This week, Paradigm Leads $70 Million Funding Round for Babylon Bitcoin Project (Bloomberg), T+1 settlement goes live on traditional financial markets (Reuters), Bitcoin ETPs start trading on London Stock Exchange (BitcoinMag).
This week, Paradigm Leads $70 Million Funding Round for Babylon Bitcoin Project (Bloomberg), T+1 settlement goes live on traditional financial markets (Reuters), Bitcoin ETPs start trading on London Stock Exchange (BitcoinMag), MasterCardâs âCrypto Credentialâ goes live (MasterCard) and Trump is found guilty on 34 counts in hush-money trial (ABC News).
đ« PayPalâs PYUSD Goes Live on Solana
đ Celebrities Join Memecoin Mania
This week saw token prices across the board trend lower following the Ether ETF news last week, with WoW average and median prices down 1.8% and 1.7%, respectively. Across the L1 / L2 universe, ETH, APT and OSMO were the only tokens that posted WoW gains. On the other side, major tokens such as AVAX and NEAR posted losses of 5.5% and 9.4%, respectively. Despite the negative price action, fundamental metrics for these two protocols have held relatively steady with daily transactions on NEAR actually rising 20% WoW.
This week also saw a wide dispersion of returns across Artemis Sectors. The Data Availability sectorâs gains were driven primarily by Celestia, which gained ~17% WoW. On the other end of the spectrum, Data Services, which includes both The Graph and BitTorrent, was down 7.3% on the week.
On Friday, the Chicago Purchasing Managerâs Index (PMI), a leading economic indicator, was announced for the month of May. The 35.9 PMI figure came in meaningfully lower than consensus expectations of around 40. The Chicago PMI has served as a leading indicator for shifts in the national economy before other indications like GDP, employment and industrial production reflect those changes. The Chicago PMI has only been this low on two other occasions over the past 20 years, at the bottom of the Great Recession in 2008 and at the bottom of the Covid crash in 2020.
Following last week's ETF news, Vanguard remains opposed to crypto ETFs despite the excitement surrounding the advancements in Ether ETF approvals. âWe believe that cryptocurrency products are not aligned with our [offerings] focused on asset classes such as equities, bonds, and cash, which Vanguard views as the building blocks of a well-balanced, long-term investment portfolio,â said a Vanguard representative (Blockworks). Despite competitors offering Bitcoin ETF products, Vanguard has refused to offer these products on its platform. Meanwhile, BlackRock filed an updated version of its S-1 application for its spot ether ETF. Eric Balchunas, senior ETF analyst at Bloomberg, provided an âover/underâ date for launch by July 4th (X/ericbalchunas). This development occured in the same week that BlackRockâs Bitcoin ETF flipped Grayscale GBTC by total assets.
This week, payments giant PayPal expanded its crypto product offering with the announcement of PYUSD on Solana. PayPal has been exploring crypto for many years, making its first big push into the space in August 2023 with the launch of their own retail stablecoin on Ethereum, PYUSD. By making PYUSD accessible on Solana, PayPal looks to give users the advantage of fast finality and low fees offered by Solana. In its press release announcement, PayPal cited Artemis data to justify the expansion, stating that âSolana has emerged as the leading blockchain to run tokenized transactionsâ since it is â⊠the most used blockchain for stablecoin transfersâ (PayPal).
Leveraging Artemisâ stablecoin dashboard, we can see the change over time in stablecoin transfer volume on different chains. The trend shown by this graph indicates significant growth of stablecoin transfer volumes on Solana since the end of 2023. We can also see the rise and fall in market share of other blockchain networks, specifically BNB Chain in early 2021, and Tron in 2023. Ethereum, which has historically been a market leader in stablecoin transfer volume has lost significant market share, controlling only 15% today, whereas historically it controlled ~50%. Intuitively, one would think this is because volume has moved to rollups, but we can see this is not true, as the sum of volume across rollups is less than 10% today. Meanwhile, A substantial amount of stablecoin volume has shifted to Solana, with its low fee environment serving as an optimal environment for stablecoin usage across memecoin trading and on-chain inter-smart contract transfers.
Jose Fernandez da Ponte, Senior Vice President of the Blockchain, Cryptocurrency, and Digital Currency Group at PayPal said that "making PYUSD available on the Solana blockchain furthers our goal of enabling a digital currency with a stable value designed for commerce and payments" (PayPal). Today on Solana, PYUSD makes up only 1% of total stablecoin supply, dwarfed by incumbents like USDC and USDT which command 77% and 18% of the 4.1B stablecoins in circulation, respectively. As Stablecoins continue to move towards mass-adoption, it will be fascinating to see how the crypto payments space evolves now that major traditional institutions like PayPal and Visa are entering the arena.
A slew of celebrities this week appear to have latched on to the memecoin mania by launching coins on the popular memecoin creation platform pump.fun. Caitlyn Jenner is (quite vocally) behind $JENNER, rapper Trippie Red is behind memecoin $BANDO, while popstar Iggy Azalea is behind $MOTHER. Other rappers like Lil Pump and Rich the Kid were getting called out by ZachXBT for promoting their memecoins in pump and dump schemes.
These tokens have been releasing on pump.fun, a Solana application that allows users to create tradeable memcoins cheaply and quickly. According to data from hashed_official on Dune, the app has generated more than $30 million of revenue from fees this year. You can see spike in fees on May 29th, around the date when many of these celebrity memecoins were being launched (note the missing data around May 19th is due to the platform shutting down following a hack).
Many constituents within the crypto industry are upset about the revival of crypto within celebrity culture. The âcasinoâ part of the industry is once again taking the spotlight. The industry was convinced that the scamming, pump and dumps and senseless celebrity involvement had been left behind in the 2022 bull run. The industry thought that lessons had been learned, and that this time around it would be different. The takeaway from this week is that crypto remains a strong option for scammers due to the inherent financial nature and lack of regulation in the industry. Scammers are still out there and some are more powerful and influential than we would think. These recent celebrity tokens were allegedly driven by a known scammer named Sahil Arora. He was apparently able to manipulate the celebrities into promoting these memecoins while ensuring he enriched himself along the way. After a major week where the launch of ether ETFs demonstrated meaningful steps made towards institutional adoption of crypto, the next week celebrities with millions of followers promoted pump and dump coins on Solana to make a quick buck. Be careful out there folks.
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