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1. Aave launches institutional platform

The Facts:

  • Aave Arc, an institutional DeFi platform, is going to launch “within weeks”, according to CEO Stani Kulechov.
  • It will allow for private, KYC’ed lending and borrowing pools.
  • The platform is targeting institutional investors that face regulatory compliance requirements.

Why it’s important:

  • Regulation around DeFi is still in its early days and clearer frameworks are being worked on by regulators around the world.
  • Aave is trying to bridge the traditional finance world with DeFi, potentially unlocking billions in capital that were previously unable to access permissionless DeFi protocols.
S01E22_AaveArc
Source: Twitter

 

2. Tether accused by U.S. DoJ

The Facts:

  • The U.S. Department of Justice is checking if Tether committed bank fraud.
  • It focuses on events that happened years ago during the early stages of Tether after its launch in 2014.
  • Tether responded to the news, discrediting the claims as “stale” and saying that Tether keeps an open dialogue with law enforcement agencies.

Why it’s important:

  • Tether has long been a focus of worries surrounding the crypto stablecoin markets.
  • Large players in the market that regularly create and redeem USDT, however, continue to put trust into Tether and USDT is able to firmly hold its peg to the dollar.

3. Uniswap limits access

The Facts:

  • Uniswap Labs, the software company behind Uniswap that controls the main user interface, has limited access to some tokens through its front-end.
  • The tokens that were removed are typically linked to synthetics or derivatives.
  • The company said that access was restricted due to regulatory requirements.

Why it’s important:

  • Similar to other DeFi protocols, Uniswap Labs is monitoring the regulatory landscape and developments and decided to proactively block access to some tokens.
  • Nonetheless, these tokens can still be traded and accessed directly on-chain through interaction with the smart contracts – only the user interface on app.uniswap.org was restricted.
  • In order to have a decentralised database, you need to have security. In order to have security, you need to have incentives.
    Vitalik Buterin

 

4. Goldman Sachs files for “DeFi” ETF

The Facts:

  • Goldman Sachs has filed for a new ETF related to decentralized finance and blockchain with the SEC.
  • It aims to track the performance of the “Solactive Decentralized Finance and Blockchain Index”, whose exact composition is unclear.
  • A related index, Solactive’s Blockchain Technology Index, includes Nokia, Facebook and Google as the three largest components.

Why it’s important:

  • It will be interesting to see what Goldman Sachs considers to be DeFi once the exact composition of the index tracked by the ETF is clear.
  • It seems, however, unlikely that (governance) tokens at the heart of DeFi – such as MKR, AAVE, COMP, or UNI – will be included, as they are hard to access through traditional finance.
  • Number of the Week
    $1 billion
    worth of short positions liquidated on July 26

5. Binance limits KYC-less withdrawals

The Facts:

  • Starting on August 4, Binance will limit withdrawals for non-KYC’ed accounts to 0.06 BTC per day.
  • The move comes as Binance has been a focus of regulators worldwide over the past months.
  • CEO Changpeng Zhao also said that Binance wants to establish headquarters globally and seek regulatory approval.

Why it’s important:

  • The original threshold of 2 BTC per day that users were able to withdraw without undergoing KYC/AML procedures was established much earlier, when the price of Bitcoin was much lower – as such, the decrease is logical.
  • With its move towards establishing headquarters, Binance is also signaling that it wants to work with regulators around the world and no longer aims to be a “decentralized” company.

 

In other news

  • Paxos raises $300M at $2.4 billion valuation (via CoinDesk)
  • Fireblocks raises $310M at $2 billion valuation (via Reuters)
  • Nigeria’s CBDC pilot to start on October 1 (via CoinDesk)
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