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The Lido Finance community has voted against a proposal to sell 10 million LDO tokens for $14.5 million to venture capital firm Dragonfly Capital, according to a vote that concluded on Monday.

Monday’s vote ended with close to 600 DAO members, representing a total of 43 million Lido DAO (LDO) tokens, voting against the proposal. This figure accounted for 66% of all votes cast. Meanwhile, only two addresses, amounting to 21 million LDO tokens, voted in support of the token sale.

The token sale is part of a treasury diversification proposal for Lido. The DAO proposal called for the sale of 20 million LDO coins, with half of that amount allocated to Dragonfly. The latest vote was only to determine whether to proceed with the token sale to Dragonfly.

Lido’s plan to sell these coins to Dragonfly without any lock-up requirement had triggered a lot of criticism. The identity of the whale wallet that initially backed the proposal, as previously reported by The Block, also led to speculation of a possible conflict of interest.

With Monday’s vote ended, the Lido team will have to do further work on the proposal. It is not yet clear if the DAO will move to vote on the other half of the plan.

Lido also has another pending treasury management-related proposal. This one calls for the sale of 10,000 ether from the project’s treasury into stablecoin. Lido’s treasury is currently worth $290 million and it holds 158 million LDO tokens ($251 million), 20,940 ETH ($32 million), five million staked ETH ($7 million) and small amounts of other coins.

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Episode 68 of Season 4 of The Scoop was recorded remotely with The Block’s MK Manoylov and The Block Research’s Thomas Bialek.

Listen below, and subscribe to The Scoop on Apple, Spotify, Google Podcasts, Stitcher or wherever you listen to podcasts. Email feedback and revision requests to podcast@theblockcrypto.com.

Non-fungible tokens (NFTs), the blockchain-based method to verify and transfer ownership of a digital asset, exploded in popularity in 2021. 

Though some collections such as NBA Top Shot and CryptoPunks had existed before last year’s climb in popularity, NFTs largely did not enter mainstream consciousness until the arrival of Bored Ape Yacht Club, a collection of 10,000 algorithmically assembled images of languid monkeys. 

The success of Bored Ape Yacht Club in the spring of 2021 sparked an influx of large-scale NFT collections such as Mutant Ape Yacht Club, Meebits, Doodles, Cool Cats and Azuki. What followed was the scramble in the crypto community to buy in early to the next popular project — and the rush for non-crypto natives to understand what these types of tokens even are. 

Around the same time as so-called profile-picture projects emerged, NFTs also expanded into the blockchain-based gaming sector through play-to-earn (P2E) mechanics. The P2E game Axie Infinity particularly emerged as a giant in the blockchain-based gaming space in the late summer and early fall of last year before losing traction. 

In all, NFTs surpassed $13 billion in trading volume in 2021. NFT trading volume cooled in concert with the broader crypto bear market in 2022. With high-profile parties like Coinbase and GameStop entering the space, this technology doesn’t seem to be going away. With it, so too are pertinent questions around copyright and ownership.

In this debut episode of The Block’s NFT Scoop, reporter MK Manoylov speaks with The Block Research’s Thomas Bialek about the history of NFTs, where they came from and what lead to their explosion in popularity in 2021.

In this episode, Manoylov and Bialek also discuss: 

• The history of NFTs prior to 2021.
• What key players emerged in the NFT mania of last year.
• Pertinent questions still to be answered in the NFT space.

This episode is brought to you by our sponsors Chainalysis & IWC Schauffhausen

About Chainalysis
Chainalysis is the leading blockchain data platform. We provide data, software, services, and research to government agencies, exchanges, financial institutions, and insurance and cybersecurity companies in over 60 countries. Backed by Accel, Addition, Benchmark, Coatue, Paradigm, Ribbit, and other leading firms in venture capital, Chainalysis builds trust in blockchains to promote more financial freedom with less risk. For more information, visit www.chainalysis.com.

About IWC Schaffhausen
IWC Schaffhausen is a Swiss luxury watch manufacturer based in Schaffhausen, Switzerland. Known for its unique engineering approach to watchmaking, IWC combines the best of human craftsmanship and creativity with cutting-edge technology and processes. With collections like the Portugieser and the Pilot’s Watches, the brand covers the whole spectrum from elegant timepieces to sports watches. For more information, visit IWC.com

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Investment bank Moelis and Company announced on Monday that it is launching a dedicated blockchain advisory division to serve companies in the blockchain space and corporations that utilize blockchain technology. 

Moelis & Company, founded in 2007, is an independent investment bank serving clients including corporations, governments and financial sponsors. Moelis co-founder John Momtazee will head up the new team, dubbed the Global Blockchain Group. 

The launch of the blockchain team demonstrates the firm’s commitment to providing counsel across both “established and emerging industries,” Momtazee said in a statement. 

“With more than 50 unicorns and several decacorns in the sector already and nearly $20 billion of capital raised for blockchain companies last year, blockchain technology is poised to be as transformative to the global business landscape,” he said.

Monday’s announcement comes following a broad crypto market rally last week after a choppy second quarter of trading — during which bitcoin registered its worst quarter of losses in 11 years. The downturn in crypto markets began in May when they were rattled by the collapse of the Terra ecosystem. Prices were further affected in June by a liquidity crisis for crypto lenders and the collapse of the Three Arrows Capital hedge fund.  

Momtazee said he is unperturbed by this volatility and that the firm sees strong long-term prospects for the application of blockchain technology.  

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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Quick Take

• FTX Trading, West Realm Shires and Alameda partnering together to purchase Voyager’s digital assets and digital asset loans
• Offer excludes all loans issued to Three Arrows Capital (3AC)
• Voyager Digital must respond by July 26 and documents prepared and ready to execute by July 30
• All terms and conditions, should Voyager accept FTX’s offer, must be approved by the bankruptcy court
• Disclaimer: This is a market commentary research piece and includes opinionated views from our research team. Nothing contained in this piece constitutes a solicitation, recommendation, endorsement, or offer by The Block Research.
   

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Curve Finance has submitted a governance proposal on Optimism for a 1 million OP token grant, according to a post on the Optimism forum submitted on July 24.

Curve is the largest liquidity pool for token swaps while Optimism is an Ethereum Layer 2 protocol. Curve’s total value locked on Optimism currently stands at $17.4 million with an average of $3.4 million in weekly trading volume occurring on Curve pools in Optimism.

According to the grant proposal, the 1 million OP tokens currently worth $850,000 will be distributed over 20 weeks on Curve. This means 50,000 OP tokens will be distributed per week to Curve pools, if it passes.

These tokens will serve as incentives to liquidity providers (LPs) on gauged Curve pools on Optimism. Gauged pools on Curve receive token emissions on a weekly basis. These pools are decided by a weekly on-chain DAO vote on Curve.

There are currently three gauged Curve pools on Optimism: sUSD, sETH, and sBTC. These three pools will be the recipient of the weekly 50,000 OP tokens emissions but the number is expected to increase over time, per the announcement.

According to the proposal, the grant will help to incentivize liquidity on Optimism via Curve-based emissions. These rewards could help to attract more LPs to seed their liquidity to Optimism pools thus expanding the Layer 2 network’s decentralized finance footprint.

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Quick Take

• Beta launched in April 2021, Phantom is a leading non-custodial wallet for the Solana ecosystem with +2mm daily active users 
• Initially released as a web browser extension wallet, Phantom released its iOS and Android applications this year – the team is working to bring more features and partnerships to maximize the security and usability of the Phantom wallet 
• This January, Phantom closed its $109mm Series B funding round led by Paradigm – with this funding round, Phantom earned its unicorn status with a $1.2bn valuation  
• This year, the team is planning to not only double down on Solana but also bring Ethereum support to its wallet, getting closer to its multi-chain form

This research piece is available exclusively to
members of The Block Research.
You can continue reading
this Research content on The Block Research.

Moonbeam, a smart contract parachain on Polkadot, has partnered with Cosmos-based decentralized exchange Osmosis to enable cross-chain token swaps between the Polkadot and Cosmos ecosystems, the project announced on July 23. This means it will be simple to transfer tokens between the two different blockchain ecosystems.

The integration is made available via the Axelar Network protocol. Axelar is both a bridge network and a platform for cross-chain communication for smart contract protocols. The former allows tokens to be sent across different blockchains while the latter is what enables decentralized apps to be deployed on different networks. The project raised $25 million in its Series A funding last year.

DOT, the native token of the Polkadot blockchain, will be the first token supported on the cross-chain bridge, per the announcement. Moonbeam stated that there are plans to support the bridging of more Polkadot ecosystem coins to the Cosmos chain.

According to Moonbeam, the ability to transfer Polkadot-based coins to Cosmos is a major step in expanding cross-chain composability between the two blockchain ecosystems. Moonbeam also stated that the partnership buttresses the fact that Polkadot and Cosmos can exist as complementary ecosystems — even though they are often seen as rivals working on different ways to achieve the same goal.

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Aptos, a blockchain startup founded by former Meta employees, this morning announced a $150 million round led by FTX Ventures and Jump Crypto.  

The startup’s latest raise includes new investors such as Griffin Gaming Partners, Franklin Templeton, Circle Ventures and Superscrypt, according to a press release. FTX Ventures previously joined Aptos’ funding round in March, which saw the blockchain developer raise $200 million from investors like a16z, Tiger Global and Multicoin Capital. 

FTX Ventures investment partner Ramnik Arora said that blockchain technology needs to prioritise scalability, safety and ease of use to reach “the next billion users.”  

The blockchain was founded by former Meta employees hoping to bring blockchain technology to a wider audience of “billions” of people. At present Aptos operates on a series of testnets and its mainnet has yet to launch, although it is slated for later this year.  

Aptos has now raised $350 million so far this year, which it plans to invest in the development of its safe and scalable Layer 1 blockchain.

CEO and co-founder Mo Shaikh said the latest funding round is an endorsement of the company’s work to date and shows the appetite for a “next generation Layer 1.” He added:  “We’ve known for a while that, due to issues like outages and downtime, current blockchains are not fit for purpose when it comes to mass web3 adoption.” 

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

In the same week court documents showed that collapsed hedge fund Three Arrows Capital (3AC) owed creditors more than $3.5 billion, an interview given by its founders has sparked outrage among crypto executives. 

3AC’s founders spoke with Bloomberg in an interview published July 22 — the first time they have broken a radio silence that began with their liquidity troubles in mid-June.  The fund filed for Chapter 15 bankruptcy in New York on July 1. 

One disgruntled party, who was granted anonymity due to the sensitivity of the bankruptcy proceedings, told The Block they were “absolutely disgusted” after reading the interview. “Stop hiding and deflecting blame and own up to your mistakes. Cooperate fully with relevant parties and do not ghost those involved with this,” they added. 

3AC’s CEO Su Zhu stressed in his comments that it was not true that he and co-founder Davies had absconded with funds, but rather that he had put more of his own money back into the business. “People may call us stupid. They may call us stupid or delusional. And I’ll accept that. Maybe,” Zhu told Bloomberg.  

At the same time, the pair stressed that they weren’t outliers, pointing out that many companies had been negatively affected by holding positions in similar assets. The collapse of the Terra ecosystem in May left 3AC and other companies facing significant losses.

Since the collapse of Terra, many crypto lending platforms have faced liquidity issues — including Voyager, Vauld and Celsius. Many of these issues were then exacerbated by 3AC’s travails, as the fund had borrowed billions from various creditors, including $2.4 billion from Genesis and $650 million from Voyager.

Read the room  

The Block spoke with two parties working closely with 3AC creditors, both of whom appeared vexed by the interview.  

“What do you expect? They lived in a reality-distorted field for so long and treated all their lenders like paid help. There was never a partnership or real relationship, which was strange given the scale of what we were doing with them,” one person told The Block. 

Crypto Twitter had a similar reaction, with many commenting on the pair’s lack of humility.  

Arthur Hayes, co-founder of BitMEX — who is no stranger to controversy himself — was scornful in a thread on Twitter, taking issue with Zhu’s claim that he wasn’t flashy.  

“Common y’all. Su ain’t flashy, he rides his bike to work and to the marina where his superyacht is moored. ONLY 2 homes, brah you straight slumming it in the Kampong aka Tanglin,” he wrote, referring to different Singapore neighborhoods.

A spokesperson for BitMEX confirmed to The Block in June that the exchange had liquidated 3AC’s positions. They didn’t comment on the amount owed at the time, but said its legal department was in touch with 3AC. 

Galaxy Digital CEO Mike Novogratz – who admitted that “venture investing requires humility” following Terra’s collapse – applauded Hayes’ thread, going on to say that he didn’t even know where to begin with the interview.

Ryan Sean Adams, founder of Mythos Capital and Bankless, broke down the interview in a thread, stating: “Here’s how 3AC went bust: Too much leverage, believing their own hype, buying the top on speculative assets, not being ready for a 90% drawdown, investing more than they could afford to lose.” 

3AC was contacted for comment but didn’t respond by press time. 

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.