Tim Cook Won’t Let Uniswap Cook 👨‍🍳

Stablecoin Settled $1.2T | Phone Numbers and Web3

March 06, 2023

GM, folks 👋🏻 - Happy Monday.

Uniswap wants to launch its mobile wallet, but Tim Cook won't let them cook 🍳. In other news, Multicoin Capital's hedge fund was down 91.4% in 2022, and Lido is rumored to have received the SEC's Wells Notice. Sigh

Let's get into today's issue 👇

In Today's Email:

What Matters: Apple blocks Uniswap's mobile wallet 🦄
Products: Redeem, connecting phone numbers to blockchains 📱
Charts: Coinbase institutional growth, stablecoins settled $1.2 trillion YTD 📈

Narratives: Binance Chain tokens are heating up. Radiant Capital moved to the chain, and Level, the derivatives perp on Binance Chain, continues to become popular.

WHAT MATTERS

Apple Blocks Uniswap's Mobile Wallet 🦄

Uniswap

State of play: Uniswap, the undisputed king of DEX, plans to launch its own mobile wallet. It will be a non-custodial crypto wallet with an in-app feature to conduct swaps via Uniswap's DEX 💱

Apple hasn't green-light the launch, without providing a clear reason why.
Many speculate that Uniswap might not be able to meet Apple's "approved exchange" criteria 🤷

“Apple won’t yet green-light our launch and we don’t know why – we’ve responded to their concerns, answered every question, and reiterated that we are 100% compliant with their specifications,” -- Uniswap Labs Spokesperson, CoinDesk

What’s next: In the meantime, Uniswap plans to release the mobile wallet to 10,000 users via TestFlight beta while working with Apple to get approval.

Apple's stance towards web3 apps isn't completely clear. For instance, Robinhood and Metamask wallets with in-app swap capabilities have been approved 🤔
This is a recurring problem, which makes it extremely difficult for web3 apps to make a profit via the app store model.

Our take: DeFi giants will continue to vertically integrate, trying to own the entire user experience stack end-to-end. This is both a feature and a bug. To justify the valuation and capture values from their users, DeFi apps need to eventually generate profits.

A wallet is the easiest way to own the end-user experience and monetize them via taking a few bps cut from every trade.

(6/8) Metamask does:
Bear market: $200k-$500k a day in swap revenue across 4k-5k DAUS
Bull market: $500k-$2m a day across 6k-7k DAUs
— Tom Dunleavy (@dunleavy89)
1:56 PM • Feb 27, 2023

For builders: Don't underestimate the amount of work needed to distribute your products to the end users. Understand whether you need to tap into the iOS or Google Play's ecosystem, and how you can do so in the most effective manner.

For investors: A playbook from a legal and technology perspective to navigate the distribution of web3 apps across web2 channels is an area where investors can play a huge part in. You're welcome for the value-add idea.

PRODUCTS OF THE WEEK

Redeem: Bringing Web3 to Your Phone 📱

Redeem

What is Redeem: Redeem is a tool that connects phone numbers with blockchain wallets. As the connectivity Layer of Web3, Redeem aims to allow users to easily navigate the digital asset ecosystem 🏄

Via Redeem, users who are not that familiar with blockchain technology or crypto can be onboarded to the ecosystem via a tool that they're already familiar with, mobile phones.
Redeem raised $2.5M on February 2023.
How it works. Users simply scan a QR code to generate SMS messages 💬, which allow them to collect various digital assets, such as NFTs, concert tickets, loyalty points, gaming items, and many more.

Redeem

Other cool products:

SolidityScan, an EVM compatible smart contract analysis tool.
Savvy Trader, a platform to create, share, and discover investment portfolios.
Striga, a crypto compliance and banking infrastructure.
Uniblock, a blockchain toolkit (APIs, SDKs, no-code tools) for developers.
Push Chat, a decentralized and web3-native chat solution.
Dynamic, a web3 auth developer platform.

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CHARTS OF THE WEEK

Coinbase Institutional Growth 📈

Delphi Digital

Coinbase continues to increase the percentage of institutions as of total trading volume on its platform. The number is 86% in Q4 2022, up from 68% in Q4 2021. Retail trading volume fell significantly, by approximately half, after Q4 2021. The percentage continued to become smaller post the LUNA meltdown in Q2 2022.

Our take: Coinbase is slowly shifting its revenue source from more lucrative but less predictable retail investors to institutions. This will also diversify Coinbase's revenue source, making it not heavily dependent on one factor; which is always a good thing.

To watch: How the Base L2 network will be integrated. Can Coinbase service institutions and offer more on-chain products if Base can assure some form of compliance along the way? Only time will tell 🤔

USD Stablecoins Settled $1.2 Trillion YTD 💵

Our Network

State of Play: Despite the bear market, stablecoins have settled at $1.2 trillion+ of adjusted on-chain volume in January and February 2023. They seem on track to rival the 2022 record of $8 trillion in settlements 💵

USDT and USDC lead with $641B and $528B respectively.
The distribution of Tether's USDT on Tron has reached an all-time high of 55%.
$39B of USDT is on Tron and $30B is on Ethereum.

Our take: If stablecoins settlement can rival its 2022 record in 2023, that will be a great achievement given the ongoing regulatory environment. All eyes are on USDT banking relationships and on USDC governmental relationships.

No one seems to have cracked the decentralized stables growth playbook.

QUICK BITES

Silvergate shuts down crypto payments network.
Coinbase purchases One River Digital.
SEC Staff believes that Binance US is operating an unregistered securities exchange.
Multicoin's hedge fund down -91.4% in 2022.
Lido rumored to have received the SEC's Wells Notice.
Bybit halts USD bank transfer.
Binance sought to hire Gensler as Adviser.
Kraken remains on track to launching a bank.
Babel Finance plans to issue stablecoin to repay creditors $766M.
Singapore Police starts investigating Terraform Labs.
Iron Bank & Alpha Homora bad debt situation.
BCB Group readies USD payment.

MEME & NOTEWORTHY READS

Raoul Pal's article on the economies of crypto.
Our Network's article on stablecoins.
NYMag's article on Arthur Hayes, the original king of crypto.

If this isn't a power pose idk what is

NY Mag

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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.