11 January

“In a blog post Monday, Polygon made some audacious claims about having set new speed and scalability milestones with its “Plonky2″ technology in what may be a possible breakthrough for Ethereum throughput.

Plonky2 is a recursive SNARK that is 100x faster than existing alternatives and natively compatible with Ethereum.

Bjelic claims that one of Polygon Zero’s major breakthroughs is that it can verify complex transactions, such as Ethereum smart contract interactions. Plonky2 achieves the speed and scalability milestones by using a blend of advancements across different academic disciplines.

The team is completing work on the virtual machine for Polygon Zero, which will allow the network to process transactions, as well as other key infrastructure for an eventual launch.”

TP ICAP, the world’s largest inter-dealer broker, has started offering clients services in crypto-linked exchange-traded products (ETPs) in another sign of the growing mainstream adoption of digital assets. The firm facilitates transactions between investment banks, hedge funds and other large financial institutions.

The broker is responding to increased demand for digital assets from institutional clients, and it’s not alone. UBS, Goldman Sachs and Bank of America are all clearing and settling cryptocurrency ETPs for hedge-fund clients in Europe.

TP ICAP plans to launch the trading of crypto-linked ETPs in the U.S. in the coming months, the broker said. Still, the focus for 2022 is on the roll-out of over-the-counter (OTC) derivative products based on digital assets.”

Global financial markets, stocks and cryptocurrencies took a knock on Jan. 10 after rumors that the Federal Reserve may hike interest rates four times in 2022 circulated and sparked a sell-off and sent the benchmark 10-year Treasury yield briefly above 1.8%.

The Fed’s shifting monetary policy is generating significant challenges for risk-on assets but this was anticipated by analysts at Delphi Digital who noted that the headwinds facing BTC and the crypto market have more to do with “tighter liquidity conditions and heightened market volatility” than with rate hikes.

The shift away from excess liquidity and accommodative monetary conditions is a structural headwind we’ve highlighted in recent months, which now appears to be coming to a head.

Conceivably a double bottom from the September 2020 low, after retracing Q4s move up. Currently trading below the 2d 200 EMA, which has historically been a good buying opportunity.”

See Also: Crypto Traders See $343M of Liquidations as Bitcoin Dips Below $40K

Between Jan. 5 and 6, the hashrate of top mining pools fell by 11% as Kazakhstan’s internet went dark. Today, the loss had narrowed to around 2.2%.

Kazakhstan is the world’s second-largest bitcoin miner. It accounts for about one-fifth of the global total and is surpassed only by the U.S. The country has been rocked by civil unrest in the past week, set off by a spike in electricity prices.

The situation is almost resolved and crypto mining data centers are back.

Internet watchdog NetBlocks said last week that the fact that multiple providers lost connectivity simultaneously “indicates a centralized kill-switch.””

“The former all-pro wide receiver for the Dallas Cowboys is tapping oracle platform Chainlink to bring “dynamic” NFTs to Personal Corner, a platform Bryant founded to help athletes build virtual brands.

Dynamic NFTs use Chainlink data feeds to change their appearance, in this case according to player performance. So if a player reached a milestone for touchdowns or receiving yards, for example, the NFT could adapt to reflect the progress.”

See Also: Associated Press Launching NFT Marketplace for Its Photographs on Polygon
See Also: Disney patents technology for a theme park metaverse

Market-beating fund manager and billionaire Bill Miller is so bullish on bitcoin that it and investments tied closely to the crypto now represent 50% of his personal assets. Miller, who gained fame for beating the S&P 500 index for a record-breaking 15 years in a row from 1991-2005 as a fund manager at Legg Mason, has previously invested heavily in bitcoin in funds that he managed, but his revelation about his personal portfolio was new.

Miller said he thinks bitcoin is best thought of as “digital gold” with a strictly limited supply and that he’s only recently allowed himself to be called a “bitcoin bull” rather than just a “bitcoin observer” because he feels that it’s now developed into a game-changing technology.

I think the average investor should ask himself or herself, what do you have in your portfolio that has that kind of track record – number one, is very, very under-penetrated; can provide a service of insurance against financial catastrophe that no one else can provide and can go up 10 times or 50 times? The answer is: nothing.”

“The near-$100 billion dollar wealth amassed by CZ (as he is known in crypto circles) doesn’t even factor in his own personal crypto holdings.

CZ’s fortune dwarfs those of many of the crypto industry’s biggest names, including FTX CEO Sam Bankman-Fried (who holds $22.5 billion according to Forbes), and Coinbase CEO Brian Armstrong (who holds $9.6 billion). Per the Bloomberg Billionaires Index, CZ’s wealth even eclipses that of Satoshi Nakamoto.

Outside the world of crypto, CZ’s peers include Tesla and SpaceX founder Elon Musk who boasts an estimated net worth of $263 billion, and Amazon founder Jeff Bezos, the founder of Amazon, whose net worth is estimated at $188.4 billion.

Coinbase might appear to be the 800-pound gorilla from a U.S. perspective, but Binance is significantly bigger.”

“The test enabled Bank ABC to settle real-time payments to Alba’s counterparts in the United States using JPM Coin, a blockchain-based payments system and stablecoin pegged to the United States dollar.

CBB governor Rasheed Al Maraj said that the trial has been crucial for the government of Bahrain to address and potentially eliminate existing inefficiencies in the traditional cross-border payments industry. The trial could potentially extend to its central bank digital currency development.

The investment bank has been actively promoting its blockchain tech for global use, partnering with Singapore’s largest bank, DBS, to pilot a blockchain payments system. JPMorgan previously provided its Liink blockchain technology to the State Bank of India to reduce transaction costs and improve cross-border payments.”

See Also: UAE regulators pave way for crypto and blockchain adoption, says legal expert

The Disrupt Weekend

“The fundamental security limits of bridges are actually a key reason why while I am optimistic about a multi-chain blockchain ecosystem, I am pessimistic about cross-chain applications.

For example, suppose that you have 100 ETH on Ethereum, and Ethereum gets 51% attacked, so some transactions get censored and/or reverted. No matter what happens, you still have your 100 ETH. Now, imaging what happens if you move 100 ETH onto a bridge on Solana to get 100 Solana-WETH, and then Ethereum gets 51% attacked. The attacker deposited a bunch of their own ETH into Solana-WETH and then reverted that transaction on the Ethereum side as soon as the Solana side confirmed it. The Solana-WETH contract is now no longer fully backed, and perhaps your 100 Solana-WETH is now only worth 60 ETH. Even if there’s a perfect ZK-SNARK-based bridge that fully validates consensus, it’s still vulnerable to theft through 51% attacks like this.

For this reason, it’s always safer to hold Ethereum-native assets on Ethereum or Solana-native assets on Solana than it is to hold Ethereum-native assets on Solana or Solana-native assets on Ethereum. And in this context, “Ethereum” refers not just to the base chain, but also any proper L2 that is built on it. If Ethereum gets 51% attacked and reverts, Arbitrum and Optimism revert too, and so “cross-rollup” applications that hold state on Arbitrum and Optimism are guaranteed to remain consistent even if Ethereum gets 51% attacked.

The problem gets worse when you go beyond two chains. If there are 100 chains, then there will end up being dapps with many interdependencies between those chains, and 51% attacking even one chain would create a systemic contagion that threatens the economy on that entire ecosystem.

This is why I think zones of interdependency are likely to align closely to zones of sovereignty (so, lots of Ethereum-universe applications interfacing closely with each other, lots of Avax-universe applications interfacing with each other, etc etc, but NOT Ethereum-universe and Avax-universe applications interfacing closely with each other).

This incidentally is also why a rollup can’t just “go use another data layer”. If a rollup stores its data on Celestia or BCH or whatever else but deals with assets on Ethereum, if that layer gets 51% attacked you’re screwed. To be a rollup that provides security to applications using Ethereum-native assets, you have to use the Ethereum data layer (and likewise for any other ecosystem).

I don’t expect these problems to show up immediately. 51% attacking even one chain is difficult and expensive. However, the more usage of cross-chain bridges and apps there is, the worse the problem becomes. So cross-chain activity has an anti-network-effect: while there’s not much of it going on, it’s pretty safe, but the more of it is happening, the more the risks go up.

  • Crypto crosses new ATHs and the total market cap reaches $5T. The bull run is not over.
  • Eth2 merge happens. All the research is done, testnets are running, and it’s only a matter of debugging right now. Say goodbye to Ethereum PoW in 2022.
  • Bitcoin gets adopted by another nation-state. Global fiat inflation is starting to hit countries and central banks will have to look for alternatives.
  • Ethereum becomes a trillion-dollar network. The Merge, Proof of Stake, EIP 1559, all of this is brewing a storm for Ethereum to join Bitcoin as a trillion-dollar network.
  • Layer 2 reaches $25B in total value locked.
  • NFT sales hit $30B.
  • DeFi will rebound this year and replace some of the weaker projects in the top 10.
  • DAOs will make an 8-figure purchase for an IRL item.
  • GameFi builds niche. Indie games on L2 have an exceptional building year with a few notable breakouts.
  • “The Coming Bear Market” will be frequently discussed until it becomes a meme. The bear market will not come.

See Also: AVC: What Is Going To Happen In 2022

“The ecosystem now boasts over 1,000 project integrations, with 700 oracle networks securing over $75 billion in value—up tenfold from 2020—and accessing over one billion data points. While Chainlink’s data capabilities formed the focus of its scaling efforts in 2021, the past year has also seen the oracle provider launch additional capabilities for its networks—most notably random number generation and its smart contract service Keepers, which enables the automation of increasingly complex instructions. VRF has already received over 2.5 million randomness requests.

Nazarov says the team is now finally satisfied with the security and scalability of the consensus system they’ve designed, and is now ready to launch staking this year. But he declines to specify when in the year it might launch.

Chainlink is also set to launch CCIP, its global standard for messaging and communication between blockchains. CCIP seeks to do what TCP/IP did for the internet: connect all the blockchains into one “internet of blockchains,” Nazarov says, via cross-chain smart contracts.

In 2022, Nazarov predicts many more banks, insurance providers, and other institutions will embrace DeFi, but also build out their own systems to launch their own smart contracts. Chainlink can offer those enterprises an on-ramp into DeFi without them having to integrate with protocols.”

See Also: EPNS Teams Up With dYdX Foundation to Enable Notifications for Governance Updates

The One sits on a 3.5-acre estate and boasts a 50-car garage, 10,000-bottle wine cellar, 4,000-foot square guest house and stunning views of Los Angeles below.

But the lavish project suffered after its owner defaulted on over $165 million in loans and debt, placing it into receivership. The home was previously expected to go on the market for $500 million—making it one of the most expensive properties in the world. The developer wants to save it from auction by creating a cryptocurrency, The One Coin, that represents shares in the property.

Once the tokens are created and traded, it would transfer the value of the house to the coin, making this the first-ever asset-backed coin by a one-of-a-kind piece of real estate.

Niami’s idea is to tokenize the house, sell the tokens, then rent the house out for glitzy events and give the profits back to the token-holders. (It’s worth mentioning that the SEC, based on past guidance, may think tokens tied to home rental revenues look like a security.)”

8 January

“Bloomberg first reported the news after evidence of PayPal’s exploration into building its own stablecoin was discovered in the company’s iPhone app. Hidden code and images show work on what is called a “PayPal Coin.” The code shows the coin would be backed by the U.S. dollar.

We are exploring a stablecoin; if and when we seek to move forward, we will of course, work closely with relevant regulators.

PayPal has been very active with its cryptocurrency efforts recently, increasing the amount of crypto its customers can purchase, as well as investing in educating its users on crypto and working to allow them to withdraw their crypto safely to third-party wallets.”

Bitcoin vs Ethereum: Divergent Evolution in Cryptocurrency

“The popular narrative is that Fed’s plans to shrink its balance sheet and raise rates concurrently could lead to prolonged asset price deflation. ‘It’s time to evaluate the conviction you have in whether positive interest rates could damage equity portfolio and see further global downward pressures.’

The fears of a prolonged bear market in stocks and digital assets might be overblown as historically markets have remained resilient during tightening cycles.

Indeed, bitcoin pretty much remained bid through the major part of the previous tightening cycle that began in December 2015 and ended in December 2018. Further, stock markets came under pressure in the final quarter of 2018 – after nearly two years of rate hikes.

Bloomberg Intelligence commodity strategist Mike McGlone foresees bitcoin and crypto benefitting from the tightening cycle.

Expectations for Federal Reserve rate hikes in 2022 may support a win-win scenario for Bitcoin vs. the stock market. It’s a question of bull-market duration, and we see the benchmark crypto coming out ahead.”

See Also: Crypto Traders Reduce Leverage, Selling Pressure Subsides
See Also: Why Bitcoin Is Having Such a Brutal Week

“Solana suffered a fourth network incident in the span of a few months. Two out of the four issues happened this week. According to Solana, this is happening because of a rise in high compute transactions.

Amid these recent events, Cyber Capital chief investment offic Justin Bons expressed his disapproval with Solana and published a series of tweets enumerating the reasons why he doesn’t support the project. Bons claims that Solana is ‘consistently displaying a pattern of bad behavior‘ and ‘prioritizing attracting ignorant investors over good blockchain design.’

On Friday, the venture capital firm – often called a16z for short – released a policy agenda aimed at global governments with 10 guiding principles on how to “build a better internet.” The venture capital firm has already spoken with “key leaders on every populated continent,” according to a16z’s Global Head of Policy.

a16z encourages world leaders to think proactively about Web 3 policy, starting by establishing a clear vision, providing clear and fair tax rules as they apply to digital assets, embracing multi-stakeholder governance and more.

We are seeing a growing number of governments approaching us saying that they want to be Web 3 republics.”

See Also: UK lawmakers form crypto advocacy group for parliament: Report

Web3 Defined

7 January

“In a zero-interest environment in traditional markets, banks may have a new friend in decentralized finance (DeFi). This is what institution-friendly DeFi initiative Aave Arc is offering, having now officially launched with the help of cryptocurrency custody firm Fireblocks, plus a “whitelist” of 30 licensed trading firms.

Aave Arc could usher in a new era of bank-friendly DeFi.

Looking ahead, Kulechov predicts permissioned and unpermissioned DeFi will likely exist in parallel, adding that there’s been “enormous” interest in Aave Arc from institutions, including banks. Enabling institutional access to DeFi could unlock a trillion-dollar opportunity over the next half decade.

See Also: Arab Bank Switzerland Is Quietly Getting Into DeFi

“Shares of GameStop (GME), the original meme stock that stoked retail investor frenzy in buying highly volatile stocks last January, surged as much as 31% in after-market trading Thursday after the Wall Street Journal reported that the company is launching a division to build a marketplace for non-fungible tokens (NFT) and to establish cryptocurrency partnerships.

GameStop’s plan calls for it to build an online hub for buying, selling and trading NFTs of virtual video-game goods such as avatar outfits and weapons. The company has hired more than 20 people for the division.

Prices for loopring (LRC), the native token of layer 2 protocol Loopring, spiked about 15% on the news. There have been rumors that Loopring is one of the crypto companies that is working with GameStop on its NFT marketplace. In October, GameStop said it was looking to build an Ethereum-based Web 3 arm.”

See Also: Castlevania’s Konami Is Latest Video Game Giant to Jump Into Ethereum NFTs
See Also: Drone Racing League Zooms Into Metaverse, Bringing ‘Play to Earn’ to Algorand

Named after Samsung’s flagship 837 store in New York, the Samsung 837X virtual store will open for business for a limited time from today. Decentraland users will be invited to explore an “experiential playground” and earn NFT rewards by completing quests.

The metaverse experience will consist of three areas, the Connectivity Theater (which showcases news from Samsung’s stage at CES 2022), the Sustainability Forest, which comprises a “journey through millions of trees” to mark the company’s sustainability initiatives, and the Customization Stage.

The latter will showcase a live in-metaverse dance party hosted by DJ Gamma Vibes from the physical 837 store, with NFT badge holders entered into a raffle to win Samsung-branded swag for their Decentraland avatars.

The metaverse empowers us to transcend physical and spatial limits to create unique virtual experiences that could not happen otherwise.”

See Also: Australian Open Apes Into Tennis NFTs and Decentraland, Too
See Also: Blockchain and the metaverse make inroads at Consumer Electronics Show

The U.S. Congress is preparing an hearing to examine the environmental impact of crypto mining, especially on the Bitcoin network. The date and witness list for the hearing are still undetermined, but it could take place as early as the end of January.

In December, Sen. Elizabeth Warren (D-Mass.) sent a letter to New York-based miner Greenidge’s CEO, expressing concerns about the firm’s environmental impact. That was followed by a New York Times article that relayed concerns surrounding the increased mining in the state. These “recent events in New York state” have raised the alarm over crypto mining with the House Energy and Commerce Committee.”

See Also: Kazakh government resigns, shuts down internet amid protests, causing Bitcoin network hash rate to tumble 13.4%

The crypto developer ecosystem has notched all-time highs in multiple metrics including monthly active developers and highest number of new developers in a calendar year. It’s a robust sign of health and growth for the industry as a whole.

The developer ecosystem, we’ve always thought it was the leading indicator. The engineers are closest to whether or not there’s real value, and this many people coming in, playing with it, is a good sign.

A key population leading the surge is developers working on top of smart contract platforms such as Ethereum and Solana. 65% of all developers working in Web 3 joined the ecosystem in 2021, and 2,500 developers are working on decentralized finance (DeFi) in particular.

While Ethereum comfortably leads all blockchains with 4,000 monthly active developers, Solana in particular has “broken out” with almost a 5x multiple to just under 900 monthly active developers. In total, 10 different smart contract platforms now have over 250 monthly active developers.

One of the takeaways for me is that it’s really impressive that Ethereum had this growth trajectory. The ecosystem was so much smaller – in terms of the absolute number of developers, it’s so impressive Ethereum could do this.”

See Also: Crypto Browser Brave Passes 50M Monthly Active Users

The January edition of Bloomberg’s Crypto Outlook described the Federal Reserve’s plan to raise interest rates in 2022 as a possible “win-win scenario for Bitcoin [versus] the stock market.” The reasons stem from the fact that the S&P 500 Index is currently the most overextended above its 60-month moving average in over two decades and that Bitcoin is seeing growing mainstream appeal as an inflation hedge.

Stretched markets have become common, but commodities and Bitcoin appear to be early reversion leaders. It’s a question of bull-market duration, and we see the benchmark crypto coming out ahead.

Minutes from the Federal Reserve’s December policy meeting revealed on Wednesday that central bankers are ready to aggressively curb their stimulus support more quickly than previously expected. The plan, at least for now, includes three interest rate hikes in 2022 accompanied by a reduction in the Fed’s balance sheet, which currently stands at nearly $8.3 trillion in Treasurys and mortgage-backed securities.”

See Also: Bitcoin Falls to 1-Month Low as Fed Minutes Reveal Talks to Shrink Balance Sheet
See Also: Bitcoin Falls Below $43K, Leads to $800M in Crypto Liquidations
See Also: Here’s why Bitcoin traders say a drop to $38K is the worst case scenario

WeChat users now have the option to pay using China’s central bank digital currency (CBDC) via a new access point in the messaging app’s payment service. They must, however, have already verified their identity using the digital yuan wallet app, or “e-CNY” app.

The Tencent-developed WeChat is the dominant instant-messaging app in mainland China with over a billion users.”

5 January

Alt-Season Incoming?

See Also: Altcoins turn bullish even as Bitcoin price slips below $46K again
See Also: Bitcoin open interest matches record high amid predictions of BTC price ‘fireworks’ this month
See Also: Bitcoin exchange balances trend back to historic lows as BTC withdrawals resume in January

“While this first action was focused on a prediction market, I have to imagine this is the sort of precedent every DeFi project operating in the U.S. might want to pay attention to, particularly if they offer trading services for anything that could be perceived as a derivative product.

Also, as noted by attorney Collins Belton, the actual order published by the CFTC appears to acknowledge decentralization (or a lack thereof) as a factor in its decision to bring an action against Polymarket. In other words, a more fully decentralized prediction market may have an easier time of it.

The CFTC also appears to note a distinction in automated market makers (AMMs) being algorithmically driven, implying that not all AMMs may fall under the CFTC’s registration requirements.”

zkSync is a layer 2 (L2) scaling solution designed to make Ethereum transactions inexpensive and near-instant.

The zkRollup design leads to something pretty magical, which is that, through network effects, zkSync becomes more inexpensive for users as activity on its network increases. That reality stands in stark contrast to traditional blockchains, which become more expensive when demand for their blockspace grows. As such, you can see why a resource like zkSync is so promising as a prospect to scale Ethereum!

Today, zkSync is the 10th largest L2 per total value locked with a $71M TVL according to analytics site L2BEAT. That number is poised to grow as zkSync continues to advance in features and functionalities and more users start migrating to zkRollups for better UX and cheaper transactions.

The coming zkSync token will also undoubtedly attract more liquidity and utility to zkSync. In the meantime, we can start getting L2 experience and preparing for the future by using zkSync in the here and now.”

“The things that make me optimistic basically are more regulatory clarity in the US and globally, which I think could help a ton on institutional adoption.

Basically, every large financial institution I’ve talked to, every large bank, every large investment bank, pension funds, they’re all eyeing this sector.

If jurisdictions ‘feel like they’re getting regulatory clarity,’ that adoption could come in a ‘tidal wave.'”

“CRV, the governance token of decentralized exchange (DEX) Curve.Fi, is extending its five-month winning streak as the battle between DeFi protocols for control leads to a demand-supply imbalance. The token rallied 127% in the final quarter of 2021.

As of Tuesday, about 86% of the token’s $3 billion supply is locked up in various DeFi protocols. The declining liquidity could be attributed to DeFi protocols competing to accumulate CRV to influence the decision-making at the DEX.

One of the major powers given to veCRV holders is the ability to change gauge weights, which determine the amount of CRV rewards allocated to each pool on Curve.’ Thus, yield-boosting application Convex Finance and other DeFi protocols such as Yearn Finance and StakeDAO are luring CRV holders by offering attractive returns on staking. The protocols then deposit the CRV received into Curve Finance and collect veCRV, gaining voting power to allocate more CRV rewards to the pools for which they provided liquidity.

Protocols like Convex are locking up almost 50% of all veCRV, as other protocols are accumulating CVX, the token to Convex. This gives them [Convex] the most governance power to decide where CRV incentives should be distributed.

In other words, more and more protocols are building off of Curve, and an entire ecosystem is emerging, engaged in the so-called Curve Wars.”

“The People’s Bank of China (PBoC) digital currency research institute developed the “e-CNY (Pilot Version)” app, which was available for download on Chinese Android and Apple app stores on Tuesday in Shanghai.

The People’s Bank of China said the digital currency could be used during the Beijing Winter Olympics in 2022.”

4 January

Vitalik on Ethereum’s Development and ‘Endgame’ Roadmap (Recommended Watch)

Samsung Electronics announced three TV models for 2022 that will enable NFT trading on the set.

Three models for 2022 feature an ‘intuitive, integrated platform for discovering, purchasing and trading digital artwork.'”

See Also: Square Enix CEO reveals plans for blockchain, metaverse, NFTs
See Also: LinksDAO NFT Sale Books First $10M Toward Buying an Actual Golf Course

“The CFTC announced the penalties Monday, ordering Polymarket to wind down all of its markets because it did not seek a Designated Contract Market (DCM) or Swap Execution Facility (SEF) registration, two requirements under the Commodity Exchange Act for companies offering binary options in the U.S.

Polymarket is a crypto betting service which allows users to pick one of at least two options on given trades, such as who might win the 2020 presidential election. Polymarket’s betting pools constituted binary options, according to the CFTC.

Polymarket said it would wind down three markets and offer refunds to its users by the Jan. 14 deadline. The company plans to share more information in the future about its plans.”

“The current price of around $46,000 is near the bottom of a two-week-long price range, which previously led to higher bids for BTC. BTC will need to return above its 200-day moving average, currently at $47,962, to yield further upside targets. The next level of resistance is seen at around $52,000.

The relative strength index (RSI) on the daily chart is rising from an oversold level reached on Dec. 10. This suggests selling pressure is starting to wane, especially as downside exhaustion signals appeared on the daily chart for the first time since July.”

See Also: Leading DeFi Tokens Post Fresh Gains as Wider Crypto Market Stalls
See Also: Bitcoin traders expect $60K by month’s end, marking $45K as ‘accumulation’

Monday marks the 13th year since Bitcoin’s creator, Satoshi Nakamoto, mined the genesis block, or block 0, of the Bitcoin network and, for the first time, mined a reward of 50 Bitcoin (BTC) back on Jan. 3, 2009. Fast-forward to 2022, the Bitcoin network shows no signs of slowing down, reaching a new all-time high hash rate of 207.53 exahashes per second (EH/s).

The Bitcoin hash rate, which correlates to the strength of the network based on the number of active miners, saw a temporary downfall after China banned citizens and businesses from pursuing crypto mining and trading activities. As a direct result of China’s blanket ban on crypto causing a sudden shortage of miners, the Bitcoin hash rate fell to 58.46 EH/s.”

See Also: Happy Birthday, Bitcoin! Industry players share a few words
See Also: Bitcoin holdings by public companies surged in 2021

The Disrupt Weekend

“Brands, brands, brands. Creators, musicians, sports teams and consumer brands all see tokens and crypto as the mechanism to better engage and grow their communities of supporters. My expectation is that a critical mass of these brands will begin building and deploying tokenized experiences such that it becomes a default part of building any online or real-world community.

The adoption of DeFi and NFTs in GameFi has only just begun, and we will see incredible innovation in this space with community-owned economies and on-ramps to the Metaverse. Blockchain-based gaming is expected to rise exponentially, with the play-to-earn model adding a monetary value to gameplay.

2022 seems likely to be the year Ether flips Bitcoin in market cap, and just about every other metric.

The companies that were first to adopt the technology are starting to reap real benefits, and whole industries will move aggressively to integrate DLT and related technologies into their enterprise stack. In the next 12 months, I believe one or more significant tech companies (e.g., Tesla, Google, AirBnB, etc.) will announce plans to invest their own capital in crypto solutions.

In 2022, it will be ‘corporate career risk’ to not have a baseline understanding of cryptocurrencies and blockchain technology. From bankers to corporate executives to politicians, it is imperative that they get on board and seriously consider the implications of blockchain.

We’re going to see more countries adopting crypto as a legal currency. We’re also going to see central governments coming out and taking their own currencies and putting them on a blockchain. China has already said it is going to do this, which will speed up the real competition for private cryptocurrencies from a payment perspective.

Central bank digital currencies do not present competition from a store of value or inflation protection perspective because it’s still the same fiat currency, subject to the same monetary policy manipulation by central banks. It’s certainly something that is fully digital, transparent, and has both good things and some very scary things that come with it. The hope is that, at least in the United States, the dialogues around CBDCs will happen alongside maintaining the values of our society in mind, including our own privacy and control.

I expect that the decentralized derivatives market will experience more attention from market makers and other professional players in 2022. Due to the lack of crypto assets and derivatives liquidity on traditional markets, there’s going to be an opportunity for DeFi to fill in the gap. With layer-two multichain lending protocols coming into the limelight, offering futuristic financial services on the blockchain could become a reality.

In 2022, we may see federal regulation from the U.S. If this happens, we should expect more countries to follow suit. Clarity is helpful for the community and encourages other jurisdictions to be friendlier to crypto investors.

In Web2, payments and transfers happen within the app with minimal clicks. For Web3 to reach mass adoption, cross-chain transfers must be in-DApp as well. This year will be the year of frictionless Web3 experiences that finally make it mainstream.”

Lower Energy Consumption – The Ethereum Foundation predicts that after the Merge the network will use at least 99.95% less energy than it does in its current state.

Deflationary Ether – The transaction fee burn combined with lower rewards and ether locked for validating will drive the circulating supply equilibrium down to between 27.3 and 49.5 million ETH. For comparison, the current supply is sitting at 118 million ETH and is still slightly inflationary.

Same Execution Layer – Ethereum’s current execution layer will be ported over to the incoming proof-of-stake consensus layer. For existing users and application developers, this means that interacting with Ethereum will remain incredibly similar post-Merge.

Increased/Similar Transaction Fees – Once Ethereum sheds the narrative that it consumes more energy than a moderately sized country, new users and entities may come onboard to use the technology and increase the current demand for blockspace. However, impending upgrades (such as sharding, rollups and calldata improvements) to the network after the Merge will focus on increasing scalability without sacrificing decentralization.

A Road to Decentralized Scalability – Under proof-of-stake, the Ethereum network will have the capability to implement sharding and other scalability focused upgrades that will lower transaction costs.”

1 January

Some analysts are expecting big things for Bitcoin shortly once institutional selling has subsided and capital gets deployed to the market.

The optimistic outlook for early January comes from the expectation of strong “fund inflows,” which appears to be in line with the sentiments of Real Vision CEO Raoul Pal. Pal said in a YouTube interview on Monday that he believed the sell-offs on Bitcoin were finished and that January would have a strong start as institutional capital gets reinvested in the market.”

“The total AUM for DAO treasuries increased from around $380 million in January to a peak of roughly $16 billion in mid-September. DeepDAO ranks Uniswap DAO, BitDAO and Lido Finance DAO as top three, with treasury value at $2.9 billion, $2.4 billion and $602 million.

User participation in DAOs has surged as well throughout 2021, with the total DAO members and token hodlers tallying in at around 1.3 million in December, marking a 130x increase since the start of the year. The Uniswap DAO has roughly 275,000 members that can vote on the project’s roadmap and maintain governance over the DEX.”

See Also: Eth2’s Rocket Pool reaches $350M TVL and 635 node operators in five weeks

Eminem purchased one of the Ethereum-based Apes for 123.45 ETH ($452,000) on Thursday night and has since made the ape his profile picture on Twitter. Meanwhile, he appears to have collected at least 15 NFTs so far on OpenSea under the name Shady_Holdings.

Eminem has joined the many other celebrities who have aped in so far, including NBA star Stephen Curry and talk show host Jimmy Fallon. BAYC recently surpassed CryptoPunks in overall OpenSea ranking and floor price.”

See Also: K-Pop Band BTS Moves Forward With NFTs in Face of Fan Protest
See Also: Paris Hilton sets her Twitter Name to ParisHilton.eth

“Shanghai, China’s most crowded city, is looking for ways to use a metaverse in public services over the next five years.

Shanghai’s five-year plan calls for the use of a metaverse in public services, businesses, entertainment and industrial manufacturing. The commission plans to encourage further study and development of underlying technologies, such as sensors, real-time interactions and blockchain technology.”

The updated law effectively bans non-custodial software wallets, as well as decentralized finance products, in the country. That’s because the bill’s provisions target VASPs, which include crypto exchanges and wallets, in Estonia. When the bill is ready, VASP will be extended to cover decentralized platforms, initial coin offerings and other services.

According to Ohtamaa’s interpretation, the new law has the following effect: ‘You are only allowed to hold your Bitcoin in a custodial Virtual Asset Service Provider (VASP). VASP can freeze your account. So it is not effectively your Bitcoin anymore.'”

See Also: Crypto Needs Centralized Systems to Integrate With Traditional Finance, Binance CEO Says

31 December

“Corey Frayer, who spent a decade working as a senior adviser to members of Congress before becoming a senior staffer on the U.S. Senate Committee on Banking, Housing and Urban Affairs under committee chairman Sen. Sherrod Brown (D-Ohio), has been tapped for the role.

Gensler’s appointment of a crypto-focused senior adviser is in line with his stated focus on establishing a regulatory framework for crypto, as well as a signal that the SEC could step up its efforts to regulate the industry in 2022.

According to a source familiar with the Senate Banking Committee, Frayer spearheaded crypto policy for Brown – who has been outspoken about his concerns about the risks cryptocurrencies could pose to investors, calling blockchain a ‘shady diffuse network of online funny money.’

See Also: SEC Commissioner Hester Peirce Says Washington Doesn’t Need a New Crypto Regulator
See Also: One Big Regulatory Question Holds Advisors Back From Crypto

“According to Rekt Capital, ‘BTC has turned the February, August and September resistance into new support this month.’ Lifchitz pointed to $52,000 as “the main hurdle.”

If BTC is able to reclaim ~$48500 as support by the end of the week then BTC could once again revisit ~$52000 resistance. Should that resistance get overthrown, the next upside stops are the $60,000 region then $70,000 ATH.

If bears manage to break below support at $46,000 and complete the large head and shoulder pattern forming on the BTC chart, Lifchitz suggested that ‘the next stop could be ultimately down to $30,000‘ but stated that ‘we’re still far from that and too obvious technical patterns tend to not complete as expected.'”

See Also: Bitcoin Investors Protect Against Even Lower Prices Ahead of New Year

“On Wednesday, two Bored Ape Yacht Club (BAYC) parody projects gained momentum on crypto Twitter, igniting plagiarism accusations, several trading bans and a robust supply of ape-themed memes. The two collections – both named PHAYC, a play on “fake” and “BAYC” – appear to be identical copies of the original BAYC collection, but with each ape’s profile mirrored to the opposite side, or “left-facing”.

Both PHAYC projects sold out in several hours, but were subsequently banned on OpenSea for allegedly violating the platform’s intellectual-property policies. @phunkyApeYC is currently live on Mintable, while @phaycbot is available on Rarible.

I think the project is a satirical take on the current state of NFTs and members of the NFT community who might be taking the NFT market a little too seriously.

It is not uncommon for successful NFT projects to be imitated through what are essentially copy-and-paste jobs, but whether those projects have violated an unspoken “code of ethics” is still a point of contention in the NFT community.”

See Also: Gamers Rally Behind ‘More Than Gamers’ NFT Project and Its Metaverse Roadmap

“On Wednesday, Coinone announced that it would reject deposits from unverified private wallets starting Jan. 24, 2022, to reduce the risk of money laundering. All Korean exchanges, including Upbit, Bithumb, Korbit and 20 others, are expected to have implemented similar or identical measures as Coinone by or before March 25.

Globally, South Korea’s exchanges are the outliers in complying with the rule. As of now, there are no other major crypto spot exchanges that require users to verify their private wallets.”

“The Mexican government tweeted that it considers these new technologies and payment infrastructure of “utmost importance” to advance financial inclusion.

We don’t want to be absent from these technological advances.

Mexico joins Brazil and Peru as Latin American countries working on the development of CBDCs.”

30 December

Jamestown, the owner of One Times Square, is recreating the 26-story tower at the heart of New York’s New Year’s Eve ball drop in Decentraland. The virtual One Times Square will span 170 parcels of Decentraland property and include the unveiling of the game’s first high-rise building.

The celebration, dubbed “MetaFest 2022,” will include non-fungible token (NFT) art galleries, rooftop VIP lounges and virtual music performances. Virtual billboards will tie the experience to the event’s meatspace counterpart via livestreams of New York City.

As the value of virtual real estate in popular metaverse games like Decentraland and The Sandbox continues to soar, involvement from real-world real estate developers like Jamestown could be a trend to watch.

The metaverse is an important part of the evolution of real estate and the built environment.”

Real Vision CEO Raoul Pal believes the recent volatility in Bitcoin’s (BTC) price is due to institutions selling to help shore up their end-of-year profits.

It looks like they’re done because the market has been chopping around for the past week, which was the traditional last week of everybody squaring their books.

Considering that much of the selling in December has come from wallets that accumulated Bitcoin around the summer, according to Glassnode, and that institutional assets under management of cryptocurrency surged in May and October, according to CoinShares, the timing of the selling indeed points to institutions unloading some bags.

Pal expects 2022 to begin with a strong start for the crypto markets as the capital from institutions gets redeployed.”

See Also: Bitcoin dominance falls under 40%

Jim Rogers, Jim Rickards & Other Top Money Experts Offer Warnings & Advice For 2022

South Korean crypto exchange Coinone has announced it plans to no longer allow withdrawals of tokens to unverified external wallets starting in January. In March, the South Korean government implemented a previously passed bill that requires local crypto exchanges to meet requirements for a real-name account and ISMS authentication.

According to Coinone, it planned to verify users’ names and resident registration numbers — issued to all residents of South Korea — to ensure crypto transactions were ‘not used for illegal activities such as money laundering.'”

See Also: Korean government tells Apple and Google stores to take down P2E games