Will August Be A Repeat Of July?

Below is a list of the top 20 cryptocurrencies by market cap and their performance for July. This list excludes stablecoins and wrapped cryptocurrencies.

If you ever want to experience how a cult behaves when you ask a pure information-seeking question, ask any question in any memecoin community subreddit, Telegram, or any other social forum. A simple question like, “What is Shiba Inu’s value proposition?” will be met with responses typically reserved for someone who insulted someone else’s dead mother. 

Unless your message contains ‘Memecoin X is going to the moooooooon!’, ‘FIRE FIRE FIRE MEMECOIN X IS FIRE BRA’, ‘HAT3RZ GONNA R3GR3T NOT BUYING AT -98% DOWN, TEH FUTUR3 IS HERE!!’, or ‘MEAMCOIN X LET’S GOOOOOOOOO!’ or any other derivative, you will get so much Internet hate bullets shot your direction you won’t even know what didn’t hit you. 

Shiba Inu ($SHIB.X) outperformed Dogecoin ($DOGE.X) by a large margin in July. Shiba Inu ended July with a 13% gain and Dogecoin with a marginal 2% gain. A big contributor to Shiba’s outperformance is likely due to the nearly 5 billion SHIB burned in July. 

A ‘burn’ in the cryptocurrency space is an elimination of the available supply – permanently. 

Elon Musk’s Tweets have historically been big movers of Bitcoin ($BTC.X) and Dogecoin – but his impact and market participant response has waned. But that didn’t stop the memecoin Floki Inu ($FLOKI.X) pamping over 20% when Musk tweeted just three words:

Floki pic tomorrow

— Elon Musk (@elonmusk) August 1, 2022

Also – because this matters in the memecoin space – the Dogecoin creator Tweeted he’s not the biggest fan of Elon Musk. The change is odd because the creator of Dogecoin has historically supported SpaceX, Tesla, and Mr. Musk. 

i used to like elon musk, but then the media started to say bad things, and it became popular to dislike him, so to keep my cred i have to dislike him too. i make all my purchasing decisions based on how much i care for the CEO of a company’s behavior according to the media.

— Shibetoshi Nakamoto (@BillyM2k) August 1, 2022

From a fundamental point of view, social media spats between memecoin communities have historically generated substantial volume spikes for those cryptocurrencies involved. We’ll keep an eye on these developments and update you as needed. 🤑

CoinFLEX issued an update late last Friday via their blog, notifying the public that CoinFLEX expects to cut costs by as much as 60% – a mix of employee and non-employee cuts. The massive cuts intend to be the ‘right size’ for a potential partnership or acquisition. 

Cryptocurrency exchange Vauld, one of the exchanges heavily affected by Three Arrow Capital’s stoopidness, received a three-month extension from the Singapore High Court. We recently covered Nexo’s ($NEXO.X) involvement with Vauld on July 20, 2022, Litepaper. Nexo has an exclusive due diligence period with Vauld to determine whether they want to buy Vauld. 

The fallout from Three Arrows Capital (3AC) appears to be settling down – I mean, things are still awful, and companies are still in bankruptcy, but at least there isn’t a stream of constant news reporting ‘company X’ is now gone.’ On a positive note, one exchange is expanding and marking new territory. 

Houbi announced today that the Australian Transaction Reports and Analysis Centre (AUSTRAC) approved Huobi’s registration to offer cryptocurrency trading services in Australia. Australia is the latest addition to Houbi’s regions after recently getting licenses in New Zealand and the UAE. 👍

Finally! Some positive news in the Voyager Digital ($VGX.X) debacle from 3AC’s collapse! Over the weekend, Voyager’s bank, Metropolitan Commerical Bank ($MCB), filed a statement supporting Voyager’s customers to withdraw their USD from Voyager.

Additionally, the motion seeks to authorize: the debtors to liquidate cryptocurrency from customer accounts with a negative balance; sweep cash held in third-party exchanges; conduct Ordinary Course Reconciliation of Customer Accounts; continue staking cryptocurrency; and grant related relief. 

The crux of this issue is two MCB accounts opened by Voyager. The account in the motion’s focus is the (For Benefit Of) account(s) – where the customer’s USD is held. 

You might have never heard of an FBO account, but in a nutshell, it’s an account that you permit another party (usually a bank and/or broker) to manage without a lot of the regulations, red tape, and licenses. However, that party does not have ownership of the account. 

For-benefit-of-accounts (FBO) are essentially there to facilitate transferring money from one account to another without all of the headaches involved. These accounts allow financial companies to pool various funds on behalf of their beneficiaries without assuming ownership interest in the accounts.

We will likely hear more about the consequences this will have on Voyager and customers’ existing crypto, but customers at least may soon be able to get their USD out. 💥