8/02/2021 - 21/02/2021

A quick thank you to everybody who provided feedback on our first draft digest. Amusingly, 46% of people said they would prefer more concise coverage, whilst 45.8% said they would prefer more detailed. Therefore we decided to do both. Our current plan is to cover 2-3 stories in depth, and provide a very brief summary of other stories at the bottom. We hope you enjoy the new format.


The Biggest Stories...

BNB roars into 3rd place as PancakeSwap DeFi Dex explodes...

Binance Coin (BNB), the native token of the world's largest cryptocurrency exchange, overtook the stabelcoin Tether as the third-largest cryptocurrency by market capitalization, CoinDesk reported. The token was trading up over 50% on the day, and was up 140% for the week. It's new marketcap (as of 19/02/21) stands at roughly $49.6 billion, $17 billion ahead of fourth placed Tether, but still a long way off Ethereum at $220 billion. The boom in price was partially fuelled by the rapid growth of the decentralized exchange protocol, PancakeSwap, which runs on the Binance Smart Chain (BSC), requiring BNB to function.

A mere three days after the UK enjoyed its national "pancake day" holiday, PancakeSwap has reportedly overtaken Uniswap as the largest decentralized exchange by trading volume. PancakeSwap has seen its 24h volume grow to a peak of $1.98 billion (as of 19/02/21), up 4,705% from $40 million a month ago according to CoinGecko. Uniswap has been dogged by poor user experience and high gas fees, and so it comes as no surprise that retail investors have flocked to PancakeSwap's more accessible platform. The rapid rise of PancakeSwap and the Binance Smart Chain behind it has fuelled speculation that BNB could overtake Ethereum as the premier smart-contract platform. However, as Larry Cermak, Director of Research at TheBlock so eloquently points out...

Whilst there is speculation that Ethereum could be under threat of  a 'flippening' from BNB, detractors have pointed out that BSC's centralised nature makes it an unrealistic long-term competitor. Yet the rapid rise of PancakeSwap and BNB highlights one glaring reality: Ethereum must solve its scalability limitations, and it must do so soon.

Mastercard to let Merchants accept Crypto Payments this year...

Mastercard is planning to allow its merchants to begin settling payments in digital currencies later this year. The global payments giant has not yet disclosed which digital currencies it is planning to support, or in which locations this feature will be supported, CoinDesk reported. Nevertheless, the new initiative promises further integration between cryptocurrencies and the traditional marketplace.

Cryptocurrency skeptics have long argued that the inability to purchase of everyday goods and services has undermined the idea that crypto can be considered real money. Yet developments such as these promise to sweep aside these limitations.

Nevertheless, Mastercard Executive Vice President for Blockchain and Digital Asset products, Raj Dhmodharan, writing in an official Mastercard blog post, was keen to point out that not all cryptocurrencies would be supported on Mastercard's network. Indeed, Raj notes that cryptocurrencies used as payments would have to offer "reliability and security" and that for this reason, stablecoins in particular may stand to benefit from the new Mastercard initiative. Other requirements included privacy and security, strict compliance features such as KYC (know your customer) and finally the "stability" needed for a payment currency. The final criteria could of course disqualify many traditionally volatile cryptocurrencies.

Mastercard's blog post also noted its engagement with several major national central banks as they plan to launch the first wave of CBDCs (Central Bank Digital Currencies), including their creation of a new test platform in which to test these pioneering digital currencies.


Story which Flew Under the Radar...

Europe's biggest Telecommunications company begins staking on several blockchains...

Europe's biggest telecommunications company, Deutsche Telekom, is now one of the largest node operators for Chainlink and has also begun staking services on various blockchain networks, CoinDesk reported. Its subsidiary, T-Systems Multimedia Solutions, runs one of Chainlinks biggest data nodes (also known as oracles). According to Gleb Dudka, an analyst at T-systems, the data they provide is mostly "digital asset prices, FX rates and commodity prices" with several applications using this data in their operations.

One notable example make use of Deutsche Telekom's Chainlink data streams is Synthetix, one of the largest DeFi derivatives markets. But a number of decentralized exchanges, as well as a smart-contract insurance platform, are also using data delivered by the telecommunications giant. Furthermore, T-systems have already begun staking and receiving rewards on the Flow Network, and have plans to begin staking for several other blockchains, including Tezos, Polkadot and Etherum 2.0.

The fact that the one of the world's leading digital infrastructure companies is investing in the maintenance of blockchain networks should come as no surprise, yet it serves as further confirmation that a growing number of major enterprises are strongly pivoting towards blockchain as the digital infrastructure of the future. It also demonstrates the willingness of major incumbents to work with and support innovative and exciting new public blockchain projects. As Andreas Dittrich, head of the Blockchain Solutions Center at Deutsche Telekom noted, "We were not focusing enough on public blockchains. This is where digital value will be moved in the future, and it's really where a telco (telecomumnications company) should be active."


Policy + Regulation

  • India pushing forward with ban on cryptocurrencies, however investors to be given a transition period in which to liquidate their assets, CoinDesk reported. The Former CTO of Coinbase described the move to ban cryptocurrencies as a "trillion dollar mistake", effectively cutting India off from the "financial internet".
  • Yellen, the US Treasury Secretary, despite lauding the efforts of the private sector to such problems, describes the misuse of crypto as a "growing problem", Cointelegraph reported.

Technology

  • Ethereum prepares to hard-fork its Ethereum 2.0 beacon chain, in a move intended to pave the way for future changes and improvements, Cointelegraph reported. You can view the document of proposed changes here: https://notes.ethereum.org/@vbuterin/HF1_proposal
  • The staked Ether deposit contract for ETH 2.0 now holds over 3,000,000 ETH (2.67% of total supply) worth $5.5 billion, Coindesk reported.

Institutions

  • The EU's blockchain trust has appointed payments firm Worldline to explore blockchain based solutions for building trust in online social media. The research initiative will look at proof-of-location and proof-of-validity for user-generated content, Ledger Insights reported.
  • Amazon is preparing to launch its own digital currency in Mexico, reports CoinDesk.
  • UN says N. Korea funded nuclear weapons research with crypto hacks worth over $316 million in 2020, CoinDesk reported.

Markets

  • Little chance of settlement between Ripple and the SEC over alleged securities fraud, CoinDesk reported. Nevertheless, the price of XRP has recovered well since the charges were first announced.
  • Uniswap has racked up over $100 billion in trading volume since it launched in May 2020, Decrypt reported.