Stablecoin projects are paying rebates to traders, and it caused a big headache for Paxos | Mapping out Ethereum’s Developer Ecosystem | Correlation between cryptocurrency prices sharply increased in 2018
|Jan 4||Public post|
“We believe that investors coming into cryptocurrency deserve the exact same protections as investors in more traditional markets, adhering to the same standards, practices, regulations and compliance protocols” — Chris Roan, Head of Marketing Gemini
The Big Block
When crypto exchange Gemini launched its much lauded stablecoin in 2018, it hoped the market would view its dollar-aregged coin as a regulated and more trustworthy alternative to Tether.
Still, things got off to a slow start, with GUSD lagging behind its competitors. Gemini dollar currently has $90.3M in circulation while Paxos has $132.2M and USDC has $287.2M. To spur adoption, Gemini offered their Gemini dollar to some over-the-counter trading desks at a 2% discount – meaning each $1 token could be bought for 98 cents. However, traders spotted an arbitrage opportunity in the deal where they could buy the discounted GUSD and then exchange it for PAX, Paxos’ stable coin, at the full dollar price – pocketing the 2% difference.
That caused headaches for Paxos. According to CEO Chad Cascarilla, traders exchanged vast sums of GUSD to PAX and then opened up dozens of accounts under relatives’ names to bypass Huobi, a fellow exchange’s, $10k transaction limit. Traders can exchange stable coins – including Pax – on Huobi, but in order to redeem those coins for USD they have to go through the original issuer — in this case, Paxos. The result? A wave of users wanting to cash out their newly acquired PAX.
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Around The Block
Mapping out Ethereum’s Developer Ecosystem
Ethereum is by far the leading smart contract platform for developers. While the number of developers in the ecosystem is a topic of debate — estimates range from 250,000 to 350,000 — download data from popular development tools show that Ethereum continues to see increasing interest from developers.
Influential members of the Ethereum community, in turn, have adopted BUIDL as their battle cry for developers to build products ranging from decentralized prediction markets, governance platforms, and security tokens, on Ethereum.
With the growing interest in building on Ethereum, The Block has mapped out its developer ecosystem. We categorized the ecosystem into six sub-categories: (1) Protocols & Platforms (2) Testing & Frameworks (3) Infrastructure (4) Scaling (5) Privacy, and (6) Storage. — More
Analysis: Correlation between cryptocurrency prices sharply increased in 2018
Increasingly it’s becoming clear: if you own one cryptocurrency, you own them all. One of the issues not talked about enough in crypto is inability to truly diversify cryptocurrencies simple because cross-asset correlations are extremely high. When Bitcoin’s price is falling, generally the price of the majority of other cryptocurrencies will fall as well.
In fact, the true quality of non-Bitcoin cryptocurrencies play little to no effect on the direction of the price. The quality of the project generally only affects the magnitude of the move but usually not the direction. — More
0fees: 0x has seen only ~$3K in ZRX tx fees since creation — More
Anti-money laundering bill to be introduced by the Irish government — More
USD-based stablecoin producer TrustToken hires former Coinbase exec Vaishali Mehta — More
Japan’s Mizuho Bank plans to issue its own stablecoin — More
Lawsuit against Craig Wright claims 1 million bitcoin — More
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