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Gate.io Blog Gate.io Podcast | Azuki Surpasses BAYC as #1 NFT, DeFi Lender Inverse Hacked for $15.6M, SEC Rejects Cathie Wood’s ARK Invest

Gate.io Podcast | Azuki Surpasses BAYC as #1 NFT, DeFi Lender Inverse Hacked for $15.6M, SEC Rejects Cathie Wood’s ARK Invest

04 April 16:28

This episode is brought to you by
Gate.io and Zignaly (Airdrop). Status-as-a-Service project Azuki series NFT surpassed the famous Bored Ape Yacht Club and ranking first among all NFT projects. Speaking of NFTs, Twitch co-founder Justin Kan is now working on an NFT Marketplace on the Solana blockchain. Meanwhile in the crypto space, SEC rejects ARK 21Shares Bitcoin ETF and DeFi lender Inverse was hacked for $15.6 million. Followed by a Deep Dive aptly titled “Are cryptocurrencies becoming mainstream?”

In today’s Headlines:

  1. Azuki’s Sales Volume Surpass BAYC | 1 | 2 | 3 |

  2. DeFi Lender Inverse Finance Exploited for $15.6M | 1 | 2 | 3 |

  3. Bitcoin network difficulty reaches all-time high as miners pursue 2M BTC | 1 | 2 |

  4. SEC Denies Bitcoin ETF From Cathie Wood’s ARK Invest | 1 | 2 | 3 | 4 |

  5. Twitch Co-Founder’s Solana Gaming NFT Platform Fractal Raises $35M | 1 | 2 |

Sponsor: Zignaly (Airdrop)

Deep Dive: Are Cryptocurrencies Becoming Mainstream? | 1 | 2 | 3 | 4 | 5 | 6 |


Welcome back to the Gate.io Podcasts. I’m Peter, this is the show to get a neutral perspective on some of the latest headlines in DeFi, Metaverse, NFTs, and Big Tech. Today’s episode is sponsored by Astar Network and brought to you by Gate.io, a centralized exchange with a neutral stance on current events.

Before we get in, the information presented in this podcast is to help you stay up-to-date on the latest happening in the crypto space, and nothing presented hereby is financial advice. The news that I cover in this podcast will have the original source at your discretion. Stick by this podcast as I show you how to stay vigilant and learn to do your own research.

But, before jumping in, make sure to subscribe to this podcast or youtube channel and don’t forget to turn on the notification bell so you’ll not miss any info about the crypto space!

Now, without further ado.

Azuki’s Sales Volume Surpasses BAYC | 1 | 2 | 3 |

Recently, the sales volume of the Azuki series NFT has soared again. According to Coinmarketcap data, the total sales volume of Azuki series NFT reached 15000 ETH, surpassing the famous Bored Ape Yacht Club, and ranking first in all NFT projects.

In addition to the sharp increase in total sales, the number of Azuki NFT whales also increased by 24, or 16.44%, in one week. Several crypto KOLs also purchased the Azuki series NFT recently.

NFTs such as Azuki, CryptoPunks, and Bored Apes are also referred to as the PFP project (Profile for Picture). They are generally used as personal profile photos for display on social networks, which are often called avatars. Several social media including Twitter, Facebook, and Instagram have launched or plan to launch NFT avatar authentication function, and the real owner of NFT can obtain special identification on his personal account.

The number of PFP projects is only approximately 20% of all NFT projects, but its market value exceeds half of the whole NFT market. Now, the connotation of PFP projects has gone far beyond a picture. They not only have speculative value but also have more social value, which is also called "Status as a service".

Holding and using NFT avatars of a certain category has become an "identity" on social media, which can highlight their social Status, help holders show their taste, shape their positioning, and quickly raise recognition and attract a following of collectors with similar tastes.

The high popularity also brings a wide range of commercial value. In reality, giant enterprises such as Adidas have also begun to cooperate with PFP project parties to jointly launch image-related peripheral products.

NFT images such as CryptoPunks and Bored Apes are gradually becoming a trend and a "cultural symbol" of our times. Using and owning NFT avatars are also considered to be representatives of avant-garde, fashion, and rebellion.

From this perspective, Azuki's target audience is extremely clear, which is anime fans among Gen Y and Gen Z, who have a wide recognition of this kind of American street style art.

These 2 generations can be said to be the aborigines of the Internet, the rebels of the current mainstream culture, and the promoters of Web 3.0. As stated in its roadmap, Azuki is expected to establish the largest decentralized brand established and owned by the community in the metaverse.

But at present, NFT projects such as Bored Apes are often criticized as games that only the rich can participate in because the price of one token is too high. In order to reduce the threshold of project participation and expand the scale of the community, Azuki also took the lead in the attempt of NFT fragmentation.

On March 7th, Azuki's fragmented NFT project "Bob, the Bean Farmer" was officially minted. The project decomposed Azuki#40 into 50,000 pieces through Fractional.art. Each fragment is represented by BOBU tokens, the concurrent ERC-1155 tokens, which also represent ownership and governance rights. The first minted projects produced 20000 NFT out of 50000 pieces, and each NFT sold for 0.01 ETH.

On March 30, Azuki #9605 traded at 420.7ETH, approximately $1.42 million, the highest trading price in the history of the NFT series. Since Yuga Labs (the parent company of BAYC) announced the acquisition of CryptoPunks and Meebits on the 12th of March, Yuga series NFT has occupied a dominant position in the whole NFT market. Presently, Azuki is expected to become a major challenger of Yuga series NFT.

DeFi Lender Inverse Finance Exploited for $15.6M | 1 | 2 | 3 |

Inverse Finance, a lending-focused decentralized finance protocol, was the target of an apparent exploit on Saturday, with approximately $15 million worth of crypto lost during the incident.

According to Inverse, the attacker targeted its Anchor (ANC) money market – artificially manipulating token prices to borrow loans against extremely low collateral.

The situation was first flagged by PeckShield, a blockchain analytics firm. The Inverse attacker took advantage of a vulnerability in a Keep3r price oracle Inverse uses to track token prices. The attacker tricked the oracle into thinking that the price of Inverse’s INV token was extraordinarily high, and then took out multi-million-dollar loans on Anchor using the inflated INV as collateral.

The attack was notably well-financed; in order to pull it off, the attacker first withdrew 901 ETH (about $3 million) from Tornado Cash, which is used to disburse crypto without leaving a clear trail. The attacker then injected the mystery funds into several trading pairs on the decentralized exchange SushiSwap – inflating the price of INV in the eyes of the Keep3r price oracle.

With the price of INV sufficiently high, the attacker then took out INV-backed loans on Anchor before arbitrageurs brought the price of INV back down to normal levels.

Altogether, the attacker managed to run away with 1,588 ETH, 94 WBTC, 39 YFI and 3,999,669 DOLA. The attacker has cycled most of the funds back through Tornado Cash – meaning it’s difficult to know where the funds will end up – but 73.5 ETH (about $250,000) remains in the attacker’s original Ethereum wallet.

This is the third multi-million dollar hack of a decentralized finance (DeFi) protocol to make headlines this week, and it underscores the increasingly sophisticated techniques being levied by attackers.

On Tuesday the gaming-focused Ronin network announced a loss of more than $625 million in crypto and then two days later lending protocol Ola Finance said it was exploited for $3.6 million.

Bitcoin network difficulty reaches all-time high as miners pursue 2M BTC | 1 | 2 |

When Satoshi Nakamoto created the Bitcoin network, the inventor set the maximum supply to 21 million, and research shows that the number is a bit less than 21 million. Some estimates indicate there will only be 20,999,817.31 BTC.

On April 1, 2022, records show that 19 million Bitcoin have been mined into circulation, meaning there’s only two million bitcoins left to be found by mining participants.

Whenever a block is found by a miner, the coin issuance increases by 6.25 bitcoins per block ($289,656) found. A block is discovered roughly every ten minutes and the next block reward halving is expected to occur on or around May 3rd, 2024. After the next halving occurs, miners will get 3.125 bitcoins per block and the next halving will take place in 2028.

Bitcoin’s network difficulty correlates to the computational power required to mine BTC blocks, which currently demands an estimated hash rate of 201.84 exahash per second (EH/s), according to data from Blockchain.com.

Supporting the spike in the network difficulty, Bitcoin’s hash rate maintained a stronghold throughout the year while breaking into an all-time high of 248.11 EH/s on Feb. 13.

A higher hash rate ensures resilience against double-spending attacks, which is the process of reversing BTC transactions over the blockchain by contributing to at least 51% of the Bitcoin hash rate.

While data shows there are 19 million bitcoins mined into existence, no one truly knows how many there really are in circulation. This is due to the fact that there’s an unknown number of unobtainable or lost coins that will never be spent. However, Satoshi Nakamoto accounted for the lost coins dilemma when the inventor said that unobtainable bitcoins will make the crypto asset scarcer and therefore more valuable.

As the next halving is expected to occur in 2024, it is estimated that block rewards will stop issuing fresh Bitcoin by the year 2140, and the miner-reward system will be based entirely on transaction fees.

On Mar. 30, a Terra wallet belonging to LFG (Luna Foundation Guard) amassed $139 million in BTC, bringing its total coffers up to 31,000 BTC or $1.47 billion.

SEC Denies Bitcoin ETF From Cathie Wood’s ARK Invest | 1 | 2 | 3 | 4 |

Cathie Wood suffered a huge blow on Friday when the U.S. Securities and Exchange Commission (SEC) turned down an application for a spot Bitcoin exchange-traded fund EFT.

The application would have created the ARK 21Shares Bitcoin ETF to trade on the Chicago Board Options Exchange (Cboe), with 21Shares acting as the sponsor, Coinbase as custodian and ARK Investment would have handled marketing, according to the SEC S-1 form the companies filed.

In the case of the Bitcoin spot ETFs that firms have been attempting to register, the value of shares would be tied to the price of Bitcoin. It would allow investors to indirectly participate in crypto markets without actually buying and selling Bitcoin themselves.

With Bitcoin futures ETFs, the share price is tied to derivatives, or speculative bets about what the Bitcoin price will do. So far, the SEC has approved several Bitcoin futures ETFs, including ProShares Bitcoin Strategy ETF (BITO), Valkyrie Bitcoin Strategy ETF (BTF), and VanEck Bitcoin Strategy ETF (XBTF).

In its rejection order for the Bitcoin spot ETF, the SEC concluded that "the record does not support a finding that the Bitcoin market is inherently and uniquely resistant to fraud and manipulation."

Adding that an exchange could meet that obligation “by demonstrating that the exchange has a comprehensive surveillance-sharing agreement with a regulated market of significant size related to the underlying or reference Bitcoin assets.”

Now, the companies join a growing list of peers who have had their Bitcoin spot ETF applications rejected: NYDIG, Global X, Fidelity, First Trust, Krypton, Van Eck and WisdomTree.

Last Monday, CEO Michael Sonnenshein said Grayscale would consider a lawsuit against the SEC as part of its response if rejection prolongs, according to Bloomberg.

Twitch Co-Founder’s Solana Gaming NFT Platform Fractal Raises $35M | 1 | 2 |

Justin Kan co-founded Twitch, the massive streaming video platform that redefined how many people discover and experience video games—and he believes that NFTs will have an even bigger impact on the gaming industry in the long run. Now his new NFT gaming startup has raised $35 million to help bring that vision to life.

Kan now runs Fractal, a curated NFT gaming marketplace for gamers to buy and sell items for these games. And he’s betting on Solana, an up-and-coming blockchain protocol that claims faster transactions and lower costs than Ethereum.

In NFT-based gaming, players often need multiple NFTs for a game and conduct many transactions in the course of ordinary play, so Solana is a better option, Kan said.

Fractal, which launched in late December and has raised $35 million in seed funding led by Paradigm and Multicoin Capital, vets the games and then partners with games that agree to have their NFTs trade on Fractal by marketing games to gamers, through its Discord (100,000 members), Twitter, podcasts and giveaways. Fractal takes a 2% transaction fee on secondary sales on its marketplace. Fractal’s CEO is David Wurtz, who Kan knew because they were both early Y Combinator participants, and is credited as a co-creator of Google Drive.

Kan said that Fractal has talked to upwards of 100 developers so far that are building NFT games on various blockchains. Fractal only admits an estimated 5% of interested developers to its launchpad for gaming NFT drops, however, with games like House of Sparta, Tiny Colony, Nekoverse, and YAKU Corp. making the cut so far.

The launchpad onboarding process requires developers to identify themselves to Fractal’s team—a move that Kan said that marketplace Magic Eden “copied” afterwards. Fractal then makes a call based on the likelihood that creators are reputable and can follow through on their promises. They also create content with developers to introduce them to prospective players.

Kan draws the parallel between NFT games and free-to-play games, which were widely reviled by many gamers when they surfaced in the late 2000s. It’s now a dominant business model seen in popular games like Fortnite, League of Legends, and Apex Legends.

While he believes in NFT games, Kan is not a fan of play-to-earn games in which users play games just to make income. Quoting Kan, “More and more games are pivoting away from that to where it's more about a fun experience and then incidentally, you might get something of value inside the game, because otherwise it requires this continual flow of new capital, of people coming in and putting capital in to play the game and usually that happens when there's higher speculation of assets.”

Sponsor | Zignaly

Before I continue with today’s deep dives, I must tell you about today’s sponsor, Zignaly, a fintech company that intends to become the leading crypto trading bot provider in the market.

Founded in 2018, Zignaly has provided a platform with a unique performance-based profit-sharing model to ensure fair profit distribution and created a win-win ecosystem where investors, traders, exchanges, and Zignaly can profit.

The main feature inside Zignaly is Profit Sharing, which is an evolution of Copy Trading. While Both services are basically to get automated crypto trading, Copy Trading refers to the operation being done on your own exchange account, and this implies that you are always one step behind the trader. However, by choosing Profit Sharing, you are co-investing together with the trader while enjoying some advantages over normal Copy Trading.

At the beginning of this year, Zigcoin (or $ZIG), the utility token that powers the NFT-based insurance protocol, was listed on Gate.io.

Zignaly is also the first social investment platform that allows experts and investors to interact in a mutually beneficial environment. As of now, over 350 professional traders are serving 350,000+ users who have allocated $120M in crypto assets and 4 Billion in trading volume.

19,000 $ZIG tokens are reserved for 95 podcast listeners until April 7. Be sure to check out the de_script_ion for more details if you’re interested.

DD | Are Cryptocurrencies Becoming Mainstream? | 1 | 2 | 3 | 4 | 5 | 6 |

Skepticism Around Cryptocurrencies.
Millions of critics consider cryptocurrencies as a scam, as a ponzi scheme and that decentralization isn’t a goal that can be achieved. Even major economists believe that digital currencies won't have any real life utility and that they are destined to fail.

But why even so, people haven't stopped investing into the new digital financial system?

Bitcoin has experienced a massive growth in the last couple of years, conquering a place among the safest assets to invest into, while Ethereum is showing that decentralization is no longer a mirage but it’s turning into reality. Nevertheless, NFTs have been the main innovation that brought millions of people into the crypto revolution by being implemented in hundreds of fields from art to music.

However, there are still critics out there that call cryptocurrencies a giant pyramid scheme that aims to financially break families while also strongly damaging the environment.

Global institutions are trying to implement regulation to impose a major control over digital assets, while there are countries that completely banned the mining and trading of cryptocurrencies, declaring them as a threat to their national economy.

But why should cryptocurrencies threaten the global economy if, as critics sustain, their utility is limited?

The Blockchain Utility In Our Daily Lives.
In the last couple of years, the technology improved so drastically that the blockchain innovation has started to be used in unexpected fields:

The Republic of San Marino used the VET ecosystem to issue Covid Certificate via NFT technology, and similarly, the Mediterranean Hospital of Cyprus recorded the first 100 Covid vaccination into the VeChain public blockchain.

Solana Blockchain managed to create their payment system usable in real life. The client directly pays the product via the Solana Pay network and the money immediately arrives on the seller account, everything managed via phone.

When something becomes mainstream, it means that its adoption has increased and more consumers have started to be aware of that product's existence, which is what is currently happening with cryptocurrencies.

According to stats, in 2021, there were 68 million crypto wallets, a number that keeps increasing every year, while the crypto total market cap is approximately $2 Trillion.
The enormous value of the crypto market has also been a consequence of the inflation that struck countries like Venezuela, Turkey or Mexico which suffered a drop in value of their own national currencies. People had to save their money and they refuged in stablecoins like UST: a token that is pegged to the dollar, considering it as a secure store of their savings.

In addition to the financial improvement that the blockchain has managed to bring to our daily lives, there are also other benefits that people can rely on.

Cryptocurrencies Are Conquering Industries.
Art and music are the industries that have experienced a massive improvement thanks to the new technological innovation: digital art has become a new way to earn money while music NFTs are building a new road for independent artists. There are digital artworks whose value can be compared to that of renaissance or cubism paintings, in some cases the prices are even higher. In fact, if crypt

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