Macro

At the close of the FOMC meeting on the 14th of December 2022, the committee decided a 50 basis point increase in the policy rate. The primary aim is to get inflation to the desired 2% level. However, the projections included along with the statement demonstrate that this might be achieved in 2025. Furthermore, the projections point to a rise in unemployment followed by a steady decrease to 4%, and the CPI data from November showed an inflation increase of 7.1% over the past year.

Networks & Protocols

Raydium, a Solana-based AMM DEX, reported that a malicious actor exploited the Raydium Liquidity Pool V4’s authority account by gaining access to the Pool Owner (Admin) account. Read more here.

Over the course of the week, Flashbots’ share in the MEV Boost Relay market continued to fall (currently at 74.30%). However, the new player Agnostic Relay saw a surge in its market share.

CeFi

Meta announced that its Anonymous Credential Service (ACS) is now open-source in the hope that it will lead to faster progress being made in de-identified authentication.

The Bahamian authorities arrested former FTX CEO Sam Bankman-Fried, and he’s charged with eight counts of fraud and conspiracy by the Department of Justice.

Venture Activity

This week experienced a spike in venture capital activity to the tune of $494.85 million, an impressive 308% increase since the previous week. The lion’s share of this amount comes from the combined $400 million raised in Amber Group’s Series C ($300 million) and Aztec’s Series B ($100 million). Reports are circulating that Amber’s raise is a debt-to-equity swap, although this is yet to be confirmed. Not to be forgotten, Nillion, a project D-Core recently researched, pulled in a $20 million round.

So far this month, 38 deals have resulted in $689.70 million raised for projects.

Although the market conditions remained subdued, the weekly deal flow remained relatively steady. This trend is a promising sign that suggests the industry is taking steps in a positive direction.

Seed rounds were the most popular, followed by Series A rounds.

Venture activity was seen across all six broader sectors, though GameFi saw a decrease after three weeks of notable activity. On the other hand, the NFT sector experienced a resurgence, and CeFi sustained its momentum.

Metaverse & NFTs

The Sandbox recently announced that Forbes has partnered with them to bring an interactive multiplayer experience to the metaverse. The announcement noted that users could look forward to an exciting party atmosphere there.

Regulatory

The New York State Department of Financial Services (NYDFS) issued guidance to all New York banking organizations stating that New York banking organizations seek approval from the NYDFS before engaging in a new or significantly different virtual currency-related activity. The institutions under this guidance should inform the department a minimum of 90 days before the intended commencement of the activity.

The Basel Committee on Banking Supervision made public their final standard, “Prudential Treatment of Cryptoasset Exposures,” which will come into effect from the 1st of January 2025. The document outlines how banks should handle their cryptoasset exposure. Further information can be found in the BIS publication.

Japan will ease tax for crypto issuers, who are currently charged 30% corporate tax. The new rules will be forwarded to parliament in January 2023.