That is a Near miss

Good morning! Welcome to The Daily Moon. Jack’s dreams could soon become reality. Twitter’s working on a crypto wallet. Reports indicate that the social media platform is building a wallet that will allow deposits and withdrawals. But no confirmation from Twitter yet. Let’s hope this isn’t another Novi.

The markets recovered. Bitcoin was above $20,500 while Ethereum crossed $1,520 levels. Nasdaq fell in early trade. Back home, Sensex and Nifty were shut for Diwali.

NEAR Junks Terra-Like Stablecoin

Nobody wants a repeat of Terra. NEAR Protocol will shut down its stablecoin USN because it is behaving like the now infamous token. Investors have time till October 24, next year to redeem their USN for Tether USDT.

What exactly happened?Stablecoin, by definition, is to be backed by assets. USN does not have US dollar reserves, but holds a reserve with USDT and NEAR tokens. But extreme market conditions have made it undercollateralised, meaning USN does not have adequate reserves. To simplify:

1. DAO Decentral Bank (DCB) created the NEAR-native stablecoin USN in April. USN is pegged to the US dollar.

2. Recently, DCB found out that USN did not have adequate collateral.

3. This happened after USN’s upgrade from v1 to v2 in June.

4. Dual factors of crypto market volatility and double minting of USN’s v1 and v2 versions caused a collateral gap.

5. Not having collateral can lead to USN’s de-peg from the US dollar.

6. Decentral Bank told NEAR Foundation that USN does not have adequate collateral.

7. NEAR Foundation decided to wind down USN.

NEAR Foundation will offer $40 billion to bridge the collateral gap. It also clarified that USN is not linked to the NEAR token like Terra-Luna.

Now, what?Investors won’t lose money. NEAR has begun a USN Protection Programme to fund the stablecoin. Under this, investors can redeem their USN tokens for USDT on a 1:1 basis. USN exchange for other tokens will also be made available later. Phew, that was close.

MakerDAO’s Endgame Plan On

MakeDAO, the largest decentralised finance protocol’s community members have approved the Endgame Plan. It was founder Rune Christensen’s plan to make the protocol more decentralised, and overhaul how it works.

Facing off with a16zThe way MakerDAO will look after this is interesting, but not as interesting as how they got here. For background, Andreessen Horowitz (a16z) is an investor in MakerDAO with the power to sway votes in decision-making. MakerDAO laid out an alternate plan to the Endgame proposal. And in the end, the community seems to have gone with Christensen’s idea. There is a history of drama with the VCs ever since Endgame was unveiled in May.

What happens now?Well, the community has voted to break up Maker into smaller units called MetaDAOs. Other proposals that were accepted include moving $1.6 billion in USDC stablecoin to Coinbase Prime, and accumulating staked Ether.

Bored Ape’s Metaverse is Crashing

The prices of NFTs from Bored Ape Yacht Club’s (BAYC) metaverse project Otherdeed are falling. Nobody is quite sure why, but over the weekend, stuff happened.

Where are things at?Coindesk reported that the floor price, or the minimum amount you have to pay to get into an NFT collection, dropped 16% on Saturday. While writing this, the floor price of the collection on OpenSea was 1.345 ETH. It’s quite a fall, considering that the Otherdeed NFTs sold for about $7,000 in May when they were launched. The current floor price translates to about $1,700 for the NFTs.

This isn’t the best season for NFTs, and for BAYC’s creator Yuga Labs in general. Remember how the SEC is investigating the crazy amounts NFTs fetched? We’ll keep an eye on this and tell you as we know more.

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