Friday, 22 April 2022

Market Summary

Market Summary 22 April 2022

Bitcoin Price: US$ 40,480.01 (-2.12 %)
Ethereum Price: US$ 2,983.58 (-3.01%)


UST Enters Top 3, Moonbirds Take Flight, & SOL Staking

  • UST’s growth has been remarkable in 2022, expanding by $7.6B in around five months. Its YTD growth is trailing behind USDC by only $78.3M and will likely soon be 2022’s top growing stablecoin in absolute terms.
  • UST demand mainly stems from Anchor’s attractive 20% deposit rate for UST. However, with the “Dynamic Anchor Earn Rate” proposal passed, the rate for UST will likely be reduced in the near future. The dynamic earn rate will be based on the change in Anchor’s yield reserve over time. If the yield reserve grows, the earn rate will be higher. And if the yield reserve falls, the earn rate will be lower. Will this affect users’ decision to continue saving UST on Anchor? It seems like Twitter is split between staying and leaving if the rates are dropped to 10%.
  • However, as Anchor’s yields decrease, other sources of demand will be needed for UST to continue growing. As covered in our previous daily, one of the key initiatives here is through LP-ing into the new 4pool on Curve which strengthens UST’s peg and provides alternative demand outside of Anchor.
  • USDC has been taking a hit recently as supply growth has diminished. USDC’s peak growth this year was at $11.2B, but has since dropped to $7.7B as users redeem their USDC back into cash USD. This isn’t to say there has been any bad news regarding Circle / USDC. Some potential explanations are that users are cashing out their crypto-gains into cash ahead of tax day on April 18th, or that market uncertainty is causing crypto users to risk-off high-risk crypto assets.
  • Circle, the issuer behind USDC, has recently raised $400M from BlackRock and other financial institutions and is planning to list publically through a SPAC deal by Dec 22th, 2022.


Aussie media company goes all in on NBA fan engagement with NFTs

  • Australian media company Basketball Forever has announced an NFT project titled Hoop Hounds which seeks to increase NBA fan engagement and provide substantial real-world utility for the tokens. 
  • Critics of NFTs have consistently taken aim at the supposed ineffectual nature of the tokens, with “right click save” memes doing the rounds. However, more recently there has been an uptick in utility-focused NFT projects, such as  Bored Ape Yacht Club and Top Shot, where holders are provided exclusive access to real-world events and products.
  • Basketball Forever, the NBA-focused subsidiary of sports media company Forever Network, has developed high levels of engagement on social media in Australia over the past four years and is trying to enhance that approach with NFTs.
  • Basketball Forever will offer a total of 8,888 different “hounds” — various basketball and NBA personalities depicted as different styles of animated canines — each with unique traits and differing levels of rarity. The company expects the NFTs to be available within the next six weeks.


US lawmakers sound alarm to EPA over environment concerns of crypto mining

  • United States House of Representatives member Jared Huffman and 12 other lawmakers have requested the Environmental Protection Agency, or EPA, assess crypto mining firms potentially violating environmental statutes.
  • In a letter addressed to EPA administrator Michael Regan on Wednesday, Huffman said he and other Democratic House members had “serious concerns” around crypto firms in the United States reportedly contributing to greenhouse gas emissions and not operating in accordance with either the Clean Air Act or the Clean Water Act. The lawmakers identified efforts to “re-open closed gas and coal facilities” as a means to produce energy for crypto mining operations as a particular area of concern, as well as “energy-inefficient” proof-of-work mining for Bitcoin (BTC), Ether (ETH), Monero (XMR), and Zcash (ZEC).
  • “Cryptocurrency mining is poisoning our communities,” said the letter. “The rapidly expanding cryptocurrency industry needs to be held accountable to ensure it operates in a sustainable and just manner to protect communities.”
  • In addition to air and water pollution as a result of energy production, the U.S. lawmakers pointed to “large amounts of electronic waste” due to crypto miners becoming obsolete, and “significant noise pollution” reported around communities with mining operations in New York, Tennessee and Georgia. House members including Representative Brad Sherman — who has previously called for a ban on cryptocurrencies in the United States — and progressive lawmaker Alexandria Ocasio-Cortez signed the letter in support of action against mining firms.


Major exchange listings spark a 40% rally in Steem, TrustSwap and 0x

  • Sentiment in the cryptocurrency market is on the upswing after small gains from Bitcoin (BTC) and altcoins hint that the market could be in the process of a bullish breakout.
  • A handful of altcoins are also finding momentum and a round of fresh partnership announcements appear to back the 40% gains seen in select assets on April 21.
  • The community-focused blockchain network Steem is the underlying chain for the social media platform Steemit, which allows users to earn rewards for their posts and interactions within the community.
  • TrustSwap trades at Bithumb. TrustSwap is a decentralized finance protocol that specializes in the creation of multi-chain token swaps and offers a host of other features including staking, the ability to mint new tokens and an in-house launchpad.
  • 0x partners with Coinbase – ZRX is a decentralized exchange infrastructure protocol that specializes in facilitating the trading of assets on the Ethereum blockchain without needing to rely on centralized intermediaries.


Australian prudential regulator releases roadmap for cryptocurrency policy

  • The Australian Prudential Regulation Authority, or APRA, published a letter to regulated entities Thursday setting out risk management expectations and a policy roadmap for the regulation of crypto-assets through 2025. “While activities associated with crypto assets are still relatively limited in Australia, the potential scale and risks of such activities could become significant over time,” chairman Wayne Byres said in the letter.
  • The letter instructed the regulated entities undertaking activities with crypto assets to engage with their supervisory agencies, and it outlined risk management measures and standards specific to a variety of cases. The foreseen regulatory framework encompassed banking exposure to crypto assets, operational risk and stablecoins.
  • The agency will consult with international regulators to ensure a consistent approach to crypto-asset operations. It intends to hold consultations with the Bank for International Settlements (BIS) Basel Committee on Banking Supervision this year and next before unveiling the crypto-asset requirements, which will take effect in 2025.
  • A draft standard for operational risk will be released later this year and go into force in 2024. APRA is working with the other members of the National Council of Financial Regulators to incorporate stablecoins into a proposed regulatory framework for stored-value facilities, with consultations expected next year and a standard coming into force in 2025. In addition, crypto assets may be included in broader reforms kicked off last year.


A dozen Bitcoin ATMs installed at the largest EU electronics retailer

  • Austrians have “sufficient funds” for more Bitcoin ATMs — that’s the verdict that MediaMarkt, a German electronics retailer, reached following a successful Bitcoin ATM pilot in Austria. 
  • MediaMarkt has rolled out Bitcoin (BTC) ATMs in 12 branches across the country, including Seiersberg and Klagenfurt. Confinity and its spinoff ATM company, Kurant, manage over 200 Bitcoin ATMs in Austria, Germany, Spain and Greece.
  • Kurant’s Head of Marketing & Sales, Europe, Thomas Sperneder told Cointelegraph:
  • “MediaMarkt stores across the country have been equipped with Bitcoin vending machines. In total, these are now present in twelve markets and enable the simple and secure purchase of cryptocurrencies.”


Bitcoin heads for 2-week highs as Terra promises BTC price will soon ‘get spicy’

  • Data from Cointelegraph Markets Pro and TradingView showed BTC/USD reaching new local highs of $42,455 on Bitstamp on April 21.
  • With the Wall Street open still to come, upward momentum meant that the pair was now at its highest since April 10. Wednesday’s opening bell had nonetheless been accompanied by bearish price pressure, and traders thus remained cautious about what could come next.
  • “So far, so good for Bitcoin,” Van de Poppe reasoned in his latest update, noting that the U.S. dollar currency index (DXY) was continuing to retrace in what is traditionally a boon for crypto markets.
  • “I don’t think the upside is done, as the $DXY is showing weakness.”
  • Also emboldened at the prospect of stronger BTC price performance coming up was Blockchain protocol Terra, now famous as one of the largest Bitcoin whales after purchasing nearly 45,000 BTC in 2022.
  • In a tweet on the day, the firm’s official account claimed that Bitcoin was in line to “get spicy,” hinting that it did not expect continuation of sideways price action.


Goldman Sachs reportedly eyes FTX alliance with regulatory and public listing assistance

  • Goldman Sachs is reportedly pursuing an alliance with one of the top cryptocurrency exchanges FTX.
  • The CEO of Goldman Sachs David Solomon reportedly met with Sam Bankman-Fried, the founder of FTX in a closed-door meeting in March to discuss various prospects of working together, reported the Financial Times.
  • According to the report, the major points of discussion were around mitigating regulatory compliance in the United States and Goldman Sachs offered to help them, especially with the Commodity Futures Trading Commission (CFTC). Apart from regulatory assistance, the Wall Street bank also offered to help with future funding rounds.
  • The latest report highlights the growing relationship between traditional Wall Street giants and emerging crypto companies. Goldman Sachs has also shown interest in helping FTX with its public listing. However, people familiar with the matter claimed that Bankman Fried is currently looking for more private fundraising opportunities.


Algorand aims to convert network transaction fees into carbon offsets

  • Proof-of-stake blockchain protocol Algorand will implement a smart contract that will automate the offsetting of the network’s carbon emissions.
  • In a recent announcement, Algorand revealed that a new smart contract would take a portion of each transaction fee within its blockchain network and automatically process it to purchase verified carbon credits at ClimateTrade, a blockchain-based carbon offset marketplace.
  • According to Algorand Foundation CEO Staci Warden, the move will allow the network to scale while still being carbon negative. Warden told Cointelegraph that the smart contract will ensure that their blockchain remains eco-friendly in the long-term and hopes that other firms do the same. 


GBTC premium nears 2022 high as SEC faces call to approve Bitcoin ETF

  • After a problematic year so far, GBTC has benefitted from steadying Bitcoin price action.
  • Bitcoin’s descent from November’s all-time highs added to an already negative “premium” on GBTC, meaning that its share price, in fact, traded at a discount to the Bitcoin spot price. That discount hit its deepest ever in January when the GBTC premium nearly hit -30%.
  • Since then, a reversal has been underway, and as of April 21, the premium is -21.4% — near its smallest for 2022.
  • The premium results from trading sentiment, and Grayscale has come under pressure over the past year, especially since the approval of the first Bitcoin futures-based exchange-traded funds (ETFs) in the United States.
  • Grayscale CEO Michael Sonnenshein and other industry figures have been vocal critics of regulators in Washington, who, while approving futures ETF products, continue to reject a Bitcoin spot-based equivalent.
  • Meanwhile, a survey by Nasdaq of prospective U.S. investors revealed that over 70% of those asked would consider gaining exposure to Bitcoin via a spot ETF should one be made available.


AUSTRAC releases 2 new guides to help spot illicit crypto use

  • Australian financial compliance enforcement agency AUSTRAC has released two new guides to help entities spot when customers are using crypto for illicit means or when they are being forced to pay the creators of ransomware.
  • But, it warned that debanking customers merely on suspicion of such activity was a harmful practice with serious negative effects.
  • In an announcement posted earlier today, AUSTRAC noted that the growing acceptance, value and adoption of crypto and blockchain technology has been accompanied by an increase in cybercrime.
  • “Cyber-enabled crime is an increasing threat to Australians. According to the Australian Cyber Security Centre (ACSC), 500 ransomware attacks were reported in the 2020-21 financial year, an increase of nearly 15 percent from the previous year,” AUSTRAC stated.

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