The Financial Conduct Authority (FCA) of the United Kingdom has imposed restrictions on the peer-to-peer lending platform Rebuildingsociety.com Ltd (Ref. No. 656344), which had recently formed a partnership with crypto exchange Binance for compliance with local marketing regulations. According to a notice dated Oct. 10, 2023, the FCA has disallowed Rebuildingsociety from “approving the content of any financial promotion for a Qualifying Cryptoasset for communication by an unauthorised person” and mandated the withdrawal of any existing approvals.
Impact on Binance Partnership
The regulatory action suggests a setback for Binance as it may have lost a crucial partner in complying with the FCA’s marketing regime, which came into effect on Oct. 8, 2023. Binance had allied with Rebuildingsociety to enable its UK users to access the exchange’s offerings through a localized domain, given that Binance is not registered with the FCA. This partnership, announced less than a week prior to the restrictions, was aimed at marketing spot trading, non-fungible tokens, and other products to UK users. However, with the recent FCA notice, Rebuildingsociety is required to inform its clients, including Binance, about the restrictions, withdraw any ads offering to approve financial promotions, and confirm compliance to the FCA in writing.
The FCA’s marketing regime initiated on Oct. 8, aims at ensuring that firms, including those in the crypto sector, deliver “clear, fair and not misleading” advertisements or face legal ramifications. While certain firms might attain approval for a January 2024 deadline amidst rule ambiguity, it remains uncertain if Binance intends to pursue this extension.
2021 was a breakout year for the cryptocurrency market in many respects and most investors are absolutely thrilled that Bitcoin (BTC) price established a new all-time high of $68,789. In the same timeframe, Ether (ETH) went on a parabolic rally which saw its price gain 565% from Jan. 1 to hit a record high at $4,859 on Nov. 10.
While it was a banner year for large cap cryptocurrencies, some of the biggest gains and most impactful developments came from the altcoin market where decentralized finance (DeFi) and nonfungible tokens (NFTs) rallied by thousands of percent and helped to usher in a new level of awareness and adoption for blockchain technology and cryptocurrencies.
Here’s a look at five altcoin projects that made significant contributions to the cryptocurrency ecosystem in 2021.
Uniswap
The decentralized exchange Uniswap (UNI) has arguably had the greatest impact on the crypto ecosystem as a whole since launching in the summer of 2020, with the DEX seeing significant growth throughout 2021 as it helped facilitate the launch of thousands of new crypto projects by removing the barriers to launch that existed on centralized exchanges.
Data provided by Dune Analytics shows that Uniswap has been the dominant DEX throughout the year and it has consistently seen more trading volume than all other DEXs combined.
Monthly DEX volume by project. Source: Dune Analytics
As seen on the chart above, the volume traded on decentralized exchanges really started to ramp up in the second half of 2021 led in large part by activity on Uniswap.
Throughout 2021 Uniswap led the field in development as well, with the developers behind the protocol announcing the release of Uniswap v3 in March. The v3 upgrade included multiple protocol upgrades and it built the foundation to integrate layer-two scaling solutions like Optimism and Arbitrum with Uniswap as a way to help reduce the transaction costs and processing times for users.
Aave
Aave (AAVE) is a DeFi lending protocol that allows users to deposit their tokens and lend them out as a way to earn a yield or pledge them as collateral in order to borrow another asset.
As the DeFi sector started to gain traction in early 2021, AAVE emerged as a community favorite thanks to the wide swath of crypto assets supported and the backing from some well-funded players.
Over the course of the year, AAVE expanded its capabilities and reach with the release of AAVE v2 which added support for Polygon, a layer-two scaling solution, and Avalanche, which is a popular cross-chain blockchain network.
Total liquidity on the AAVE protocol. Source: Aave
As a result of these added capabilities, the total liquidity available on the AAVE protocol has surpassed $25.7 billion, making AAVE the top-ranked DeFi protocol by total value locked (TVL).
Curve
Curve Finance is a stablecoin-focused protocol that utilizes an automated market maker to manage liquidity on the platform and across the DeFi ecosystem.
Stablecoins have emerged as a foundational piece for the cryptocurrency community as a whole in 2021 because they provide sufficient liquidity for the market and a safe haven for traders seeking shelter during periods of high volatility.
The growing importance that stablecoins have benefited Curve protocol and its native CRV by accelerating its integration of stablecoins into many of the top DeFi protocols, including the Yearn.Finance ecosystem and Convex Finance.
Despite the fact that a significant portion of the assets locked on the Curve protocol are stablecoins, the platform now ranks as the second leading protocol in terms of TVL behind AAVE, with data from Defi Llama showing that $21.77 billion in value is now locked in Curve vaults.
Total value locked on Curve. Source: Defi Llama
Curve has also integrated with many of the most active blockchain networks, including Ethereum, Avalanche, Harmony, xDAI, Polygon, Arbitrum and Fantom, which is further evidence of the protocol’s quest to be the stablecoin liquidity provider for the entire crypto market.
Related:US Financial Stability Oversight Council identifies stablecoins and cryptos as threats to financial system
Axie Infinity
Axie Infinity is a play-to-earn (p2e) trading and battling game that allows participants to collect, breed, raise, battle and trade NFT-based creatures called Axies.
The p2e model emerged as a new fan favorite over the course of 2021 because it provides users with the ability to earn a daily income alongside their gameplay, which offers a few unique advantages when compared to the traditional pay-to-play model.
Alongside the rise in popularity of Axie Infinity came a new all-time high for the platform’s native AXS token. As the token stormed to new highs, the platform generated a daily revenue of $17.55 million at its height on August 6.
Axie Infinity price vs. total revenue. Source: Token Terminal
Axie Infinity was also one of the earliest projects to establish the trend of migrating away from the Ethereum network because of high fees and slow transactions. Earlier in the year the project migrated to the Ronin sidechain and in November the project launched its own DEX called Katana.
Dogecoin
Dogecoin is an open-source proof of work cryptocurrency that leads the field of “meme” coins that made headlines all throughout 2021.
While the project has few contributions on the technological or development front, frequent shilling from the likes of Tesla CEO Elon Musk and Shark Tank star Mark Cuban helped to push Doge into a 23,746% rally that saw the price rise fr from $0.0031 on Jan. 1 to an all-time high of $0.74 on May 8.
DOGE/USDT 1-day chart. Source: TradingView
On top of the gains seen in DOGE price, the token received increased attention after it was announced that it would be used to help fund the launch of a lunar satellite by SpaceX and the Dogecoin movement also kicked off a meme-coin rally and spawned a bevy of copy-dog projects li Shiba Inu (SHIB) and Dogelon Mars (ELON).
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.
Sentiment in the cryptocurrency market is back on the rise on Nov. 29 as the recent dip down into the “extreme fear” zone on the Crypto Fear and Greed Index slightly improved after Bitcoin (BTC) recovered above the $57,000 support, lifting the index higher into the “fear” zone.
Fear & Greed Index. Source: Alternative.me
Despite the overall “fear” and “extreme fear” sentiments that have been dominating the market since the index began to decrease on Nov. 16, several sub-sectors of the cryptocurrency market including Metaverse-related projects and gaming protocols have seen breakouts to new all-time highs.
The rapid gains seen in these projects has led to some concern that the Metaverse and gaming sectors could see a significant pullback in the short term if traders take profits and await more sustainable price levels, leading many to speculate on which sector of the market will be the next to see bullish momentum and price gains.
A deeper dive into the available data shows that the decentralized finance (DeFi) sector of the market has been steadily gaining momentum over the past several months as the total value locked in DeFi climbed to a new all-time high of $276.92 billion on Nov. 9 and currently sits at $265.74 billion.
Total value locked in DeFi. Source: Defi Llama
The surge in TVL comes as new protocols continue to launch on Ethereum (ETH) compatible networks such as Fantom and layer-two solutions like Arbitrum that offer users the ability to conduct transactions in a lower fee environment.
Related:Ethereum layer-two TVL reaches all-time high
DEX activity picks up
Another sign that activity in DeFi is on the rise has been the uptick in the trading volume on decentralized exchanges (DEX) such as Uniswap and SushiSwap, which have slowly been seeing an increase in activity since the market bottomed in mid-July.
Total volume traded on decentralized exchanges. Source: Token Terminal
As seen in the chart above, the volume traded on the top DEXs is now consistently back at levels similar to what was seen during the bull market in the first half of 2021.
One of the most notable changes has been the addition of activity from dYdX, a decentralized layer-two perpetuals and futures exchange that surprised early adopters back in September when it airdropped its new governance token to users who had previously engaged with the protocol.
Since its launch, dYdX has become the go-to option for decentralized options trading the crypto market and at one time saw its trading activity surpass the spot trading activity on the top U.S.-based cryptocurrency exchange Coinbase.
One final piece of evidence that shows that activity in DeFi is on the rise along with the underlying sentiment in where the market is headed is found in the borrowed volume on the top lending platforms, which is now near an all-time high of $35 billion.
Borrowed volume on lending platforms. Source: Token Terminal
This indicates that crypto hodlers are locking up their tokens as collateral to receive loans that can be put to further use in crypto and DeFi related activity, and suggests that many are expecting a continuation of the bull market as the ecosystem prepares to close out 2021 and get 2022 off to a hot start.
The overall cryptocurrency market cap now stands at $2.63 trillion and Bitcoin’s dominance rate is 42.1%.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.
Demand for Aave (AAVE) boomed dramatically in the previous 24 hours as traders assessed its involvement in Bitwise Investment’s upcoming institutionally-focused investment vehicle.
The San Francisco-based asset management firm announced Wednesday that it would invest directly in AAVE to back its “Bitwise Aave Fund,” a fund created to build a bridge between accredited investors and the emerging decentralized finance (DeFi) sector.
“There is growing demand from financial advisors, hedge funds, institutions, and other professional investors for exposure to the fast-growing DeFi markets,” Matt Hougan, chief information officer at Bitwise, said in a press release, adding that their investment products would simplify access to DeFi markets for professional investors.
The announcement helped to send the bids for AAVE higher across spot exchanges. As a result, the DeFi protocol token surged 9.90% to $333.84 and continued its upside momentum heading into the current session.
Aave eyes a clear bullish breakout above the Triangle range. Source: TradingView.com
It established an intraday high of $372.71 on Thursday, a level it last approached on June 9.
Behind the demand
The latest bout of uptrend pushed AAVE’s year-to-date gains a little over 320%, asserting its growth in the emerging DeFi sector. In detail, Aave enables users to earn interest rates on deposits and borrow assets with a stable or variable interest rate option.
The protocol also enables “flash loans,” wherein users can borrow funds for ultra-short durations without needing to provide collateral.
Meanwhile, the token AAVE (formerly known as LEND) allows the community to govern the protocol’s ecosystem. In doing so, AAVE holders can propose, vote, and decide on new additions, features, and assets to the protocol.
Additionally, a pre-programmed algorithm burns AAVE based on the fees earned by the protocol, thereby ensuring that the token remains scarce in the longer run.
As a result, the total value locked (TVL) inside the Aave reserve pools has climbed from $519.9M to $11.2B year-over-year, per data provided by DappRadar. The total outstanding loans issued via Aave also grew 70 times in the previous 12 months.
Aave TVL in the past 12 months. Source: DappRadar
Ty Young, a researcher at crypto data aggregator Messari, noted that investing in DeFi projects makes more sense for institutional investors than putting capital in Bitcoin, explaining that protocols like Aave “generate cash flow and have intrinsic value.”
“DeFi tokens’ cash-generating properties allow us to frame discussions about these assets’ worth using traditional valuation methods,” he added.
“As familiar frameworks gain traction and valuation standards coalesce, DeFi assets will gain greater appeal from financial institutions and investors.
Part of the reason is the dismissive returns on savings offered by the traditional sector.
Related: Finding the sweet spot: Traditional financial institutions ready for DeFi
According to Bankrate.com, the average interest rate on saving accounts in the United States is just 0.06%. Conversely, DeFi projects offer depositors annualized returns anywhere between 1% and 10%—and sometimes even higher—on dollar-backed stablecoins, such as USDT, DAI, USDC, etc.
What’s next for AAVE?
A strong fundamental backdrop has pushed AAVE to new highs but its ability to continue its uptrend relies on a technical structure.
As spotted by PostXBT, a pseudonymous market analyst, AAVE/USD wants to break above a stern technical resistance level that constitutes an Ascending Triangle pattern. As long as the pair trades under the said price ceiling, it would face possibilities of a pullback.
Eyes on $AAVE for the daily close…
Close above and we look for the retest to jump in
Close below and we ignore this fake out and remain patient https://t.co/ooAlbIlnli pic.twitter.com/ttX2jkaIfZ
— Posty (@PostyXBT) August 5, 2021
Cointelegraph’s VORTECS™ Score also suggested a bullish outlook as price bounced off the $300 mark. The VORTECS™ Score is an algorithmic comparison of historical and current market conditions derived from a combination of data points, including market sentiment, trading volume, recent price movements, and Twitter activity.
AAVE price (white) vs VORTECS™ Score (green) chart. Source: Cointelegraph Markets Pro
As seen in the chart above, the VORTECS™ Score for AAVE rebounded from 64 (orange) towards 80 (green) on Aug. 4 suggesting that more upside is likely.
AAVE price is currently around $350 at time of publishing.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.
Analyzing the activity on lending platforms can sometimes be used as a barometer for measuring the sentiment of the cryptocurrency market as a higher number of collateral-backed loans may signal that traders are eager to trade a rising market.
The month of April saw the total value locked on Maker (MKR), Aave (AAVE) and Compound (COMP) climb to new highs alongside rising token values and trading volumes.
MKR/USDT vs AAVE/USDT vs COMP/USDT 4-hour chart. Source:TradingView
All three of the projects are based on the Ethereum (ETH) network and have benefited from the rising price of ETH as well as a recent decline in the average gas fee that has led to an uptick in user engagement with decentralized finance (DeFi).
MKR/USDT
Maker has seen the largest price appreciation in the month of April thanks to multiple factors including an upgrade to its liquidation engine and the possible expansion of its approved collateral list.
The Maker protocol is responsible for the creation of the DAI stablecoin, which has seen its circulating supply reach a new high of $3.569 billion tokens.
Data from DappRadar shows that the total value locked (TVL) on the Maker platform has climbed higher throughout the month of April and now stands at $11.09 billion, making it the number one ranked Ethereum-based DeFi platform in terms of TVL.
Total value locked on Maker. Source: DappRadar
With institutions now getting involved in the cryptocurrency sector and showing great interest in the growing Ethereum network, the MakerDAO ecosystem and its DAI stablecoin could see further gains in users and TVL as one of the more established and long lasting DeFi protocols in the space.
AAVE/USDT
Growth in the AAVE ecosystem really began to take off in the middle of April after the project launched on the Polygon network in an effort to help scale the protocol while remaining on the Ethereum network.
The launch was well received as evidenced by the Polygon-based AAVE protocol surpassing $1 billion in liquidity within 10 days of launching.
A rally in the price of Polygon and the rapid growth of its QuickSwap DEX coincided with a sharp increase in the TVL of the AAVE protocol, which now stands at $10.56 billion according to data from DappRadar.
Total value locked on Aave. Source: DappRadar
The rapid increase in TVL that began on April 25 coincided with a 55% increase in the price of AAVE from a low of $315 to a high of $534 on May 3. AAVE’s migration to the Polygon network and the increased scalability it offers is continuing to attracting new users and pushing the token price to new highs.
COMP/USDT
Compound price whipsawed in both directions in April but that didn’t prevent the protocol from reaching a new all-time high.
COMP/USDT 4-hour chart. Source:TradingView
Data from Cointelegraph Markets and TradingView shows that after bouncing off a low near $430 in April, the price of COMP rallied 104% to set a new record high at $879 on May 2.
The main driving force behind excitement in the community has been a series of governance votes as well as the
Total value locked on Compound. Source:
