Monday, 28 March 2022

Market Summary

Market Summary 28 March 2022

Bitcoin Price: US$ 46,827.76 (+5.20%)
Ethereum Price: US$ 3,295.65 (+4.79%)

 

Market Insights – Started From the Bottom, Now We’re Here

  • In a few of our previous Market Insights reports, we hit on several potential catalysts for Avalanche heading into Q2, including the $290M Avalanche Multiverse Incentive Program, the Terra <> AVAX announcement from Do Kwon, the 2022 Avalanche Summit & Hackathon in Barcelona this week (March 22-27th), and the general uptrend in network growth.
  • Further confirmation of AVAX’s strength compared to the broader market can be found when comparing AVAX to ETH performance (via AVAXUSDT/ETHUSDT). The ratio between these two continues to grind higher, retesting the range highs for the 4th time since the start of 2022.
  • Avalanche has seen excellent growth in daily active addresses over the last 6 months. Even more impressive is the sticky nature of these users over the last 3 months. 2022 has not been kind to many networks, but this hasn’t taken the wind out of Avalanche’s sails. Transaction activity and unique address growth has stagnated, but the stickiness of new users is notable.
  • One of the key drivers of AVAX’s recent strength has been the anticipation for the ecosystem’s upcoming subnet functionality. On March 8, Avalanche Foundation announced a new $290M Multiverse incentive program to promote the adoption of subnets. $15M of the program is already allocated to the popular game DeFi Kingdoms. As a refresher, subnets are independent networks that can run one or many app-specific chains. Avalanche ecosystem will have many tailor-made interoperable subnets catered for different specific use cases such as identity, DeFi primitives, gaming, oracles, institutional use cases, etc. The proven market fit of the Cosmos’ independent app-chain thesis only strengthens Avalanche’s multiverse vision.
  • Last week, LUNA retested all-time highs. Since then, LUNA has seen a brief pullback, followed by the current upward consolidation just beneath its prior ATH / double top. Should LUNA reclaim $100, we wouldn’t be surprised to see it run higher with momentum at its back.
  • LUNA and the broader Terra ecosystem have also been a beneficiary of uncertainty in the market. This is due its decentralized stablecoin UST, which can generate above-average yields on Anchor Protocol relative to other stablecoins alternatives.
  • SPX “death cross” is actually a bullish signal when the market is in longer-term uptrend. In each of the six occurrences since 2010, the S&P 500 generated positive returns over the next 60 trading days after its 50-day SMA crossed below its 200-day equivalent, with an average return of nearly 9%.

 

Is Austin the next US crypto hub? Officials approve blockchain resolutions

  • Most recently, Austin — the state capital of Texas that goes by the slogan “Keep Austin Weird” — has taken a strong interest in cryptocurrency and blockchain technology. While Texas’ desire to lead the way for crypto innovation was established about a year ago when Governor Greg Abbot tweeted that he is a “crypto law proposal supporter,” the city of Austin has taken additional measures to ensure the acceptance of cryptocurrency for city services.
  • Although questions remain, Kelly mentioned that Austin has always been a forward-thinking and innovative city, noting that many cryptocurrency investors currently live and work in Austin. Kelly added that Austin Mayor Steve Adler is a co-sponsor of her resolution. Given this support, Kelly believes cryptocurrency payments will serve as a useful alternative to allow individuals the flexibility of paying for certain city services.

 

Coinbase to track off-platform crypto transfers in Canada, Singapore, Japan

  • Citing compliance with local jurisdictions, crypto exchange Coinbase announced to soon collect additional information from users based in Canada, Singapore and Japan. 
  • Effective from April 1, Coinbase users from Canada, Singapore and Japan will be required to provide additional information while sending cryptocurrencies to a different (non-Coinbase) platform. 
  • However, while Singaporean and Japanese investors will be required to share additional information about the recipient for every single off-platform transaction, Canadians sending less than $801 (1,000 CAD) will be exempted from this requirement.

 

Ukraine launches NFT museum ‘to keep the memory of war’

  • The Ministry of Digital Transformation in Ukraine has started an online nonfungible token (NFT) museum aimed at preserving the timeline of major events starting with the Russian military invading the country.
  • In a Friday tweet, Ukraine’s minister of digital transformation Mykhailo Fedorov said the government launched an initiative with NFT artwork depicting key moments from the Ukrainian perspective from Feb. 24 onward. The NFTs feature events starting at 5:45 am local time on the day of the conflict when Russia announced a “special military operation” in the Donbas region of Ukraine.
  • According to the NFT museum website at the time of publication, 54 NFTs of key moments in the war between Feb. 24 and Feb. 26 will be available starting on March 30, with proceeds of the sales in Ether (ETH) used “to support army and civilians.” The artwork includes a variety of events and sources based on Twitter posts from government officials, photos from news outlets and the response of world leaders “accompanied by personal reflections.”

 

MIT adds the Bank of England to its stable of CBDC research partners

  • The Bank of England announced Friday that it had reached an agreement with the Massachusetts Institute of Technology Media Lab Digital Currency Initiative, or DCI, on a joint twelve-month research project on central bank digital currencies, or CBDCs. The bank said in a statement that the new project was for research purposes only and not intended to develop an operational CBDC.
  • The Bank of England joins the Federal Reserve Bank of Boston and the Bank of Canada as CBDC research partners at the DCI, the originator of the OpenCBDC project. The Bank of Canada announced its year-long joint research effort last week, while the Boston Fed kicked off its collaboration with the DCI in 2020.

 

Secretary Yellen recognizes ‘benefits of crypto’ despite lingering skepticism

  • Janet Yellen, the 78th United States Secretary of the Treasury, spoke Friday morning on CNBC’s flagship business and politics show Squawk Box on an array of topics such as the growth of the renewable energy sector amid Russia’s economic isolation, the rising levels of inflation and Federal Reserve responsibility and her current perspective on digital assets.
  • Recognizing the multitude of technological and societal advancements within the cryptocurrency space over the past few years, Yellen offered a friendlier more receptive tone than on previous occasions, stating that crypto is “now playing a significant role, not really so much in transactions, but in investment decisions of lots of Americans.” 

 

Crypto.com will air campaign in support of Ukraine during Academy Awards

  • Cryptocurrency exchange Crypto.com plans to use its ad time during the 94th Academy Awards on Sunday to air a TV spot regarding the humanitarian crisis in Ukraine.
  • In a Wednesday announcement, Crypto.com CEO Kris Marszalek said the exchange had partnered with the International Committee of the Red Cross, or ICRC, to launch a campaign aimed at helping those suffering under war-torn conditions in Ukraine. The CEO did not specify what the campaign would entail, but the platform already allows donations in crypto, fiat and nonfungible token purchases to the humanitarian network Red Cross Red Crescent. The exchange will match up to $1 million in donations until March 31.

 

Crypto tax policy framework passes India’s parliament despite pushback from lawmakers

  • A tax framework on cryptocurrencies introduced by India’s Finance Minister Nirmala Sitharaman will become law in the country after being passed as an amendment to the Finance Bill.
  • On Friday, India’s lower house of parliament, the Lok Sabha, passed the 2022 Finance Bill, which included 39 amendments proposed by Sitharaman. The amendment on crypto established a 30% tax targeting digital asset and nonfungible token transactions and did not allow for deductions from trading losses while calculating income. In addition, taxpayers in India will have an additional 1% tax deducted at source, or TDS.

 

US senators Lummis, Gillibrand reveal working on bipartisan crypto legislation

  • United States Senator from New York Kirsten Gillibrand revealed working with Senator Cynthia Lummis on a broad-based regulatory framework for the crypto industry on Thursday during a live event in Washington, D.C. 
  • As Gillibrand specified, she and Lummis are undertaking “a very complex and intensive review” of different aspects of the industry, with a future regulatory task-sharing in mind. The framework will see both the Commodity Futures Trading Commission (CFTC) and Securities and Exchange Commission (SEC) get their share of a regulatory mandate.
  • Speaking of her and Lummis’ motivations for taking up the initiative, Gillibrand said:
  • “Many of the goals that Sen. Lummis and I have are identical — we want to address things like safety and soundness. e want to address consumer protection, we want to address certainty for markets.”

 

Top Israeli bank to accept BTC and ETH trading through Paxos’ collaboration

  • Leumi Bank, one of the largest lenders in Israel, has reportedly started to accept Bitcoin (BTC) and Ether (ETH) trading.
  • According to a Thursday report by Reuters, Pepper Invest, Leumi’s digital platform, has partnered with blockchain infrastructure provider Paxos to launch crypto trading. Pepper Invest clients can now buy, sell and hold cryptocurrencies using the new service.
  • The move will only support BTC and ETH before adding support for other crypto assets. In addition, the minimum transaction value for cryptocurrencies was set at around $15.50 (50 shekels), as per the report.
  • There is currently no start date announced, and the new move is pending regulatory approva

 

LG Electronics adds blockchain and crypto as new areas of business

  • South Korean tech giant LG Electronics has officially added blockchain and cryptocurrency as new business areas in its corporate charter. 
  • According to a local South Korean news report, LG added two distinct crypto-related objectives during its annual general meeting on Thursday. The objectives include “the development and selling of blockchain-based software” and “the sale and brokerage of cryptocurrency,” leading to conjecture whether LG would establish some form of crypto exchange.
  • When asked about the company’s intention to start its own exchange or platform, an LG spokesperson tempered any speculation, stating, “Nothing has been decided yet. We just mentioned business areas in a broad manner.”
  • Rumors concerning LG creating a crypto-related marketplace emerged earlier this year when Bithumb CEO Heo Baek-young confirmed that the exchange was working with “a large company” to develop a nonfungible token (NFT) marketplace.

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