Analysts at global audit and consulting firm KPMG have predicted that even as investments in cryptocurrencies and blockchain technologies keep on declining, they do not yet see a bottom and expect the slowdown to continue.

Russia is reportedly in talks with several friendly countries about launching clearing platforms for cross-border settlements using stablecoins.

Decentralized finance (DeFi) protocol Aave has invoked new rules to protect itself from risks that could stem from a surge in borrowing demand for Ethereum (ETH) ahead of the network’s Merge upgrade.

Top stories in the Crypto Roundup today:

• KPMG Predicts Crypto Slowdown Will Continue
• Russia Exploring Cross-Border Stablecoin Settlements
• DeFi Giant Aave Halts Ether Loans Ahead of the Merge
• EOS’ Price Action Ahead of the Hard Fork

KPMG Predicts Crypto Slowdown Will Continue

Analysts at global audit and consulting firm KPMG have predicted that even as investments in cryptocurrencies and blockchain technologies keep on declining, they do not yet see a bottom and expect the slowdown to continue.

At the end of June, crypto and blockchain investments totaled $14.2 billion, while in 2021 investors allocated a high of $32.1 billion into the cryptocurrency industry. Per KPMG, prior to 2018 most crypto investment “came from retail consumers,” but since then, “the investor profile has changed, with institutional and corporate investors now accounting for a much larger share of investment.”

KPMG’s analysts noted that the current macroeconomic environment has meant crypto is being traded more like a risk asset, with a tight correlation to broader markets. For the rest of the year, KPMG predicted a “slowdown in crypto interest and investment, particularly retail firms offering coins, tokens and NFTs.”

The analysts added that the move toward decentralized finance is expected to survive the slowdown:

"While investment in cryptocurrencies is expected to slowdown further, there will likely be a continued focus on the use of blockchain in financial market modernization."

Per the firm, well-managed crypto companies with “healthy risk management policies, long-term vision, and strong cost and risk management approaches” will survive.

Russia Exploring Cross-Border Stablecoin Settlements

Russia is reportedly in talks with several friendly countries about launching clearing platforms for cross-border settlements using stablecoins.

The country’s Deputy Finance Minister Alexey Moiseyev was quoted saying they’re working “with a number of countries” to create “bilateral platforms in order not to use dollars and euros.” Mioseyev added:

"We offer mutually acceptable tokenized instruments that will be used on these platforms, which are essentially clearing platforms that we are currently developing with these countries."

Russia has in the past taken a hard stance against cryptocurrencies, with President Vladimir Putin signing a law banning digital payments back in July. The Bank of Russia, which is developing a digital ruble, has also pushed for all crypto activity to be banned in the country.

DeFi Giant Aave Halts Ether Loans Ahead of the Merge

Decentralized finance (DeFi) protocol Aave has invoked new rules to protect itself from risks that could stem from a surge in borrowing demand for Ethereum (ETH) ahead of the network’s Merge upgrade.

The Aave community has overwhelmingly voted to stop loaning ether in a bid to mitigate protocol-wide risks that could arise from the network’s transition to a Proof-of-Stake consensus algorithm, which is expected to occur between September 13 and 15.

A proposal highlighted by research firm Block Analitca said:

"Ahead of the Ethereum Merge, the Aave protocol faces the risk of high utilization in the ETH market. Temporarily pausing ETH borrowing will mitigate this risk of high utilization,"

The utilization rate refers to the percentage of the protocol’s Ethereum pool being loaned out. The rate is likely to rise as borrowers would receive potential airdrops from potential fork ETHPOW.

EOS’ Price Action Ahead of the Hard Fork

While all eyes are on the Ethereum network’s upcoming Merge upgrade, it isn’t the only blockchain set to go through a major hard fork this month. EIOS.io announced its upcoming hard fork v3.1 last week, and the asset’s price rose 20% since then.

EOS is a blockchain protocol that claims to eliminate transaction fees and conduct millions of transactions per second. The blockchain has seen little excitement over the last couple of years.

Last year, the EOS community elected to stop ongoing payments to Block.one — the company that originally designed the network — over claims that it is no longer acting in the network’s best interests. It also claimed that Block.one raised $4.1bn to improve and build on EOS, however, the funds were misused with no tangible benefit to the chain.

As the existing EOS.io code is handled by Block.one, the community has decided to hard fork the chain and undergo a rebrand in a bid to sever ties with Block.one. The hard fork will also look to add faster finality, inter-blockchain communication, and EVMcompatibility

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