Stablecoins were adding $100M in market capitalization nearly every day back in June 2020. When expressed in big picture terms, the cumulative market capitalization rose from $9.4B in June 2020 to $35.4B in January 2021.

On the contrary, DeFi projects’ TVL hiked by over 2500% from June 2020 to January 2021. Now, though DeFi projects’ TVL has risen by over $25B in 1 year, the sustainability of the entire sector may be in question.

Source: DeFiPulse

As algorithmic stablecoins enter what may be termed as a “death spiral,” they are throwing in coupon upgrades and new farming incentives at it as a last-ditch attempt to hold on to the market capitalization. The challenge here is that these short-term fixes signal a drop in the sustainability of these projects in the long-term.

It should be noted, however, that the sustainability of DeFi projects was not a concern throughout 2020. DeFi supported Ethereum’s long-term price rally in the market cycle, and the perception was that DeFi projects are here to stay. In fact, some hold this opinion in the year 2021 too, with Dan Morehead of Pantera Capital recently tweeting on the growth of DeFi projects,

We’re v. bullish #Ethereum & #Polkadot. Even more bullish DeFi projects built on them.

Non-bitcoin+ethereum share has grown from 16% to 21%. That’s where largest gains are likely to be in 2021.

Pantera Liquid Token Fund is long 62% non-bitcoin+ethereum.https://t.co/0PxBUIvmjV pic.twitter.com/3aD7l0Ytuf

— Dan Morehead (@dan_pantera) January 26, 2021

It’s interesting that Pantera is bullish on DeFi projects largely since they are built on Ethereum. This has become a cycle now. DeFi projects get investment flows and investor interest since they are built on Ethereum and increasing TVL in DeFi helps Ethereum’s price rally and thus, the cycle goes on.

DeFi is like a plug and play element of the cycle, even with the rising TVL. It is entirely possible that DeFi projects may lose the flow of investments when Ethereum’s price rally comes to a halt or stops. Since it is a cycle, DeFi projects’ sustainability will be tested and it may turn out that only 20% of all DeFi projects are highly sustainable while the remaining 80% are masquerading without real utility and use case.

This would make these projects no different from the hundreds of altcoins in the crypto-market. Overall, the longevity of DeFi projects is an important question for an altcoin trader building a portfolio or updating one. DeFi’s growth may not be as sustainable as expected, but they are the rage due to an increasing number of use cases and the increasing price of Ethereum.

AAVE started at $57 in 2021 and was trading at $270.71, at press time, having hiked by over 440% on the charts. SUSHI was up 164% and UNI was up 167%, while SNX and LINK gained by over 100% in 2021. Less popular DeFi projects have offered three-digit returns in 2021 and this marks the beginning of the DeFi rally. In 2021, the TVL may increase further and investment flow from Bitcoin and Ethereum may pour into DeFi projects. Sustainable or not, DeFi projects may be heading towards a short top, before corrections set in.

Source: https://ambcrypto.com/how-sustainable-are-defi-projects/

eToro faced some technical issues today on 27 January. Several users took to Twitter to complain that they were unable to use the app. This was later confirmed by the eToto team which acknowledged the matter and said on Twitter: 

We’re aware that some users are unable to close positions on eToro.

We’re aware that some users are unable to close positions on eToro.

We’re working to resolve this issue quickly & in the meantime, you may close existing positions via https://t.co/ydRIghscm7

We apologize for the inconvenience and thank you for your patience.

– The eToro Team

— eToroService (@eToroService) January 27, 2021

However, this did little to stop people from complaining about the outage. One user even claimed of suffering losses. He took to Twitter and said that because he could not open any positions on eToro, it cost him “hundreds by not being able to close.”

Some Twitter users also claimed that other than eToro, several other platforms were down. Users said that Revolut and Trading 212, had actually suffered a crash which disrupted their trading services. However, the trading apps have not officially provided a reason or acknowledged the issue.

Reports also stated that earlier today that crypto trading app Robinhood suffered a “major outage” and that it experienced “issues with crypto trading” at 9:49 a.m. EST. However, at press time, all systems are operational according to the Robinhood website. 

Bitcoin was trading at $30,405 at press time and has been down by 4% on the daily time frame.

Source: https://ambcrypto.com/when-bitcoin-went-below-30k-etoro-and-robinhood-faced-technical-issues/

“This XRP coin is all or nothing,” noted Jeremy Hogan of the law firm Hogan & Hogan, with the legal practitioner becoming just the latest to comment on the SEC’s lawsuit against Ripple. Hogan, who claims to have studied the lawsuit in detail since December, is in the news after he asserted that if the lawsuit goes in Ripple’s favor, then it will be a “conservative estimate” to assume XRP’s price would go up by 2-3 times by the time it ends.

Alternatively, Hogan also claimed that XRP might drop to zero if litigation ends poorly and the SEC hinders Ripple’s ability to fund operations entirely, forcing Ripple to shut down.

This situation is unlikely, however, given the fact that Ripple is a technology company that does not rely too heavily on physical assets to run its operations. In the worst-case scenario, Ripple can expect significant disruption to its business model and it might have to stop dealing with U.S-based investors, while also considering incorporating itself overseas.

Hogan wasn’t done, however, with the attorney going on to add,

“In my opinion, the upside to XRP, especially in the short-term, greatly outweighs the downside by at least 2-3 times.”

The popular attorney also suggested that XRP’s price has been artificially suppressed by the current lawsuit against Ripple. According to Hogan, whatever the conclusion is, it won’t be a ‘death blow’ to Ripple.

“My conclusion is that the most likely outcome of the SEC lawsuit would be a settlement involving a large fine or penalty for sales from 2013-14 and maybe 2015 and some sort of control or limitation on the sale of the escrowed XRP.”

Before Hogan, Gabriel Shapiro, Partner at BSV Law, was the latest to comment on the future prospects of Ripple. He suggested that if Ripple were to become an SEC reporting company, XRP could redeem itself. Although this would kill the utility of the digital asset XRP, he claimed that there will still be ways to generate value from XRP.

Interestingly, Ripple execs have often cited “regulatory uncertainty” in the U.S to be a concern, and have even discussed relocating overseas to overcome this issue.

It is fair to assume that the market has already priced this into the price of XRP, suggesting that if Ripple comes out on the right side of the lawsuit, it would essentially remove all the uncertainty that’s been hanging over XRP for years now.

Source: https://ambcrypto.com/xrps-price-being-artificially-suppressed-by-lawsuit-claims-lawyer/

UAE-based LuLu Exchange is in the news after it announced its partnership with Ripple and India’s Federal Bank to facilitate faster cross-border payments from UAE to India.

We are proud to announce our partnership with Ripple and Federal Bank to enhance real-time payments from UAE to India that are faster and more affordable than ever before. Step into any of our 76 branches in the UAE or call 600 5222 04 to know more. #ripple #luluexchange @Ripple pic.twitter.com/VoCcycce92

— LuLu Exchange UAE (@LuLuExchange) January 26, 2021

The partnership between Ripple and Federal Bank, a leading Indian private bank, has long been rumored, with an official disclosure released by the Federal Bank doing the rounds too. However, this is perhaps the first time a partnership of such a tripartite nature has been announced, especially one involving an Indian bank. Interestingly, the disclosure in question said,

“This partnership will help Federal Bank to explore new corridors where Ripple is aggressively pursuing new partnerships.”

Using RippleNet, cross-border remittances are expected to be significantly faster and more secure, an incredible development, especially in light of the high remittance volume between India and the UAE.

The same was recently highlighted by Asheesh Birla, General Manager of RippleNet, after he revealed that the APAC region remains Ripple’s busiest region for customer demand and transaction growth. In India alone, Ripple is working with 3 out of the 5 major banking players, with the rapidly growing MENA-India corridor likely to become Ripple’s largest one so far.

India is the world’s top receiver of remittances, with the country’s share in global remittance volumes often climbing as high as 12% in the years past.

The UAE alone accounts for over $13.8 billion in remittances to India, ranking number one amongst all the countries in terms of inward remittances to the nation. Ripple is the first company to provide a blockchain-enabled solution to the country’s remittance market.

Further, according to previous reports, 20% of all transactions on Ripple’s On-Demand Liquidity (ODL) platform used XRP as a bridge currency on RippleNet.

It should be noted, however, that it is unclear whether RippleNet will make use of Ripple’s native crypto-asset XRP to facilitate these cross-border transactions.

Source: https://ambcrypto.com/ripple-targets-uae-india-corridor-with-lulu-exchange-federal-bank-partnership/