WhiteboardCrypto Newsletter - Mar 1

Welcome back to this week's edition of our WhiteboardCrypto Newsletter!

Aave votes yes to halt Polygon PoS lending

The popular lending platform known as Aave was one of the first to offer lending services on Polygon’s Proof of Stake (PoS) chain and has the most total value locked (TVL) on the chain with over $300m. The reason Aave has decided to decouple from Polygon is due to the perception that Polygon is willing to take more risk than is trustworthy. This is due to Polygon's recent proposal to take over $1 billion in stablecoins and invest them in DeFi protocols to earn extra yield (interest). Polygon’s proposal was voted against, but Aave’s community seems to not be swayed by that decision.

Learn more here.

Bybit’s hack caused by Safe’s infra

Last week, the Bybit CEX was hacked for $1.4b of ETH that was stored in the popular Safe multisig wallet. The hacker group Lazarus first gained control of a developer’s computer, likely through malware or a phishing attack. Once inside, they modified the Safe wallet's UI code stored on AWS, which is used for signing transactions. This was targeted only for ByBit employees, so anyone else using the interface was not affected. When Bybit’s team thought they were transferring funds securely, they were actually signing transactions that sent money to the hackers' wallet instead. The hackers then switched the malicious code back to the good code to try to cover their tracks.

Safe claims the hack only affected the Bybit wallet, and since the malicious code was removed people do not need to worry, but there are still questions about how exactly this was possible and how to improve security in crypto.

Learn more here.

Ethereum’s bumpy ride

The Ethereum network has experienced some hiccups over the past few months, with criticisms about the ecosystem’s reliance on L2s shifting needed liquidity away from the L1, the Ethereum Foundation’s (EF) leadership team changing, and the Pectra upgrade not going as smoothly on testnet as hoped. Change isn’t always a bad thing, even if it feels bad along the way. Many Ethereum developers and the EF team remain committed and actively building. If you believe in the tech and its future, you can focus on the ecosystem's long-term growth rather than short-term challenges. Regardless, as in all investments, it’s usually recommended to diversify.

MetaMask’s new roadmap

The self-custody wallet MetaMask, founded in 2016, released their updated roadmap on Thursday and it’s excited a lot of users. It includes adding smart contract capabilities that allow for wallet recovery, batched transactions for cheaper gas, methods to remove gas fees entirely, making it easier to switch networks as needed, the ability to have multiple distinct wallets, full Bitcoin and Solana support, multi-network simultaneous connections, a redesigned (and simplified) UI, and more.

Learn more here.

Uniswap allows users to off-ramp directly

By partnering with Robinhood, MoonPay and Transak, Uniswap is integrating native fiat off-ramps that will allow users to cash out directly to their bank rather than having to go through an exchange. It’s not the first DEX to do this, but as one of the largest DEXes, it’s a huge improvement for user experience. Users will have to swap supported ERC-20 tokens into stablecoins to withdraw to a bank account. Due to regulations, this won’t necessarily be supported in every country or jurisdiction, and will most likely require KYC through the third-party payment platforms.

Learn more here.

Thanks for reading and I hope you learned something!

- Theodore