a16z and its web of influence

Good morning! Welcome to The Daily Moon. German crypto bank Nuri is calling time. It has been trying to find buyers or investors. Anything. But it couldn’t find either. Now, its customers have until mid-December to withdraw their funds.

The markets were back in the red. Bitcoin was at $19,100 while Ethereum slipped below $1,300. Nasdaq fell in early trade. Back home, Sensex and Nifty closed slightly higher.

a16z Wants A Say

The world’s largest crypto investor wants to run crypto policy. It really should not come as a surprise, to be fair. a16z, a Forbes story claims, is on a lobbying spree. It is trying to persuade candidates across the US, which is weeks away from midterm elections, to create crypto-friendly policies. Now, you ask, why should we care. It is important to know who is trying to shape your policies. And once this election is over, apart from the drama around the president, important policies such as the one around crypto will be tabled. These policies will change the way the world views crypto.

The backgroundThe VC has been known to be vocal. It hates the media and was willing to back Elon Musk in his attempt to buy Twitter, despite the billionaire putting forth no new business plan. The subtext in those emails that were submitted to the courts is that crypto will play a role in it. a16z has raised $7.6 billion for crypto investments alone. And the larger the involvement, the more its companies can make and the more it can return to its LPs.

ICYMI: It backed Flowcarbon, the blockchain-based carbon credit platform founded by WeWork’s Adam Neumann. If you’ve forgotten, Neumann is the same founder who was fired from his own company just before its IPO on account of corporate governance issues.

There’s moreAlright, so a16z does interesting things. BFD. This lobbying may also have a spill over to one of its more interesting investments: Ripple. Currently, the company is in hot water with the SEC. A friendly policy may remove those hurdles.

What is it doing?To start with, it has donated $2.2 million to crypto-friendly politicians such as New York Congressman Ritchie Torres. a16z has also hired former regulatory officials to find favour with the SEC. The investment firm’s chief compliance officer Scott Walker, who looked at blockchain technology when he was at the SEC, now writes open-letters.

ETH Takes A Breath

Ethereum investors should take a deep breath. There may be temporary respite to the carnage they’ve had to endure. According to some analysts, Ethereum is closely tracking the S&P. Every time it goes up, there is a corresponding rise in Ethereum prices as well.

It’s all the whalesThe whales are the ones setting this trend. The number of transactions valued over $100,000 crossed 400 over the past 24 hours all of this at the same time the S&P 500 index showed gains. Now, we know that correlation ≠ causation and others have noticed that the number of investors selling Ethereum> number of investors buying.

The next upgradeJust when we were done with the Merge, now it’s time for a brand new upgrade: Shanghai. It has nothing to do with the country (put down your tinfoil hats). This upgrade will lower gas fees, and allow stETH withdrawals.

MATIC’s dApp Advantage

Polygon is home to more than 53,000 decentralised applications (dApps). It’s a sign that the platform is in demand among developers. This comes as good news for its token MATIC, which rose ~9% over the past one week.

What’s the trigger?There is an 8X jump in dApps since the start of 2022. And more than 60% increase since June. DeFi applications and NFTs were a hit. Polygon has over 174.9 million unique user addresses and has processed more than 2.1 billion transactions.

Why isn’t it going supernova?There isn’t much activity on the network. Apps have been built but engagement stayed low. The bear market is partly to blame but daily active wallets have not increased. There's hope that the dApp activity numbers may boost MATIC’s prices.

Uglier And Uglier For Celsius

When it rains, it pours. It’s pouring lawsuits for the beleaguered lender. Reports have emerged that Celsius is under multiple federal investigations.

40: The number of states currently investigating Celsius for a variety of causes.

4: The number of federal bodies, which have sent enquiries to the lender. The bodies looking at Celsius right now include, the SEC, the Federal Trade commission, Commodity Futures Trading Commission, and US District Court for the Southern District of New York.

ICYMICelsius paid investors jaw-dropping interest on tokens. So, let’s say, you bought Sol, it would offer double digit returns within a year. Ultimately, this turned out to be a pipe dream. And the company crashed. Investors couldn’t withdraw their funds and the co-founders and senior management got out unscathed.

And that’s it for today. If this email was forwarded to you, please consider subscribing. It’s free. We’ll never show you an ad or charge you for this. We swear.

Who are we? This newsletter’s ambition is to educate (and to entertain). The world of money is changing everyday and we want to help you decode what’s happening in the world of crypto, public markets in the US and India.