What's Driving Token Prices? March 27, 2024

KCS (-20%) - Yesterday, the Southern District of New York charged the two founders of the crypto exchange, Kucoin, with violating the Bank Secrecy Act. The exchange is charged with lying to federal investigators about serving U..S customers. It is also accused of not instituting an Anti-Money Laundering (AML) program until 2023 and receiving millions of dollars from Tornado Cash. This is another crackdown by U.S. law enforcement on crypto exchanges, with similar charges levied against Binance last year. Since the news broke yesterday, $600m have flowed out from the exchange.
FTM (-2.8%) - Layer-1 blockchain, Fantom, announced the launch of its new technology, Sonic, which promises to speed up and process blockchain transactions at far greater speeds than are currently available. Fantom has experienced a lot of turmoil over the past couple of years, from the hack of its main bridge Multichain, to its founder, Andre Conje, quitting the project. The new upgrade and functionality promised by Sonic could potentially create relevancy for Fantom once again.
FXS (+5.8%) - DeFi project, Frax, released a governance proposal last week detailing revenue generation strategies for Frax. It proposes distributing 50% of the revenue to stakers of FXS (Frax’s governance token) and the other 50% to buy back FXS and add liquidity to Frax assets in the open market. Frax previously used a mix of stablecoins and FXS to back the FRAX stablecoin, however, following the collapse of LUNA and UST in 2022, the team pivoted to a fully-backed stablecoin. Therefore, any revenue generated was redirected from token holders to create full backing for the stablecoin. This week, the collateralization ratio reached 100%, which means the FRAX stablecoin is now backed 1:1 with redeemable assets, allowing the team to return to focus on revenue generation. The proposal is currently up for a vote and ends on Saturday.
BADGER/LDO (+56%/+17%) - DeFi projects, Lido and BadgerDAO, launched a new product that allows users to take out feeless Bitcoin loans and earn rewards, called eBTC. Users can take out a loan backed with ETH or stETH, Lido’s liquid staking derivative. The deposited assets are then staked in Lido’s protocol to earn ETH staking rewards, which are passed on to the end user. eBTC also does not charge the typical fees of other DeFi lend/borrow projects, such as initiation fees, repayment charges, and interest, and it is designed to be fully transparent and non-custodial.

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