Welcome back and thanks for joining us this week ??. I wanted to take a moment and wish everyone a happy Martin Luther King Jr. Day as we celebrated the birthday of the great civil rights leader on Monday. In crypto land, there’s lots of news this week as always, but honestly it all pales in comparison to how quickly and drastically prices have moved over the last 7 days… The overall market cap crossed the one trillion dollar mark for the first time in months, and BTC and ETH are both up over 20% (don’t even get me started on?Solana). If you’re looking for an explanation – maybe you’ll find it in this week’s news (how’s that for a teaser):?
- Let’s start with news of another drastic and quick turnaround – Wyre. Just last week we reported that the popular crypto payments infrastructure provider was shutting down… This week, they are removed a recently-imposed withdrawal limit and?announced they will continue operations as usual?due to a recent investment. (Maybe blinking is overrated?)
- Speaking of crypto payments, MetaMask (one of the biggest wallet providers) is?partnering with liquid staking providers Lido and Rocket Pool?to allow its users to directly stake crypto through its browser-based and mobile wallets. And that’s not surprising because staking and liquid staking derivatives (LSDs – crypto really needs to work on it’s acronyms) are exploding.?This thread explaining LSDs is awesome?and highlights the big players like LDO, RPL, SWISE, FIS, and SD (all up BIG).?
- And since we’re talking staking,?ETH stakers may soon be able to withdraw Ether?from the Beacon chain, with Ethereum’s developers aiming to deliver the long-awaited upgrade this quarter (Shanghai upgrade!!). And crypto traders are?already placing bets?on Ethereum’s “Shanghai Hard Fork”.
- If at this point you’re like “why is he writing so much about ETH staking??” Here’s the deal: after Ethereum switched (the Merge) to Proof of Stake (POS – another great crypto acronym) blockchain nodes had to “stake” 32 ETH (a lot of $) to validate blocks (no more mining) and get rewards in the form of more ETH. Since running a node is pretty hard, not everyone has 32 ETH, and the more you stake the more the reward - there are staking pools, and they pay interest. Because staked ETH is locked until the next upgrade (that Shanghai fork we mentioned), liquid staking - where you have liquidity even though your ETH is locked – is now popular (that’s as deep as I’ll go here). Now some BIG stats:?Ethereum now has 500,000 validators. And even more impressive,?there is now more than 16 million ETH staked?– that’s 13.28% of the total ether supply and represents over $22 billion at current prices!
- In related news, Polygon’s Ethereum compatible POS sidechain?underwent a hard fork on Jan. 17. The upgrade is intended to help address gas spikes and chain reorganization issues that have affected the network. Polygon (MATIC) is the most well known L2 Ethereum scaling solution.
- Moving on… here’s some really big news (and it’s definitely driving the rally in AVAX): A?partnership between Amazon and Avalanche development studio Ava Labs?has been announced, and Amazon Web Services (AWS) will now support the network.?Here’s the blog post.
- And this is definitely NOT hurting BTC prices -?Bitcoin CME futures draw premium?for the first time since FTX's collapse.
- Since we’re talking BTC, let’s talk Bitcoin Cash (BCH), and one possible reason for its rally:?A May hard fork (mandatory network upgrade)?is set to bring added security, privacy, and “CashTokens” – which would enable decentralized applications (DApps).
- Maybe this explains the Cardano (ADA) rally??!! Cardano founder Charles Hoskinson has announced the launch of his new hospital called?“Hoskinson Health & Wellness Clinic”?(I’m dead serious). And you can pay in ADA (ok that’s actually kinda cool).
- In more good news, there were two BIG raises this week as HashKey Capital raised?$500 million for its third crypto fund, and Venom Foundation in partnership with Iceberg Capital launched a?$1 billion Venom Ventures Fund. Looks like Galaxy Digital's head of research might be right as he?predicted more venture funding for Web3 firms this year. And a lot of them may be in Dubai as their?Free Zone?is now home to more than 500 crypto startups.
- Ok, let’s get you caught up on the Genesis/DCG vs Gemini drama: Barry Silbert (DCG) laid out a?point by point rebuke of accusations?made by Cameron Winklevoss (Gemini) in an open letter. In response, Cameron called on the board of DCG to?remove CEO Barry?in a?tweet. Gemini has now?officially terminated its Earn program?after Genesis Global Capital failed to return more than $900 million in assets owed. Here’s a?DCG Shareholder Letter?from Barry Silbert…?insiders aren’t buying it. And now the SEC is investigating and has filed?a complaint?against both Genesis and Gemini for?selling unregistered securities.
- And now let’s get caught up on the SBF/FTX saga: The U.S. government?has launched a website?for victims of FTX.?FTX has located $5 billion in cash, liquid cryptocurrency and liquid investment securities?(not including the cryptocurrency held by the Securities Commission of the Bahamas). It has been reported that the $91.7 million in FTX creditor claims?listed on the claims trading marketplace Xclaim?will likely get around 13 cents on the dollar (that will still be?more than BitConnect victims). A federal bankruptcy judge?terminated the sponsorship agreement?between FTX and Miami-Dade County, which owns the downtown arena where the Heat plays. FTX gets judge's approval to?start selling LedgerX and other units. Nishad Singh, FTX’s former director of engineering and a housemate of Bankman-Fried,?is said to have met with prosecutors?in a "proffer session." If you want to hear from the man himself (with a lot of excuses and no admission of guilt) here’s?SBF’s recently launched Substack. And eight mainstream media outlets are?calling for the release of two unknown names?who co-signed Sam Bankman-Fried’s $250 million bond (I’m not ashamed to admit I want to know…).
- There’s so much news about Binance this week that it deserves its own section (there’s a nice balance of good and bad lol). US prosecutors are reportedly?investigating hedge funds’ relationships with Binance?as part of a money laundering probe.?Binance has registered with Sweden's Financial Supervisory Authority. Binance CEO Changpeng Zhao (CZ) said the exchange?will continue to scale in 2023, with headcount growth goals between 15% and 30%. Voyager’s?VGX token jumped 40%?following Binance.US takeover news. And interestingly, Indian crypto exchange WazirX?released its proof-of-reserves report, and disclosed that 90% of its user assets are held in Binance wallets.
- While Binance is hiring, there are a lot of firms firing:?SuperRare?cuts 30% of staff.?ConsenSys?to cut upwards of 100.?Coinbase?lays off 950 (and CEO will likely miss?a huge bonus).?Blockchain.com lays off 28%?or about 110 staff. And?Crypto.com cuts 20%. (I think this rally may have some of these firms second guessing their decision…).
- I’m closing this week with some cool news out of El Salvador as they passed a law for the issuance of digital assets other than Bitcoin, including the issuance of a Bitcoin-backed bond, also known as the?Volcano Bond. And more importantly (and cooler) is?this video of Miss El Salvador wearing a Bitcoin costume?at the Miss Universe pageant (so that’s why BTC rallied!).
That’s it folks! As always - thank you for reading! Have an AWESOME week!!! ??
Editor in Chief @ TradeZero Crypto Newsletter
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