Monday, 11 July 2022

Market Summary

Market Summary 11 July 2022

Bitcoin Price: US$  20,862.47 (-3.38%)
Ethereum Price: US$ 1,168.36 (-4.00%) 


US dominates crypto ATMs installations and BTC hash rate worldwide

  • Despite the myriads of state and federal regulatory hurdles faced by crypto businesses in the region, the United States plays a major role in preserving the Bitcoin (BTC) and crypto ecosystem. With China moving out of the picture following a permaban on crypto, the United States maintains the top position in terms of hash rate contribution and ATM installations worldwide. 
  • Prior to cracking down on BTC mining, China historically represented over 50% of the total hash rate up until Feb 2021. With China out of the competition, the US picked up the slack to become the highest BTC hash rate contributor — representing 37.84% of the total mining power by Jan 2022.
  • Chinese miners resumed operations in September 2021. However, the miners in the US continued to dominate the space while increasing their hash rate contribution month-over-month. 
  • In addition, the US is home to the highest number of ATM installations, representing nearly 88% of the total crypto ATM installations worldwide. Over 90% of the overall crypto ATMs installed over the past several months are in the United States. Data from Coin ATM Radar confirms that the trend continues to July as the US saw the installation of 641 out of the 710 Bitcoin and crypto ATMs installed in the first 10 days of the month.
  • Further strengthening North America’s position in the crypto ecosystem, Canada represents the second-largest network of crypto ATMs after the United States. Outside of the Americas, Spain houses the highest number of crypto ATMs, 210 or 0.5% of the total active ATMs.


Investors lament potentially lost ‘millions’ on Voyager bankruptcy

  • Many Investors are reeling from Voyager Digital’s recent bankruptcy filing, with some claiming to have either ‘millions’ worth of crypto assets or most of their life savings locked on the crypto exchange.
  • As previously reported, Voyager paused withdrawals at the start of this month amid its liquidity issues as a result of Three Arrows Capital (3AC) defaulting on a $650 million loan from the firm. Despite Alameda supplying the firm with a $500 million loan in June, Voyager went on to file for bankruptcy on July 6.
  • In a July 9 article, Fortune spoke to several Voyager users who are reeling from the recent bankruptcy filing. Some put nearly all of their life savings onto the platform, while others are said to have millions hanging in limbo.
  • One user, referred to as Robert for anonymity purposes, stated he put roughly six figures on the platform, representing 70% of his life savings.


After Terra’s fall to Earth, get ready for the stablecoin era

  • Events in May demonstrated that crypto stability is still elusive. With governments slow to react, Terra’s LUNA token — which has since been renamed Luna Classic (LUNC) — dropped to close to zero in value, wiping out $60 billion along the way. The obvious conclusion would be that the stablecoin experiment has failed. But I believe Terra’s fall to Earth is the precursor to a new era where stablecoins will become established, accepted and beneficial components of the global economic system. And the regulation that is only now dropping into place already looks well past its sell-by date.
  • What’s happening is a clearout of the algorithmic stablecoins. These are coins that were never fit for purpose because they were built on insecure foundations. There were always critics: Some called out Terra as a Ponzi scheme and argued that it, and other algorithmics, would only hold value if more and more people bought them.
  • Algorithmic stablecoins are unregulated and not backed by equivalent amounts of the underlying fiat currency — or by anything, for that matter. Instead, they deploy smart contracts to create or destroy the available supply of tokens to adjust the price. It’s a system that worked, backed up by an artificially high interest-paying mechanism called Anchor, while enough people believed in it. Once that trust started to evaporate in early May, the flood gates opened in a classic, old-world bank run.


VC Roundup: ‘Web5,’ Metaverse sports and Bitcoin monetization startups generate buzz

  • A lot has happened in the Bitcoin (BTC) and cryptocurrency markets since our last edition of VC Roundup. The monumental collapse of the Terra ecosystem spilled over into other segments of the digital asset market, exposing over-leveraged traders, lending platforms and venture capital funds. In the process, Bitcoin’s price plumbed new lows, falling below the previous cycle’s peak for the first time in its history. 
  • Despite macro headwinds inflicting pain on the crypto markets, venture capital firms are still investing in the industry’s most promising startups. The latest edition of VC Roundup highlights funding deals for digital asset infrastructure providers, non-custodial crypto protocols, payment solutions and decentralized identity management companies.
  • PolySign’s quest to bring institutional-level crypto custody solutions to investors has received backing from several venture capital firms. The firm recently raised $53 million in Series C financing backed by Cowen Digital, Brevan Howard, GSR and more. In addition, the company secured a $25 million credit facility from venture firm Boathouse Capital. Although PolySign didn’t specify how the funding will be allocated, the Series C was closed around the same time that the firm acquired digital asset fund administrator MG Stover.


Cardano ‘sharks’ scoop up 79.1 million ADA ahead of Vasil hard fork

  • Notably, addresses holding between 10,000 and 100,000 ADA, also called sharks, have added 79.1 million tokens, $37.7 million as of July 9, to their reserves since June 9, according to data from Santiment.
  • Meanwhile, Cardano whales that hold between 100,000 and 1 million ADA have stopped selling.
  • Holding a larger amount of ADA makes sharks and whales powerful enough to determine the token’s upcoming trends via increased volatility or decreased liquidity. Additionally, they can force fishes, or investors holding fewer ADA tokens, to copy their trades.
  • The recent buying spree among the Cardano sharks hints that they have been positioning themselves for a sharp price rebound, especially as ADA trades nearly 85% below its September 2021 record high of $3.16. 
  • Dubbed Vasil, the hard fork could allow faster block creation and improve scalability for Cardano’s decentralized application (DApp) ecosystem. It will also introduce interoperability between Cardano’s sidechains.


BREAKING: Elon Musk wants to terminate the $44B Twitter takeover

  • In an unexpected turn of events, Tesla CEO Elon Musk announced his intention to end the $44 billion Twitter deal via a letter sent to the board of the social media giant.
  • In short, one of the world’s richest man is not happy with the lack of information Twitter provided about spam and fake accounts. According to the letter, which is addressed to Twitter’s chief legal officer Vijaya Gadde, Musk is terminating the merger because Twitter “appears to have made false and misleading representations,” which Musk used as a reference point for his decision.
  • Elon Musk initially agreed to purchase the crypto-friendly social media platform for $54.20 per share, or about $44 billion, in cash. The board of Twitter was happy with the decision, unanimously voting in favor of the deal that would make it a privately held company once again.
  • However, the letter filed for the SEC argued that Twitter was not very clear about two crucial data — Twitter’s process for auditing the inclusion of spam and fake accounts in monetizable daily active users (mDAU) as well as identifying and suspending such accounts. The social media giant was reportedly secretive about the daily measures of mDAU for the last two years. The letter reads:
  • “In short, Twitter has not provided information that Mr. Musk has requested for nearly two months notwithstanding his repeated, detailed clarifications intended to simplify Twitter’s identification, collection, and disclosure of the most relevant information sought in Mr. Musk’s original requests.”
  • The letter then claims that Twitter is breaching two sections of the merger agreement (Sections 6.4 and 6.11). The letter says the social media company has been on notice of its breach since June 6, and “any cure period afforded to Twitter under the Merger Agreement has now lapsed.”


Tether liquidates Celsius position with ‘no losses’ to stablecoin issuer

  • Tether’s Bitcoin (BTC)-denominated loan to Celsius Network has been fully liquidated without a loss, easing concerns that the stablecoin issuer may have oversized exposure to the embattled crypto lender.
  • In a statement issued Friday, Tether explained that its lending arrangement with Celsius prevented any downside risk to its underlying business. Specifically, the BTC-denominated loan issued to Celsius was overcollateralized by 130%, and the original agreement allowed Tether to liquidate the collateral to cover the loan.
  • “This process was carried out in a way to minimise as much as possible any impact on the markets and in fact, once the loan was covered, Tether returned the remaining part to Celsius as per its agreement,” the statement read. “Celsius position has been liquidated with no losses to Tether.”

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