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The Wolf Den #556 - Navigating A Minefield

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August 4 · Issue #556 · View online
The Wolf Den Crypto Newsletter
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In This Issue:
  1. Navigating A Minefield
  2. The Best Chains For Yield Farming - IntoTheBlock
  3. Bitcoin Thoughts And Analysis
  4. Legacy Markets
  5. Bitcoin And Ethereum Are Commodities
  6. Michael Saylor Steps Down As CEO
  7. Slope Is To Blame
  8. Layer 1 Wars: How Near Protocol Is Different | Illia Polosukhin, Co-Founder Of Near
  9. My Recommended Platforms And Tools
NOTE: I AM TAKING NEXT WEEK OFF FOR THE FIRST TIME EVER!
Navigating A Minefield
Landmines don’t discriminate between civilians and soldiers. They are designed to trigger on the slightest contact, indifferent to whether the victim is friend or foe.
The crypto space is starting to feel like a minefield. Builders, users, natives, and newcomers are equally affected, with platforms, wallets and portfolios blowing up left and right. Here are just a few of the recent explosions.
Unbank yourself with Celsius… BOOM
Become a Voyager… BOOM
Harmony One… BOOM
Phantom, Slope, and Trust Wallet Users… BOOM
Nomad… BOOM
Ronin or Wormhole Bridge… BOOM
LUNA or UST… BOOM
One wrong step into close proximity with any of the aforementioned and your portfolio is dust. If you were lucky enough to dodge these mines, were you lucky enough to avoid these others? The mines below haven’t killed the common investor’s portfolio, but they did cost an arm and a leg.
3AC… BOOM
India Ban… BOOM
China Ban… BOOM
Tesla Sells… BOOM
New York Mining Ban… BOOM
Coinbase Investigation… BOOM
What if you decided to skip crypto entirely and roam the fields of the fiat world? Does shelter actually exist there?
COVID… BOOM
Inflation… BOOM
Recession… BOOM
Interest Rates… BOOM
Is anyone safe? Well, if you happen to live entirely off of the land or in a secure bunker with pre-stocked supplies, with no exposure to financial markets, then I guess you are safe.
As for everyone else, good luck. 
The problem with walking through the crypto minefield is that blowing one up does not necessarily minimize the risk. For every one that explodes, it seems our beloved builders and founders are creating 5 more potential mines for us to trip.
We came here to avoid the traps of the fiat world, only to find more pain in the crypto one, largely because we replicated the same failing systems but with less regulation and rails. We messed up, bad.
That said, we all know that the fiat world is not built to last. Government debts are rising with inflation. There are no (fiat) solutions for these problems. The foundation appears strong today, but the fiat world is one giant ticking time bomb. That’s why every fiat currency eventually fails or hyper inflates.
So despite our propensity for self-destruction, I believe that, given enough time, our world will in fact become safer. It’s going to take a team effort, and a laser-sharp focus on survival and safety, but it will be worth it. We need to clear out the minefield so that everyone can walk safely across.
Until then, tread lightly…
The Best Chains For Yield Farming - IntoTheBlock
In this report, we bring to you the latest in on-chain cryptocurrency analysis. We look at the blockchain directly and analyze balances, transactions, and the overall activity of market participants. This gives us a unique insight into the future of the market.
This section is written in conjunction with IntoTheBlock (ITB). ITB is an intelligence company that leverages machine learning and advanced statistics to extract intelligent signals tailored to crypto-assets. IntoTheBlock tackles one of the hardest problems in crypto: to provide investors with a view of a crypto asset that goes beyond price and volume data. 
The Wolf Den research team uses IntoTheBlock to dig deeper and get the most important insights about the crypto market.
The Best Chains For Yield Farming
At IntoTheBlock we have noticed an upward trend in DeFi yields on several protocols over the past few weeks. The total supply of ETH in DeFi has continued to remain relatively low and has been moving downwards. Yet still, there have been steadily increasing APYs in some of the larger pools such as the stETH-ETH on Curve. For people with an appetite for higher APYs, it appears that the market is moving in a favorable direction. So today, we will dive into the on chain analytics to see which chains are providing the best APYs.
The chains we will focus on today are Ethereum and the more popular L2s (Polygon, Optimism, and Arbitrum). Together, these 4 networks have a total value locked (TVL) of $67.39B and have many opportunities available for yield farming. The categories of yields we will look at are:
  • Stablecoins: what types of yields are available on each chain for the farmers that are leaning towards a more risk-off portfolio
  • Volatile tokens: All the other tokens that aren’t stables where higher yields can be found for all of the degens out there
We will look at the last two months of average daily yields that you can find on each chain for these two categories to see how the yields are trending. Below are two charts showing the average daily yields for both stablecoins and other tokens. These yields are only using LPs that have more than $5M TVL to avoid wild APYs in smaller pools that are often short lived.
From these charts we can see that the most interesting chain for high yields is currently found on Optimism. This is most evident from the volatile tokens chart, but it is also the case for stablecoins as well since late last month. This coincides with the explosion of TVL in the new protocol Velodrome that has high incentives for stable pools as the aim to be the premier AMM on Optimism. While the other chains can’t compare on volatile token APYs, Ethereum and Polygon have shown consistent yields for the last two months on stable pools.
Bitcoin Thoughts And Analysis
Unfortunately, I am currently suffering from EXTREMELY slow internet that will not allow me to publish any charts. So I will say this one thing… Bitcoin is currently retesting the weekly 200 MA as support. And that’s all that I am watching for the moment. Screen shot above. Watch the red line.
Legacy Markets
Asian Stocks to Rise as Earnings Spur Wall Street: Markets Wrap - Bloomberg
What to watch this week:
  • US initial jobless claims, trade, Thursday
  • Cleveland Fed President Loretta Mester due to speak, Thursday
  • US employment report for July, Friday
Some of the main moves in markets:
Stocks
  • Futures on the S&P 500 rose 0.2% as of 7:33 a.m. New York time
  • Futures on the Nasdaq 100 rose 0.3%
  • Futures on the Dow Jones Industrial Average rose 0.1%
  • The Stoxx Europe 600 rose 0.5%
  • The MSCI World index rose 0.3%
Currencies
  • The Bloomberg Dollar Spot Index was little changed
  • The euro rose 0.1% to $1.0179
  • The British pound fell 0.5% to $1.2088
  • The Japanese yen fell 0.3% to 134.23 per dollar
Bonds
  • The yield on 10-year Treasuries advanced one basis point to 2.72%
  • Germany’s 10-year yield declined three basis points to 0.84%
  • Britain’s 10-year yield declined five basis points to 1.86%
Commodities
  • West Texas Intermediate crude rose 0.2% to $90.87 a barrel
  • Gold futures rose 1.3% to $1,798.90 an ounce
Bitcoin And Ethereum Are Commodities
Proposed New Bill Classifies Bitcoin and ETH as Commodities – Trustnodes
A new crypto bill is seemingly being introduced every month to define cryptocurrencies and dictate who oversees them. This time, the Senate Agriculture Committee is working to define cryptocurrencies as digital commodities, granting the CFTC power rather than the SEC. The bill is yet to be published, but from what’s known, the bill defines a digital commodity as, “fungible digital property that can be transferred without an intermediary and excludes tokens representing interest in a physical commodity, securities, or CBDCs.” What we also know is that the overview of the bill explicitly states that BOTH Bitcoin and Ethereum are considered digital commodities.
Bitcoin maximalists are in disbelief.
It would be nice to see some power wrestled from the cold dead hands of Gary Gensler.
Michael Saylor Steps Down As CEO
MicroStrategy CEO Saylor moves to chairman role, focusing on strategy and bitcoin
Did you know that Michael Saylor has been the CEO of MicroStrategy since 1989? That’s probably before a lot of you were born. In another universe, if Bitcoin had continued to rise, Saylor probably would have remained CEO. But who really knows? The Q2 earnings report was just released, and despite a dwindling stock price, the company is in fairly good shape. Considering we are in a quasi-recession, the company reported only a 2.6% decrease in revenue for Q2 along with a gross profit of $96.9 million. As far as their assets go, they have $69.4 million in cash and $2.451 billion in Bitcoin… which cost $3.977 billion.
Slope Is To Blame
Slope wallets blamed for Solana-based wallet attack
There was no zero day bug and no random number generator was compromised. Instead, the recent hack was entirely the fault of Slope for accidently transmitting private keys out of safe keeping. It’s a shame to have to keep covering these hacks, but it’s all the more reason to continue beating the dead horse that we need better infrastructure and proper self custody.
Layer 1 Wars: How Near Protocol Is Different | Illia Polosukhin, Co-Founder Of Near
Podcast - The Wolf of All Streets
Illia Polosukhin stops by to talk about NEAR Protocol - a climate-neutral, high-speed, low-fee, Layer 1 blockchain. Illia shares what makes NEAR one of the most exciting projects in crypto - a great user experience, support for Javascript, and much more. He discusses what problems NEAR solves, how they got started, what’s coming next, and how NEAR can scale to 1 Billion users and beyond.
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My Recommended Platforms, Tools And Podcast Sponsors
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On-chain and fundamental analysis, research, predictions and indicators, all in one place. Highly recommend.
The views and opinions expressed here are solely my own and should in no way be interpreted as financial advice. Every investment and trading move involves risk. You should conduct your own research when making a decision. I am not a financial advisor. Nothing contained in this e-mail constitutes or shall be construed as an offering of financial instruments or as investment advice or recommendations of an investment strategy or whether or not to “Buy,” “Sell,” or “Hold” an investment.
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