This weekly roundup of stories from Mainland China, Taiwan, and Hong Kong makes an attempt to curate the trade’s most essential information, together with influential tasks, modifications within the regulatory panorama, and enterprise blockchain integrations.
A lot like last week, China’s minor COVID flareups dominated the headlines because the nation seeks to keep away from extra critical lockdowns. Cryptocurrency managed to remain out of the information, which contemplating the regulation lately, can solely be seen as a superb factor.
A lot love for the layer-twos
On August 3, IOSG Ventures and Chainlink hosted the Demo Day of the Layer-Two Hackathon in Shanghai. The occasion aimed to help builders engaged on scaling options for Ethereum and was backed by main tasks resembling Polygon, Close to, The Graph, and Matter Labs. The profitable workforce, which received bounties and mentorship, was a Synthetix-based asset administration challenge. The winners referred to as themselves ObjK and used querying know-how from The Graph to tug knowledge from Synthetix, attaining an automatic cross-pool portfolio rebalance.
Layer-twos have at all times been well-liked in China, notably as customers really feel much less involved about custodial dangers and decentralization. Final week, OKEx formally launched OKExChain, which is an EVM-compatible layer-two community much like what different giant exchanges have launched.
That is of curiosity resulting from OKEx’s giant userbase, which ranks second solely to Binance when sorted by quantity. Layer-two networks launched by exchanges usually lack a number of the technical strengths of the devoted layer-two networks however have an enormous benefit in entry to customers, belongings, tasks and communities.
OKExChain was proof of this because it amassed over $2 billion in belongings within the first week. About $350 million of that’s on AMM CherrySwap, which seems to be fairly liberally based mostly on BSC’s PancakeSwap. That TVL would rank across the thirtieth greatest DeFi app on all networks, across the dimension of OlympusDAO on Ethereum and BakerySwap on BSC. KSwap, one other AMM platform on OKExChain, racked up over $684 million in 24-hour commerce quantity on Thursday, which places it second behind Uniswap V3 for the busiest dApp within the trade. After all, the problem can be on the functions and community to take care of these early numbers after the beneficiant APYs have been lowered to extra sustainable numbers.
Monitoring adoption elsewhere
Regardless of declining DEX buying and selling quantity on each BSC and Huobi Eco Chain, BSC lately noticed an explosion in exercise round CryptoBlades, an NFT recreation that accounted for greater than thrice the transaction quantity of all the Huobi Eco Chain on Thursday.
In the end, for chains like Huobi ECO or OKExChain to compete with different layer-two networks, they need to discover a strategy to recruit distinctive app builders to their ecosystems, slightly than counting on ports or forks from different networks. As Axie Infinity has proven, any blockchain community can turn into loaded filled with transactions and customers if the precise software is deployed on it.
China’s personal shadowy super-coders
In accordance with a Chainanalysis report, greater than $2.2 billion price of cryptocurrency had been despatched from Chinese language wallets to addresses related to illicit exercise within the two-year interval between April of 2019 and this summer season.
The majority of that is associated to the notorious PlusToken ponzi scam that came about in late 2019. Since then, the variety of addresses partaking in scams and criminal activity has shrunk dramatically, indicating that Chinese language clampdowns are having some affect on client protections.
Regulators appear to be taking satisfaction of their victories, as evidenced by an article from a Individuals’s Financial institution of China working convention final week, the place the digital forex crackdown was talked about in a listing of 2021 efforts up to now.
Tech giants eyeing up the NFT area
Crypto corporations aren’t the one ones feeling the wrath of Chinese language regulators as of late. Over the previous week, hundreds of billions of dollars have been wiped from Chinese language tech shares together with on-line schooling, supply, and video gaming.
Tencent, which invests in numerous main recreation publishers, suffered a greater than 17% drop in inventory value this month alone. Nonetheless, that didn’t cease it from saying this week that it would release an NFT trading platform that roughly interprets as “Magic Core”. Third events can reportedly launch NFT paintings on the platform, and it’s designed by simply certainly one of a number of groups inside Tencent which are growing NFT associated companies. Because of China’s strict regulatory insurance policies, many of the NFTs launched by the key web corporations are constructed on non-public chains or consortium chain know-how. Alibaba also launched an NFT platform in late June.