Coin360 Daily Dispatch | Crypto Market Updates & Highlights | May 12, 2023
Crypto Market Update
Written by Van
Table of Contents:
Banking and Regulatory Updates
- Fidelity's Jurrien Timmer Sounds Alarm on Bitcoin Overvaluation
- JPMorgan CEO Jamie Dimon Cautions Against Over-regulation of Banks
- US Chamber of Commerce Criticizes SEC's Crypto Regulation Approach
Crypto Exchanges and Platforms
- Coinbase Apologizes for Pepe the Frog Hate Symbol Misstep
- Crypto Lender Nexo Faces Legal Troubles in the UK and Bulgaria
- Uniswap Outperforms Coinbase in Trading Volume for Fourth Month
- Binance Founder Plans to Reduce Stake Amid Regulatory Pressure
- Binance's Bitcoin Liquidity Drops, Sparks Increased Volatility
Developments in Cryptocurrencies and Blockchain Technology
- Axie Infinity’s AXS Staking Rewards Unlock Event on the Horizon
- MetaMask Introduces Ether Purchases via PayPal for US Users
- Ethereum’s Beacon Chain Stalls, Emphasizes Importance of Client Diversity
- MakerDAO Unveils Roadmap for AI-Enhanced Endgame Update
- Bitcoin Slips to Two-Month Low, Bulls Eye $30,000
- Bitcoin Developers Discuss BRC-20 Token Surge Impact
- Texas Amends Bill of Rights to Include Cryptocurrencies
Corporate Involvement in Crypto and Blockchain
- Elon Musk Considers NBCUniversal's Linda Yaccarino for Twitter CEO
- LG Patents TV with Built-In NFT Trading Capability
Legal Issues in the Crypto Space
- Terraform Labs Executives Released on Bail in Montenegro
Fidelity's Jurrien Timmer Sounds Alarm on Bitcoin Overvaluation
Fidelity's Jurrien Timmer remarks on Bitcoin's correlation to gold and warns of potential overvaluation at $30,000. He notes an 88% inverse correlation to real TIPS yield and a 63% inverse correlation to PCE-derived real rate. Bitcoin's regression model is exponential, suggesting a "high-powered inflation hedge."
JPMorgan CEO Jamie Dimon Cautions Against Over-regulation of Banks
JPMorgan CEO Jamie Dimon has warned against over-regulation of banks, stating that it could lead to smaller banks ceasing operations. This echoes concerns from those in the cryptocurrency industry, who feel that heavy-handed regulation could stifle innovation.
US Chamber of Commerce Criticizes SEC's Crypto Regulation Approach
The US Chamber of Commerce has criticised the Securities and Exchange Commission (SEC) over its regulatory approach to the cryptocurrency industry. In an amicus brief, the Chamber threw its support behind Coinbase, accusing the SEC of "creating a precarious and uncertain landscape for crypto companies". The brief also called for the SEC to provide clearer regulatory guidelines for companies operating in the country.
Coinbase Apologizes for Pepe the Frog Hate Symbol Misstep
Coinbase has apologized for describing a meme called Pepe the Frog as a "hate symbol" and sparking the hashtag #DeleteCoinbase. The Chief Legal Officer, Paul Grewal, posted a tweet claiming "We screwed up and we are sorry."
Crypto Lender Nexo Faces Legal Troubles in the UK and Bulgaria
Crypto lender Nexo has shut down two of its UK subsidiaries and is being investigated in Bulgaria for alleged links to organised crime. In January, Nexo was fined $22.5 million by the SEC for failing to register its retail lending product and paid a separate $45 million fine in the same month.
Uniswap Outperforms Coinbase in Trading Volume for Fourth Month
Decentralized exchange Uniswap has surpassed Coinbase in trading volume for the fourth consecutive month, handling $37 billion in April compared to Coinbase's $34 billion. The depeg of stablecoins in March was a significant factor in Uniswap's rise, according to CCData.
Binance Founder Plans to Reduce Stake Amid Regulatory Pressure
Binance founder Changpeng Zhao is reportedly seeking to reduce his stake in Binance.us amid increased regulatory scrutiny. The exchange has come under fire from US federal regulators over the past year, with the Commodities Futures Trading Commission accusing the firm of running an illegal exchange. CZ is believed to be looking to reduce his stake so that the exchange can more easily acquire regulatory licenses.
Binance's Bitcoin Liquidity Drops, Sparks Increased Volatility
Bitcoin liquidity on Binance has more than halved relative to the start of February from around $45 million to $16 million in early May. This has led to increased volatility, as thin order books provide room for wild price swings, with Binance trading volumes and liquidity declining amid the spate of US banking failures and after ending its zero-fee promotion for 13 different BTC pairs.
Axie Infinity’s AXS Staking Rewards Unlock Event on the Horizon
The upcoming AXS staking rewards unlock event could unlock over 3.4 million AXS tokens worth over $23 million. Over 43% of AXS tokens have been staked, contributing to a thriving staking market cap of $272 million. The Axie Infinity collection dominates NFT metrics with over $4.2 billion in total sales and more than 18 million transactions recorded.
MetaMask Introduces Ether Purchases via PayPal for US Users
MetaMask now allows US users to buy and transfer Ether via PayPal. The company claims to be the first Web3 wallet to offer Ether purchases via PayPal. In its Q1 report, PayPal disclosed $943 million in crypto assets, a 56% increase from the previous quarter ($604 million).
Ethereum’s Beacon Chain Stalls, Emphasizes Importance of Client Diversity
Ethereum's Beacon Chain temporarily stopped finalizing on Thursday due to difficulty reaching consensus, resulting in a brief downtick in validator participation, according to a community health consultant. The incident highlighted the importance of client diversity among Ethereum's validator set, with historical precedent showing having a diverse set of validators can prevent denial-of-service attacks.
Staking activity on Ethereum saw a surge following the Shapella upgrade, with around 750,000 ETH deposited in the six days that followed. Non-custodial staking service provider, Staked, predicts the ETH stake rate will increase from 15% to the 20-35% range in the next 12-18 months. Ethereum currently generates about $1.8 billion in annual staking rewards.
MakerDAO Unveils Roadmap for AI-Enhanced Endgame Update
MakerDAO has released a roadmap for its Endgame update, which aims to use AI to enhance the Maker Ecosystem and become the most widely-used stablecoin project over the next three years. A beta launch of the Endgame will launch in the coming months, and six SubDAOs will be launched for daily operation. The final step in the plan will involve deploying a new blockchain with AI-assisted DAO governance processes.
Bitcoin Slips to Two-Month Low, Bulls Eye $30,000
Bitcoin hits two-month lows at $26,100 amid concerns over a potential "head-and-shoulders" pattern. Bid liquidity drops despite favorable macroeconomic conditions. Bitcoin's price dropped below $27,000 for the first time since March 2023, but on-chain data shows no signs of panic sell-off. Long-term investors remain confident, and bullish investors are positioned to buy the dip at $25,000. If BTC clears resistance at $27,500, bulls could push for $30,000, but a sudden drop below $25,000 could invalidate the positive outlook.
Bitcoin Developers Discuss BRC-20 Token Surge Impact
Bitcoin developers are debating how to handle the staggering amount of BRC-20 tokens minted via the Ordinals protocol, which has sent transaction fees soaring. While some developers are calling for action to curb the surge, others believe that Bitcoin should maintain its status quo.
Over 14,300 BRC-20 tokens have already been minted, with market cap approaching $1 billion. However, no change is expected to the Bitcoin protocol despite developers labeling the BRC-20 tokens as spam. BRC-20 tokens hit a $1 billion market cap due to high Bitcoin fees but have now dropped to $385 million as average fees paid per block decreased from six to one Bitcoin.
Texas Amends Bill of Rights to Include Cryptocurrencies
The US state of Texas has changed its Bill of Rights to recognise residents' right to hold and use digital currencies. Bitcoin entrepreneur and politician Giovani Capriglione's bill would permit Texans to use "a medium of exchange that is mutually agreed upon, including cryptocurrency". It now requires a second vote and Senate approval before coming into law.
Elon Musk Considers NBCUniversal's Linda Yaccarino for Twitter CEO
Elon Musk is reportedly in talks to appoint Linda Yaccarino, NBCUniversal's head of advertising, as Twitter's new CEO. Musk has served as CEO since acquiring the social media giant last year. The move may impact the crypto industry as Twitter is a key communication method for people working in the sector.
LG Patents TV with Built-In NFT Trading Capability
LG seeks to patent a TV that allows users to buy and trade NFTs, building on an Art Lab marketplace it launched last year. The device would be able to connect with an NFT market server and the user's cryptocurrency wallet.
Terraform Labs Executives Released on Bail in Montenegro
Terraform Labs co-founder Do Kwon and CFO Han Chang-joon have been released on bail by a court in Montenegro following their arrest for allegedly using false passports. The two had been accused of forgery after TerraUSD, the algorithmic stablecoin that they helped created, suffered a crash last year. Kwon had been on the run until his subsequent arrest.
Top Altcoin Gainers and Losers
Kava KAVA (+7.04%)
Lido DAO Token LDO (+6.66%)
Trust Wallet Token TWT (+4.06%)
Pepe PEPE (-14.12%)
Toncoin TON (-12.26%)
Huobi Token HT (-11.58%)
NFT Market Map
Gaming firm Animoca Brands reports $194 million in stablecoin reserves and $566 million in liquid digital assets, while its other token reserves are worth $2.7 billion, according to its Q1 2022 earnings report. The firm, which was delisted from the Australian Stock Exchange in 2020 for its digital asset activities, aims to be a leading company in gaming and the metaverse and plans to launch a mobile game powered by NFTs in Q1 2024.
Meanwhile, Paradigm-backed fractional NFT project Tessera and its sister project Escher are shutting down due to the economic model not being profitable. Tessera had raised $20 million in an August Series A round led by Paradigm.
This article has been refined and enhanced by ChatGPT.