Midweek Bitcoin watch
Digital asset markets continued to fall this week on the back of the Terra Luna crash. The Bitcoin price is down 7.1%. The Ethereum price lost more value that Bitcoin with a 17.8% loss.
Australian derivatives and securities exchange Cboe Australia listed three new crypto exchange-traded funds (ETF) this week. It is the first exchange to offer Australian investors direct and regulated exposure to Bitcoin and Ethereum.
A new bill announced in the UK’s Queen’s Speech will pave the way for the acceptance of stablecoins as legal tender. UK Treasury Economic Secretary John Glen says The Financial Services and Markets Bill will ensure the UK becomes “a world-leading regulatory regime for stablecoins”.
- Crypto finance platform Coinloan says it is delisting prominent DeFi coins UNI, COMP, YFI and SUSHI due to a lack of market demand.
- The German Federal Finance Ministry has issued guidance on crypto covering mining, airdrops, staking and trading. Investors will not pay tax on sales of a digital asset after holding for one year and crypto is classed as a private asset attracting annual income tax rather than capital gains tax.
- El Salvador’s president met with representatives of 32 Central Banks to discuss “financial inclusion, digital economies, banking the unbanked, the bitcoin rollout and its benefits.”
- Despite a government ban on all crypto operations, China continues to host 21.1% of the global Bitcoin hash rate distribution. It is the second-largest mining hub. The United States leads mining with 37.8% of the total hash rate.
- Japan’s largest investment bank, Nomura, has made two significant crypto moves, launching over-the-counter trading of bitcoin futures and options for institutional clients and a crypto unit focused on DeFi and NFTs.
7-Day Market Snapshot
- Bitcoin Liquid Index: BLX 29,013.00 (+2.88%)
- Ethereum Liquid Index: ELX $1,922.68 (-1.3%)
- XRP Liquid Index: XRPLX $0.39 (-7.14%)
- Strongest of Top 40: HBAR $0.09 (+19.29%)
- Weakest of Top 40: HEX $0.10 (-35.12%)
Altcoin Watch
- Despite a tough week in the markets, some altcoins closed with positive gains. MakerDAO (MKR) had significant growth of 18%. Chain (XCN), Zcash (ZEC) and KuCoin Token (KCS) also had positive gains of 11%, 7.7% and 3.2% respectively.
- MakerDAO token (MKR) rallied on the Terra-Luna stablecoin (UST) losses. DAI is a stablecoin that is maintained and regulated by MakerDAO. DAI is now the fourth largest stablecoin by market capitalization.
- Ethereum-based blockchain technology company Chain (XCN) joined the Binance Smart Chain (BSC) ecosystem. BSC offer reduced fees and fast transaction speeds. The partnership provides liquidity incentives on PancakeSwap.
- KuCoin announced the launch of the Windvane NFT marketplace. Four thousand Genesis NFTs will be offered to the early users.
- Spotify experiments with NFT galleries. The new feature will allow artists to promote their NFTs on their profiles. Artists’ NFTs will be purchased through a third-party platform.
Hot take of the week
You should be looking at:Terra founder Do Kwon announces rescue plan
In a Twitter post Terra founder Do Kwon has announced that voting has commenced on a Terra ecosystem revival plan. If the Terra community votes in favor, the proposal will entail;
- Creating a new Terra chain without the algorithmic stablecoin. The failed chain to be renamed Terra Classic (token Luna Classic - LUNC), and the new chain to be called Terra (token Luna - LUNA).
- Luna will be airdropped across Luna Classic stakers, Luna Classic holders, residual UST holders, and essential app developers of Terra Classic.
- TFL’s wallet (terra1dp0taj85ruc299rkdvzp4z5pfg6z6swaed74e6) will be removed in the whitelist for the airdrop, making Terra a fully community owned chain.
- The allocation of a large portion of the token distribution to 1) providing emergency runway for existing Terra dapp developers 2) aligning the interest of devs with the long term success of the ecosystem.
- Network security to be incentivized with token inflation. Target staking rewards of 7% p.a.
Voting on the plan will continue until the 25th of May. To date 87% of votes cast are in favor of accepting the proposal.
At the time of writing LUNA was trading at US$0.00017, whereas a month ago it was US$116 - an all-time high. UST is priced at US$0.094. CEO Do Kwon has been summoned to a South Korean parliamentary hearing following the crash of LUNA and UST. Meanwhile Polygon CEO, Ryan Wyatt tweeted that Polygon was working with several Terra projects to assist them in migrating to Polygon. Fantom (FTM), VeChain and Binance CEO, CZ have also offered support to the Terra community.
Disclaimer: This newsletter has been designed for informational and educational purposes only. Readers are advised to conduct their own independent research into individual assets before making any investment decision.
BNC
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