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Libra Criticism; Friday Metrics Watch #14

Less than a day after the much-awaited Libra launch, we are already seeing regulators expressing their reservations about having a global, blockchain-powered, borderless currency for payments, powered by a Valley behemoth. Libra may not be a security under SEC’s lodestone Howey test; there is not a reasonable case of future profit expectations as its value is expected to be relatively stable. However, the presence of a new form of currency that is not controlled or issued by a central bank will be of concern to many governments across the world. Unlike in the case of bitcoin, which is an existential threat theoretically to central banks but is still not quite a mainstream phenomenon in terms of adoption, Libra has the heft of Facebook and the user base that Facebook and the Libra Association members bring to the fore.

Given this context, regulators are not sitting still. For instance, with the increasingly likely ban on cryptocurrencies by the Indian government, Facebook’s Libra project will suffer a setback as it will not be able to allow its 200 million WhatsApp users in India to use Libra for p2p payments. Moreover, with Libra expected to make remittances cheaper by significantly reducing the transaction costs, the benefits of cheaper crypto-powered remittances will not be available to the recipients in the world’s biggest remittance corridor. With around 10-12 months to go before the actual launch of Libra, it will be interesting to see whether Facebook can convince regulators around the world to come on-board as well, for the project to be successful on a global scale. It is not going to be easy, but we believe that they will to a large extent be able to do so, especially with the network of partners they have on-boarded on the Libra platform.

You can catch up on our previous editions on Libra here and here.

Perhaps also as a result of fears around increased scrutiny in a post-Libra environment, privacy coins make up 3 of the top 5 week-on-week top gainers. Grin ( which we covered at length earlier) is up 40%! Zcash and Monero, the two secrecy coin majors are also in the top 5.

Source: Circle Research

Ethereum Locked in DeFi

MakerDAO still accounts for a lion’s share of ETH locked up in collateral, with more than 1.64 million of ETH locked up. Uniswap showed a strong w/w decline of 8% in ETH locked up and Augur showed a w/w decline of 10%, while Compound has seen a w/w growth of 5%. ETH locked up in Maker was almost flat w/w.

w/w growth in ETH locked

Lightning Network Growth

Capacity per channel showed a moderate decline of 2% w/w. The total number of nodes increased w/w by 2%, and the total number of channels increased by 1%.

w/w growth in LN stats

(For reference, some previous articles on LN, here).

DEX Tracker

Trading volumes on DEXs have increased on a w/w basis, with the average daily trading volume averaging 35k ETH for this week. IDEX remains the biggest DEX in terms of trading volume and DAI is the highest traded cryptocurrency on DEXs.

DEX tracker

(For reference, some previous articles on DEXs, here and here).

Crypto Loans Tracker

Compound Loans:

Total loans issued on Compound for the last week stands at approx. $1.4 million for the week, a steep decrease from $4.2 million in the previous week. WETH is the most borrowed cryptocurrency on Compound followed by DAI and BAT.

Compound Loans 7 day volume

Dharma Loans:

Total loans issued on Dharma Lever for the last week stands at approx. $140k for the week, a slight increase from the previous week. DAI is the most borrowed cryptocurrency on Compound followed by WETH and USDC.

Dharma Loans 7 day volume

MakerDAO Loans:

DAI loans issued on MakerDAO for this week stand at ~$5.5 million, a meaningful increase from $4.2 million last week. The total outstanding DAI debt currently stands at ~$85 million.

DAI 7 day volume

(For reference, some previous articles on MakerDao, here and here).

You can also check out last week’s Metrics Watch here.

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