Hong Kong Continues Tokenization Experimentation, Safe Proposes Fee Switch
Market Update
U.S. equities are relatively flat on the final day of trading for August, with the ^SPX -2.56% oscillating around $5,600 and the NDQ trading near $19,400. Rates and the dollar are gaining today despite PCE and Consumer Confidence data providing more assurance that inflation is receding. Crypto is underperforming, with BTC -3.29% falling to $58.5k and ETH -9.28% at $2,450, as ETF flows and spot volumes have been muted this week. Through yesterday, Bitcoin ETFs saw approximately $102 million in weekly outflows, and Ethereum ETFs saw outflows of about $18 million. After appreciating ahead of Nvidia’s earnings release this week, AI tokens have taken a hit, giving back much of their gains. TAO -8.32% , RNDR, and FET -16.33% have all lost approximately 20% this week.
HKMA Initiates New Tokenization Sandbox
The Hong Kong Monetary Authority (HKMA) has initiated a new sandbox program for Project Ensemble, a wholesale CBDC project, as they prepare to test new tokenization use cases within traditional capital markets. Wholesale CBDCs are designed for financial institutions for large interbank settlements or large-value transactions compared to retail CBDCs, which are designed for everyday payments and transfers. The sandbox program will focus on four key areas: fixed income and investment funds, liquidity management, green and sustainable finance, and trade and supply finance. The sandbox should pave the way for tokenization experiments for both interbank payment-versus-payment and delivery-versus-payment settlement. Banks and companies participating in Project Ensemble include the Bank of China, HSBC, Hang Seng Bank, Standard Chartered, Blackrock, and Franklin Templeton, among others. Project Ensemble was established in March as part of Hong Kong’s digital currency pilot, and the HKMA said it is seeing encouraging results and is excited to expand into new tokenization use cases to help transform the financial industry.
SafeDAO Proposes Fee Switch on Native Swaps
The Safe Ecosystem Foundation (SEF) has submitted a governance proposal to introduce a new licensing fee for any protocols utilizing Safe Wallet’s Native Swaps feature. Safe offers one of the premier multi-sig wallets within crypto, securing over $55.5 billion in assets and deploying over 10 million accounts. Native Swaps is a feature that allows for in-wallet swapping without needing to navigate to decentralized exchanges. The proposal suggests charging a fee on Native Swaps transactions, varying on the size of the swap. Fees would be used to purchase SAFE tokens on the open market and put into the DAO’s treasury. SEF projects that the fee would generate about $2.5 million in yearly fees for the DAO, also representing the DAO’s first revenue stream, enhancing SAFE utility, and improving the project’s economic sustainability.
Technical Strategy
Weakness over the past few days has resulted in a break of the minor August uptrend for Solana, and likely could drive prices down to challenge important support at $121 which has been tested three separate times since it was established back in April of this year. Trends remain near-term bearish over the last month as part of a neutral trend from March of this year. Until/unless 121 is violated, it’s right to consider the trend for SOL -5.71% to be neutral, not bullish or bearish. To reignite the SOL uptrend, a move back above $162 will be necessary which served as strong resistance last weekend. Overall, traders would look to buy dips near support at 121 and sell gains to 162, then 185 until evidence of this having been surpassed.
Daily Important Metrics
All metrics as of 2024-08-30 14:53:03 All Funding rates are in bps Crypto Prices
All prices as of 2024-08-30 13:31:38 Exchange Traded Products (ETPs)
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