In this recap of the crypto world, we will explore the events and news that had the most significant impact in the past week of May 1. Our focus will be on the following developments:
- Blur Launches Blend
- Sotheby Launches NFT Marketplace
- Coinbase Launches International Crypto Exchange
- FED Raises Interest Rates by 25bps
- SUI Launches Mainnet
Blur Launches Blend
On May 1, the largest Ethereum NFT marketplace by trading volume, Blur, launched Blend, a new peer-to-peer perpetual lending protocol based around NFT assets. With the NFT-backed loan market gaining steam and recently surpassing $1 billion in total loan value across various protocols, this move by Blur is sure to capture the attention of NFT collectors and liquidity providers alike.
Short for “Blur Lending,” Blend offers NFT collectors the opportunity to take out loans on their existing assets while allowing liquidity providers to earn interest by loaning out ETH, with the NFT serving as collateral. Unlike some other lending protocols, Blend’s loans are perpetual, which means they do not have set timeframes for repayment. Instead, interest continues to accrue until the loan is repaid or until a refinancing auction is triggered. This flexibility gives NFT collectors and liquidity providers more options when managing their assets and loans.
According to the announcement by Blur, Blend offers 10x higher yield opportunities than current DeFi protocols and unlocks greater liquidity for NFTs. This is a significant development for the NFT space as it provides a new way for NFT collectors to put their assets to work and for liquidity providers to earn interest on their ETH.
Currently, Blend has no fees for borrowers or lenders, but BLUR token holders can vote to enable fees after 180 days. This provides an additional layer of community governance to the protocol, giving BLUR token holders a say in the direction of the platform.
Sotheby Launches NFT Marketplace
Sotheby’s, the iconic auction house with a history dating back nearly three centuries, has once again made waves with its latest foray into the world of NFTs. The company recently announced the launch of a secondary NFT marketplace on its Sotheby’s Metaverse platform, enabling collectors to buy and sell digital art from a carefully curated selection of leading artists in a fully on-chain, peer-to-peer environment.
The Sotheby’s Metaverse platform was first launched in October 2021, focusing on direct NFT sales. Now, the secondary sales on Sotheby’s Metaverse will be facilitated entirely through automated smart contracts, allowing collectors to pay for art and collectibles in ETH or MATIC using their digital wallets.
The artists featured on Sotheby’s secondary marketplace will rotate every few months, with the platform launching with works from 13 leading digital artists. Some artists featured include Tyler Hobbs, Claire Silver, XCOPY, Diana Sinclair, Pindar van Arman, and others.
One of the unique features of Sotheby’s NFT marketplace is that it honors on-chain royalty fees specified by artists. Sotheby’s decision to include these fees comes amid a broader discussion about resale royalties about the growing competition between the NFT Marketplaces. Thus, it highlights the company’s artist-centric approach. Read more on this here.
Coinbase Launches International Crypto Exchange
On May 2, Coinbase, one of the most prominent public crypto exchanges, announced the launch of its international derivatives platform, the Coinbase International Exchange (CIE). This move comes as the cryptocurrency industry faces regulatory challenges in the United States, prompting Coinbase to expand its reach beyond American borders.
The announcement of the CIE platform was made with the support of regulators in Bermuda, which is a significant departure from the scrutiny that exchanges face in the United States. Coinbase obtained a license from the Bermuda Monetary Authority (BMA) in April, allowing the exchange to operate a digital asset exchange and a digital asset derivatives exchange provider, as well as services such as token issuance and sales.
Designed specifically for institutional clients, the CIE is a platform for crypto derivatives trading based in Bermuda, which has supported the digital asset industry. Direct access trading on the CIE is currently limited to institutional clients who meet specific eligibility requirements, with retail products yet available.
As regulatory challenges continue to mount in the United States, it is evident that significant players in the crypto industry are looking beyond US borders for more favorable environments to operate in. Coinbase’s move into Bermuda reflects this trend, and more crypto exchanges and blockchain-related companies will likely follow suit in the coming years. Read more on this here.
FED Raises Interest Rates by 25bps
The United States Federal Reserve (FED) has announced a quarter-point hike in interest rates, marking the 10th consecutive increase in a single year. The move comes amidst the risks of a banking crisis in the US and growing calls to halt interest rate hikes. However, the FED has prioritized the fight against inflation, engaging in its most aggressive stance against rising inflation rates in decades.
The Federal Open Market Committee (FOMC) meeting in May was a focal point, with investors and traders awaiting the accompanying policy statement and Chair Jerome Powell’s post-meeting press conference for clues about whether the central bank was considering a pause after a historic run of rate hikes that have taken the rates from 0% in early 2022 to today’s 5%-5.25%. As per Coindesk, Powell clarified that the decision to pause rate hikes was not made and that the FED is prepared to do more to contain inflation.
Overall, the FED has been seeking to lower inflation to its 2% target, but with several macroeconomic factors at play, achieving this target becomes more complicated. While the FED’s move was widely expected, it marks a continued effort to address the current economic situation in the US. Investors and traders will continue to closely monitor the FED’s actions and statements in the coming weeks and months as the situation evolves.
SUI Launches Mainnet
After much anticipation, the Sui blockchain network has finally launched on its mainnet. The project, built by former developers of Facebook’s crypto initiative, has garnered significant attention in the blockchain community since its inception. With the successful launch of its mainnet, Sui is set to shake up the blockchain space with its high-performance capabilities.
As per Decrypt, Mysten Labs, the development team behind the blockchain, secured a $300 million investment in a Series B round in September 2022, indicating significant interest in the project. According to reports, the Sui blockchain has achieved high throughputs, between 10,871 transactions per second (TPS) to 297,000 TPS on various workloads. For comparison, Solana, one of the fastest layer-1 blockchains, boasts a TPS of roughly 4,000.
The launch of high-performance blockchains like Sui aims to tackle scalability issues plaguing some of the industry’s major players, including Ethereum. As the demand for faster, more efficient blockchain technology grows, Sui’s innovative approach can potentially disrupt the status quo. Moreover, with major cryptocurrency exchanges worldwide launching trading of the Sui ($SUI) token in conjunction with the mainnet launch, the project is set to gain even more traction in the coming days.