Wednesday, 15 December 2021

Market Summary

Market Summary 15 December 2021

Bitcoin Price: U$48,343.28  (+3.51%)
Ethereum Price: U$3,858.99 (+2.04%)


Disappointing December, Flight to Stables, Nike Furthers Metaverse Ambitions

  • December has been a disappointing month for crypto as macro uncertainty brews. Prices of large-cap crypto assets moved sideways to start the month before taking another turn lower yesterday.
  • Despite the uncertainty, LUNA is an outlier as it’s the only one that performed positively since the start of December; LUNA has been burnt every day since the start of December driven by increased UST minting.
  • These upcoming launches of Astroport and Mars Protocol have also likely contributed to LUNA’s recent outperformance. 
  • The markets have become extremely fearful as of recent, largely driven by the latest sell-off and heightened macro uncertainty. BTC has tumbled over 30% from its November peak and is now trading at levels last seen in early October; it’s important to point out market sentiment appears to be much more “fearful” than we saw in October, however.
  • During the November FOMC meeting, the Federal Reserve confirmed its plans to start tapering asset purchases, a decision the Fed will likely remain steadfast on as it seeks to curb the highest inflation readings in four decades. Fed Chair Jerome Powell has also signaled recently that the timeline to wind down the Fed’s bond-buying program may be accelerated, adding further concerns we may see another liquidity crisis unfold.
  • All eyes will be on the Fed as Powell hosts the final press conference of the year tomorrow following the FOMC’s two-day meeting. Markets are on edge as each FOMC meeting is now considered “live” and may cause further volatility if they hold any surprises.
  • Nike announced that it has acquired the metaverse sneaker company RTFKT (pronounced as “Artifact”). With that, Nike joins the likes of Visa and Adidas as companies that have entered the NFT space.
  • RTFKT recently launched Clone X in partnership with Takashi Murakami, a Japanese contemporary artist.
  • Upon the announcement, Clone X and Mintvials (pre-revealed Clone X) were swept off their floor prices and nearly doubled in just a few hours.


IRS posts finalized 1040 form with revised crypto question

  • The Internal Revenue Service (IRS) posted its finalized Form 1040, featuring some minor revisions to its crypto question.
  • The IRS included a question on cryptocurrency at the top of the 1040 form last year: “At any time during 2020, did you receive, sell, or otherwise acquire any financial interest in any virtual currency?” The IRS made the move in the hopes of curbing any confusion on reporting cryptocurrency. 
  • “At any time during 2021, did you receive, sell, exchange, or otherwise dispose of any financial interest in any virtual currency,” reads the form.
  • The previous version contained a catch-all asking if taxpayers had “otherwise acquire[d] any financial interest.” That is not the case for 2021. The new language solidifies the clarification, since the phrasing only covers transactions that would constitute taxable events. 
  • Activities like receiving crypto as payment; airdrops; exchanging crypto for crypto; selling; and receipt from mining, staking or hard forks would require the taxpayer to answer “yes” to the crypto question.  


Ethereum Foundation launches incentive program for client teams

  • The Ethereum Foundation has launched what has been dubbed the Client Incentive Program to encourage software development teams to continue to maintain the core network.
  • Client teams will each receive 144 validators totaling 4,608 ETH to operate on mainnet. The teams can unlock rewards as they continue to build software that meets performance and security requirements. Ownership of the funds vests over several years as the team maintains clients and meets performance benchmarks on mainnet. The first tranche unlocks at the delivery of Beacon Chain — Ethereum’s proof-of-stake solution — withdrawals.
  • Validators will earn transaction fees after the merge, so the program will act as a revenue stream. Teams can use the vested grants as they see fit, whether by staking to earn further rewards or withdrawing and liquidating. 


Solana Ventures announces new $150 million fund for blockchain gaming

  • Solana Ventures, the investment arm of Solana Labs, announced Tuesday a new $150 million fund to back blockchain gaming startups.
  • The fund has been launched in partnership with Forte, a blockchain gaming startup that recently raised $725 million in new funding, and Griffin Gaming Partners, a VC firm focused on the gaming sector and a lead investor in Forte.
  • The fund backed by the trio is denominated in dollars and not in Solana (SOL) tokens, a Solana Labs spokesperson told The Block. It plans to invest in gaming startups building on the Solana blockchain. Solana Ventures contends that the network’s throughput of 65,000 transactions per second and average per-transaction cost of $0.00025 makes it an ideal blockchain for gaming applications.


FTX US signs NFT deal with the Golden State Warriors basketball team

  • The United States-based crypto exchange FTX US announced today that it has entered a deal with the Golden State Warriors professional basketball team. As part of the deal, the Warriors will create and launch non-fungible tokens (NFTs) and FTX US will be the main hub for the team’s digital asset launches. 
  • The Warriors, which are based in San Francisco, intend to release NFTs FTX US’s NFT marketplace beginning in early 2022, according to a release. They will include digital collectibles of the Warriors’ six NBA Championship rings and 10 commemorative ticket stubs. 
  • In addition, FTX US will also donate one bitcoin to three charities based in the Bay Area, all of which aim to improve diversity in STEM and tech.


NYDIG raises $1B in funding, valuation now $7B

  • On Tuesday, New York Digital Investment Group, or NYDIG, a financial institution specializing in Bitcoin financial services such as savings accounts, trading brokerages, 401(k)s, etc., announced it had secured a $1 billion equity investment led by WestCap. The funding places its valuation at nearly $7 billion.


Circle’s USDC stablecoin deployed on Avalanche blockchain

  • Circle has launched its USD Coin (USDC) stablecoin on the Avalanche blockchain network, the company announced on Tuesday.
  • The news marks another boost for Avalanche’s stablecoin diversity push following Tether’s launch of its USDT stablecoin in November, as well as e-Money’s suite of interest-bearing, fiat-backed stablecoins earlier in the year.
  • As part of the announcement, Circle stated that USDC support on Avalanche could empower more developers to build eco-friendly decentralized finance (DeFi) applications.


Elon Musk: Tesla will start selling merchandise for Dogecoin

  • Car manufacturer Tesla will be offering merchandise for sale with dogecoin (DOGE) according to Tesla CEO Elon Musk.
  • “Tesla will make some merch buyable with Doge & see how it goes,” tweeted Musk today.
  • The price of dogecoin surged 20% on his tweet, rising as high as $0.20.

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