with $2.3 billion of the $3.17 billion in total fees that have ever been generated by Ethereum, having been recorded since the start of 2021. By contrast, Bitcoin has generated roughly $2 billion fees over the network’s lifetime.

The average Bitcoin transaction fee was $20.68 over the past 100 days, while Ethereum transactions averaged $16.68 over the same period. Bitcoin’s average transaction size of $30,000 has been almost double Ethereum’s $15,660 since the start of 2021.

Despite Ethereum’s impending transition to Proof-of-Stake, Ethereum hash-rate has grown at 4.5 times the rate of Bitcoin since the start of the year, with Ethereum up 89% while Bitcoin’s hashing power has increased by 20%.

The report also notes the surging popularity of stablecoins, with Tether’s supply on Ethereum increasing from 13.5 billion to 24.4 billion this year— however that was outshone by the amount of USDT on TRON, which grew from 6.8 billion to 26 billion. USDC expanded 234%, from 4.1 billion to 13.7 billion, and circulating DAI was up 192%, from 1.2 billion to 3.5 billion, since the start of the year.

“It took about 2.5 years for stablecoin supply to grow from 1B to 10B. It took less than a year to grow from 10B to over 75B,” CoinMetrics wrote, adding:

Total stablecoin supply is on pace to pass $100 billion before the end of 2021.”

100 fascinating facts about crypto’s last 100 days

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mStable launches on Polygon, hopes to attract defi users ‘priced out’ of ETH

Defi-yield protocol mStable has become the latest to embrace second-layer scaling solutions, announcing its deployment on Polygon (formerly known as Matic) today. 

mStable’s interest-generating savings account, two of its “risk minimized meta-stablecoins,” and asset swapping features are now live on Polygon, offering its users reduced fees when compared to its Ethereum mainnet deployment.

Polygon is a layer-two network that processes transactions on its sidechain before bundling them together into the next block produced by the Ethereum mainnet.

In an April 27 announcement, mStable emphasized the barrier posed by Ethereum’s recent gas fee crisis to the DeFi sector’s mission to democratize finance:

“With savings rates at near zero in traditional finance, there exists an enormous latent demand for a secure, dependable and high yielding savings account. mStable Save was built to fulfil this demand, but unfortunately, given Ethereum’s recently sky-high gas fees, most users have been priced out.”

CEO James Simpson expressed his support for Polygon’s scaling solution stating: “Polygon is scalable, offers nearly free transactions, has attracted DeFi heavyweights and with them billions in liquidity. This is all done while being anchored to the Ethereum mainchain and to its community.”

mStable also teased three major upcoming releases for its Polygon deployment, including liquidity incentives, free transactions in partnership with Biconomy, and a bridge between its Polygon and Ethereum mainnet versions.

The protocol’s deployment on Polygon comes as an increasing number of DeFi protocols are exploring second-layer solutions, with Aave recently attracting $1 billion worth of liquidity to its Polygon release within 10 days of launch.

mStable launches on Polygon, hopes to attract defi users \’priced out\’ of ETH

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