Myth of Money: FTX & BlockFi, ApeWater, and more.
Welcome to this week’s edition of Myth of Money, a weekly newsletter on the digital asset markets read by 12,000+ investors.
Disclaimer: The following is not intended as investment advice. Do your research.
Dear Investors,
FTX continues its JP Morgan-like bailout approach to the market despite further volatility.
Despite the onset of the crypto winter, FTX has shown no signs of slowing its expansion. Amid mass layoffs in the crypto exchange world, FTX confirmed earlier this month that the exchange plans to keep growing for the foreseeable future.
BlockFi reports downtime due to the current market crash and in a bold move, partnered with FTX-US. This partnership was brought about by client’s reaction to BlockFi’s affiliation with 3AC and whilst Zac Prince reported solutions implemented, he also reported losses of about $80 million. This partnership got BlockFi a $400M revolving credit facility and an option for FTX to buy or acquire BlockFi as reported by Zac Prince on his twitter page.
If FTX decides to activate this clause, BlockFi will be acquired at a variable price of $240 million. This is a significant discount from BlockFi’s previous VC valuation of $4.8 Billion. Naturally, equity holders such as Morgan Creek are not happy with this deal, but it is commendable that the founders chose to put the interests of depositors first.
Additionally, Bloomberg reported that FTX is holding an internal deliberation on whether to acquire Robinhood. It was reported, in May, that FTX purchased a 7.6% stake in the company for $650 million which caused a 30% spike in the stock price. The transaction was executed by an Antiguan firm called Emergent Fidelity Technologies LTD., of which SBF is the sole director and majority owner.
FTX could opt against pursuing a deal because Robinhood’s co-founders, Chief Executive Officer Vlad Tenev and Chief Creative Officer Baiju Bhatt, control more than 50% of Robinhood’s voting power, giving them the ultimate decision to sell.
Earlier in June, Robinhood rolled out its highly anticipated crypto wallet to 2M waitlisted users, outlined plans to integrate the Lightning Network, and listed Shiba Inu (SHIB) after months of campaigning from the coin’s supporters.
This Week By the Numbers 📈
Top Stories 🗞️
Hundreds of Bored Ape owners sign up to hire out their NFTs to brands
Hundreds of Bored Ape owners have signed up to a new nonfungible token (NFT)licensing marketplace that enables hodlers to rent out their Apne’s IP to brands. Blockchain accelerator Mouse Belt Labs launched the marketplace called Boredjobs, claiming that it will list all 10,000 BAYC NFTs on its website for brands to browse through and “indicate interest in hiring for campaigns.” Of course, 10,000 Apes won’t be available to hire unless the respective BAYC owners sign up and confirm ownership to view offers. “The Bored Ape Yacht Club gave its owners a fantastic opportunity to utilize the IP rights of the NFTs they purchased. Unfortunately, they did not provide them with an instruction manual on how to put them to work. Bored Jobs is creating that instruction manual,” the announcement reads.
Polkadot's founder announces steps toward full decentralization with a new governance model
Live from Polkadot Decoded in Buenos Aires on Wednesday, Polkadot (DOT) and Kusama founder Gavin Wood announced that the blockchain's governance model would undergo a new transformation. Dubbed Gov2, anyone would be able to start a referendum at any time for as many times as they wish in the new setup, similar to initiating new transactions on the blockchain. Thereafter, pending referenda need 50% of the vote from stakeholders within 28 days' time for approval or face rejection by default. Participants can also intervene and launch timely cancellation proposals, which require similar voting procedures, in the event that technical glitches are discovered within the referenda, themselves. Passive voters, t can specify a different delegate for every class of referendum in the system in a process known as multirole delegation. Wood said there will be a new body, dubbed the Polkadot Fellowship, composed of technical experts who have the power to shorten referenda voting times in the event of time-sensitive matters.
Binance taps TikTok star Khaby Lame to drive Web3 adoption
Crypto exchange Binance has partnered with Khaby Lame, the most-followed creator on TikTok, to increase awareness of Web3. The influencer will act as a global brand ambassador for the exchange, helping debunk myths surrounding the crypto and blockchain space. Lame rose to fame on TikTok, gaining 142 million followers with his videos calling out do-it-yourself content creators who make things too complicated. He provides comical life hacks that make things much simpler while doing his signature move where he puts both his palms up.
Lending network enables transparent credit history in Africa via blockchain partnership
African mobile banking platform Aella has partnered with Creditcoin Network to make credit histories transparent by integrating all its transactions into Creditcoin’s public blockchain. In an announcement, Creditcoin said that all Aella's credit transactions will be recorded on the Creditcoin blockchain, making it easy to audit and available for viewing through their block explorer. The recorded transactions will include the terms of the loans as well as payments and repayments. Creditcoin said that the partnership comes with the release of Creditcoin 2.0, an upgrade that makes the network more stable and easier to integrate with.
Coinbase denies reports of selling customer data to the US government
Crypto exchange platform Coinbase denied reports alleging that the company is selling its customer information to the United States Immigration and Customs Enforcement (ICE), an agency that works under the country’s Department of Homeland Security. On Thursday, news that Coinbase has been providing geolocation data to ICE has circulated online. Because of this, Twitter users like Solobase Mac were shocked and noted that they “didn't sign up for that. In a statement on Twitter, Coinbase clarified that the firm “does not sell proprietary customer data.” The exchange highlighted that its foremost priority is giving a safe and secure experience to the users of the platform.
Deal of the Week 💰 * Ape Water *
I am putting together an SPV in APE BEVERAGES, whose first product is Ape Water.
Capitalizing on the recent popularity of the Bored Ape Yacht Club NFTs, Ape Water allows owners of Apes to license their characters and monetize their NFTs by selling…. yup, water. Canned water has taken off as a category, with companies like Liquid Death gaining a valuation north of $500M. Ape Water is an all-American-made sustainable brand sourced from Mt. Shasta, regarded as one of the best water sources on earth.
Ape Water already has support from several key players in the space, including their lead investor, “Pink Dot” a Los Angeles iconic landmark convenience store chain, which also has hundreds of ghost stores distributed through Postmates.
I like this team for their experience in consumer beverages with former executives of some of the biggest beverage brands in the world. I like the concept as it addressed both the NFT trend, as well as sustainability. I like this valuation (seed-stage) and am comfortable with the potential return profile.
If you would like to learn more or participate, please reach out.
Thank you for reading this week’s edition of the Myth of Money.🚀
Until next week,
Tatiana Koffman
By Tatiana Koffman
Hi there and thanks for reading. If you stumble upon my newsletter, you will notice that I write about money, economics, and technology. I hold a JD/MBA and spent my career in Capital Markets working across Mergers & Acquisitions, Derivatives, Venture Capital, and Cryptocurrencies. I believe in empowerment closing the financial education gap and creating equal opportunity for the next generation. I have invested in 20+ companies and funds. Check out my portfolio here.
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