Rollbit Starts Buyback & Burn 🔥

PayPal USD Stablecoin | Huobi Insolvency Rumor

Marco Manoppo & Karon Pangestu
August 09, 2023

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Good Morning,

Happy hump day. Crypto market cap has been flat at $1.2 trillion, but we’re seeing some tokens outperforming the markets. It’s an exciting time to assess the market, and load up your bag for the next cycle. Hoozah!

Hint: More signs that Bitcoin ETFs are done deal.

In Today's Email:

What Matters: PayPal launches a stablecoin 💵
Case Study: Goldfinch loan problems 🤝
Governance & Features: RLB buyback & burn 🔥

Narratives: Protocols with revenue-sharing mechanism.

RLB is the best performing token in the top 1-100. UNIBOT is the best performing token in the top 100-200. There’s a reason why.

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WHAT MATTERS

PayPal Launches a Stablecoin

Paypal

State of play: PayPal introduced its own USD stablecoin, named PYUSD.

The launch boost PayPal’s shares by 2.5%+.
PYUSD is issued by Paxos, the firm that previously helped Binance issued BUSD.
PYUSD is backed by US dollar deposits and short-term US Treasuries.

PYUSD holder will be able to:

Transfer PYUSD between PayPal and compatible external wallets.
Send P2P payments using PYUSD.
Fund purchases with PYUSD.

Major economies like the UK and the EU have introduced stablecoin regulations, with the EU's policies scheduled to be effective from June 2024.

Last month, the US House Financial Services Committee advanced a bill on stablecoins, with a focus on issuer registration and approval.

Why it matters: PayPal started a revolution on global payment system in the late 90s and remain as a leader in the field. The launch of PYUSD might trigger a mass adoption of USD stablecoin.

JPMorgan also says that Ethereum could benefit from PYUSD because the stablecoin could fill the void left by the $20B shrinkage of BUSD.

For builders: PayPal’s decision to launch its stablecoin might suggest that the there are more regulatory clarity around stablecoin (and the broader crypto space) coming soon.

For investors: Further crypto integration by PayPal is a net positive for the space as it brings in additional flow of new capital.

CASE STUDY

Goldfinch Problems: RWA is Hard

@thiccythot_

Credits to @thiccythot_ for the original tweet.

State of play: Goldfinch, a real-world assets (RWA) protocol for lending to businesses in developing nations, faced a default on a $5M (14% of its TVL) loan to a Kenyan motorbike company called Tugende.

Goldfinch obtained an annual percentage yield (APY) of 11.70% for the two-year loan in October 2021.
The two-year loan is currently trading at 4.77%, indicating a considerable unfavorable premium over the risk-free rate.
Tugende completely ignored the loan terms by extending a loan of $1.9M to another company.

While the concept RWA is appealing, the failures of Maple and problems at Goldfinch highlight that:

Underwriting loans remotely for emerging markets companies is hard.
Your liquidity might be trapped.

rwa stuff is a nice narrative and all but the failures of maple and now goldfinch show that you're completely shit out of luck if (or when kek) the borrowers rug you
why not buy foreign treasuries on-chain instead of lending to Kenyan motorbike companies?
4/
— thiccy (@thiccythot_)
1:07 AM • Aug 8, 2023

Our take: Having boots on the ground knowledge regarding the markets that you’re lending to is paramount. There’s a reason why there’s not many Emerging Markets focused TradFi hedge funds.

Take a peek at our referral reward at the bottom of this issue. Share this newsletter and receive our list of 100 smart crypto investors' wallet addresses 👇

INSIGHTS

Huobi Faces Insolvency Speculation

12/16
But it's not just that.
All the user ETH is missing as well, Sun has turned it into stETH. All of it.
Users think they hold 141,000 ETH on Huobi and instead Sun holds about half that total balance and its all in stETH.
— Adam Cochran (adamscochran.eth) (@adamscochran)
10:49 PM • Aug 5, 2023

Samyuktha Sriram from Unchained reported that Huobi experienced outflows exceeding $44M in the past week, amid speculations about the exchange's insolvency.

Reports of senior exec arrests by Chinese police led to significant outflows from Huobi.

More takeaways:

Rumors about Justin Sun (Tron founder and Huobi stakeholder), arrest is circulating.
Adam Cochran, an industry “insider” with sources at Tron, suggests that while Sun himself hasn't been detained, Huobi employees are being questioned about "Huobi and Sun's money laundering" activities
Cochran’s analysis points to Huobi holding just $90M worth of USDC and USDT, despite Huobi’s claim of a wallet balance of $631M USDT.

Huobi head of social media dismissed these allegations, branding the rumors as FUD without any foundation.

FEATURES & GOVERNANCE UPDATE

RLB Token Buy & Burn

@Lucky_Rollbit

Rollbit has implemented a buy & burn initiative, allocating portions of its revenue to buy its RLB token from the open market.

Rollbit’s revenue from Casino (10%), Sportsbook (20%) and 1000x Futures (30%) will be used to buy and burn RLB on a daily basis.
The revenue breakdown will be displayed on Rollbit’s newly launched dashboard.
In the last 24 hours, 2.1M RLBs (~$224K) were burned and RLB price has soared by more than 60%.

Why it matters: Rollbit is the first gambling platform to integrate value accrual mechanism towards its token holders.

Gambling platforms are incredibly profitable businesses. The northstar, Stake(.)com, generated multi billion in annual revenue — no other casino at a similar scale has done so.

Other notable feature updates:

Chainlink price feeds goes live on Base.
GMX v2 beta goes live on Arbitrum and Avalanche.
Term Finance goes live on Ethereum.
Arkeo Testnet goes live.
MakerDAO EDSR goes live.
Pika v4 launched on OP mainnet.
Bybit launches wealth management.
ZigZag launches the Invisible testnet.
Uniswap’s v3 integrated into Base.

QUICK BITES

PayPal launches a USD stablecoin.
Rep. McHenry pushes for stablecoin bill.
David Rubenstein makes the case for Bitcoin.
Fed increases oversight of banking crypto ties.
UK updates plans for systemic stablecoin regime.
Bitstamp in talks to raise funds for expansion.
China sprints ahead in race to expand Digital Yuan.
Ex-FTX Exec Salame talks to prosecutors about plea deal.
DOJ will still push for campaign finance charges against SBF.
Blockchain.com obtains major payment institution license in SG.

MEME & NOTEWORTHY READS

Matt Walsh’s read on why Congress, not the SEC, should regulate crypto.
a16z’s read on building community, followings, and buzz.
minaminao’s read on MEV-share CTF.

Updated my "how to revive dying token" list
— Hsaka (@HsakaTrades)
2:14 PM • Aug 8, 2023

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Disclaimer: All the information presented in this publication and its affiliates is strictly for educational purposes only. It should not be construed or taken as financial, legal, investment, or any other form of advice.