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This is the web version of The Ledger, Fortune’s weekly newsletter covering financial technology and cryptocurrency. Sign up here to receive future editions.
Welcome to 2022.
Just six days in, the new year is already proving to be a chaotic one for cryptocurrencies, financial markets, and Web 3.0. Venture capitalists are still squaring off with Block’s Jack Dorsey about the Internet’s future. Non-fungible token marketplace OpenSea has raised an additional $300 million that values the company at $13.3 billion—a little more than Robinhood’s market capitalization on Thursday. And crypto and meme stocks alike are in freefall, thanks largely to evolving monetary policy and expected interest rate hikes that are making investors rethink owning risky assets.
To kick The Ledger‘s year off, though, we’re going to talk about the past: RadioShack. Why? Because the 100-year-old electronics retailer—whose new management team calls it the “original tech company”—is making a hard pivot.
RadioShack is getting into decentralized finance, or DeFi.
Now owned by Retail Ecommerce Ventures, an investment firm that has bought a handful of other distressed retail brands like Pier 1 Imports, Dressbarn, and Stein Mart, RadioShack’s foray into the world of algorithmic finance centers on launching a decentralized exchange (DEX). The idea is to create a way for users to more easily move in and out of different tokens, à la Uniswap and Sushiswap. At the heart of the DEX will be a token named SHACK that RadioShack, or the separate part of the business that will be running the DeFi unit, plans to soon introduce.
So, why does RadioShack want to be in DeFi?
Well, in the eyes of Retail Ecommerce Ventures executive chairman Tai Lopez and CEO Alex Mehr, who own the century-old brand and whose DeFi protocol Atlas USV is partnering with it on the project, a land rush of corporate interest in crypto is coming.
Between NFTs, the metaverse, and crypto payments, companies worldwide have been dabbling in digital assets for some time now. But the two entrepreneurs predict that executives, who increasingly see crypto as legitimate, will dive headfirst into it by having their companies issue their own tokens. And to do that, they’ll want a trusted partner, which Lopez and Mehr hope will be RadioShack.
“Our mission is to be the first protocol to bridge the gap to mainstream usage of DeFi,” RadioShack’s website now reads.
Granted, RadioShack is not the first legacy brand to fall on hard times only to later hinge a turnaround via crypto. Eastman Kodak, the once giant photography company, tried to do as much back in 2018 before U.S. financial regulators started raising questions about it. Lopez says some parts of RadioShack’s crypto ambitions will only be available initially to people outside of the U.S. to steer clear of any U.S. regulatory issues, though he did not go into specifics.
The very fact that RadioShack is in the news in 2022 is remarkable in and of itself, though.
Within the last five years—following a deterioration of its business at the hand of both e-commerce and tech giants like Apple that sell their products directly to customers from brick-and-mortar stores—RadioShack filed for bankruptcy twice. Ultimately, Retail Ecommerce Ventures bought it. Now, following weeks of work by a team of two dozen or so, the RadioShack DeFi project is ready, pending some further testing, Mehr says. An early iteration of its DeFi project is expected to go live in the first quarter.
“If this becomes a little bit more of a trustworthy, well-understood process, the demand for it is going to be super high,” Mehr told me. “That’s the bet.”
New year, new beginnings, right?
And on that note, a programming one from The Ledger team: I’m going to be a dad. Again. For the second time in the pandemic, my wife and I are expecting a little one, who should be arriving in the coming weeks (if not days…). So, our beloved newsletter here will be on pause soon while I take time off to hang out with my kids and, more importantly, help my wife. In the meantime, my inbox is always open to tips, news, and scoops. So stay in touch, and happy new year.
Declan Harty
@declanharty
Declan.harty@fortune.com
DECENTRALIZED NEWS
Credits 🚀
BTCS is issuing the first-ever dividend payable in Bitcoin by a Nasdaq-listed company… The original meme stock company GameStop is wading into the NFT business… A crypto bank named Sygnum has raised $90 million in new funding in a Series B led by Sun Hung Kai & Co… Andreessen Horowitz has led a $25 million Series A extension round in decentralized credit protocol Goldfinch… Samsung has opened a metaverse version of its flagship physical store in New York City’s Meatpacking District… Nas is selling part of the rights to two of his songs with the help of blockchain-built investment platform Royal… Quentin Tarantino is moving ahead with plans for a slate of Pulp Fiction NFTs despite a pending lawsuit from movie studio Miramax.
Debits 🐻
The crypto markets have been having a rough start to 2022… Bitcoin and Ethereum are down more than 8% and 7%, respectively, over the last week as of Thursday afternoon, per CoinMarketCap… Major blockchain-linked gaming platforms got snagged in the sell-off, too… Axie Infinity‘s AXS governance token, for one, dropped nearly 20% in one day… U.S. securities regulators issued charges against Crowd Machine and Metavine, along with the two companies’ founder, Craig Sproule, over an unregistered ICO… Congress is reportedly planning a new hearing related to the environmental impact of crypto… Block CEO Jack Dorsey has spent much of the last month trading barbs via Twitter with Silicon Valley’s crypto elite like a16z‘s Marc Andreessen… Mozilla cofounder Jamie Zawinski lambasted the foundation’s decision to expand its suite of crypto donations to Dogecoin.
FOMO NO MO
The wild world of finance in 2021. It’s hard to remember, but a year ago today, GameStop was just a struggling video game retailer, AMC was nothing more than a movie-theater chain battered by the COVID-19 pandemic, and Shiba Inu coin was just a few months old. But over the last 12 months, the financial markets have changed—perhaps forever. Individual investors have been emboldened by lower-than-ever trading costs, unabashed passion, and their fellow degens, apes, or what have you egging them on, as Bloomberg Businessweek senior editor Michael Regan recently wrote. How it ends remains to be seen, though.
From the article:
It all seems a little crazy. And it is. It all sounds like it will end terribly. And it probably will. Someone, somewhere has to buy at the top, setting the most ridiculous price so it can be printed in the record books for future generations to laugh at and wonder what was wrong with all of us. Fortunes will be lost, both large and small. Social media profile pictures will change back to professional headshots. When that actually occurs is anyone’s guess. Maybe when the U.S. Federal Reserve shifts to a tighter monetary policy, or when those pandemic-swollen savings accounts finally revert back to normal. Or maybe not.
BUBBLE-O-METER
0.15%
Crypto is often referred to as an easier way of funding illicit activities: Drug deals, money laundering, whatever it may be. And while there is still aplenty, as illicit activity linked to crypto-based crimes reached a new all-time high of $14 billion in 2021, the share of it versus the whole market has never been lower, according to a new Chainalysis report that found just 0.15% of all crypto transactions were tied to illicit activity last year.
THE LEDGER’S LATEST
Bitcoin mining is being banned in countries across the globe—and threatening the future of crypto by Shawn Tully
Meet the 45-year-old whose untraditional career path led to her becoming the second woman in history to lead the NYSE by Declan Harty
The cheapest plots on popular metaverse platforms are already selling for more than $13,000 by Marco Quiroz-Gutierrez
How holiday card heavyweight Shutterfly outmaneuvered supply chain issues this season—and sees a future in NFTs by Jane Thier
Venture capitalist Tim Draper continues to stand by Elizabeth Holmes after guilty verdict by Jessica Mathews
Accredited investor rules are perpetuating inequity by Peter Rex
Investors poured a record $30 billion into crypto in 2021 by Marco Quiroz-Gutierrez
(Some of these stories require a subscription to access. Thank you for supporting our journalism.)
MEMES AND MUMBLES
Want the SEC’s advice? Markets are in a wild way with the Federal Reserve’s next steps on an interest-rate hike hanging in the balance. And while investors have often taken a nothing-can-stop-markets-from-going-up mindset with their portfolios over the last year, the SEC wants you to “say ‘NO’ to FOMO,” as Lori Schock, director of the regulator’s office of investor education and advocacy, wrote in her top 10 investing resolutions of 2022.
Financial Services
