Trakx Weekly Update: July 24, 2023

Key Crypto Market Figures

CTIs Weekly Performance

After the previous week’s XRP-induced pop in crypto prices, calm once again descended on crypto prices with the Trakx Top10 Crypto CTI barely changed over the past seven days. The best performers were the Top10 Defi CTI, which rose 7% w/w, followed by the Interoperability CTI, which gained 6%. The weakest performer was the ESG CTI, which slipped 2% over the week.

Helping to propel both the Top10 Defi and Interoperability CTIs was a 15% rally in the Chainlink (LINK) token, a gain triggered by the release of their Cross-Chain Interoperability Protocol (CCIP) on its Mainnet. CCIP allows a standard communication system between different blockchains and aims to increase security and improve data transfers. Given the well-recognized blockchain trilemma, rising crypto adoption and the need for greater scalability means secure interoperability protocols are likely to face robust demand in the future.

Also providing a boost to the Top10 Defi CTI was a 10% rally in Maker, after the Defi lending DAO deployed a buyback scheme (Smart Engine Burn) that uses excess DAI stablecoins to purchase MakerDAOs governance token. While this latest development is clearly a positive step, as outlined in a recent blog post – see below - the Defi lender is likely to face some regulatory hurdles in relation to its recently launched lending programmes for tokenized RWA.

Finally, on the topic of regulation, the Financial Stability Board – one of the regulatory bodies tasked last year by the G20 to provide guidance on crypto legislation – released their framework, which included nine top-level recommendations. The overarching principle outlined in the report is “same activity, same risk, same regulation”, indicating that crypto-assets will be treated by global regulators in much the same way as tradfi assets.

Sources: Trakx, Coingecko, Alphavantage

Market Trends

• Chainlink rallies hardest since May 2021 after CCIP release: Blockworks.
• MakerDAO’s MKR Soars 28% in a Week as Token Buyback Scheme Goes Live: Coindesk.
• RFK Jr. Vows to Back Dollar With Bitcoin, Exempt BTC From Taxes: Coindesk.
• Celsius Network reaches settlements to exit bankruptcy: Cointelegraph.
• Sam Altman’s Worldcoin Crypto Project Officially Launches: Bloomberg.
• G20 Body Issues 9 Regulatory Recommendations to Rein in Crypto Industry: Decrypt.

Trakx News

• Lionel Rebibo, Yann Le Floch and the Trakx team attended the EthCC6 conference in Paris.
• Ryan Shea published: “Tokenization: The next big thing in crypto” examining the impact of digitizing tradfi financial assets. He also released a video presentation "Crypto Oulook: Boom, Bust, Next?" looking at the macro drivers which will influence how crypto prices evolve from here (English audio with French subtitles).

Trakx CTIs Performance

Sources: Coingecko and AlphaVantage

*Return of bitcoin is calculated since 01/05/2020, while CTIs performances were calculated since their respective launch date.
**Includes simulated performance.
***The risk signal is determined according to the historical volatility level, the higher the riskier.