M3TA Recap: December 19 – December 25, 2022
Merry belated Christmas! The holiday spirit might still be pervading the air but we don't think Santa came bearing gifts to the children of Cryptoville. Read on for M3TA's ho-ho-holiday wrap-up!
MARKET WRAP
CoinDesk - 27 December, 2022. at 6:52 a.m.
Cryptos - Comparing the crazy market affected by the FED announcements from 2 weeks ago, Christmas market was fairly quiet as investors wound down for festive activities and awkward, yet sweet family dinner. This left the BTC’s Relative Strength Index (RSI) momentum appearing a bit lifeless since its move was tethered on neutral territory only.
As such, BTC was trading flat between $16,500 and $16,800 over the Christmas weekend. ETH also mirrored the largest cryptocurrency by market cap by marching sideways marginally above $1,200. Prices have been projected to hover more or less at the same level in the upcoming days due to the compounding effect of volume reduction that is historically typical of year-end trades and enterprise activities.
Another noticeable event taking place last week, which cast a straightforward effect on the most trusted value-storing cryptocurrency, was the voluntary discontinuation of mining activities as the extreme weather of winter got the best of the entire US, putting a strain on the the nation’s power grid. As a consequence, this has drawn public attention to a fleeting, yet concerning on-chain dip in BTC’s hash rate.
Considered by a large number of investors as a requisite for the founding network’s security, Bitcoin’s hash rate measures how many hashes are produced daily by Bitcoin miners. A declining number in hash rate could mean that fewer fences (in the case of PoW consensus algorithm - miners) are employed to hold down the fort.
While billions of people on the Earth were sound asleep at midnight on Christmas’ Eve, waiting for Santa to do his highly-anticipated job - to quietly squeeze himself into their chimneys and make their wishes come true, US-based BTC miners were suffering from widespread outages, and hence forced to unplug their mining rigs from the central electricity supply as the biting cold hit them as well as millions of other US citizens.
Statistics released by the Cambridge Bitcoin Electricity Consumption Index indicated that the United States accounts for a massive 37.84% of the average monthly hash rate share as some states’ regulation deems favorable to not only mining operation but also power cost. That’s why when the US mining population was cut off from the mainstream, the heavy weight imminently burdened on the rest of the system, which manifested through a precipitous 39% decline in the token hash rate, as observed from CoinWarz data (Figure 1).
As the following week approaches, the number of hashes proposed on the network has seen a certain setback, though has not regained as much of its footing before the holiday’s peak at 276.4 EH/s.
Other high-profile cryptocurrencies also witnessed some minor corrections as the market withered to an unappealing submission towards last weekend but has since shown promising forays into the green zone as a new week is dawned upon the bear Cryptoville. XRP, the token of the public blockchain Ledger XRP, got a decent 1.7% 7D slide at $0.346 on Sunday and has increased 6.9% to over $0.36 cents within the past 24 hours. On the other hand, the valuation of L2 platforms’ native tokens - Polygon's MATIC and the autonomous blockchain platform Cardano's ADA - tumbled to a dismally lower level, $0.79 (declining 3.2%) and $0.25 (declining 3.8%) over a week span of comparison, but then bounced back to their feet by a ceiling of 2% each.
Equities - Decoupling from the volatile neighborhood Cryptoville, Wall Street experienced slight upticks in quite a diversity of major indexes, namely the S&P 500, the Dow Jones Industrial Average, and the technology-heavy Nasdaq Composite all rising by 0.6%, 0.5%, and 0.2%, respectively. As of the glittering gold market, spot trading was triggered with a leap to $1,816 per ounce over the first half of the week. The joy was not quite fulfilled during the second half, though, when it plummeted by 2% when families are appraising the gifting spi
Insights - In 2023, attempts to employ financial engineering to convert the future value of those systems into present-day U.S. dollars accounted for the majority of high-profile crimes and failures. Oftentimes, the financial bros placed large bets utilizing the same risky, nested, and interconnected leverage that caused the 2008 financial catastrophe, and some other times, they exploited blatant fraud; they conducted it off-chain, without following any standards, and in an ambiguous manner.
However, it would have been more correct to describe them as freeloaders and hangers-on who diverted genuine public interest in cryptocurrencies to their many unsustainable games. They were mistakenly thought to be a part of the cryptocurrency sector. The financial bros were extractive rather than additive, as is common in most contemporary finance. They were a scam artist rather than a builder.
2023 will be very different from 2021 or 2022 in the crypto realm due to the colossal failures of these finance parasites and larger economic situations. Hedge fund gamblers and token-shillers will be demoted to supporting roles, where they belong, as the mysterious super-coders who create cryptocurrency take center stage once more.
Takeaways -
We are in the last month of the year so the trading volume could go down, people usually withdraw their money during this period to preserve their money and to prepare for New Year.
The market is going sideways which means it is extremely volatile at the moment.
The Bollinger Bands is narrowing in size which indicates that the market is preparing for an explosion (either up or down).
A lengthy crypto winter tends to test the patience of investors, but it is one of the finest opportunities to purchase good cryptocurrencies at a discount.
Note: To facilitate your reading flow, we now introduce 3 new sections that cater to your reading preferences:
CARDIAC ARREST - shocking news alike
WEAK PULSE - mildly negative news & pre-fall indicators
STRONG PULSE - tech/project development update pieces.
Hope this helps!
CARDIAC ARREST
CoinDesk - 20 December, 2022 at 1:17 a.m. UTC
On Dec 19, Binance.US agreed to buy the bankrupt crypto lender Voyager Digital assets for $1.022 billion. The bid is made for the fair market value of Voyager's cryptocurrency holdings, now valued at about $1.002 billion, plus an extra $20 million in worth.
Binance.US will provide a $10 million good faith deposit and will pay up to $15 million in reimbursements to Voyager for specific costs. Additionally, Voyager will ask the bankruptcy court for permission at a hearing on January 5, 2023.
Earlier this year, FTX had outbid Wave Financial and Binance for Voyager’s assets. However, after the fall of FTX, Binance is now acquiring the assets. VGX, the native token of Voyager Digital, was boosted by over 32% when the news came out.
CoinDesk - 23 December 2022 at 6:47 a.m. UTC
After Sam Bankman-Fried appeared in U.S. federal court in New York on Thursday on allegations that he was the brains behind the fraud and unauthorized transfer of customer funds inside his former crypto business, a federal judge decided to grant his freedom. The judge set bail at $250 billion. Equity in his parents' Palo Alto, California, the house was used to secure Bankman Fried's release, and a long number of conditions were added so that he could continue to be free while he is convicted. However, while being free, he is restricted to conduct transactions totaling more than $1,000, is not permitted to create new credit accounts, is only allowed to leave the house for exercise, and is required to undergo treatment for his substance misuse and mental illness.
WEAK PULSE
CoinDesk - 22 December 2022 at 3:56 a.m.
According to Ankr, their former employee was the one who caused a $5 million exploit earlier this month. The company claimed that the ex-employee used a malicious code package to launch a supply chain attack, allowing a user to mint 6 quadrillion aBNBc tokens. The attacker subsequently exchanged those newly created tokens for Binance Coin (BNB) and sent the gains to cryptocurrency exchange Tornado Cash. Finally, they could exchange the BNB tokens for USDC worth 5 million. Ankr said they were working with law enforcement to discharge the exploiter.
FinancialTimes - 21 December, 2022
Core Scientific (CORZ), one of the top BTC miners by computing power went bankrupt on Wednesday and came to an agreement with some of its lenders to restructure its debt. Its market worth was about $3 billion in April but has subsequently dropped to less than $100 million, according to FactSet data.
According to the filing, Core Scientific's liabilities were believed to be between $1 billion and $10 billion. Hence, the company's operating performance and liquidity declined as a result of the protracted reduction in the price of bitcoin, the rise in electricity prices, and the failure of some of its hosting clients to honor their financial commitments.
STRONG PULSE
CoinDesk - 20 December 2022 at 0:16 a.m. UTC
According to CoinDesk, the acquisition of Tokocrypto by Binance is now complete. As part of the acquisition, Pang Xue Kai, CEO, and co-founder of Tokocrypto will resign from his position but continue to serve on the board. Although acquired by Binance, Tokocrypto confirmed that it will keep its branding. Moreover, it is said that because of the unstable market conditions, Tokocrypto will have to cut down its workforce by around 58%. TKO, Tokocrypto's exchange token, has increased 40% today as a result of the news's initial release in Indonesia.
CoinDesk - 20 December, 2022 at 9:13 p.m. UTC
Recently, Visa (V), a payment processor, presented an Account Abstraction system that makes use of smart contracts to enable automatic programmable payments on Ethereum. The system will be deployed on the Ethereum layer 2 network StarkNet which would enable the conduct of all recurring payments using blockchain networks.
On the Ethereum blockchain, Account Abstraction (AA) is a proposal that tries to unify user accounts and smart contracts into a single type of account. This is made possible by enabling the development of validity guidelines for specific transactions.
One application for AA is the development of "delegable accounts," which enables payment automation through the use of smart contracts. A user can provide a pre-approved smart contract, also referred to as an "auto payment contract," access to their delegable account in order to delegate the authority to initiate payments.
As of Tuesday, Visa had not disclosed any plans to incorporate the system into the services it provides.
CoinDesk - 21 December 2022 at 0:00 a.m. UTC
In order to introduce drivechains and other cutting-edge technology to Bitcoin, Layer 2 Labs has raised a $3 million seed round from angel investors. Drivechains are secondary blockchain that interchanges with the main blockchain and seeks to improve user experience (UX). Drivechains are a concept that Sztorc introduced in BIPs 300 and 301 for Bitcoin. The system, on which Layer 2 Labs will primarily concentrate its efforts, enables users to transfer bitcoin (BTC) back and forth between the principal Bitcoin blockchain and several drivechains. Drivechains' goal is to provide Bitcoin users with access to novel services and goods that are now available only on altcoin networks.
CoinDesk - 23 December, 2022 at 3:01 a.m. UTC
A crypto regulatory measure approved by the Senate and Chamber of Deputies of Brazil was signed by President Jair Bolsonaro on Thursday. The new rule admonishes fraud crimes that involve crypto assets with a sanction of four to six years in jail plus a fine. Additionally, it establishes a "virtual service provider" license that firms dealing in digital assets, such as exchanges and trading intermediates, must apply for. Every digital asset that is in the category of securities will be overseen by the Brazilian Securities and Exchange Commission (CVM). Those who don't fit that description (to be determined) will be under the control of another yet-to-be-formed entity. After the approval on Thursday, businesses will have 180 days to adjust to the new regulations.
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