All Been Crypto — Week 16 Feb 2024
A bullish week as we broke through 50k and claimed the 1tn market cap for BTC and 2tr for our industry. BTC + 13% ETH + 17% and STX a whooping 38% wow having some concerned on market overextending itself. Looking at leverage on exchanges OI clearly on the rise and CME continuing gaining share from Binance. The driver of the price action, outside of macro we had some point to CNY holiday which seasonally is usually a good period for BTC but also institutional flows caught a strong bid. All the while GBTC outflows seemed to have stabilized — but that might be the calm before the next storm Genesis got courts approval to sell their Grayscale funds including 1.3bn in GBTC. Outside GBTC though others have seen strong inflows of up to $632M in a day and now putting a strong bid underneath our asset class. And crypto related equities had an even stronger performance with COIN, MSTR and miners all outperform. In the news STRK announced airdrop details that led to some heated debates, Frax went live with their L2 Fraxtal, and there’s some indication another African nation is opening up to Bitcoin and Coin Metrics did some guesstimate on the cost of a 51% attack on BTC. Enjoy reading!
Bat Tai Chi — btc21@mail.com
HEADLINES:
Airdrop season is upon us but why is not everyone happy with Starknet?
We are in bull market, not just price action but also if you look at the airdrops. Long awaited projects like LayerZero have confirmed drops soon and Starknet is now also revealing details. This one was one of the largest anticipated and had sparked some controversy. They are planning to drop 7% of outstanding supply to some 1.3mm eligible wallets including early adopters, core contributors both to the protocol but also to Ethereum and even ETH stakers. Uniswap founder Hayden felt like ETH stakers were not really the kind of people deserving the airdrop which is a philosophical question and shows various levels of interest in the space. There also have been what appears to be some hiccups with solo stakers. Another point of critique was on the quick unlock and the fact that locked tokens can still be staked and earn rewards.
Launching own L2s — Fraxtal went live and ApeDAO
Frax went live with their own L2 Fraxtal. It’s an optimistic roll up using an internally developed data availability layer developed by the Frax Core Team using fxsETH as the main gas for the chain. The are also trying a new model for driving demand for blockspace they call Blockspace Incentives (FLOX) I havn’t got my head around it fully but it’s utilizing a points system which they also aim to tokenize at a later stage. Since everything that Frax so far has implemented in DeFi followed a neat logic and strong vetokenomics this is one to spend a bit time on potentially setting standards for DeFi 3.0 (their L3). ApeDAO also made some progress on their L2 with a vote passing to build on Arbitrum tech stack. Thats some progress for APE holders and BAYC especially as the NFT floor price continues to trend lower and the recently passed proposal of the DAO to liquidate all of it’s NFT holdings will likely assert additional sell pressure
Ethiopia the next Bitcoin Mining Hub?
The Gov has still banned crypto but now looking to welcome miners leveraging it’s electricity infra built out and gaining access to hard currency. They have entered into a partnership with a Hong Kong data center operator and Bitcoin mining will be among the activities the sides develop together. Not surprising as many frontier countries have realized the potential to attract FDI and bootstrap infra investment particularly into power with implementing a mining friendly environment. Kazakhstan, Uruguay are just two examples of large mining operations in otherwise less developed countries. The obvious challenge is the insatiable political system and the risks associated with that but if energy is cheap and abundant then this can we a win/win for the gov and the miners.
QUOTES:
The unlocking for the team and early investors… is one aspect in which we may be non-standard […] but we build different and we view things a little bit differently.”
Eli Ben-Sasson, Starkware’s co-founder and CEO
MicroStrategy is now a Bitcoin development company, in the same way you would see a real estate or petroleum developer.
Michael Saylor — MicroStrategy founder
We also find no ways for a nation-state attacker to continuously run a 51% / 34% attack if the goal is to destroy these networks. The possibility of retaliation techniques makes ideologically driven attacks costly at each retaliation round. In the end, the network survives.
Lucas Nuzzi — Head of R&D at CoinMetrics
