👀 What’s to Come in Volume 30

🔑 Key News: SBF JAILED, Brazil Reveals CBDC, CocaCola NFTs on BASE, $NEWO Winding Down & more from CJ

⛓ On-Chain Sleuthing: Arca Dumped $GNS and Amber Group Entered GambleFi feature along with Smart Money Moves from Cl & Amir Ormu

🔥 Hot Narratives: Positive Developments on Base Chain and DeFi Giants Drama from unexployed & storgi

📈 Macro Outlook: Simplified Round-up and Implications from Hansolar

📉 HTF Price Action Scenarios from Vlad

⚔️ A Call to Arms

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🔑 Key News

Major Headlines

• Binance Becomes the First Fully Licensed Crypto Exchange in El Salvador

• Temasek, Sequoia Capital, Softbank, leading VCs face lawsuit for “abetting” FTX fraud

• Ark 21 Shares Bitcoin ETF Application Decision Pushed by SEC

• Bittrex settles with the SEC for $24 million

• Visa allows Paying Blockchain Gas Fees with Card

• Sam Bankman-Fried jailed after US judge revokes bail

• Central Bank of Brazil Reveals Its CBDC

• CocaCola unveils ‘Masterpiece’ NFT collection on Base

Exploits/Updates that Happened this Week

• EarningFarm exploited for 283 ETH

• Peko Protocol rugged on Linea

• Steadefi recovered $418k USD from the exploit

• Investigation into hacked BITDAO investors/contributors who dumped tokens

• Uniswap employee who rugged Frenstech fired

• Zunami Protocol hacked for $2.1M

Useful Weekly Defi Updates

• SaddleFinance shutting down and distributing ARB to holders

• Aave and MakerDAO agreed to Spark Lend profit-sharing proposal while Spark Protocol confirms airdrop for borrowers and reducing ESDR rates to 5%

• WINRprotocol building Layer 3 on Arbitrum

• Rollbit $RLB tokenomics revamped to implement buyback and burn

• y00tsNFT migrating to Ethereum

• Staderlabs introduces Liquid Restaked Token

• Fantom considering adding optimistic rollups to connect to Ethereum

• Binance invests in Curve and Helio while Coinbase invests in Rocketpool

• Debank announces DeBank Chain

• Aave aCRV OTC Deal proposal passes

• Eigenlayer increasing LST staking caps on August 22nd

• New Order DAO winding down to focus on Synonym Finance

Some Interesting Projects to Look Out For:

• LandTorn: First game-fi project on Base

• Friendtech: Social token on Base

• Gold: Memecoin on Base by Balancer Whale

• Protocol Cha: DSR Lego

• Yamato: CDP on Japanese Yen

Courtesy of CJ - check out his telegram channel for daily news, projects updates and new releases

⛓ On-Chain Sleuthing

Arca Sold All $GNS

We have covered Arca in a few Chronicles now. After already selling a portion of their $GNS stack initially, they have now winded down their entire position.

The group still holds a $2.5 million in $dYdX and a $1 million $GMX position. Additionally, they have been buying lots of $ARB last week.

Amber Group Entering GambleFi

Amber Group is another well-established digital assets investment firm. On-chain activity by one of their addresses shows that the firm is now jumping on the on-chain degeneracy train as they have bought $75k worth of $RLB and $100k of $UNIBOT.

Smart Money Farms

• Smart farmers have bridged into BASE recently, and are busy farming on there.

• Alien Base on BASE has caught the attention of smart farmers.

• Base Swap is still favored by the BASE smart farmers.

• SwapBased has been favored on BASE too.

• Sable Finance on BSC has become popular among smart farmers as well.

• Extra Finance on Optimism is still favored by smart farmers too.

Research and analysis by Cl & Amir Ormu

🔥 Hot Narratives

Base Chain Developments

After the huge debacle of $BALD, the Leetswap exploit, and all the other rugs on the Base chain, it seems that things are consolidating and becoming more peaceful.

Most notable is the deployment of Safe on Base which enables anyone to create multisigs and other AA smart contracts. For serious teams and developers, Safe is essential for securing treasury funds and other finances.

With the memecoin saga out of the way, we expect a lot of other big names to deploy on Base paving the way for a healthy new DeFi ecosystem. Along with Safe, Uniswap (announcement), and Compound (announcement) are also available on Coinbase’s L2.

These are important names, especially considering that they do not deploy on most other chains. For example, Uniswap has not deployed on zkSync yet, nor on zkEVM and was very reluctant to deploy on Avalanche during the bull market.

The fact that they were quick to onboard Base is a positive sign. Perhaps it was done with some stimulation of Coinbase. Anyhow, good to have your eyes on Base and search for protocols for building actual products. Money to be made here.

Courtesy of unexployed

DeFi Giants Drama

Most of you know MakerDAO and the Aave DAO as two OG DAOs that go way back. They’ve been collaborating multiple times (onboarding SAI/DAI, D3M-module, etc.) and the relationship has been good thus far. Since then both DAOs have evolved and attracted several service suppliers to help out with protocol development or governance. In this snippet, BGD Labs (Aave) and Phoenix Labs (MakerDAO) are in disagreement and Block Analitica (both) tries to de-escalate the situation.

Phoenix Labs approached Aave by creating a proposal that would fork the Aave codebase, from core contracts to frontends, so that MakerDAO can launch its own lending protocol Spark(Lend), in return for a 10% fee split on future revenue. This effort was received well by the Aave DAO and this partnership would be another milestone in the relationship between the DAOs.

However, the CTO of the Aave Genesis team (founder BGD Labs) replied in the thread that he thinks that MakerDAO acted deceptive regarding honoring the fee split agreement. His main argument is that the Reserve Factor parameter is set to 0%, which means that the profit will also be 0, so there wouldn’t be any fee accrual on the main asset on the new lending platform. Among other arguments, the post was concluded with quotes such as ‘At best, this is total marketing deception, at worse, this is just an orchestrated behavior from MakerDAO to trick the Aave DAO participants.’ or ‘The situation by itself is so ridiculous and “cheap” that shows the appreciation (lack of) that MakerDAO has for Aave’ and finally ‘However, they decided to do some commonly called “cloud-chasing” … It is simply disgusting and to be ashamed of.’.

Phoenix Labs, creators of the original proposal, replied that some technicalities have changed since the proposal was approved and the Spark product rolled out. They emphasize that the original agreement is still in place, but that it will be settled off-chain between MakerDAO and Spark. Aave will receive its 10% split from everything that Spark will get from MakerDAO.

Monet-supply (Block-Analitica) chipped in by voicing his thoughts on the matter and proposing several options to de-escalate the situation/discussion. No conclusion or closed ends for now, we’re awaiting a reply from Phoenix Labs, probably with a new proposal around the fee split with Aave for using their product.

Courtesy of storgi

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💹 Macro Outlook

Please note that if certain technical jargon or concepts mentioned in this text are unclear, you can refer to investopedia.com for detailed explanations and definitions. Additionally, for a comprehensive overview of macroeconomic events, you can explore the event calendar on investing.com/economic-calendar/.

Upcoming Events

• Wed : Building Permits Prel.

• Thurs : FOMC Minutes

BTC, ETH, and Macro

• Both the CPI and SEC’s deadline extension for Ark’s spot ETF barely moved BTC prices as volatility levels continue to fall to all-time lows.

• The Chinese economy is looking shakey as two major corporations; Country Garden Holdings and Zhongzhi Enterprise Group(AUM 138b) are having trouble repaying their bonds. Exports have also fell -14.5 YoY showing very poor domestic and international demand.

• Contrastingly, the US Retail Sales come in at the highest levels since January.

• With the rate decision over a month away, the FOMC meeting this week is also unlikely to cause any surprises to the market.

• BTC implied volatility (IVs) are currently at historical all-time lows.

• BTC IVs are 35.2 which implies the options markets expect a 1.84% daily price move.

• Skews are currently negative which means the markets are heavily in favor of buying calls. This is likely due to the anticipation of the spot ETF passing.

• ETH IVs at 31.8 imply the options markets expect a 1.66% daily price move.

• Skews are currently neutral implying the market is equally bidding on calls and puts.

Courtesy of Hansolar - check out his telegram chat for all things options, crypto and DeFi

📈 HTF Price Action Scenarios

Gm frens!

Another week of extremely low volatility, it’s getting boring out there. The daily demand zone is still holding, but no money has shown up on the long side just yet.

• Re-accumulation playing out

• Daily swing low liquidated and absorbed

• Looking to follow new momentum to the upside

This low volatility environment is not optimal for trend-following systems, therefore I am sitting on my hands and waiting for some more directional clues. Once momentum to the upside shows up I’ll be looking to join that ride. Until then I’m just spectating.

Trade responsibly and I’ll see y’all next week!

Courtesy of Vlad - trend-based trader and MentFX student

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Virtually yours,

The Castle

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