Crypto Adoption Grew 10x in a Year

Hartmann Capital Newsletter, Friday August 20, 2021

In this issue

  • Chainalysis reports that crypto adoption grew 10x in a year

  • Sushiswap: Community saves major exchange from potential hack

  • DWeb is here: Social media leader TikTok partners with crypto music platform

  • This week’s blog: “The Institutionalization of Crypto Funds

Market by numbers

Markets trended sideways this week. The Metaverse darlings remained bid, but with less momentum than in the previous weeks.

Chainalysis reports that crypto adoption grew 10x in a year

Developing countries are driving adoption of cryptocurrencies, says Chainalysis

Countries with serious currency issues or political unrest (e.g. Venezuela) take many of the top places, evidence of store of value as a key crypto asset use case.  

The big news is that Chainalysis sees an 880% jump in retail crypto adoption globally. It is easy to identify positive trends in crypto adoption at fintechs such as Robinhood, Coinbase and Circle. But broader “grassroots” adoption across the globe is perhaps even more bullish for the crypto markets. We are still early.

DWeb is here: Social media leader TikTok partners with crypto music platform

The decentralized web (dWeb or Web3) is slowly gaining traction with non-crypto natives. Arweave is storing censored newspaper content cryptographically to enable uncensored access for all. Games that previously would reside on centralized platforms with centralized governance are emerging on-chain, such as Aavegotchi and Axie Infinity. Yet these new use cases remain small relative to the size of the platform economy that included Facebook and Spotify.

As such any move by the dominant centralized platforms of Web2 may mark the beginning of a sea change for decentralization. This week the decentralized Spotify, Audius, announced a partnership with TikTok, perhaps the number one privacy-violator of all the large bigtechs. TikTok will use Audius to provide one-click sharing of audio on its platform. 

Unsurprisingly, AUDIO more than doubled on the news, and remains up 100% on the week. 

In fact, both Arweave and Audius were in the top 5 weekly gainers:

DWeb has arrived, ironically on the back of the worst of Web2. 

Community saves major exchange from hack

Last week, a major exploit was thwarted when the Poly Market hacker returned his ill-gotten gains after being hounded by the crypto community.  This week provided another example of how the ecosystem cooperates to protect vital infrastructure.

A potential vulnerability in challenger decentralized exchange Sushiswap was exposed and fixed in spite of hard feelings between Paradigm and Sushiswap. Samczsun from Paradigm identified a bug on Sushswap’s MISO platform that could have resulted in a $350 million exploit. After discussions between both teams, involving Paradigms Dan Robinson and Sushi’s Joseph Delong, Sushiswap ended the ongoing BitDAO auction and paused the platform in order to fix the bug.

This cooperation is relevant in that Paradigm, backers of and active partners in both Uniswap and Optimism, as well as Uniswap founders, have often clashed with Sushiswap’s team leaders. Crypto remains a community, in spite of the rhetoric. 

This week’s blog: The Institutionalization of Crypto Funds

When Hartmann Capital started out, the infrastructure for running a ‘crypto-institution’ like ours didn’t exist. Funds were largely stuck using the same tools available to retail. A few years later, we are able to take advantage of institutional-grade data, analytics, custody, execution and borrowing. Corporations such as MicroStrategy and Tesla have entered, albeit solely on the long-only buy-and-hold side. With recent improvements in ancillary services, however, crypto-institutions like Hartmann Capital are becoming more akin to institutional asset managers from traditional finance.

Hartmann Capital Weekly written by Head of Communications, Rasheed Saleuddin, PhD, CFA


Disclaimers:

This is not an offering. This is not financial advice. Always do your own research.

Our discussion may include predictions, estimates or other information that might be considered forward-looking. While these forward-looking statements represent our current judgment on what the future holds, they are subject to risks and uncertainties that could cause actual results to differ materially. You are cautioned not to place undue reliance on these forward-looking statements, which reflect our opinions only as of the date of this presentation. Please keep in mind that we are not obligating ourselves to revise or publicly release the results of any revision to these forward-looking statements in light of new information or future events.