Inside Tether’s Documents

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Good Morning,

Happy Juneteenth for the Americans. Over the weekend, ZachXBT got sued for defamation, and crypto Twitter rallied behind him. He has received over $1M in donations for the legal fees.

In Today's Email:

• What Matters: Inside Tether’s docs 📄

• Products: Uniswap v4, a more advanced DEX 💱

• Charts: NFT markets and DAI growth 📈

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WHAT MATTERS

Inside Tether’s Disclosed Documents

State of play: Tether’s financial documents from its 2021 settlement with the NYAG were released. The documents show that Tether issued $11.6B of collateralized loans between 2019 and 2021.

• Out of the 694 loans, 89% used Bitcoin as collateral, 9% used Ether, and the remaining 2% used Tether Gold (XAUT) and unnamed securities.

• $8B in loans were repaid during that period.

• In December 2022, Tether announced plans to eliminate secured and overcollateralized loans from its reserves by the end of 2023.

The documents also show that Tether did partially back its stablecoin with Chinese securities for a period of time, contradicting their earlier denial.

• Tether held securities issued by companies including China Construction Bank Corp. and Agricultural Bank of China Ltd.

• In July 2021, Tether said that it didn't hold any Chinese commercial paper.

• At that time Tether accused critics “to spread falsities about its commercial paper holdings" and said they were wrong.

Tether also held bank accounts at Deltec Bank & Trust, Ansbacher (Bahamas) Limited, Capital Union Bank, and Far Eastern International Bank to support USDT assets as of March 31, 2021.

What’s next: It is likely that there will be further findings and clarification on the information released by the NYAG.

Our take: Tether will be forced to address the documents and provide more transparency in the long run.

Unlike the SEC’s action toward crypto assets, regulatory scrutiny of stablecoin issuers and CEXs is warranted.

• For far too long, these players have been much less transparent about their financials. Users deserve more transparency (even more with blockchain capability) regarding where they store their capital.

For builders and investors: If you touch Tether in any of your investment or operational process, make sure that you hedge appropriately and spread your capital across multiple stablecoins and banks.

Take a peek at our new referral reward at the bottom of this issue. Share this newsletter and receive our list of 100 smart crypto investors' wallet addresses 👇

PRODUCTS OF THE WEEK

Uniswap v4

Introducing “Hooks” and Singleton. Uniswap v4 advances Uniswap's evolution as a flexible DEX platform, enabling the creation of new pools with custom "hooks" through permissionless deployment.

• Hooks are plugins that enable the creation of highly customizable pools with features such as dynamic fees, limit orders, and TWAP orders.

• The Singleton is a single contract that contains all of the pools deployed on V4.

• Trades will be routed through the Singleton which should significantly lower gas costs for swaps & pool deployment.

The Uniswap v4 code will be released under a Business Source License 1.1, before eventually converting it to a GPL license.

Other cool products:

• DAOs Spot, an all-encompassing platform dedicated to DAOs.

• One Click Crypto, an AI-powered DeFi portfolio assistant.

• Family, a self-custody Ethereum wallet.

• ChainJet, a no-code platform to build Web3 automation.

• Binocs, a crypto tax software and accounting platform.

CHARTS OF THE WEEK

Activity Surge Across NFT Marketplaces

State of play: On June 14, there was a surge in daily active users and sales across NFT marketplaces, It hits the highest value in the past 2 months.

• OpenSea and Blur experienced the highest increase in sales & users.

• The upward trends started in mid-May.

• On June 14 the sales count hit ~50K.

Our take: It remains to be seen if the trend will persist. Some say that the Boring Punks collection was the key contributor to the increase in sales.

• NFTs haven’t been under any fire from regulators. Crypto market participants might be shifting their attention while regulatory scrutiny cools down over at fungible token land.

DAI: 3rd Largest Stablecoin

State of Play: DAI has surpassed BUSD and re-emerged as the third-largest stablecoin in the cryptocurrency market.

• DAI has 4.39B of circulating supply while BUSD has 4.34B of circulating supply.

Our take: DAI hasn’t grown as much over the past few years, but BUSD has truly suffered from regulatory scrutiny against Binance.

• As Maker explores its own lending protocol, we will see more DAI use cases that can potentially prop up its circulating supply.

QUICK BITES

• ZachXBT sued, doxxed by the alleged scammer he exposed.

• Ethereum devs consider raising the max validator limit to 2,048 ETH.

• Bakkt delists Solana, Polygon, and Cardano amid SEC scrutiny.

• French Authorities investigating Binance for money laundering.

• Wyre plans to shut down next month.

• Crypto(.)com operates internal prop trading desks.

• Tether issued $11.6 billion of loans from 2019 to May 2021.

• Frax to launch Ethereum L2 called Fraxchain.

• Avraham Eisenberg is set for a criminal trial on December 4th.

MEME & NOTEWORTHY READS

• Our Network’s read on ZK-EVMs.

• Credo’s read on markets at the open, June 12-18 2023.

• Adam Cochran’s thread on the Prometheum story.

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Disclaimer: All the information presented in this publication and its affiliates is strictly for educational purposes only. It should not be construed or taken as financial, legal, investment, or any other form of advic