Finance Redefined is your weekly dose of essential Decentralized Finance (DeFi) insights. This newsletter was created to highlight the most significant developments in the past week.
Celsius’s financial woes got worse as a new report on the coin showed that Celsius had a $2.85 billion balance gap, which is more than twice what it reported in its bankruptcy filing. Aave ( AAVE), urged community members to join the Ethereum proof-ofstake (PoS ) Merge.
Coinbase CEO stated that the exchange would prefer to end its staking services rather than implement regulatory compliance on-chain. This week saw another depeg in the crypto market, as the Acala ecosystem lost its native stablecoin.
A sudden drop in price towards the end of the week saw most DeFi tokens register a seared red and fall in double digits according to the weekly charts.
Report by Celsius Network shows that there is a $2.85 Billion balance gap
The bankruptcy report for Celsius, a troubled crypto lender, was filed Aug. 14. It shows that Celsius’s actual debt is $2.85 Billion and its bankruptcy filing claims of $1.2 billion.
According to the latest report, net liabilities of $6.6 billion are shown and total assets under management is $3.8 billion. The firm filed for bankruptcy in September and showed assets of $4.3 billion against liabilities of $5.5 billion, a deficit of $1.2 billion.
Coinbase would prefer to stop staking than allow on-chain censorship — Brian Armstrong
There has been growing concern about whether or not crypto service providers will choose decentralization over censorship in light of the recent Tornado Cash ban and subsequent arrest for the Tornado Cash developer.
Brain Armstrong, Coinbase’s CEO, answered the question “Would Coinbase or others” and chose to comply with compliance requests, impose protocol-levelcensorship, or shut down staking service.
Another depeg: Acala trace reports reveal 3B aUSD incorrectly minted
In 2022, high-profile security incidents will continue to be a major theme. The Acala network joins a long list stricken platforms that fall prey to exploits.
After its launch on August 14, the Acala USD (aUSD token), which acts as a native stablecoin in the Polkadot, Kusama and Kusama Blockchains, its value plunged 99% due to a misconfiguration within the iBTC/aUSD liquidity pools. Acala’s initial estimates indicated that 1.2 billion USD was issued without collateral. This led to the token’s value plummeting from its 1:1 peg with the United States Dollar to $0.01.
Aave urges members to join the Ethereum PoS chain
Aave token owners were asked to participate in an Aave Response for Comment (ARC), which would require them “commit” Ethereum’s Proof-of-Stake (PoS) consensus.
In light of Ethereum’s upcoming transition from proof-of-stake to cryptocurrencies, the ARC was proposed on August 16. The ARC requires members to choose the Ethereum mainnet under PoS consensus to be the new “canonical” governance structure. It also gives power to a authority to stop any Aave deployments using any other Ethereum forks.
Overview of the DeFi market
Analytical data shows that DeFi’s total locked value remained mostly unchained over the past week due to the market dip towards the end. The TVL value was $66.21 billion. Cointelegraph Markets Pro and TradingView data show that DeFi’s top 100 tokens according to market capitalization experienced a bearish week with many tokens suffering double-digit losses.
Gnosis (GNO), the sole token to trade in the green on the weekly charts was Gnosis (GNO), the rest registered double-digit losses in the past week.
We are grateful that you have read our summary of the week’s most important DeFi developments. For more information, insight and education on this rapidly changing space, join us next Friday.