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Solana and other blockchains may snag market share from Ethereum over time, the bank said in a research note.
The Solana blockchain could become the “Visa of the digital asset ecosystem” as it focuses on scalability, low transaction fees and ease of use, Bank of America told clients in a research note after hosting Solana Foundation member Lily Liu.
Solana has experienced strong adoption since launching in 2020. It has settled over 50 billion transactions (Visa, the global payments giant, processed 164.7 billion transactions in the year ended Sept. 30), has more than $11 billion in total value locked and has been used to mint more than 5.7 million non-fungible tokens (NFTs), analyst Alkesh Shah wrote in the note published Tuesday. Solana is optimized for consumer use cases such as micropayments and gaming, the bank said.
“Solana prioritizes scalability, but a relatively less decentralized and secure blockchain has trade-offs, illustrated by several network performance issues since inception,” Shah said. “Ethereum prioritizes decentralization and security, but at the expense of scalability, which has led to periods of network congestion and transaction fees that are occasionally larger than the value of the transaction being sent.”
Bank of America said Solana and other blockchains could grab market share from Ethereum over time, and will begin to distinguish themselves through user adoption and developer interest.
Memecoins were among the highest gainers in the past 24 hours as the overall crypto markets surged.
Shiba inu (SHIB) jumped 16% on Thursday, leading the gains among major cryptocurrencies, amid rumors of a listing on Robinhood.
Shiba inu prices reached as high as $0.00003 during early Asian hours on Thursday before a selloff. Shiba inu is the thirteenth-largest cryptocurrency with a market capitalization of $17 billion.
Price-charts suggest the move followed a bounce from resistance-turned-support levels of $0.000027. However, the tokens remains in a broader downtrend, as prices have dropped 62% since reaching all-time highs of $0.00008 in October 2021.
The price bump came shortly after rumors of a listing on Robinhood did the rounds on Twitter.
“Shiba Inu Robinhood listing said to come as early as Feb,” a tweet by business news handle ZeroHedge read. Robinhood did not return requests for comment.
Robinhood CEO Vlad Tenev previously denied plans for listing shiba inu on the influential stock trading application in October 2021. “It goes back to safety first, right. So we’re not generally going to be the first to add any new asset. We want to make sure that it goes through a stringent set of criteria,” he said in an interview with CNBC.
Additionally, shiba inu was listed on Bitso, one of Mexico’s largest crypto exchanges by trading volumes. However, the announcement did little to affect prices, trading data shows.
The bump in shiba inu saw other memecoins, such as dogecoin (DOGE), gaining as much as 14% in the past 24 hours. Baby doge and floki inu, two meme tokens issued on the Binance Smart Chain, surged 10% in the same period.
The surge in shiba inu came on the back of a broader recovery in crypto markets after nearly a week of declines. Bitcoin rose to the $43,000 level on Wednesday as Federal Reserve chair Jerome Powell said the state would take measures to curb inflation in the coming months, as reported.
Splitting the ownership and utility of gaming assets opens huge investment opportunities for GameFi, potentially making game finance bigger than decentralized finance (DeFi). The GameFi sector is young but booming, and this is very exciting for investors. The financial components of GameFi include on-chain leasing solutions, fractionalization, staking, game non-fungible tokens (NFT) dedicated marketplaces, layer 2 solutions for blockchain games and others.
GameFi and DeFi have many similarities but there are also some crucial differences. The DeFi sector has more structure but without any recent major improvements, whereas GameFi is a brand-new sector with lots of rules and standards yet to be set. Moreover, GameFi has less chance of manipulation by crypto whales. It also has a much higher potential to attract non-crypto users into the crypto market, especially in emerging markets, helping with both education and conversion.
The thesis of GameFi sector investment is that it makes sense to invest in whatever makes playing blockchain games more fun, more capital efficient and more trustless. For example: 1) on-chain leasing protocols that separate ownership and the right to use it; 2) game NFT-dedicated on-chain swaps; 3) distributed cloud gaming platforms; and 4) layer2 solutions for blockchain games.
This was perhaps best demonstrated this summer, when Andreessen Horowitz – one of the biggest and most storied Silicon Valley venture capital firms – invested $4.6 million in a little-known Philippine GameFi company called YGG. Yield Guild Games was established as a way to finance the use of gaming assets. Essentially it allows users to lease NFTs and then redeem them for fiat money. The heart of the innovation is that it splits the usage and the ownership of gaming assets. In a short time, YGG has grown to be a hugely important part of the GameFi ecosystem.
It also shows how the current GameFi upcycle is different from the DeFi upcycle (2020 through early 2021). During that period, investors were largely focused on investing in lending protocols, decentralized exchanges, synthetic assets and on-chain derivatives – basically the plumbing underpinning the ecosystem of DeFi. The thesis centered on investing in the best technology that would attract the most developers, which in turn would then grow the wider ecosystem.
There are some important platform investment opportunities in the current GameFi tide. GameFi is bringing crypto to the mass market. Many people will have earned their first crypto ever through blockchain games. This means that the potential market size is orders of magnitudes bigger than the previous round. Back then, it was all about crypto natives, with high barriers to entry. This time it’s about non-crypto natives with low barriers to entry.
The potential is much bigger, as the play-to-earn model means that many gamers will receive crypto assets for the first time. The focus will be more on investing into the financial infrastructure of blockchain games rather than the game itself. The key will be to invest in the Fi part of GameFi because a single game’s lifetime could be short, but the Fi is essentially tech infrastructure that will last much longer.
Doing well and doing good
There is a further angle to the GameFi investment opportunity. Many of the early adopters of play-to-earn opportunities are gamers in developing regions of the world, whose normal incomes have been badly hit by the effects of two years of lockdowns. GameFi and play-to-earn are seen as a way to make an income in the virtual world, free from the problems that beset the real world.
YGG is a great example of this. In a blog post this summer, Arianna Simpson, a general partner at Andreessen Horowitz who invests in crypto, wrote about this opportunity in regard to the investment in YGG. “Right now, there is a largely untapped economic opportunity in emerging markets to provide jobs by building a virtual economy in the digital world,” she wrote. “The way we define a ‘job’ is quickly evolving because of crypto and gaming, and we think we’re just starting to glimpse what’s possible in this realm.”
It’s still early, and that means there are still opportunities to help shape the standards of GameFi, unlike DeFi. As the GameFi ecosystems expand, and more people take part, more value is created. It is a virtuous circle that also has the potential to help alleviate poverty.
The country’s adoption of BTC as legal tender wasn’t enough to keep the cryptocurrency near $50K in September.
El Salvador buys in
In June, El Salvador President Nayib Bukele, announced that bitcoin would become legal tender, making his country the first to make that move, which also meant no capital gains taxes for bitcoin holders there.
Bitcoin rose about 70% from a low of around $30,000 toward a high of nearly $50,000 in early September as traders reacted to the news from El Salvador – seen by many fans of the 12-year-old digital asset as a long-awaited validation of its potential to serve a global currency. El Salvador’s bitcoin’s law went into effect in September.
When the law actually took effect, bitcoin’s price began to sell off – a classic “buy-the-rumor, sell-the-fact” scenario. (A similar thing had happened earlier in the year, when the big cryptocurrency exchange Coinbase held its direct stock listing on the Nasdaq exchange.)
Bukele tweeted that El Salvador was ready to buy on price dips even as BTC continued to fall. A growing number of users on social media platforms, including Twitter and Reddit, called for people to buy small amounts of bitcoin in support of El Salvador’s bitcoin policy, Bloomberg reported. Many investors were already betting the news could give the oldest cryptocurrency a price boost.
On Sept. 13, software company MicroStrategy purchased an additional 5,050 BTC for about $242 million in cash. Still, BTC continued lower.
BTC declined from $50,000 toward $40,000 and ended September on a down note.
Concerns were growing over a possible credit default by the Chinese property developer Evergrande Group, shaking speculative assets including equities and cryptocurrencies; lower risk appetite among investors also contributed to bitcoin’s September slump.
The takeaway for crypto traders from the July-August price action was that El Salvador’s decision to make BTC legal tender wouldn’t be enough to keep the cryptocurrency’s price elevated at $50,000. Bitcoin’s correlation with stocks increased along with the credit concerns in China.
Still, the nearly 7% BTC drop in September looked far less severe than the 50% price crash in April and May. After some ups and downs, bitcoin’s price had again stabilized at well above 2020 levels as some traders began to anticipate a $100,000 BTC price by year end.
Marc Andreessen, Brian Armstrong and Tyler Winklevoss have been cut out of the Twitter founder’s timeline.
To the uninitiated, it sounds like a bunch of rich guys arguing over how many angels can dance on the head of a pin.
But beyond Twitter drama, Block Inc. CEO Jack Dorsey’s public sparring with venture capitalists over “Web 3″ serves as a proxy for a long-running debate – not only about which cryptocurrencies are best but what they are good for.
The contretemps highlights important questions about what a truly decentralized internet would really look like, and what role different stakeholders have in building it. Dorsey, a longtime Bitcoin aficionado, appears to have aligned himself with the so-called maximalists, a camp highly suspicious of any rival to the original cryptocurrency and any non-monetary application of the underlying technology.
Both sides of the Web 3 debate bemoan the current state of the internet, dominated by a handful of large platforms (not least of all Twitter, where Dorsey stepped down as CEO last month). But the maximalists distrust the Web 3 crowd’s use of crypto tokens as a way to fund such projects. The fact that VCs are big holders of these tokens is, to the maximalists, damning, a classic case of “meet the old boss, same as the new boss.”
Web 3 advocates, which include but are not limited to VCs, counter that a variety of approaches is needed to make good on the internet’s liberating promise; that tokens can align participants’ interests in a network; that Web 3 developers’ reliance on VCs is a perverse consequence of outdated securities laws; and that while Bitcoin was a bona fide breakthrough, its utility is limited and the purists are being shortsighted.
Since his controversial tweet on Dec. 20, declaring that VCs, not users, control Web 3, thus making it a “centralized entity with a different label,” Dorsey has gone on an unfollowing spree on the social network he co-founded and ran for years.
Some of the most well-known players in the crypto space, including Andressen Horowitz (a16z) co-founder Marc Andreessen, Coinbase CEO Brian Armstrong and Gemini founder Tyler Winklevoss, have been felled by Dorsey’s unfollow button. Andreessen later blocked Dorsey.
Proponents of Bitcoin, like Dorsey, have long touted the network’s utility as a tool of liberation to be used by the people, as a way to resist financial censorship and protect against hyperinflation. On that score, few if any in the Web 3 camp would likely disagree.
The ongoing debate centers around the level of decentralization in the burgeoning Web 3 space, which big investors have been pouring money into – and, in the eyes of their critics, gaining outsized control of in exchange.
Dorsey has been increasingly critical of non-Bitcoin crypto projects, which he sees as going against the decentralized ethos of Bitcoin, culminating in Monday night’s Twitter spat.
Web 3 investors and supporters alike pushed back against Dorsey’s claim that Web 3 will “never escape [venture capitalists’] incentives.”
Balaji Srinivasan, former CTO of Coinbase and a former partner at a16z, responded to Dorsey’s tweet to voice his disagreement and point out how Twitter’s own corporate interests shaped the company in ways that betrayed its early slogan, “the free speech wing of the free speech party.”
“Web 3 offers the possibility, not guarantee, of something better,” Srinivasan tweeted.
“All false,” Dorsey replied, kicking off a fight that has lasted well into Wednesday and shows no sign of slowing down.
On Dec. 21, Dorsey re-tweeted an unflattering cartoon depicting an Ethereum-enabled Web 3 faucet pouring water into the waiting mouth of a corpulent venture capitalist, while a starving retail investor waited for droplets to fall on his tongue. In a quote-tweet of this post, Srinivasan pointed out that the Ethereum project was initially funded in 2014 by a public crowdsale, not through a venture capital round.
Later that evening, Dorsey tweeted more directly: “The VCs are the problem.”
Dorsey’s pot-stirring is reminiscent of another Big Tech CEO with a finger in the crypto pie – Elon Musk, who also joined the fray on Monday night, tweeting “Has anyone seen web3? I can’t find it.”
Dorsey’s reply was a thinly-veiled reference to Andreessen Horowitz’s domination of Web 3: “It’s somewhere between a and z.”
A16z bought $80 million in Twitter shares in 2011 on the secondary market.
Dorsey, for his part, seems to be taking the heat in stride.
When Andreessen blocked Dorsey on Twitter, Dorsey posted a screenshot and cheekily tweeted “I’m officially banned from web3.”
After unfollowing a host of prominent Web 3 supporters, Dorsey has gone on a following spree, adding several bitcoin maximalists and open-source software contributors.
Critics of non-fungible tokens say they are symptomatic of unsustainable digital gold rush
The global market for non-fungible tokens hit $22bn (£16.5bn) this year as the craze for collections such as Bored Ape Yacht Club and Matrix avatars turned digital images into major investment assets.
NFTs have drawn from veteran investors similar warnings to those issued about cryptocurrencies: that they are symptomatic of an unsustainable, digital gold rush. NFTs confer ownership of a unique digital item – whether a piece of virtual art by Damien Hirst or a jacket to be worn in the metaverse – upon someone, even if that item can be easily copied. Ownership is recorded on a digital, decentralised ledger known as a blockchain.
Data from DappRadar, a firm that tracks sales, showed that trading in NFTs reached $22bn in 2021 and that the floor market cap of the top 100 NFTs ever issued – a measure of their collective value – was $16.7bn.
The most valuable NFT sale this year was The First 5000 Days, a digital collage by Beeple, the name used by the American digital artist Mike Winkelmann, that was auctioned for $69.3m in March, making it one of the most valuable pieces of art ever sold by a living artist. Another Beeple NFT, Human One, sold for $29m.
Other multimillion-dollar NFTs included the Bored Ape Yacht Club, a collection of 10,000 NFTs represented as cartoon primates that are used as profile photos on the social media accounts of their owners and which raised $26.2m. Celebrity BAYC owners include the talkshow host Jimmy Fallon and the rapper Post Malone.
DappRadar said a key factor in the surge in NFT trading was mainstream businesses entering the fray.
Coca-Cola raised more than $575,000 from selling items such as a customised jacket to be worn in the metaverse world of Decentraland while the Matrix star Keanu Reeves failed to keep a straight face when told by an interviewer that his Matrix film series now had NFTs attached to it.
“Hollywood, sports celebrities and big brands like Coca-Cola, Gucci, Nike, and Adidas, made their dent in the space, providing NFTs with a new level of exclusivity. The power of attraction of these famous names profoundly impacted NFTs and the blockchain industry overall,” said DappRadar.
Football fans have been targeted with NFT marketing – including with NFTs backed by the former England players John Terry and Wayne Rooney – and have been warned by experts that they are risky assets, unregulated in the UK. It will take years before NFTs behave like a conventional market, said George Monaghan, analyst at research firm GlobalData.
“2021 NFT activity was frenzied. That’ll subside in coming years and NFTs will settle into something more akin to today’s modern art market, where consensus on value is more solid. That said, it’ll be years before any crypto market, let alone NFTs, comes to resemble anything conventional markets would call stable. I wouldn’t throw your rainy day fund into any meme NFTs quite yet,” he said.
Opera said Friday its native wallet will add support for Solana early next year, a timeline that could place the browser developer on track to beat Brave.
Opera, which has emphasized Web 3 readiness since 2018, said in a press release that it will be “the first browser” to support Solana-based decentralized applications. Browser plugin Phantom, a closed-source platform, currently dominates that space.
It also faces steep competition from Brave, another browser competitor leaning heavily into the crypto space that also plans to add Solana support. But Brave, which has only said its integration will come in the “first half” of 2022, may not move fast enough to claim the first spot.
Solana is a fast and cheap network with roughly $12 billion in total value locked, according to DeFi Llama. It’s benefitted from a banner year of development and massive token price gains.
Crypto upstart Solana Labs will work with Opera on the integration, the publicly-traded Norwegian company said.
Revenue from virtual gaming worlds could grow to $400 billion in 2025.
The metaverse may represent an over $1 trillion annual revenue market opportunity, crypto investment giant Grayscale said in a report, without specifying the timeline.
The report, which was published on Thursday, is dubbed “The Metaverse, Web 3.0 Virtual Cloud Economies.” The report looks into the opportunity that will arise from the intersection of trends in gaming and lifestyle with blockchain’s potential to provide infrastructure for digital worlds.
Projects like Decentraland allow people to interact, govern and earn tokens, and get real world benefits for their time spent online, Grayscale said. People are spending more and more time online, and they concurrently spend money to build social status within digital realms, the company added.
Revenue from virtual gaming worlds could grow to $400 billion in 2025, from $180 billion in 2020, Grayscale said. The overwhelming majority of that $400 billion will be in-game spending, compared to spending on premium games, the company noted.
In Q3, total fundraising for crypto was $8.2 billion, $1.8 billion of which went to Web 3 and non-fungible tokens (NFTs), Grayscale said. Fundraising for gaming applications overshadowed all other verticals of NFTs in the third quarter, hitting around $1 billion.
“Compared to the $10 billion that companies like Facebook plan to invest, and the amounts that could follow from other companies and venture capitalists, the Metaverse is in its early innings,” Grayscale said.
The report was authored by Grayscale’s Head of Research David Grider and Research Analyst Matt Maximo. They defined the metaverse as “interconnected, experiential, 3D virtual worlds where people located anywhere can socialize in real-time to form a persistent, user-owned, internet economy spanning the digital and physical worlds.”
New York City Mayor-elect Eric Adams’ pro-crypto stance appears to be showing early signs of working, with a community-led crypto project planning to create a dedicated city-based token.
CityCoins, which works on the Stacks protocol, decided to develop the token after Adams engaged in a friendly online banter with Miami Mayor Francis Suarez over Bitcoin, including taking paychecks in the largest cryptocurrency by market value. Adams has vowed to build a crypto-friendly city when he takes office in January.
“We voted on what city should be next,” Patrick Stanley, a CityCoins community lead, told Bloomberg in a telephone interview. The top two choices were New York City and Austin. After Mayor Adams spoke last week, “the community to decided to activate New York.”
CityCoins launched a Miami token in August. MiamiCoin has earned the city over $21 million to date, according to CityCoins. Outsiders can send STX tokens to “mine” MiamiCoin, and a percentage goes to the city’s designated crypto wallet. STX was last trading at around $2.30 and had a market capitalization of about $2.9 billion, according to CoinMarketCap.com.
NYCCoin mining is expected to kick off Wednesday, after which the city’s wallet stands to get fatter, Stanley said.
“Every 10 minutes the city earns money for the sheer fact that NYCCoin exists. The wallet will get filled with Stacks and they can spend the Stacks or the yield the Stacks generate,” he said.
“We’re glad to welcome you to the global home of Web3,” Adams responded to CityCoins’ choice in a tweet.
The pro-crypto Adams is seeking to one-up Miami Mayor Francis Suarez, who recently said he’ll be taking his next paycheck in the cryptocurrency.
Incoming New York City Mayor Eric Adams said on Thursday that he will take his first three paychecks in bitcoin when he takes office in January.
“In New York, we always go big, so I’m going to take my first THREE paychecks in bitcoin when I become mayor. NYC is going to be the center of the cryptocurrency industry and other fast-growing, innovative industries! Just wait!” Adams wrote in a tweet on Thursday.
The tweet was in response to one from Miami Mayor Francis Suarez, who on Tuesday pledged to take his next paycheck in bitcoin. Suarez won reelection earlier this week by a wide margin.
Adams, currently the Brooklyn borough president and a retired New York City Police Department captain, was pro-crypto throughout his campaign that culminated with a victory at the polls earlier this week. The support is notable because New York City, despite being a major financial center, has some of the nation’s toughest cryptocurrency rules that require licenses for most types of crypto transactions.
Binance CEO Changpeng Zhao announced the launch of the $115-million crypto and blockchain initiative during a conference in France.
Global crypto exchange Binance is starting a 100-million euro ($115 million) initiative to develop the blockchain and crypto ecosystem in France and Europe, Binance CEO Changpeng “CZ” Zhao announced in a talk with French Minister Cédric O at the French Ministry of Finance in Paris.
Binance is launching the new initiative, officially named “Objective Moon,” in partnership with the local financial technology association France FinTech. The association will help Binance connect and work with the local fintech sector, a Binance spokesperson told Cointelegraph.
According to the announcement, Objective Moon would see the development of a Binance Research and Development hub in France. To this end, the crypto exchange plans to recruit crypto and blockchain talent from across France and Europe.
As part of the $115-million initiative, Binance aims to start a decentralized ledger technology accelerator named Objective Moon Accelerator and an online education program to raise new talent for the crypto and blockchain industry. France-based online education platform OpenClassrooms and crypto hardware provider Ledger will also contribute to the development of the education program.
“France FinTech believes that France is uniquely positioned in terms of regulation, talent and expertise to be the leading player in Europe in the field of decentralized finance,” France FinTech chair Alain Clot commented on the initiative. He said that the collaboration with Binance will support the growth of the entire ecosystem.
Speaking highly of French and European tech and talent, CZ said that Binance plans to help make France and Europe the leading global players in the blockchain and crypto industry by launching its major operations and investments in the country.
Known for its “decentralized” structure, Binance was reportedly seeking a headquarters in Europe. As Cointelegraph reported, the exchange had established three subsidiaries in Ireland in September. CZ then told Bloomberg that Binance is looking to set “a few headquarters in different parts of the world.”
A SHIB hodler who spent $3,400 on the memecoin last August is now a crypto billionaire from that purchase alone, with the asset gaining 94,278,239.8% over the past year.
An address with the foresight to purchase $3,400 worth of Shiba Inu (SHIB) last August has seen the value of the coins grow to a whopping $1.55 billion on Thursday.
In total, the unknown person has bought SHIB 44 times since August 2020 — with $3,200 as the largest purchase at any one time — and their total holding of 70,200,003,107,594 SHIB is now worth $5.63 billion.
After the wallet address was shared on Twitter, user Untraceable questioned whether the SHIB market was liquid enough to “absorb $5.7b if this wallet sells?”
According to Etherscan, the anonymous SHIB hodler purchased the dog-themed token on nine occasions in August 2020, spending a total of $3,400 worth of Wrapped Ethereum (wETH) that month.
As the price of SHIB has since gained more than 94,278,239.8%% over the past year to sit at $0.00008094 at the time of writing, the hodler has become a crypto billionaire from their August purchases alone.
According to data from CoinGecko, the total market capitalization of SHIB is now worth $40.3 billion. The asset’s mammoth 1,063% gain in value over the past 30 days has seen SHIB oust the beloved Dogecoin (DOGE) it was modeled on as a top 10-ranked coin.
At the time of writing, SHIB is currently ranked ninth, while DOGE is sitting at 11th with a market cap of $31.6 billion. The flippening of DOGE has sparked a new meme online in which people are calling Dogecoin a “boomer meme coin.”
Earlier on Thursday, Cointelegraph’s market team reported on three reasons behind the bullish momentum of SHIB, pointing at an increase of user access via listings on multiple crypto exchanges, the launch of the Shiba Inu’s own nonfungible token project dubbed “Shiboshi’s,” and a surge in futures open interest on multiple exchanges, including OKEx, FTX and Huobi.
While SHIB has seen a meteoric rise of late, DOGE’s appreciation fails to match up in comparison, with the elder memecoin gaining a mere 18.5% over the past 30 days to sit at $0.23.
It’s a nice Series B-1 for Sam Bankman-Fried’s crypto exchange following a $900 million mega-round earlier this year.
FTX has memed itself into another massive funding round.
Sam Bankman-Fried’s Bahamas-based crypto exchange said Wednesday it had raised $420,690,000 in a Series B-1 funding round. Sixty-nine investors – including BlackRock and Tiger Global – joined the fast-growing crypto conglomerate.
Investors valued the exchange at $25 billion, FTX said, a nearly 39% jump over the Series B sticker price from July when it raised a whopping $900 million in crypto’s largest-ever venture capital funding round. FTX says users have grown 48% in that period and trading volume rose 75%.
Surging growth coincided with FTX’s summertime marketing blitz. The new funding round is being announced as bitcoin tops fresh all-time highs.
The exchange has spent big on sports advertising this year, writing a mainstream outreach playbook with Major League Baseball that competitor Coinbase appears to be following in a new deal with the National Basketball Association.
But courting name recognition is just one spoke in the strategy, Bankman-Fried told CoinDesk in an interview.
Awash in venture capital and multimillion-dollar-a-day revenue streams, the CEO is planning a series of acquisitions and partnerships to get FTX into more countries, with more users.
“We’ve probably done a half a billion dollars of acquisitions so far this year,” Bankman-Fried told CoinDesk in a call. He said the coming buys are “potentially sizable.”
All that from a company whose influence is growing by the day. FTX – once only an overseas crypto derivatives exchange – now boasts a U.S. affiliate with its own NFT marketplace and a roadmap to offering regulated futures products.
The power FTX has amassed over the cryptosphere was on display last week when it barred NFTs projects with revenue-sharing schemes from listing on its marketplace. A number of projects including Solarians quickly dumped that feature to comply, angering troves of buyers.
“To some extent, people are taking cues from us,” Bankman-Fried said.
China started losing its position in global crypto markets before this year’s crackdown.
Growth in decentralized finance (DeFi) has driven North America to the world’s second-biggest largest crypto market, new research by crypto intelligence firm Chainalysis said.
North American addresses received $750 billion in crypto between July 2020 and June 2021, or 18.4% of global transactions. Central, Northern and Western Europe received $1 trillion in that time period, accounting for 25% of global volume, Chainalysis’s 2021 Geography of Cryptocurrency Report found.
Monthly transaction volume in North America grew by over 1,000% between July 2020 and May 2021, from $14.4 billion to $164 billion.
Chainalysis attributed this growth to DeFi, which represented 37% of total transactions in North America between July 2021 and June 2021. The region’s top exchange in that time period is decentralized Uniswap, followed by centralized Coinbase and decentralized dYdX.
The U.S., the region’s largest market, topped Chainalysis’s DeFi Adoption Index, which measures “grassroots adoption” of DeFi.
Both North America and East Asia saw a slight dip in total transaction volume in May 2021. The dip in activity in E. Asia is likely explained by Beijing’s new crackdown on crypto, which started with a State Council proclamation in May. China has historically been the world’s biggest bitcoin mining country and a major hub for crypto trading.
East Asia has long lost its edge
Eeast Asia’s share of global crypto transaction volume started dropping in April 2020, long before this year’s crackdown on the industry by Chinese authorities, research by Chainalysis shows.
Starting April 2019, E. Asia accounted for the lion’s share of crypto transactions globally, until June 2020, when it was overtaken by Central, Northern and Western Europe, as well as North America, the report said.
China accounted for 47% of these transactions between July 2020 and June 2021, Chainalysis economist Ethan McMahon told CoinDesk in an email interview.
When asked about the drop in East Asia’s share of global crypto transactions in April 2020, McMahon said that “China has been moving towards an outright crypto ban in favor of its own solutions” for a while, adding that China started testing its own central bank digital currency in that month.
From July 2020 to June 2021, East Asian countries also fell several places in the Chainalysis Global Crypto Adoption Index; China fell from fourth place to 13th, South Korea from 17th to 40th, Hong Kong from 23rd to 39th, and Japan from 71st to 80th.
DeFi is also gaining ground in East Asia. Huobi is the region’s most popular exchange, according to the research, followed by decentralized exchanges dydx and Uniswap.
Hong Kong is the region’s top DeFi adopter, where it accounts for 55% of transactions, followed by China at 49%, Japan at 32%, and South Korea at 15%.
Since China’s State Council called for a crackdown on crypto mining in May, China’s miners have been moving their facilities overseas, primarily to North America, Central Asia, and South America.
Between May and June, Binance saw the biggest decline in bitcoin received from mining pools, over $200 million, Chainalysis said. Huobi saw the second biggest net decline, at just over $150 million, followed by FTX at around $100 million.
This lost liquidity might also account for the overall decline in activity in the region after May, said the intelligence firm.
North America’s share of the global mining hash rate more than doubled between the end of April and August, research from the Cambridge Center for Alternative Finance shows. By August, China’s hash rate had virtually dropped to zero, according to the the center.
For mining pools not based in China, proceeds have more than doubled between January and July 2021, Chainalysis said. Those based in China saw their earnings decline by 50%, according to the report.
There is an 18% potential upside to trading volume and an 11% upside to total revenue estimates, an analyst wrote Tuesday night.
Coinbase (Nasdaq: COIN) is likely to top consensus estimates for trading volume and total revenue for the third quarter due to recent volatility in the price of bitcoin, according to Oppenheimer analyst Owen Lau.
Lau estimates there is an 18% potential upside to trading volume and an 11% upside to total revenue estimates, citing the exchange’s “substantially” improved trading volume in the second half of the third quarter.
Coinbase shares had a “rough” September with the stock down 12.2% versus the S&P 500′s 4.8% dip – likely hurt by increased regulatory scrutiny, the retreat of bitcoin, the company’s move to preemptively end its Lend product, its $2 billion debt raise and macro risks associated with Evergrande in China.
“With all the news driving volatility, trading volume has substantially improved in late August and September,” Lau wrote in a note.
Lau, who has an outperform rating on the shares and a $444 price target, estimates that Coinbase has $6.5 billion in cash as of the third quarter that can be potentially used for new product development, M&A, diversification and increased balance sheet investment in crypto.
Late last month, JMP Securities was also bullish on Coinbase shares, putting a $300 price target and market outperform rating on the shares.
COIN shares are currently trading at around $250.
Coinbase shares may reach $300, representing an almost 30% upside from their current price, according to a new research report from JMP Securities, which rates the crypto exchange at market outperform.
“With the company just scratching the surface of its long-term potential, in what we view as a rapidly growing and evolving addressable market, we see a compelling value proposition in COIN shares,” JMP analyst Devin Ryan wrote in a note.
Coinbase has a competitive advantage as a “first mover” in the crypto industry, and even with 68 million users, the company has reached only a small portion of its long-term addressable market, according to the report.0 seconds of 7 minutes, 10 secondsVolume 90%
Ryan wrote:“While we do not expect COIN shares to move in a straight line, we see material upside that compensates for the inherent risk, and with the stock trading at just 6.0x EV/2023E revenue (compared to a number of other high-growth, leading brand FinTechs trading closer to ~10x and above), we believe the risk/reward in shares is compelling, with additional optionality to the upside as the business model iterates into new areas that the market is currently not even contemplating.”
Earlier this month, Piper Sandler analyst Richard Repetto defended Coinbase after a sell-off in the shares following news that it had received a Wells notice from the U.S. Securities and Exchange Commission (SEC) concerning a potential lending product that was subsequently scrapped.
Coinbase shares have fallen about 7% since the exchange’s direct listing in April.
Compound erroneously paid out millions in liquidity mining rewards following an update to one of its smart contracts. In one transaction, $27 million was claimed.
In a possible exploit on Wednesday night, decentralized money market Compound has been erroneously paying out millions of dollars in COMP tokens intended as liquidity mining rewards.
Twitter user “napgener” first flagged the issue, pointing to three Ethereum transactions showing users receiving a total of $15 million in COMP tokens in exchange for borrowing and supplying tiny quantities of tokens, including USDC, ETH and DAI.
Compound has a liquidity mining program that rewards depositors and borrowers, but often at a rate of a single-digit APY. The botched payout sums indicate a flaw in the comptroller contract, which disburses the COMP liquidity mining rewards, possibly related to a recent upgrade.
Observers have noted that Compound’s comptroller contract is not managed by a multi-sig controlled by Compound Labs, and any fix to the exploit may require a governance vote among COMP holders.
Per DeFi Llama, Compound is the world’s fifth-largest decentralized finance protocol with a total value locked (TVL) of $10.2 billion.
Compound acknowledged the exploit on its official Twitter handle and said no user funds are at risk.
Likewise, Compound founder Robert Leshner acknowledged the exploit in a tweet, saying that “at worst” only 280,000 COMP tokens are at risk of being erroneously claimed.
He also noted that “there are no admin controls or community tools to disable the COMP distribution; any changes to the protocol require a 7-day governance process to make their way into production. Labs, and members of the community, are evaluating potential steps to patch the COMP distribution.”
Shortly after Leshner’s tweet, at 1:38 UTC on Thursday, some 91,000 COMP tokens worth $27 million were claimed in a single transaction. The user appears to have supplied $0 in crypto assets to the platform; they paid $154.77 in gas fees to take in their dubious haul.
The same wallet then swapped $140,000 in COMP for USDC via Uniswap.
The price of COMP has plunged on the news, falling from a 24-hour high of $334 to as low as $290. At the time of this story’s latest update, it sits at $290, according to CoinGecko.
A request for comment sent to Compound Labs was not returned by press time.
TangoChain focuses on gaming and NFTs, and its model involves giving players financial incentives to play and progress through games.
TangoChain has launched a blockchain devoted entirely to gaming that allows players to earn profits and create non-fungible tokens (NFTs).
The firm describes itself as a third-generation blockchain platform and claims to be the first to launch a platform that is entirely a gaming host.
GameFi is one of the hottest new trends to emerge from the crypto industry, combining decentralized finance (DeFi) and NFTs with blockchain-based online games.
TangoChain focuses on gaming and NFTs and its play-to-earn model rewards players with financial incentives as they play and progress through games. It allows users to secure the network and verify transactions by playing their favorite game.
What would a world without banks look like? The answer may lie in decentralized finance. Decentralized finance is an emerging ecosystem of financial applications and protocols built on blockchain technology with programmable capabilities, such as ethereum and solana. The transactions get executed automatically through smart contracts on the blockchain, which includes the agreement of the deal. “Anyone can actually build businesses on top of these protocols and using them the same way as we can today build an internet business on top of the HTTP IP protocol,” said Stani Kulechov, founder of a DeFi protocol called Aave. Decentralized finance has captured only 5% of the crypto space, according to CoinGecko, but it has seen massive growth recently. There was $93 billion worth of DeFi assets in the crypto market as of June 2021, up from $4 billion just three years ago. To be sure, DeFi’s growth has slowed since the summer of 2020, and regulatory scrutiny from Capitol Hill has spiked over fears of crypto’s checkered past.
The firm pushed the agency, citing increased investor interest and a growing number of bitcoin holders.
Fidelity Investments privately prodded the U.S. Securities and Exchange Commission (SEC) last week to approve its bitcoin exchange-traded fund (ETF), according to recent filings.
The multinational, financial services giant urged the regulator to approve its fund by citing increased investor interest in crypto. Fidelity also pointed to the rising number of investors holding bitcoin and similar funds worldwide. Bloomberg first reported the news Tuesday.
Fidelity Digital Assets President Tom Jessop, among other executives from the firm, met with SEC officials via a Sept. 8 video call.
Fidelity had not responded to a CoinDesk request for comment by the time of publication.
Bitcoin ETFs in the U.S. have had a notoriously hard time winning SEC approval of their applications. Presently, there are over 10 applications pending, including those by VanEck, WisdomTree, and more recently, Anthony Scarammuci’s SkyBridge.
The firm originally filed its Wise Origin Bitcoin Trust in March with a follow-up response in June. Last week marked the second round of talks between the SEC and Fidelity, and like all others, the application is pending.
Purpose Investments became the first in North America to be approved for a bitcoin ETF when Canadian regulators gave their go-ahead in February.
By Sebastian Sinclair