America’s largest crypto exchange, Coinbase, announced a long list of tokens it could potentially list in the second quarter of 2022 in an effort to increase transparency.
An April 12 blog post from the exchange includes a list of tokens under consideration, but notes that other tokens may be under consideration but not specifically mentioned. Among those on their radar are 45 ERC-20 tokens on the Ethereum (ETH) network, and five SPL tokens on the Solana (SOL) network.
Some of the tokens with a relatively large market cap are Binance USD (BUSD), which is the third-largest stablecoin on the market, and one of the largest DAO projects BitDAO (BIT) which boats a market cap of just over $1 billion at the time of writing according to CoinGecko data.
The exchange stated that its new approach toward token listings will also provide “as much information symmetry as possible.” Information symmetry promotes efficiency and fairness within a market.
It also reduces the chances for a pump and dump scenario on listing day as the retail trading frenzy can be mitigated by advanced knowledge of a listing. While it is far more common on other centralized and decentralized exchanges, Coinbase has had its share of such price action on coins it lists. In 2020, OMG Network (OMG) pumped 200% within 15 minutes of being listed on Coinbase and crashed moments later.
Crypto projects are aware of the attention a Coinbase listing, or even just the potential one can bring. The relatively small decentralized finance (DeFi) data tokenizer Big Data Protocol (BDP) with a $3.3 million market cap according to CoinGecko tweeted delight today that Coinbase was giving it looks at potentially being listed.
However, while the increased transparency may be a boon for investors and projects, the seasoned crypto trader from Twitter account @12yearoldwithcc believes the potential listings are lackluster. The account tweeted today that “Coinbase is in their flop era.”
Other investors may not even have noticed Coinbase’s new transparency efforts yet as many are focused on the exchange’s intention to produce a series of three films about the Bored Ape Yacht Club (BAYC) nonfungible token (NFT) collection.
Some in the crypto community are perplexed by the $10,000 deal Coinbase has offered BAYC holders for the rights to use their ape in the films, with some even warning that they should not accept it.
In all, it has already been a turbulent week for the exchange as it launched trading services in India for the first time on April 8 but abruptly suspended buy order services under pressure from local payment service regulators on April 11.
The cryptocurrency market took a turn for the worse on April 11 after concerns related to rising inflation, the prospect of several more interest rates by the U.S. Federal Reserve and fear of a global food shortage led to widespread weakness across global financial markets.
Data from Cointelegraph Markets Pro and TradingView shows that bears broke through the bulls’ defensive line at $42,000 in the early trading hours on Monday to drop Bitcoin (BTC) to a daily low of $39,200 and several analysts project even lower prices in the short-term.
BTC/USDT 1-day chart. Source: TradingView
Here’s a look at what analysts are saying about Monday’s move lower and whether or not traders should expect more downside over the coming days.
$40,000 or bust
The dip below $40,000 was foreshadowed by market analyst Michaël van de Poppe, who posted the following chart on Sunday highlighting the strong move in Bitcoin, but he also warned that “it’s the weekend and we still need to crack this resistance zone.”
BTC/USD 4-hour chart. Source: Twitter
After Monday’s pullback, van de Poppe posted a follow-up tweet addressing the rejection at $43,000 and offering insight into what level to keep an eye on as the next support. According to the trader, “the green zone” in the $43,000 to $44,000 range would need to become support to preserve any blossoming bullish momentum.
This bear market is “different”
BTC/USD 1-day chart. Source: Twitter
Insight into the confusion that many crypto traders have been experiencing over the past year was provided by decentralized finance advisor and pseudonymous Twitter trader ‘McKenna’, who posted the following chart looking at the Bitcoin price action since April 2021. McKenna said that “this has been the weirdest bear market I’ve seen.”
McKenna said,
“I don’t even think we see sub $30,000, I’m more in favor of just choppy price action in this range which is also hell. Just need corn to chill and let my altcoins run.”
A similar sentiment was expressed by crypto analyst and pseudonymous Twitter user ‘360Trader’, who posted the following chart highlighting the consolidation range Bitcoin has been trading in since last November.
BTC/USD 1-day chart. Source: Twitter
360Trader said,
“Bitcoin consolidation continues… leverage is in control… float still drying up… This ain’t gonna last forever. Just slap a band-aid on and keep pushing.”
A final bit of insight on the future of BTC price was provided by Philip Swift, markets analyst and founder of LookintoBitcoin, who posted the following chart showing the recent price rejection off the 1-year moving average (MA).
BTC/USD 1-day chart. Source: Twitter
According to Swift, the 1-year MA “has acted as a pivot point for bull v. bear markets throughout Bitcoin’s history.”
Swift said,
“Can’t really call it a bull market until we are convincingly back over the 1yr MA.”
The overall cryptocurrency market cap now stands at $1.874 trillion and Bitcoin’s dominance rate is 41.4%.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.
Ethereum developers implemented the network’s first-ever “shadow fork” on Monday, marking an important milestone in the ongoing shift to a proof-of-stake (PoS) consensus.
The shadow fork provides a venue for developers to stress test their assumptions around the network’s complex shift to PoS, according to Ethereum Foundation developer Parithosh Jayanthi. “The aim of the Kiln merge testnet was to allow the community to practice running their nodes, deploying contracts, testing infrastructure, etc.,” he tweeted on Sunday.
The aim of the Kiln merge testnet was to allow the community to practice running their nodes, deploying contracts, testing infrastructure, etc. We hope it’s helping the community get a sense of the post merge world!
Kiln refers to the last testnet of the so-called merge, which involves transitioning Ethereum’s Execution Layer from proof-of-work to PoS. In a March 14 blog post, the Ethereum Foundation described the merge as a “culmination of six years of research and development” intended to make the network more secure and energy-efficient.
Ethereum Foundation developer Marius van der Wijden confirmed on Monday that PoS testing was underway. “Today will be the first mainnet shadow fork ever. We’re roughly 690 blocks (~2 h) away from TTD,” he tweeted.
Positive developments surrounding the merge have fed an increasingly bullish narrative for Ethereum — one that allowed the Ether (ETH) price to temporarily break a months-long downtrend. While ETH and the broader crypto market are recoiling in a new bout of risk aversion, the prospect of earning passive rewards on the Ethereum network has attracted considerable interest from investors.
The number of staked ETH on Ethereum’s Beacon Chain is fast approaching 10.9 billion, with the average balance currently 33.5 ETH, according to industry data. Beacon Chain currently has over 340,000 validators, which represents a gain of 13% from early March when the 300,000th validator was first recorded.
Last week, there was a lot of regulatory talk about crypto-related risks. While this is very common in itself, some angles and proposed solutions to such risks came across as novel. In the United States, the Federal Deposit Insurance Corporation (FDIC) issued a letter to commercial and savings banks under its purview, or all federally chartered banks, asking financial institutions to notify the FDIC about all ongoing and planned crypto-related activities. Apparently, standardized guidance for all banks would not fit the bill since the risks seem to be unique in each case.
In Singapore, the local monetary authority became concerned about the “reputational risks” that virtual asset service providers that have originated in the city-state but operate overseas can pose. The proposed solution is bringing such firms under the Singaporean licensing regime that, until now, applied only to firms with domestic operations.
Finally, the U.S. Securities and Exchange Commission (SEC) Chair Gary Gensler — one of the most vigilant guardians of the nation’s investor folk – spoke about how retail crypto investors must be protected. Embedded within the usual talking points that were previously unheard of calls for the SEC staff to explore ways of regulating platforms that facilitate the trading of both securities and non-securities, including closer coordination with the Commodity Futures Trading Commission (CFTC). At the same time, other crypto-related fears have begun to dissipate, best exemplified by the “Russia sanctions evasion” narrative taking a major hit.
Crypto for real people
U.S. Treasury Secretary Janet Yellen testified before the House Financial Services Committee last week and fielded numerous questions about the relationship between digital assets and national security, including several on the potential threats that crypto could pose to the robustness of the international financial sanctions regime. Yellen reassured representatives that using blockchains to circumvent sanctions is difficult and that her agency hasn’t seen any significant crypto-aided sanctions evasion in practice. It is fair to say that regular Russians, rather than the wealthy corrupt elites, rely on digital assets as they flee the country or get stranded abroad, as evidenced by their firsthand accounts. According to the government’s latest estimate, Russian citizens could be holding as much as $130 billion in cryptocurrency.
Stablecoins in crosshairs
Emerging regulatory frameworks around stablecoins continue to be one of the hottest areas of crypto policy. Speaking at another event last week, Secretary Yellen said that the Treasury was hard at work helping Congress draft legislation that would ensure the stablecoin sector’s risk resilience. Another related piece of legislation dropped on April 7, introduced by Senator Pat Toomey called the Stablecoin Transparency of Reserves and Uniform Safe Transactions (TRUST) Act. To Toomey, the main risk associated with stablecoins is that such assets could be categorized as securities. Thus, the bill proposes that convertible “payment stablecoins” should be exempt from securities regulations. Stablecoin offerings used as a means of payment are also the major focus of the United Kingdom regulators, where Her Majesty’s Treasury announced plans to amend the legislation around payments accordingly. This is just one of the assortment of measures that the U.K.’s financial authorities announced against a background of crypto-bullish rhetoric from Economic Secretary of the Treasury John Glen and Chancellor of the Exchequer Rishi Sunak.
More futures before spot
Days after rejecting yet another application of a Bitcoin (BTC) spot exchange-traded fund (ETF), the U.S. Securities and Exchange Commission greenlighted the fourth futures-based BTC ETF. Teucrium Bitcoin Futures Fund has joined the ranks of similar offerings by ProShares, Valkyrie and VanEck. Inevitably, the development has triggered a new round of the conversation on whether a spot-based Bitcoin product is on the way. Bloomberg ETF analyst Eric Balchunas opined that the approval is a “good sign” for a prospective spot BTC offering. Meanwhile, Grayscale CEO Michael Sonnenshein, whose company is working on converting its GBTC fund into a BTC spot ETF, has found language in the text of the SEC’s Teucrium approval that strengthens the case for a spot approval. Meanwhile, ProShares, the firm behind the first regulated Bitcoin futures ETF, filed a registration statement for an exchange-traded product that will allow investors to short Bitcoin futures contracts.
Last year, cryptocurrencies reached a “tipping point,” according to Gemini’s 2022 Global State of Crypto report, “evolving from what many considered a niche investment into an established asset class.”
According to the report, 41% of crypto owners surveyed globally purchased crypto for the first time in 2021, including more than half of crypto owners in Brazil at 51%, Hong Kong at 51% and India at 54%.
The study, based on a survey of 30,000 adults in 20 countries over six continents, also made a strong case that inflation and currency devaluation are powerful drivers of crypto adoption, especially in emerging market (EM) countries:
“Respondents in countries that have experienced 50% or more devaluation of their currency against the USD over the last 10 years were more than 5 times as likely to say they plan to purchase crypto in the coming year than those in countries that have experienced less than 50% currency devaluation.”
Brazil’s currency, the real, experienced a 218% devaluation — suggesting high inflation — against the United States dollar between 2011 and 2021, and 45% of Brazilians surveyed by Gemini said they planned to purchase crypto in the coming year.
South Africa’s currency, the rand, recorded a 103% devaluation in the past decade — second only to Brazil among the 20 countries in the survey — and 32% of South Africans are expected to be crypto owners in the next year. The third and fourth highest devaluation, or inflationary, countries, Mexico and India, displayed a similar pattern.
By comparison, the currencies of Hong Kong and the United Kingdom experienced no devaluation at all against the U.S. dollar over the past 10 years. Meanwhile, relatively few surveyed in those countries, 5% and 8%, respectively, professed an interest in purchasing crypto.
What conclusions can be drawn from this? Noah Perlman, chief operating officer at Gemini, sees different crypto use cases, often depending upon where one lives. He told Cointelegraph:
“In countries where the local currency has been devalued against the dollar, crypto is viewed as a ‘need to have’ investment, whereas in the developed world it is still largely seen as ‘nice to have.’”
Source: Gemini
Crypto as currency replacement
Winston Ma, former managing director and head of North America at China Investment Corporation and now adjunct professor at New York University School of Law, makes a key distinction between an asset that works as an inflation hedge and one that is used as a currency replacement.
Cryptocurrencies like Bitcoin (BTC) have yet to achieve “inflation hedge” status, unlike gold, in his view. In 2022, they have behaved more like growth stocks. “Bitcoin correlated more tightly to the S&P 500 index — and Ether to NASDAQ — than gold, which is traditionally viewed as an inflation-hedge asset,” he told Cointelegraph. But, things are different in parts of the developing world:
“In the emerging markets like Brazil, India and Mexico that are struggling with inflation, inflation may be a primary driver of cryptocurrencies’ adoption as a ‘currency replacement.’”
“There’s no denying that in early days and still now adoption has been driven by countries where currency stability and/or access to proper banking services has been an issue,” Justin d’Anethan, institutional sales director at the Amber Group — a Singapore-based digital asset firm — told Cointelegraph. Simply put, developing countries are more interested in alternatives to easily debased fiat currencies, he said, adding:
“On a USD notional basis, the larger flows might still come from institutions and more developed countries, but the growing number of actual users will probably come from places like Lebanon, Turkey, Venezuela and Indonesia, among others.”
Sean Stein Smith, assistant professor in the department of economics and business at Lehman College, told Cointelegraph that he was not particularly surprised by the survey’s findings, “since inflation is one of the factors that has and continues to drive adoption of Bitcoin and other crypto assets all over the world.”
But, it remains just one of many factors, and often different regions have separate factors that push adoption, said Stein Smith. “On a fundamental level, investors and entrepreneurs are increasingly recognizing the benefits of crypto assets” as an “instantaneously accessible,” traceable and cost-effective transaction option. In other places, “the potential capital gains and returns of crypto assets” encourage crypto adoption.
There are regulatory questions surrounding cryptocurrencies globally, particularly in the Asia Pacific and Latin America regions where 39% and 37% of survey respondents, respectively, said that “legal uncertainty around cryptocurrency,” tax questions and a general education deficit could affect adoption, the report noted. In Africa, for example, 56% of respondents said more educational resources to explain cryptocurrencies were needed.
“It is not only inflation, it is a bigger issue of empowering our youth to have a better life than their parents and not to have fear of failure or allegiance to the legacy financial markets or products,” Monica Singer, South Africa lead at ConsenSys, told Cointelegraph. In addition, “the issue of dependency on cash and remittances is huge in Africa and the dependency on social grants.”
The future of money?
Overall, Brazil and Indonesia were the top two countries in cryptocurrency ownership in the survey. Forty-one percent of those surveyed in each of those countries said they owned crypto. Comparatively speaking, only 20% of Americans surveyed said they owned cryptocurrency.
People living in inflation-afflicted markets are more likely to view cryptocurrencies as the future of money. According to the survey:
“The majority of respondents in Latin America (59%) and Africa (58%), where many have experienced long-term hyperinflation, say that crypto is the future of money.”
The strongest support for this view was seen in Brazil at 66%, Nigeria at 63%, Indonesia at 61% and South Africa at 57%. The fewest believers were in Europe and Australia, notably Denmark at 12%, Norway at 15% and Australia at 17%.
Will the Ukraine conflict impact adoption?
The survey was conducted before the Ukraine-Russia War. Will that devastating conflict have any long-term impact on global crypto adoption growth?
“The Ukraine-Russia war has certainly led to crypto being thrust directly into the mainstream conversation,” said Stein Smith, “especially since the Ukrainian government has directly solicited over $100 million in crypto donations since the war began,” further adding:
“This real-world demonstration of the power of decentralized money has the potential to turbocharge wider adoption, broader policy debate and increased utilization of crypto as a medium of exchange moving forward.”
But, the war may not affect all parts of the developing world. “The war in Ukraine is of no consequence to the demand for crypto in Africa,” Singer told Cointelegraph. Other factors loom larger. “Inflation, yes, but also the lack of trust in the government in many countries in Africa and the fact that we have a young demographic that is very knowledgeable in using mobile phones and the internet.”
The success of Mpesa in Kenya, for example, has had a big impact on the continent and will arguably help hasten further crypto adoption. It “is directly related to the spirit that exists in Africa of making a plan when everyone that you trust fails you,” she said.
On the other hand, Ma views the Ukraine conflict as a sort of crisis check for cryptocurrencies. “The Ukraine-Russia War has served as a stress test for the payment rail of cryptocurrencies amid global uncertainty, especially for the residents in emerging markets,” he told Cointelegraph, adding:
“We could expect the greatest future gains in crypto adoption to be found in emerging markets like these.”
Inflation along with currency devaluation are enduring concerns in many parts of the world. In such afflicted areas, Bitcoin and other crypto are now seen as candidates for currency replacement — the “future of money.” This is generally not the case in the developed world, though that could change, particularly with more regulatory clarity and education. As d’Anethan told Cointelegraph, “It seems that even Western nations are waking up to inflation and the impact it will have on cash holdings.”
Two new carbon-neutral cryptocurrency exchange-traded products (ETPs) have been launched on the Six Swiss Exchange, bringing the total number of crypto ETPs to 155.
The SIX Swiss Exchange just announced on Monday that Helveteq is introducing two new crypto exchange-traded products (ETPs), Bitcoin (Bitcoin Zero / BTCO2) and Ethereum (Ether Zero / ETH2O), becoming the third crypto ETP issuer to join SIX in 2022.
An ETP is a derivative financial instrument that trades based on assets such as commodities, currencies, share prices, or interest rates. The BTCO2 and ETH2O ETPs seek to expose investors to the world’s two most valuable cryptocurrencies while offsetting their carbon footprints. They are part of the “crypto goes carbon neutral” campaign led by Helveteq in conjunction with the Swiss fintech innovation lab at the University of Zurich.
Christian Katz, CEO of Helveteq, said it is vital to provide carbon-neutral crypto ETPs while commenting on the latest listing. He added that:
“Awareness of the link between the environment and the blockchain economy is rising fast and we all must work together to find sustainable solutions. That’s why Helveteq sponsors and cooperates with the University of Zurich for research in this field, based on which we compensate the carbon footprint of our Zero ETP family.”
Many crypto ETPs have been created since the world’s first crypto ETP was launched on the Swiss SIX Exchange in December 2018. The Amun Crypto Basket ETP (HODL), which tracks five major cryptocurrencies, was introduced in 2018 as the platform’s first ETP.
On Jan 13, SIX announced the BTCetc Bitcoin ETP (BTCE) trading, allowing investors to gain exposure to the world’s most valuable cryptocurrency in a new way. The platform provides access to 240 cryptocurrencies-based products. According to the announcement, the platform’s trading volume for crypto-related products surged 673% in 2021.
Bitcoin (BTC) starts the second week of April with a whimper as bulls struggle to retain support above $40,000.
After a refreshingly low-volatility weekend, the latest weekly close saw market nerves return, and in classic style, BTC/USD fell in the final hours of April 10.
There is a feeling of being caught between two stools for the average hodler currently — macro forces promise major trend shifts but are being slow to play out. At the same time, “serious” buyer demand is also absent from crypto assets more broadly.
However, those on the inside show no hint of doubt about the future, as evidenced by all-time high Bitcoin network fundamentals and more.
The combination of these opposing factors is price action that simply does not seem to know where to go next. Can something change in the coming week?
Cointelegraph takes a look at five potential Bitcoin price cues as a retest of $40,000 looms closer.
No “massive drawdown” for BTC?
April 11 is starting out with a reclaim of $42,000 for BTC/USD, which the pair briefly lost overnight as it dipped into the weekly close.
Hitting $41,771 on Bitstamp in the process, Bitcoin thus saw its lowest levels in weeks, matching those from March 23.
In doing so, the largest cryptocurrency, likewise, gave up all of its gains from the intervening period to fall back to the top of its trading range from last month. However, this could end up being a retest of previous resistance as support. Instead of fearing the worst, many traders are hopeful that a reversal would soon kick in.
“Bullish retest of flipped weekly level, finex whale filling bids, I’m buying the dip. If you want to wait for confirmation you can wait for a monthly close to confirm,” popular Twitter user Credible Crypto wrote as part of comments overnight.
Designed to identify uptrends or downtrends in an asset, Aroon has only delivered such bearish-to-bullish “crosses” six times since 2017 — the time of Bitcoin’s previous blow-off top.
Pretty good odds of you ask me. Aroon is designed to act like both a smooth indicator and exponential one due to its behavior toward time instead of price.
As Cointelegraph recently reported, trader and analyst Rekt Capital also had plenty of reasons to adopt a bullish thesis for Bitcoin. But, at around $42,150, the weekly close ultimately disappointed compared to his required $43,100.
“A BTC Weekly Candle Close like this and the retest of ~$43.100 as new support would be successful,” he explained alongside a chart on April 10.
“Therefore, BTC would be positioned for a move higher inside the ~$43100-$52000 range, as per the previous blue circle.”
Cointelegraph contributor Michaël van de Poppe, meanwhile, also noted that the late dip on April 10 had closed the potential for a CME Group futures gap to provide a short-term price target at the start of trading on April 11.
Stocks pressured across the board
It’s a gloomy day for stocks so far, as Asia leads with widespread losses, thanks in no small part to China’s latest COVID-19 lockdowns.
Both the Shanghai Composite Index and Hong Kong’s Hang Seng fell over 2% in morning trading.
In Europe, markets were yet to open at the time of writing, but the ongoing geopolitical tensions focused on Russia showed no signs of change.
A glimmer of hope for the euro came in the form of a potential lead for incumbent French President Emmanuel Macron against rival Marine Le Pen in polls.
Beyond the short term, however, analysts are eyeing concerning trends: rapidly increasing inflation, bond market losses and a seeming inability for central banks to respond so far.
The European Central Bank (ECB) is due to meet this week with a key focus on inflation control — ending asset purchases and raising interest rates.
The biggest bond bubble in 800yrs continues to deflate after the start of the Fed’s rate-hike cycle, ahead of next week’s #ECB meeting & as rising #inflation shakes up bond mkts. Value of global bonds has dropped by another $960bn this week, bringing total loss from ATH to $6tn. pic.twitter.com/g78Pu2dyLo
The situation underscores the difficulties stocks and risk assets face in the current climate. As commentators agree that the inflationary environment and associated central bank measures will reduce demand for Bitcoin and crypto, the true extent of the economic reality is already clear.
In a previous Twitter post last week, Holger Zschaepitz revealed that for all the gains in the S&P 500, for example, the Fed’s asset purchases mean that progress has, in fact, been flat since the global financial crisis.
“Just to put things into perspective: The S&P 500 may have hit a new ATH today, but if you put the index in relation to the Fed’s balance sheet, it is trading at the same level as in 2008, so equities have traded sideways since 2008, basically counteracting balance sheet expansion,” he wrote.
Down together?
For Arthur Hayes, ex-CEO of derivatives giant BitMEX, the bullish case for Bitcoin as a store of value in the face of failing fiat is still there.
The problem is that such a scenario is not reality — yet.
In his latest blog post released on April 11, Hayes repeated warnings that pain would precede gain for the average investor with significant risk asset exposure.
The future could well see a shift away from United States dollar hegemony toward different assets by nation-states and individuals alike, but in the meantime, macro forces will continue taking their toll on crypto.
If stocks are due to dive as central banks act, notionally to combat inflation, crypto’s increasing correlation to them means only one thing.
“The short-term (10-day) correlation is high, and the medium term (30-day and 90-day) correlations are moving up and to the right. This is not what we want,” Hayes argued about crypto correlations with the Nasdaq 100 (NDX).
“For me to hoist the flag in support of selling fiat and buying crypto in advance of an NDX meltdown (30% to 50% drawdown), correlations across all time frames need to trend demonstratively lower.”
Could equities really see half their value removed as a result of the Fed and its actions? It would be anyone’s guess, Hayes answered.
“Down 30%? […] Down 50%? […] your guess is as good as mine,” he added.
“But let’s be clear– the Fed isn’t planning to grow its balance sheet again any time soon, meaning equities ain’t going any higher.”
Federal Reserve balance sheet as of April 4 (screenshot). Source: Federal Reserve
Sentiment diverges from traditional markets
With the macro gloom on the horizon, it is no surprise that market sentiment is taking a beating.
Having sensed “greed” across crypto at the end of March, the Crypto Fear & Greed Index is now firmly back in “fear” territory.
An analog of the traditional market Fear & Greed Index, the metric has shed half its normalized score in under two weeks as cold feet return to traders.
On April 11, Crypto Fear & Greed measured 32/100, while its traditional market counterpart was higher at 46/100, defined as “neutral.”
Deserved or not, Van de Poppe, meanwhile, reminded readers not to trade based on sentiment cues.
“Everyone was super bullish on the markets, but now the markets start to correct, and the fear takes over,” he summarized.
“The sentiment isn’t a great indicator of how you should trade usually.”
Crypto Fear & Greed Index (screenshot). Source: Alternative.me
Fundamentals keep the faith
A glimmer of hope comes from a familiar source this week. For all the price drawdowns, Bitcoin’s network difficulty is only due to decrease by 0.4% in the next few days.
Arguably the most important aspect of the Bitcoin network’s self-maintaining paradigm, the difficulty will adjust downward from all-time highs to reflect changes in mining composition.
The adjustment’s small size suggests that miners remain financially buoyant at current levels and are not struggling despite last week’s 10% BTC/USD dip.
Bitcoin difficulty 7-day average chart. Source: Blockchain
Further data supports the argument, with hash rate estimates from monitoring resource MiningPoolStats likewise lingering at record highs.
As Cointelegraph recently reported, mining continues to attract major investment, including from Blockstream, which last week announced a solar-powered farm set to generate 30 petahashes per second in hash rate once operational.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.
Crypto investment company Ark Invest founder, Cathie Wood, has dumped all of the firm’s holdings of PayPal and showed greater confidence in the long-term growth of the Cash App payment system which uses the Bitcoin Lightning Network.
Wood explained her firm’s move at the Miami Bitcoin 2022 conference which wrapped up on April 9.
The Lightning Network (LN) is a layer-2 solution for Bitcoin meant to facilitate faster and cheaper transactions. Financial technology company PayPal operates the payment app Venmo as a direct competitor with Block’s (formerly Square) Cash App.
“@ARKInvest has sold, completely got out of Paypal, whose Venmo is a big competitor to Cash App.
Wood said in an interview with CNBC on April 8 that she made the decision to drop PayPal for Cash App due to its more comprehensive approach toward digital asset wallet integration. She said that although Venmo has begun to accommodate Bitcoin (BTC), “it’s more of a follower of Cash App.”
“We tend to put our bets with who we believe will be the winners… As we consolidated our portfolios during a risk-off period, we chose Block over PayPal.”
Wood continued that her firm’s conviction in Cash App stems from what she perceives to be the organically-driven growth in users “as opposed to more of a top-down approach” from Venmo.
In general, Wood believes retail investors have driven the crypto market up to this point as she stated:
“I don’t think most institutional investors are positioned the way they ultimately will be. Retail has really led the charge here.”
Venmo currently boasts 70 million users and $850 million in profit compared to Cash App’s 44 million and $2.03 billion in profit in 2021 according to data from app tracker Business of Apps. The stark contrast in their ability to net profits could be another motivating factor for Ark’s assessment of the two brands.
As Ark Invest has taken a bullish stance on Cash App, its Bitcoin product lead Miles Suter announced on April 7 that American users would be able to automatically invest a portion of their direct deposits into Bitcoin.
Wood is a big Bitcoin believer who repeated her prediction in the interview that BTC would hit $1 million by 2030.
Metaverse events at ancient and historical sites could soon shape up to be an alternate future for tourism.
Owners of physical castles and villas who have drafted up augmented reality blueprints of their properties think their ambitious plans to attract visitors in the metaverse will work, as virtual events can help them pay the hefty maintenance bills for their aging properties and also offer a chance to change historical narratives.
The metaverse tourism model was expedited by downturns in tourism brought about by COVID-19, but the industry may have already been heading that way.
Currently, major metaverse platforms are clunky, difficult to use and waiting for more “real estate” development, but firms are concentrating on what could be. Brands seem to be entering the metaverse en masse just for PR bragging rights.
So, it seems the possibility of learning existing, new and revised histories through the metaverse is not so remote.
Nonfungible castles, villas and chateaus
Michelle Choi, founder of 3.O Labs — a Web3 venture lab — turned to digital opportunities to finance the upkeep of physical paintings, such as selling nonfungible tokens, or NFTs, as fundraisers to preserve illiquid assets.
Choi was a product manager at Google when she noticed the downturn in museum tourism due to COVID-19, seeing it as an opportunity for future metaverses. She subsequently quit her job and started her own metaverse experiments.
She began by working with a team to launch Non-Fungible Castle, an NFT exhibition and auction at Lobkowicz Palace, a real-life castle in Prague, held in October 2021. The event saw NFTs displayed next to 500-year-old paintings and had the goal to “broaden accessibility to cultural heritage.”
The launch raised enough to cover the restoration of all urgent projects at the property. Motivated by this proof-of-concept, Choi and 3.O Labs are now busily curating metaverse tourism experiences globally.
With the broader mission of making Web3 accessible to all users, 3.O Labs is already incubating an array of Web3 projects ranging from NFTs to decentralized autonomous organizations, or DAOs. Within its metaverse vertical, the venture lab is already building a project in a castle in Germany, which will be followed by a villa in India and then possibly a museum in Ghana.
Lobkowicz Palace. Source: Prague Morning
Choi told Cointelegraph about her long-term vision for metaverse travel:
“Travel will be augmented as a teaching tool. In the past, tourism meant visiting a place. Photos were 2D, but 3D travel then emerged with virtual headsets. 4D time experimentation is now possible. Now, we can mesh different time periods. There’s a teaching angle.”
This raises a series of questions regarding what new histories will be created in the metaverse.
Will history be rewritten in the metaverse?
For better or worse, tourism businesses, education platforms and museums could reimagine history in the metaverse.
Priyadarshini Raje Scindia’s family owns Jai Vilas Palace, a 200-year-old palace-turned-museum in Madhya Pradesh, India. She is planning an NFT collection produced by local artists to fund a metaverse experience. COVID-19 shut her museum for two years, allowing time for some needed — but expensive — restoration work.
Scindia told Cointelegraph that NFTs should be embraced as art, as “Every generation has its art and the interpretation of it. This is a new medium and a new platform for hungry, emerging Indian artists.” She added that there “should be no barriers around art creation.”
Scindia is convinced that the metaverse is the future, as “A person usually visits a museum once,” but they can visit multiple times in the metaverse. She says that in India, especially, museums are not the first destination people think to go to for entertainment. Private museums in small towns can be taken for granted, especially when compared with shopping malls and cinemas. So, she is working with 3.O Labs to “create immersive experiences — for example, animations that allow you to put yourself in short history documentaries.” It’s about opening more doors for conversations and education.
Scindia also has a story to tell the world via the metaverse:
“I disagree with my family history. We have rooms of research documents in the palace. Now is the right time and the right platform to correct history.”
She told Cointelegraph that the historical narrative she would like to paint with her immersive experiences is “to tell the real story of my clan, the Maharatas. Retelling the story told by the British, which sounds like a Game of Thrones book — dark and barbaric. We fought for independence from all exterior forces, yet it was made out that we were fighting Indians in India. It is a historic fact that the Maharatas were the rulers of India, post the Mughals. And their narrative and value system are even more essential to study and understand today. I would like to use the platform to change the narrative through art, culture and history.”
“I disagree with the way Maratha history is portrayed. However, today there is a renewed interest, maybe because of the glamor of cinema, but there’s also a new world out there. People have a deep interest in history today and are rediscovering art and history. The metaverse may be the right platform to inform and educate people, to generate interest, so they may start their own journey of a deep dive into history, art and culture through this amazing world.”
Prince Heinrich Donatus of the Schaumburg-Lippe family owns Bueckeburg Castle, a castle in northern Germany, 45 minutes from Hannover. Schaumburg-Lippe was one of the 16 reigning families of the German Empire until 1918. Later, the British Army of the Rhine confiscated the castle to use as its headquarters from 1948 to 1953. It had previously been under American control following the end of World War II in 1945 until Germany’s occupation zones were established.
A bullet hole in the outhouse serves as a reminder of the castle’s recent history. Americans were the first to arrive at Bueckeburg during the war, and their tank shell that penetrated the dome is still viewable in the castle’s museum. The family exhibits the shell and has left the hole in the ceiling as a reminder of the war.
Donatus has the same idea as Scindia: a metaverse for historical preservation.
Bueckeberg Castle. Source: Trip Advisor
Donatus, who co-founded 3.O Labs with Choi, will soon operate an NFT exhibition and a DAO-focused hacker house at the castle. He told Cointelegraph that “The metaverse isn’t a virtual reality world. It is a new economy. For example, the incentivization to enter the metaverse could be to protect a castle.”
But why support noble families in 2022?
For illiquid assets like sprawling estates, the cost of maintenance can outweigh a family’s cash flow. The preservation of privately owned sites of historical significance is, therefore, a significant challenge for owners and a national or global public good.
In 2001, Donatus’ grandfather sold a castle for 1 euro, and the new owner’s latest two attempts to sell the same castle for 1 euro failed to find a buyer. Donatus added:
“Foreigners who buy European castles give up after a year when they realize what is involved.”
“The Bueckeburg castle is not meant to be lived in anymore — it is primarily a cultural site,” Donatus said, “We have the sole responsibility to maintain this history working with limited resources, and suddenly resources can be vastly enhanced and crowd-sourced.”
“Virtual tours could be profitable, though metaverse ideas could take several years to pay back,” noted Choi. “But long term, there are no maintenance or air conditioning expenses for the metaverse.”
Donatus said he foresees a launching DAO treasury for renovations, akin to a “people’s UNESCO” — a reference to the United Nations agency tasked with protecting sites of cultural and historical significance.
DAOs are not constrained by borders, and this can create network effects for new models of tourism. “A sort of PleasrDAO for castles,” said Donatus.“They will include decentralized access/stewardship to castles, and castle hackathons — as castles are a cool place for meetups.”
Augmented 4D metaverse events
Historical storytelling and experiences can also be augmented to create surreal and impossible scenarios.
“Under no circumstance do I want to experience things I can experience in the real world,” said Donatus. “The Metaverse can recreate and preserve the past.” He said one could create a “tennis match in a ballroom in the Palace of Versailles as a great tourist drawcard.”
Choi said, “In the metaverse, we can upload guns and recreate wars for historical teaching purposes.” Historical reenactments with reconstructed weapons happen all over the world, including in the United States, Germany, Russia, the United Kingdom and Italy, and there may be many future teachable moments in the metaverse.
If metaverses truly are the future, the planning for their rules and composition starts now. This is why, for example, a group of Indigenous Australians plan to set up an embassy in the metaverse. Mixing the ancient and the new is seemingly tenuous, but it all depends on how bullish one is about the significance of the cultural totems in the metaverses of the future.
As metaverses become new models for tourism, they may also rewrite history in the process.
On April 2 after an incredible 82% rally over a 20 day period Solana (SOL) price reached $143.50. This positive performance can be attributed to recent NFT markets-related news and a marketwide bounce, but it could have confused investors because of the current 22.7% decline.
The rally started after Coinbase Wallet added support for SOL and other Solana-based blockchain tokens on March 18. The crypto exchange also outlined plans to “further integrate” with Solana by connecting the Coinbase Wallet with the decentralized applications (DApps) and nonfungible tokens (NFTs) hosted on the network.
Solana/USDT at FTX. Source: TradingView
Investors are excited with the expectation of OpenSea’s integration of the Solana network. This means Solana will join Ethereum, Polygon & Klaytn as the payment options visible in the drop-down “all chains” tab on OpenSea’s “rankings” page.
Solana’s strategy to focus on NFT markets seems to have paid off because on April 6 the layer-1 blockchain network has risen to third place all-time in total NFT sales. However, the latest 30-day amassed data shows Solana amassing $216 million worth of NFT sales.
Decline of Solana’s DApp deposits
Solana’s primary decentralized application (DApp) metric started to display weakness in late March after the network’s total value locked (TVL) dropped below SOL 50 million.
Solana network Total Value Locked, SOL. Source: DefiLlama
The above chart shows how Solana’s DApp deposits had a 30% decrease in 3 weeks as the indicator reached its lowest level since Sept. 20, 2021. As a comparison, Fantom network deposits grew by 30%, while Terra’s TVL increased by 34% year-to-date.
On April 8, DappRadar data shows that the number of Solana network addresses interacting with decentralized applications increased by 11% on average.
Orca, a user-friendly decentralized exchange (DEX), was the absolute highlight, amassing 153,290 users.
Even though Solana’s TVL has been hit the hardest compared to similar smart contract platforms, there is solid network use on DeFi and NFT marketplaces, as measured by Magic Eden’s 212,230 active addresses in the last 30 days.
The above data suggest that Solana investors should not worry about the most recent correction. The Solana ecosystem is fueled by the delivery of important milestones toward Ethereum compatibility and NFT market integrations and as long as this happens the potential for further price appreciation seems likely.
The opinions and views expressed here are solely those of the author and do not necessarily reflect the views of NewsPolite. Every trading and investment move involves risk. You should definitely conduct your own research when making a decision.
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