Huobi Ventures Weekly Report #33

Huobi Ventures Weekly Insights

Insight provided by Julietof Huobi Ventures

What is happening in crypto industry and what what can we expect ?

Since March this year, affected by the global interest rate hike policy led by Fed, the Russian-Ukrainian war and the repeated outbreaks of Covid-19, the prices of many assets in the world have experienced price drop, the price of USD and commodities such as oil and agricultural products continue to rise. In Crypto, the total supply of stablecoins continued to decline since the beginning of March, reflecting the continued outflow of funds from crypto. The total supply of stablecoins fell 0.4% this week, showing that capital keeps fleeing this high volatile industry.

Source: Dune@hagaetc, https://dune.com/hagaetc/stablecoins

Two sensational black swan incidents happened in Crypto recently came from Terra and Stepn. After the de-peg of UST and USD, Luna and UST suffered massive short selling, which led them to Luna/UST death spiral. However, this week Stepn announced that they would withdraw users from China, which resulting in a price drop immediately and may causing a large negative impact on their income in the long run. The above macro and micro events and factors accelerated the arrival of the bear market, with Bitcoin falling below $30,000 and Eth falling below $1,800 this week.

However, what are we going to do in this bear market? In my opinion, a potential opportunity lies in the NFT financial protocol. With the decline of liquidity in the market, the liquidity shortage will have a larger impact on NFTs since NFTs are Non-Fungible Tokens. How to activate the liquidity of NFT assets will become one of the most promising research topics. Now there are some NFT financial tools, including p-p/p-protocol lending, leasing, fragmentation products, etc., but the reality is that they have little effect on the improvement of liquidity in the market, which means they haven’t solved the core problem yet. I look forward to see disruptive and innovative products which can indeed improve the liquidity of NFTs developed, and at the same time, NFT-Oracles which provide more accurate prices and prevent price gouging are also highly expected in the future.

About Huobi Ventures

Huobi Ventures is focused on growing its venture investment portfolio and supporting blockchain projects through long-term investment strategies.Huobi Ventures aims to identify strategic opportunities across different blockchain verticals to complement and expand Huobi’s product offerings. Acquisitions will be integrated into Huobi’s growing suite of blockchain-enabled applications and services to expand the business into new markets.

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Huobi Ventures

Huobi Ventures

Focus on Huobi’s venture investment portfolio and supporting innovative blockchain projects through long-term strategies. Twitter:@HuobiVentures