We the 'People'

Good morning. Today we learn about DAOs, get some heartburn looking at the market's performance, and even get a bit of a history lesson.

What this is:
A "Top 5" of crypto, digital asset, and other blockchain related news sent to your inbox on a daily basis

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Top 5:

1. What Is A DAO—And Why Is One Trying To Buy The U.S. Constitution?
   We the People, in order to purchase the only remaining copy of the U.S. Constitution, do ordain and establish this decentralized autonomous organization (DAO). To get slightly more technical, a DAO "is an organization represented by rules encoded as a computer program that is transparent, controlled by the organization members and not influenced by a central government. A DAO's financial transaction record and program rules are maintained on a blockchain." Thank you, Wikipedia. Today, the biggest DAO news relates to a group of friends out of Atlanta that have started Constitution DAO in an effort to purchase the last known privately owned copy of the U.S. Constitution. The effort, which kicked off just a few days ago, has already raised $5.8 million (as of this writing). Contributors to the DAO receive tokens referred to as "People" in exchange for their contribution. These "People" or tokens confer the right of the holder to vote in DAO related decisions (e.g., what to do with the Constitution if they win the auction). If you'd like to contribute or check out current fundraising levels, click here. The auction will occur this Thursday at Sotheby's.
   
2. Bitcoin Price Briefly Drops Below $60,000 as Strong Dollar Weighs on Crypto
   It's been a rough couple of days for many crypto investors, with price pullbacks of 10% or more across the most popular assets. As of Tuesday night, Bitcoin and Ethereum are down ~13% and ~14% respectively, both coming off all time highs earlier this month. Some analysts are pointing to broader market risks like an uptick in COVID cases and inflation concerns that may be driving investors out of crypto and into more traditional safe havens like gold and the U.S. dollar. On Tuesday, the WSJ Dollar Index, which measures the dollar against a basket of other currencies, reached its highest level since July 2020. The strength in the dollar may also point to an assumption from investors that the Fed will be forced to raise interest rates in order to respond to inflation concerns. Higher rates on safer investments could impact demand for cryptocurrencies, where many investors have flocked in search of higher yields.
   
3. China’s NDRC to Consider Punitive Electricity Prices for Crypto Mines
   China’s National Development and Reform Commission (NDRC) is calling on local governments to help crack down on crypto mining in their jurisdictions. The NDRC may implement “punitive electricity prices” for crypto miners that are paying residential electricity rates. The current crackdown will focus on industrial scale mining organizations and state-owned entities that are mining cryptocurrencies. Over the weekend, Xiao Yi, a top Communist Party member, was fired, expelled from the party, and is likely to face criminal charges over his support for crypto mining, the party’s anti-corruption watchdog said.
   
4. Valkyrie to Launch $100M ‘On-Chain DeFi Fund’
   Valkyrie Investments is launching an On-Chain DeFi fund on Nov. 22. The fund's assets will be, as the name suggests, held on-chain which differentiates it from existing DeFi funds in the market. Valkyrie asserts that by holding assets on-chain they will be able "to participate in the [price] upside while also gaining additional yield from lending, liquidity pools, farming and staking in the DeFi ecosystem." Of course, by participating in the DeFi ecosystem they also introduce additional risk to investors. “We see a lot of opportunities on blockchains including Ethereum, Avalanche, Solana, Binance Smart Chain, Matic, and Fantom,” says Valkyrie’s Managing Director of DeFi, Wes Cowan.
   
5. Something to chew on...
   In the below tweet, Caitlin Long, founder of Avanti Bank and former Morgan Stanley Managing Director, questions the risk-reward tradeoff provided by stablecoin lending. The article referenced below can be found here and goes in depth on risks associated with stablecoins like business collapse, asset runs, hacks, and/or tech failure. I highly recommend giving Caitlin a follow if you don't already.

Top Sharers of the Crypto Top 5:
1. Cameron S. - New York, NY
2. Jake Y. - Greenville, SC
3. Lauren A. - Nashville, TN

Disclaimer: The information contained in this newsletter shall not be understood or construed as financial advice. I am not an attorney, accountant or financial advisor, nor am I holding myself out to be, and the information provided is not a substitute for financial advice from a professional who is aware of the facts and circumstances of your individual situation.