This weekly roundup of stories from Mainland China, Taiwan, and Hong Kong makes an attempt to curate the trade’s most essential information, together with influential tasks, adjustments within the regulatory panorama, and enterprise blockchain integrations.
A lot like last week, China’s minor COVID flareups dominated the headlines because the nation seeks to keep away from extra severe lockdowns. Cryptocurrency managed to remain out of the information, which contemplating the regulation not too long ago, can solely be considered as a great factor.
A lot love for the layer-twos
On August 3, IOSG Ventures and Chainlink hosted the Demo Day of the Layer-Two Hackathon in Shanghai. The occasion aimed to help builders engaged on scaling options for Ethereum and was backed by main tasks reminiscent of Polygon, Close to, The Graph, and Matter Labs. The successful workforce, which gained bounties and mentorship, was a Synthetix-based asset administration challenge. The winners referred to as themselves ObjK and used querying know-how from The Graph to tug information from Synthetix, attaining an automatic cross-pool portfolio rebalance.
Layer-twos have at all times been well-liked in China, notably as customers really feel much less involved about custodial dangers and decentralization. Final week, OKEx formally launched OKExChain, which is an EVM-compatible layer-two community much like what different massive exchanges have launched.
That is of curiosity because of OKEx’s massive userbase, which ranks second solely to Binance when sorted by quantity. Layer-two networks launched by exchanges typically lack a few of the technical strengths of the devoted layer-two networks however have a large benefit in entry to customers, property, tasks and communities.
OKExChain was proof of this because it amassed over $2 billion in property within the first week. About $350 million of that’s on AMM CherrySwap, which seems to be fairly liberally based mostly on BSC’s PancakeSwap. That TVL would rank across the thirtieth largest DeFi app on all networks, across the dimension of OlympusDAO on Ethereum and BakerySwap on BSC. KSwap, one other AMM platform on OKExChain, racked up over $684 million in 24-hour commerce quantity on Thursday, which places it second behind Uniswap V3 for the busiest dApp within the trade. In fact, the problem might be on the purposes and community to keep up these early numbers after the beneficiant APYs have been lowered to extra sustainable numbers.
Monitoring adoption elsewhere
Regardless of declining DEX buying and selling quantity on each BSC and Huobi Eco Chain, BSC not too long ago noticed an explosion in exercise round CryptoBlades, an NFT sport that accounted for greater than thrice the transaction quantity of the whole Huobi Eco Chain on Thursday.
Finally, for chains like Huobi ECO or OKExChain to compete with different layer-two networks, they have to discover a method to recruit distinctive app builders to their ecosystems, quite than counting on ports or forks from different networks. As Axie Infinity has proven, any blockchain community can change into loaded filled with transactions and customers if the suitable software is deployed on it.
China’s personal shadowy super-coders
In accordance with a Chainanalysis report, greater than $2.2 billion value of cryptocurrency had been despatched from Chinese language wallets to addresses related to illicit exercise within the two-year interval between April of 2019 and this summer time.
The majority of that is associated to the notorious PlusToken ponzi scam that occurred in late 2019. Since then, the variety of addresses partaking in scams and criminality has shrunk dramatically, indicating that Chinese language clampdowns are having some affect on shopper protections.
Regulators appear to be taking satisfaction of their victories, as evidenced by an article from a Individuals’s Financial institution of China working convention final week, the place the digital foreign money crackdown was talked about in a listing of 2021 efforts up to now.
Tech giants eyeing up the NFT house
Crypto firms aren’t the one ones feeling the wrath of Chinese language regulators as of late. Over the previous week, hundreds of billions of dollars have been wiped from Chinese language tech shares together with on-line schooling, supply, and video gaming.
Tencent, which invests in numerous main sport publishers, suffered a greater than 17% drop in inventory value this month alone. Nonetheless, that didn’t cease it from saying this week that it would release an NFT trading platform that roughly interprets as “Magic Core”. Third events can reportedly launch NFT paintings on the platform, and it’s designed by simply one in every of a number of groups inside Tencent which can be creating NFT associated providers. Attributable to China’s strict regulatory insurance policies, many of the NFTs launched by the most important web firms are constructed on non-public chains or consortium chain know-how. Alibaba also launched an NFT platform in late June.