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Silicon Valley Bank collapse: Crypto firms caught in the fallout
Bank-free, decentralized future for finance, Musk’s anti-woke AI, plus more metaverse stories today
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The shuttering of Silicon Valley Bank (SVB) has sent shock waves to the cryptocurrency world, as a number of crypto companies have signaled their exposure to the collapsed bank that has built a reputation for lending to some of the world’s biggest tech startups.
Here’s a quick lowdown:
SVB’s stock started to spiral late Wednesday following rumors of an acquisition bid after failing to raise sufficient capital to satisfy its obligations.
VC funds reportedly advised clients to withdraw their fund, leading up to $42B in withdrawals Thursday, forming a bank run.
The bank’s closure Friday by California’s Department of Financial Protection is deemed the second-largest bank failure in US history since the 2008 global financial crisis.
The SVB closure mostly wrought havoc on VC firms and tech startups, but crypto firms weren’t spared.
From BlockFi, Circle, Avalanche, Yuga Labs, to Proof, here’s a running (and constantly updated) list of the crypto firms caught in the SVB fiasco.
Still on the subject of banks and finance, a report launched Friday by global asset management firm Bernstein announces that “new wealth creation and financial-services innovation will move to a new financial app universe on the Ethereum ecosystem.”
While banks will still exist, it will do so in the background as “custodians of old wealth.”
Some estimates and predictions from the Bernstein report:
By 2028, bank-free DeFi will have revenue of $40B and total assets will grow to $1 trillion from about $65B today.
There is a likely $5 trillion in assets over the next decade due to rapid adoption.
Next-gen DeFi will be built on a layer 2 network that’s scalable with 95% lower transaction costs and products that generate real revenue and sustainable yields rather than being driven by token incentives.
How does this take on the future of $$$ make you feel?
Multibillionaire and Twitter CEO Elon Musk isn’t the most eager fan of AI, even as it makes waves across industries and disrupts every possible conduct of life and business today. While a co-founder of OpenAI, the startup that created ChatGPT, he left in 2018 over disagreements in AI development strategies and to refocus on his Tesla and SpaceX ventures.
Musk’s AI pronouncements include:
AI being the “greatest threat to humanity,” with a Terminator-like outcome.
AI as “potentially more dangerous than nukes”
AI as “one of the biggest risks to the future of civilization,” as “both positive or negative — it has great promise, great capability but also, with that comes great danger”
AI being one of the three biggest threats to humans: its unchecked growth, the declining global birth rate, and religious extremism
Pushing for AI moderation, Musk recently has been taking an active role to develop AI amid increased demand for the tech. He is reportedly recruiting AI researchers and developers - most prominently ex-Google DeepMind AI unit researcher Igor Babuschkin - to build a ChatGPT rival.
Likely a version that “would not be woke,” Musk’s concrete vision of AI remains to be seen.
Following its clear intentions of dominating the metaverse via K-pop entertainment and similar investments, South Korea is pouring 27.7B Korean won ($21M) into local services looking to utilize the metaverse, following a previously announced $30M metaverse fund to assist startups in the space.
The $21M investment is allocated to 12 projects in healthcare, education, tourism, and other sectors, while the $30M fund will encourage smaller entities to actively seek M&As and expand to the global market.
As early as February 2022, the entertainment powerhouse already invested some $185M to cultivate its metaverse ecosystem, followed by a slew of metaverse projects from both the private and public sectors.
🏃♂️ Quick Hits
🎮 Gaming
Community members of crypto collectibles game Aavegotchi are voting on whether to end a roughly 2.5-year contract sale of its native GHST token, a move that can stop the token’s supply from increasing further and support the ecosystem’s development. (Link)
Bitcoin game developer THNDR Games is releasing P2E mobile game Bitcoin Blocks. (Link)
Web3 gaming studio Games for a Living (GFAL) partners with Seedify, Enjinstarter, and Bit2Me for its initial game offering (IGO), then a listing on centralized and decentralized exchanges such as Gate.io Bitmart and Pancakeswap. (Link)
Virtual property game Upland has emerged as the top decentralized app on the freshly reinvigorated EOS blockchain. (Link)
Payment service provider Worldline launches a shopping mall in Decentraland to enable companies across industries worldwide to enter the metaverse. (Link)
🕶 Fashion
Why Puma pushes further into web3, including its upcoming, 10,000-strong PFP NFT project for its 75th anniversary. (Link)
The waning interest in the metaverse could be heralding a new direction for digital fashion - here’s why. (Link)
Singaporean label Charles & Keith brings its spring/summer collection to The Sandbox via virtual space CHARLESKEITHHAUS. (Link)
Thanks to AI algorithms and machine learning, realistic virtual clothing can be easily generated for users' avatars and let people play around with VR. (Link)
Fashion has flirted with basic AI and the metaverse, yet so far has little experience with generative AI. (Link)
Clothing simulation tech company z-emotion launches zeavric, a 3D fashion design studio for characters, garments, AR environments and more. (Link)
🏀 Sports
Fantasy sports game Ultimate Champions’ basketball game, featuring the Turkish Airlines EuroLeague and the 7DAYS EuroCup, opens for registration. (Link)
Community remains the holy grail for the metaverse - and amid the crypto winter, people in sports still love to sell scarce digital assets, which NFTs essentially are. (Link)
Lamborghini concludes its 7-month Epic Road Trip NFT run with a 60th-anniversary digital collectible and special airdrops. (Link)
Designed for Meta Quest 2, TrueTennisVR is a tennis simulation software that recreates the hitting experience. (Link)
Welcome to the era of Fan Controlled Football. (Link)
🎥 Media & Entertainment
Planet Hollywood and Animoca Brands will launch a members-only NFT club in LA. (Link)
Web3 music platform Audius implements NFT-gating for exclusive artist access, following news of Spotify’s release of token-gated playlists. (Link)
Discover WAVE, a DJ based within the metaverse and whose recently-released album included tracks composed for the automotive giant Kia. (Link)
Peek into the entertainment zone of the Landian metaverse, which promises unlimited fun and interaction in a shared virtual universe. (Link)
Here’s how 5G is democratizing the fan experience. (Link)
Metaverse platform Rec Room showcases the Rec Rocks music festival, which presents five immersive concerts each day in a virtual environment. (Link)
The forthcoming EU metaverse policy “cannot shy away from cybersecurity,” an expert warns. (Link)
🖼 Art
NFT company Palm teams up with Pussy Riot to foster activist art, including curating a feminist art contest through the PALM DAO. (Link)
Through Polygon-based Starbucks Odyssey, Starbucks is serving up its first premium NFTs at $100 a pop. (Link)
The gentlemen aren’t buying it - GQ Magazine’s NFT drop flops and now sells for about half the original price. (Link)
Could MissJourney's AI alternative, launched on IWD 2023, break the gender bias barrier? (Link)
Wormhole launches the Aptos NFT bridge, allowing NFT transfers between Aptos Network and other chains without double-wrapping. (Link)
The Gitcoin Presents NFT collection takes top spot on OpenSea, the collection soaring based on its link to Ethereum co-founder Vitalik Buterin. (Link)
🤖 AI
AI-powered photo and modeling studio Deep Agency believes it could make modeling more accessible, with 100% AI-generated models, scenes, and outfits. (Link)
While OpenAI already disrupts the world while Google is integrating almost all of its tech and platforms with AI, why in the world would Meta lag behind? (Link)
It looks like Gen Z dating app Snack lets your AI-trained avatar go on dates so you don’t have to. (Link)
The latest cool kid on the block in generative AI? Productivity apps. (Link)
AI is as big as the agricultural revolution or the industrial revolution, says Sir Peter Gluckman. (Link)
AI is booming, and so is its carbon footprint. (Link)
AI-focused CryptoGPT, a ZK layer 2 blockchain, issues its own token listed on Bitfinex, Bybit, Bitget, and four other exchanges. (Link)
💸 Funding & Partnerships
3D modeling company Hexa raises $20.5M to enable businesses to upload their inventory in 3D into the metaverse. (Link)
Digital art platform Wildxyz raises $7M in seed funding to expand its residency program and community surrounding NFT art. (Link)
Metaverse platform Africarare partners with nonprofit Innovation Africa to deliver clean drinking water to the continent. (Link)
The TON Foundation, a nonprofit association of developers and enthusiasts advancing The Open Network (TON), has closed a seed round of $1.5M. (Link)
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All content on this newsletter is for informational purposes only and does not aim to serve as or replace expert investment advice.
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