Winners and losers of a stormy DeFi week

Once again this week, a lot has happened in the decentralised finance (DeFi) sector. From Flash-Loan attacks, hacks to the manipulation of price oracles, everything has been there.

After the DeFi sector recorded enormous price increases last week, it is now having to take a beating. The DeFi token Aave (AAVE), Synthetix Netowrk (SNX), YearnFinance (YFI) all fell by more than 13 percent and even the UNI token from Uniswap corrected by 10 percent.

The „ETF token“ DeFi Pulse Index, which Bitcoin Formula is a good indicator of general development of DeFi token prices, also lost more than 15 per cent.

DeFi Pulse Index DPITokensets: DPI price

Nevertheless, the total capital deposited in the Decentralized Finance sector recorded only a slight decline from USD 13.54 billion to USD 12.6 billion. This development suggests that the majority of investors remain convinced of the potential of the DeFi sector. It appears that investors are not under too much pressure from price setbacks and continue to actively use DeFi protocols.

A new day, a new DeFi hack. Pickle went haywire this week and the protocol lost more than $20 million. The team does not yet want to announce how this could happen. In addition, the 20 million DAI tokens are still untouched on the hacker’s address. At the moment it is also unclear whether the security problem has been resolved. Since the hack was announced, Pickle has suffered a price drop of more than 36 percent.

Flash loan attack on price oracle

Cheese Bank, another Ethereum DeFi project, fell victim to a flash loan attack on Monday. Flash Loans are loans where a user borrows money without the need for a security deposit. This makes it possible to exert leverage without risking one’s own capital. There is only one condition – users must repay the Flash Loan into their loan within the same transaction.

Through a Flash Loan, the attacker was able to manipulate the price oracle of Cheesebank by creating an arbitrage situation through which he was able to capture a total of $3.3 million. A discussion broke out in the crypto-community. Many criticised that this security gap could have been avoided if Cheesebank had used a decentralised rate oracle. After all, decentralised price oracles like Chainlink’s are not as easy to manipulate as centralised price oracles.

Uniswap and sushi swap benefit

Despite the attacks and hacks this week, there were also two DeFi platforms that benefited in particular. The decentralised stock exchange (DEX) Uniswap and Sushiswap recorded significantly higher trading volumes.

It seems that more and more users are using decentralised exchanges to trade crypto currencies.

Although Uniswap currently dominates the decentralised exchange scene, there is still no clear winner and several DEX have increased their trading volume in the past week.

Los principales medios de comunicación han declarado a Joe Biden ganador de las elecciones de 2020, lo que lleva a los analistas a especular sobre cómo una presidencia de Biden puede impactar en el precio de Bitcoin en 2021.

El 7 de noviembre varios medios de comunicación anunciaron que después de 4 días de riguroso recuento de votos en estados clave de la batalla, Joe Biden había logrado asegurar suficientes votos electorales para convertirse en el 46º Presidente de los Estados Unidos.

A medida que la emoción por una elección increíblemente reñida comienza a disminuir, los analistas analizarán más de cerca cómo una presidencia de Biden puede impactar en los mercados tradicionales y en el precio de Bitcoin. Tres factores clave a considerar son la eventual aprobación de una nueva ronda de estímulo económico, el fortalecimiento del dólar estadounidense y la posibilidad de una recuperación del mercado de valores.

El estímulo económico podría impulsar a Bitcoin a un nivel más alto

Antes de la elección, el presidente de los Estados Unidos, Donald Trump, dijo que tenía la intención de retrasar las discusiones sobre el estímulo hasta después de la elección. En consecuencia, los demócratas y los republicanos se esforzaron por llegar a un consenso sobre un acuerdo.

La elección de Biden ilumina la perspectiva de un paquete de estímulo para finales de año. Los demócratas en el Congreso de los Estados Unidos ya propusieron un proyecto de ley de estímulo de 2,2 billones de dólares en octubre, pero no consiguió apoyo en el Senado.

La segunda ronda de estímulo podría afectar positivamente a Bitcoin porque relaja significativamente las condiciones financieras de los EE.UU. También levantaría la economía de los EE.UU. y, a su vez, estimularía el apetito de los inversores por los activos de alto riesgo.

La percepción de Bitcoin ha evolucionado desde un activo de riesgo a un activo seguro y un juego de inflación en los últimos meses. A pesar de esto, todavía hay múltiples casos en los que el precio de Bitcoin se mueve en tándem con el mercado de valores, por lo que en ausencia de apetito por activos de riesgo, el precio de Bitcoin todavía puede subir.

Subida del dólar americano

Si la administración Biden aprueba un paquete de estímulo, entonces el dólar americano subirá. La zona euro, por ejemplo, vio cómo el euro se disparaba rápidamente después de aprobar una importante propuesta de estímulo.

El dólar estadounidense ha tenido un rendimiento inferior al de las monedas de reserva desde marzo. En consecuencia, ayudó a la recuperación del oro, el Bitcoin y otras reservas alternativas de valor, ya que se cotizan frente al dólar.

Por lo tanto, existe la posibilidad de que una segunda ronda de estímulos y la mejora de la confianza de los inversores puedan tener inicialmente un impacto positivo en el precio de Bitcoin. También es importante señalar que, con el tiempo, el fortalecimiento del dólar podría ejercer una presión de venta adicional sobre Bitcoin y el oro.

Los mercados bursátiles pueden recuperarse ahora que la elección está „resuelta

Los analistas también prevén que el mercado de valores de los Estados Unidos se recuperará tras la confirmación del resultado de las elecciones.

Aunque muchos analistas creen que las políticas fiscales y ambientales de Biden pueden llevar finalmente a una caída del mercado de valores, hay una alta probabilidad de que las acciones se recuperen a corto plazo.

El mercado bursátil cayó abruptamente durante agosto y septiembre, ya que los analistas advirtieron de la posibilidad de que se produjera una elección impugnada. Es poco probable que la especulación sobre el resultado de las elecciones haya impulsado la venta de activos de riesgo.

Más bien, el temor de que las elecciones se prolongaran sin un claro ganador hizo que los mercados se pusieran nerviosos.

Tras la conclusión de la carrera de 2020, hay menos incertidumbre en los mercados y esto podría permitir que las acciones se recuperen junto con otros activos de riesgo.

En cuanto a la regulación, el asesor general de Compound Finance, Jake Chervinsky, dijo que Biden no ha expresado ninguna postura pública hacia la criptografía. Escribió:

„El presidente electo Biden no ha dicho nada públicamente sobre sus opiniones sobre la criptografía. Por ahora, realmente no es un tema lo suficientemente grande como para merecer su atención. Los próximos cuatro años de la política de criptografía de los EE.UU. depende de a quién designe para los puestos clave; sabremos más a medida que la transición se pone en marcha.“
Mientras que los medios de comunicación han anunciado que Joe Biden es el ganador de las elecciones de 2020, el presidente Trump aún no ha cedido y se espera que el equipo legal de Trump dispute los resultados e intente forzar un recuento en cada estado del campo de batalla.

Si esto ocurre, el miedo y la volatilidad podrían volver a entrar rápidamente en los mercados y provocar un retroceso en los precios de las acciones y de los criptos.

Virtual asset service providers in the country will not be allowed to deal with „dark currencies“.

According to a November 3 announcement by the South Korean Financial Services Commission (FSC), virtual asset service providers within the country will no longer be able to deal with any digital assets that present a high risk of money laundering. These updates were made as part of the Special Payments Act guidelines – regulations that specifically cover the legality of cryptomorphs in South Korea. The Financial Intelligence Unit specifically criticized the „dark currencies,“ which would be privacy-focused cryptomorphs, for having records of transactions that are supposedly difficult for the group to track. This could potentially affect the use of privacy currencies such as Zcash (ZEC), Monero (XMR) and Dash (DASH).

The Financial Supervisory Authority’s amendments to the Special Payment Act are expected to apply from March 2021. The project requires existing exchanges to employ sufficient Know Your Customer (KYC) and Anti-Money Laundering (AML) policies. The exchanges must also report their operations within six months of the implementation of the law. In addition to not dealing with privacy currencies, virtual asset service providers are required to confirm the real names of their customers by comparing them with personal data, such as national identity numbers.

Many crypto currency exchanges in the country no longer list privacy currencies due to existing international regulations. In September 2019, the South Korean branch of the OKEx crypto exchange removed the ZEC, XMR, DASH, Horizen (ZEN) and Super Bitcoin (SBTC), citing the guidelines set by the Financial Action Task Force. The local Upbit cryptomode exchange announced in the same month that it would no longer support the three privacy-focused cryptomodes.

 

Dutch Bitcoin companies that are not registered with De Nederlandsche Bank (DNB) as of 21 November are no longer allowed to offer their services to Dutch people. A number of platforms have now passed the supervisory authority’s inspection.

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Register of DNB
In order to facilitate the trade in bitcoin in the Netherlands in accordance with the rules, you have to go through a selection procedure by the regulator, among other things. Directors and other important persons within the organisation are screened. You also have to comply with the anti-money laundering rules.

In practice, this means that parties have to play an open card with DNB and also collect much more customer data. Parties must share this data with, for example, the tax authorities or the police on request.

At the moment there are 5 known companies in the register of De Nederlandsche Bank:

AMDAX
Anycoin Direct
Blox
Coinmerce
LiteBit
New names will undoubtedly be added before 21 November. But not everyone will pass the inspection on time or at all. 25 Bitcoin companies jointly spoke out against the hard demands of DNB.

Consequences of stricter rules
Procedures and measures of this kind cost the industry as a whole a great deal of money. There are also entrepreneurs who, in principle, do not want to participate in the collection of (even) more customer data. Several companies have stopped or moved because of the new rules.

Two prominent Dutch examples are BitKassa and Bittr. Both platforms were trendsetters in the Netherlands in their own way.

BitKassa still facilitates bitcoin payments for entrepreneurs, especially in Arnhem, but in a stripped-down form. You could also buy and sell bitcoin directly at BitKassa; these services have been discontinued. Supervision costs and objections of principle caused them to throw in the towel.

Bittr was a service with which you could buy BTC with a simple automatic bank transfer. Ideal and easy to use, but DNB wants companies to collect more data from their customers. Founder Ruben Waterman indicated that as a one-man business it was impossible for him to meet the strict requirements of the regulator.

Bitcoin derivatives exchange Deribit officially left the Netherlands in February. All trading activities are now part of a company in Panama.

It can have major consequences for your company if you don’t comply with the rules in countries where you offer your services. An example of this is derivatives exchange BitMEX.

The companies and individuals behind the exchange are prosecuted by the US Department of Justice and the Commodity Futures Trading Commission (CFTC). Tens of thousands of Americans are said to have used the platform when they were not using the correct procedures.

Digital currency is the great highlight of the investments in the year, according to a survey.

Many stocks, fixed income, among other investments, occupy the idea of investors in Brazil. Bitcoin lives then another month of prominence in October, when reaching an important high mark in the month.

In fact, Bitcoin is one of the highlights in emerging countries, not only in Brazil today. This is because, with the US Dollar being a strong currency in several countries, local currencies lose strength.

At the end of August, Bitcoin was the valorization champion, returning in October.
In a year of high inflation, Bitcoin reaches an important mark in October after a great price increase

Brazilian investors have had an extended weekend and can reflect on 2020 so far. With a year of great uncertainty in the global economy and health, protecting capital is an arduous task.

Some have observed traditional hedge assets, such as gold, for example. Others have looked at innovative assets such as Bitcoin. Living a unique moment in its history, digital currency sees an important price movement.

In Brazil, the price of Bitcoin is up 166% in 2020, according to Valor Econômico. With the close of October, the price of the digital Bitcoin registered an increase of 28%, that is, a giant appreciation. This comparison was in relation to the Brazilian Real.

The move up is one of the most important of Bitcoin, which reduced its inflation by half in May 2020. With the process called halving, the emission of Bitcoin in the world saw a drastic reduction.

On the other hand, central banks have increased money issuance in several countries. The so-called economic stimuli are still seen as dangerous by many attentive investors.

In Brazil, rental inflation, the IGP-M, rose 3% in October, up 18% in the year. The IPCA already rose 2.1% in 2020, surpassing the current Selic rate, set at 2% by Brazil’s Central Bank. In addition, the Ibovespa registers a drop of 18% in the year, at the close of last month.
Higher value at Bitcoin monthly closing since December 2017

With Bitcoin currently quoted at around U$ 13500, or R$ 77600, the currency operates in drop this second (2). Nevertheless, last Saturday (31), Bitcoin made history with last month’s high.

However, with the Bitcoin being worth over U$ 13 thousand, this was the first time that the currency ended a month above the value. According to analyst Joseph Young, the Bitcoin mark in October is important for the history of the currency.

In addition, throughout the history of the Bitcoin, almost 12 years old today, it is worth noting that a few days the price of the currency was worth over $ 13 thousand. According to a graphic survey published by analyst Travis Kling, on October 31st, Bitcoin was only traded above U$ 13 thousand for 48 days (50 today).

Anyway, Bitcoin is experiencing an interesting time for investments in the year. In Brazil and in the world the currency valuation is noteworthy and attracts more and more companies to the ecosystem. PayPal entered the market of cryptomoedas in October and may have helped in the movement of high