Survive and Thrive
Market Meditations | July 5, 2022
If you survive crypto’s nuclear winter, what remains on the other side? Upon finally leaving the cave, you might just find that there is a new balance of power in place… for it is the early bird that catches the worm.
- Lots of crypto lenders and exchanges have been bitten this year by offering credit lines to counterparties running high-risk practices.
- Double-digit returns must come from somewhere, and it is likely that at the end of the chain of borrowers was a high-risk DeFi application or leveraged trade.
- Singapore-based firms are some of the hardest hit, the most notable example being 3AC, but also smaller companies like crypto exchange Vauld, which froze withdrawals yesterday.
- For companies in stronger positions, they can not only survive but thrive in the fallout.
- Nexo has been working with Citibank since last month to advise on how to sweep up some good deals through acquisitions.
- Today they signed a term sheet with Vauld to start due diligence with a view to buying up to 100% of the firm.
- Others like Binance and FTX / Alameda are also looking to consolidate their powerful positions by continuing to hire and invest in different parts of the market.
As the market resets, one cannot help but wonder whether this further centralisation of crypto is what Satoshi envisioned. The king is dead – long live the king.
