Coin360 Daily Dispatch | Crypto Market Updates & Highlights | October 23, 2023
Crypto Market Update
Table of Contents
Market Trends
- Bitcoin Crosses $31K: What's Fueling the Surge?
- FTX Bankruptcy: Creditor Claims Gain Momentum
- Worldcoin's WLD Token: New Changes and Challenges
- China's e-CNY: First Oil Deal and New Wallet Features
Crypto Exchanges and Wallets
- Bitget Introduces MPC Wallet for Enhanced Security
- Institutional Crypto Investments: The Fourth Winning Streak
- Binance and Polygon: Upcoming USDC Changes
- Marinade Finance: UK Users Blocked Over FCA Rules
Regulatory and Community Updates
- Reddit's MOON Scandal: Moderators Ousted for Insider Trading
- WSJ's False Claims: Chainalysis Debunks Hamas Funding Story
- Chainlink's Bull Run: What's Behind the Surge?
- Bitcoin Lightning Network: Uncovering a Security Flaw
Banking and Regulatory Developments
- Brazil's CBDC Dilemma: Privacy vs Open Networks
- Ripple vs SEC: The Legal Battle Takes a Turn
- Deutsche Bank's UDPN: First Stablecoin Swaps
High-Stakes Tokens and NFTs
- HayCoins: From Test Tokens to $3 Million Valuation
- Azuki NFTs: A Rollercoaster of Valuations
- Magic Eden Halts BRC-20: Security Concerns Arise
Bitcoin Crosses $31K: What's Fueling the Surge?
Bitcoin's price has surpassed the $31K mark, buoyed by bullish cues from gold and a pause in Fed rate hikes. Massive institutional demand is waiting for a spot Bitcoin ETF approval, with trillions in capital on standby.
MicroStrategy's Bitcoin holdings are back in profit, with the firm up $132 million as BTC crossed $30K. Meanwhile, the economic calendar suggests more market volatility, with key U.S. GDP and inflation data due this week.
FTX Bankruptcy: Creditor Claims Gain Momentum
The FTX bankruptcy case is seeing a surge in creditor claim values, some fetching over 50 cents on the dollar. A claim worth $20+ million recently sold for 52-53 cents at an October 20 auction. Smaller claims, ranging from $500,000 to $800,000, are trading between 30 and 40 cents.
The uptick is attributed to recent clawback efforts and capital-raising activities, including Anthropic's $580 million Series B and Amazon's $4 billion investment. The FTX creditor coalition suggests that these valuations could fully compensate creditors.
Concerns like KYC and AML issues still exist but are being addressed. The "shortfall claim" estimates FTX customers will receive 90% of distributable assets, valued at around $8.9 billion for FTX.com and $166 million for FTX US.
Worldcoin's WLD Token: New Changes and Challenges
Worldcoin is replacing USD Coin with its native WLD token for Orb operator rewards. The WLD reward program will be accessible to all operators from November. The Foundation has paid out 9,500 WLD tokens in rewards so far.
The loan settlement period for market makers has been extended, potentially impacting the circulating supply of WLD. The token's price has decreased by 5.5% in response to the news. The project faces regulatory scrutiny in multiple countries.
China's e-CNY: First Oil Deal and New Wallet Features
China's e-CNY digital currency was used by PetroChina to settle a large international crude oil transaction, marking the first use of the digital currency in this capacity. The transaction, which involved the purchase of one million barrels of crude oil, took place on the Shanghai Petroleum and Natural Gas Exchange.
The move is part of the exchange's efforts to comply with the government's instruction to utilize the e-CNY in cross-border trade. Meanwhile, the Bank of China has unveiled the "e-CNY hard wallet," a SIM card wallet that connects users' mobile phones to their centrally controlled digital yuan wallets for enhanced safety, reliability, and convenience in digital transactions.
Bitget Introduces MPC Wallet for Enhanced Security
Cryptocurrency exchange Bitget has launched an MPC wallet using distributed key generation for improved security. The wallet offers a mnemonic-free user experience and uses a 2/3 threshold setup for transaction authorization. It also features a reshare mechanism and standalone transaction passwords for enhanced security.
Institutional Crypto Investments: The Fourth Winning Streak
Investments in institutional crypto products have been positive for the fourth consecutive week, with a total investment of $66m. The majority of investments (83.7%) were directed towards Bitcoin, with Swiss firm 21SharesAG seeing the largest inflows.
The report suggests that the positive inflows may be linked to excitement over a spot Bitcoin ETF launch in the US. While Solana continues to attract investment, Ethereum experienced outflows due to concerns over its centralization and increasing validator size.
Binance and Polygon: Upcoming USDC Changes
Binance will support USDC on Polygon, the network for the stablecoin issued by Circle. Deposits and withdrawals of USDC bridged from Ethereum will be suspended on Oct. 25 and will resume later with a new ticker. The move aims to improve usability and attract corporate clients.
Marinade Finance: UK Users Blocked Over FCA Rules
Marinade Finance, the largest decentralized finance (DeFi) protocol on the Solana blockchain, has blocked users in the UK due to compliance concerns over FCA regulations. Other crypto businesses have also withdrawn or paused operations in the UK following the FCA's new promotions rules. Geo-restrictions are unusual for decentralized protocols, which typically do not require KYC checks.
Reddit's MOON Scandal: Moderators Ousted for Insider Trading
Reddit's r/CryptoCurrency community ousted two moderators for insider trading of Moons (MOON) tokens. These mods sold their tokens just before an official announcement that led to an 85% token value drop. Two were removed, three are under investigation. The incident was flagged by on-chain analysis accounts.
WSJ's False Claims: Chainalysis Debunks Hamas Funding Story
The Wall Street Journal published a false article claiming that $90 million worth of cryptocurrency was used to fund Hamas. The article was debunked by Chainalysis. US politicians used the article as evidence and sent a letter to the White House and Treasury, requesting details on preventing crypto financing of terrorism. Chainalysis found 20 suspected service providers affiliated with terror financing. The Wall Street Journal's figure was off by over 99%.
Chainlink's Bull Run: What's Behind the Surge?
Chainlink (LINK) has seen a 43% surge over the past month, hitting multi-month highs. Large investors, or "whales," have been accumulating LINK tokens, contributing to the rally. According to Santiment, the network has reached three-month highs in whale transactions, unique interacting addresses, and trading volume.
Specifically, on October 21st, LINK recorded over 220 whale transactions exceeding $100,000 each, nearly 5,000 distinct addresses engaging with LINK, and over 800 million in trading volume. The crypto is currently trading at $10, a level last seen in May 2022. One major catalyst is the upcoming launch of Chainlink Staking v0.2, set for Q4, which aims to offer stakers greater control, security, and transparency.
Bitcoin Lightning Network: Uncovering a Security Flaw
Developer Antoine Riard has identified a vulnerability in the Bitcoin Lightning Network called "replacement cycling attacks." This flaw poses a risk to fund security and could disrupt the normal flow of transactions.
However, there have been no real-world attacks reported in the last 10 months. Mitigation steps have been taken, with patches deployed across major Lightning Network implementations. Riard has also announced his departure from Lightning development.
Brazil's CBDC Dilemma: Privacy vs Open Networks
Brazil's Central Bank President, Roberto Campos Neto, highlighted the challenge of balancing privacy with open networks in the implementation of central bank digital currencies (CBDCs). He stated that no one has yet solved this problem, but believes a solution is close.
Neto also discussed the potential benefits of CBDCs for international transactions and the development of Brazil's digital currency, known as Drex. Additionally, he highlighted the programmability of money and its potential impact on the credit card industry.
Ripple vs SEC: The Legal Battle Takes a Turn
The SEC's chances of winning an appeal against Ripple are slim, pegged at about 3% by lawyer Bill Morgan. This contradicts government data suggesting a 14.2% chance. Ripple recently scored a major win when a judge ruled that XRP sales don't violate securities law.
The SEC also recently moved to dismiss all charges against Ripple's top executives, marking another victory for the company. Ripple's legal battles have significantly impacted its business, leading to delisting from major crypto exchanges. The SEC has now dropped the rest of the case, eliminating the possibility of a trial next year.
Deutsche Bank's UDPN: First Stablecoin Swaps
Deutsche Bank and SC Ventures have completed the first stablecoin swaps on the Universal Digital Payments Network (UDPN), a platform launched in January 2023 to facilitate the development of stablecoins, central bank digital currencies (CBDCs), and digital foreign exchange infrastructure.
The on-chain swaps involved the USDC and EURS stablecoins, with SC Ventures using UDPN-based SDKs and APIs to create decentralized identities and linked digital currency wallets. Deutsche Bank initiated the swaps via a graphical user interface.
HayCoins: From Test Tokens to $3 Million Valuation
The first-ever coins released by Uniswap creator Hayden Adams are now trading at over $3 million per token. These coins, called HayCoins (HAY), were originally released in 2019 for testing purposes and were not intended to hold any value. A group of traders recently acquired all 4.4 tokens available on the market, leading to a surge in prices.
Adams has burned his remaining stash, destroying the majority of the supply. Nevertheless, the 4.4 remaining tokens still hold significant value, with prices settling above $3 million per token. Adams has distanced himself from the speculation surrounding the tokens.
Top Altcoin Gainers and Losers
Gainers:
Injective INJ (+15.15%)
THORChain RUNE (+14.41%)
Mina MINA (+14.01%)
Losers:
KuCoin Token KCS (-0.75%)
Aptos APT (-0.74%)
Tether Gold XAUT (-0.42%)
NFT Market Map
Azuki NFTs: A Rollercoaster of Valuations
The Azuki NFT collection saw its floor price skyrocket by 47% in the last month, jumping from 3.7 ETH to 5.3 ETH. With a market cap exceeding $90 million, Azuki launched in early 2022 and quickly sold out 8,700 NFTs at 1 ETH each in a 4-minute Dutch auction.
The collection has faced volatility; its floor price peaked at 31.8 ETH in April 2022 but later dipped to 8.3 ETH. Azuki also launched a new Elementals collection in June 2023, but it faced criticism for mismanagement and holding 20,000 ETH without progress.
Magic Eden Halts BRC-20: Security Concerns Arise
NFT marketplace Magic Eden has temporarily halted trading of Bitcoin BRC-20, causing concern among crypto enthusiasts. The platform cited the need to protect users and ensure full consensus across all BRC-20 tokens.
The decision comes after reduced activity on the BRC-20 network, which raised questions about its security, scalability, and regulatory compliance. Magic Eden had previously promoted BRC-20 as a way to showcase new possibilities for digital currencies.
This article has been refined and enhanced by ChatGPT.
