Fintech meets crypto #15
Metaverse bubble goes poof, new stablecoin GHO says hi and why BNPL companies are meme stocks.
Hi 👋
What a nice, sunny summer.
To be honest, it seems like things in fintech and/or crypto slowed down a bit. Comparing to the spring time.
But don’t be fooled.
The bear market is the perfect time to build new stuff. Prototype. Get first customers. Prepare for another bull cycle.
I wonder what autumn will bring us in the fintech/crypto space.
Hopefully - only good stuff.
Welcome to “Fintech 🤝 crypto” - episode #15.
Let’s go! 🚀
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Happened recently 👀
1) Metaverse housing bubble bursting. Virtual land prices crash 85% 💥 📉
Might be a shocker for many but the virtual real estate market is crashing. The trading volume dropped from its peak $1 billion in November 2021 to less then $160 million in August 2022. Who would have thought.
On the other hand, McKinsey’s consultants are predicting a $5 trillion market by 2030. These are really smart people, they can’t be wrong. I kid you not.
2) Crypto․com adds Apple Pay support in the US📱
If we want to onboard another million people to crypto, the exchanges need to step up their on-ramp game. Like Crypto.com did with this Apple Pay integration.
Interestingly, Crypto․com isn’t charging a higher fee for Apple Pay purchases –unlike other exchanges such as Coinbase. Instead, the service’s traditional card fee applies, so the customers pay the same 2.99% credit card fee regardless of whether they purchase via a linked card or via Apple Pay.
I predict this kind of mobile wallet integrations (e.g. Google Pay, Samsung Pay) will happen in the upcoming months across all major crypto exchanges.
Check out its smooth UX and payment flow:
3) Aave to launch overcollateralized stablecoin called GHO 🤔
Over the past three years, Aave has emerged as the leading decentralized lending platform.
Aave enables users to borrow and lend assets at algorithmically-defined rates, without the intervention or cost of a centralized lending facility.
So what is GHO? The GHO stablecoin will work similarly to DAI, the leading crypto-backed stablecoin. GHO is NOT an algorithmic stablecoin (like TerraUSD was). It is a crypto-backed stablecoin:
Why is AAVE launching GHO? Money! Having GHO means more revenue for funding the growth of the Aave ecosystem. With the GHO stablecoin the Aave treasury will collect 100% of the interest revenue paid by GHO borrowers.
4) The Reserve Bank of Australia to explore use cases for CBDC 🦘
Another country - this time Australia - starts working on CBDC.
The pilot project will last a year. More details will be published in the next months.
“This project is an important next step in our research on CBDC. We are looking forward to engaging with a wide range of industry participants to better understand the potential benefits a CBDC could bring to Australia.”
/ by Michele Bullock, the deputy governor of the Reserve Bank
My prediction (nothing crazy): CBDCs will go live in some countries faster than the mass adoption of BTC or ETH happens.
Great reads worth your time 📚
📘 BNPL has become an industry of meme stocks worth basically nothing (Adam Schwab)
Buy Now, Pay Later industry has imploded - that’s a fact. Klarna’s valuation is down almost 87%, Zip’s valuation is down 97% (sic!). Affirm’s market value has slumped from US$47 billion to US$5.7 billion in less than a year.
The author, Adam Schwab, thinks that BNPL companies are similar to the meme stocks. For some people this may feel like an unfair comparison but Adam gives some solid arguments why his thesis might not be that far away from truth.
📕 The alchemy of deposits (Patrick McKenzie)
When Patrick McKenzie publishes a new article about payments and fintech, you just go and read it. Period.
📙 Inside the 'mempool,' where crypto risks hide (Ben Schreckinger / Politico)
Super insightful piece about mempool - the “part” of blockchain of huge significance for most of DeFi projects. Why? Ben Schreckinger explains it thouroughly in his article.
Gold Tweets 🏅
1. Great thread explaining stablecoins. What they are, how they can be designed and why they matter so much fro crypto (DeFi) & finance (TradFi):
2. If you are down -95% from the top and looking for (potentially) promising new projects, here are some ideas:
3. The most crazy moments of the last bull cycle:
That’s all for now 👋
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And feel free to reach out to me on Twitter or Linkedin.
Stay curious,
/Pawel