Token Unlocks Unlock Long-Term Growth Potential for Crypto Projects

• Token unlocks are significant events that have the power to sway the market. CryptoSlate looked at price data for six different crypto projects to better understand how their token unlocks affected the market.
• Polygon’s MATIC token saw a 30% increase in price leading up to its unlock, but then saw a flat market following the unlock. In the month following the unlock, MATIC saw its price increase by over 80%.
• LidoDAO’s LDO token saw little positive price action leading up to its unlock, but 1.65 million tokens were unlocked and distributed on Dec. 18, 2022, leading to an increase in its price of over 30%.

Cryptocurrency tokens are a growing asset class in the digital space, which is why it is so important to understand and analyze the data surrounding token unlocks. Token unlocks are significant events that have the power to sway the market, and by looking at the data surrounding them, we can better understand how they affect the market. To better understand this, CryptoSlate looked at price data for six different crypto projects, ranging from high-cap to mid-cap.

First, we looked at Polygon (MATIC). On Oct. 26, 2019, the Polygon network unlocked 190 million MATIC. The tokens were distributed to private investors and early supporters who participated in Polygon’s funding rounds. The market was gearing up for the token unlock, creating a buying pressure that pushed its price up almost 30%. After the tokens were airdropped, increased selling pressure kept MATIC’s price relatively flat. However, in the month following the unlock, MATIC saw its price increase by over 80%.

Next, we looked at LidoDAO (LDO). Lido has seen its popularity increase significantly in 2022, as Ethereum’s transition to a PoS network made it its most valuable player. Its LDO token saw a notable uptick ahead of the Merge, so the month leading up to its December token unlock saw little positive price action. On Dec. 18, 2022, 1.65 million LDO tokens were unlocked and distributed, leading to an increase in its price of over 30%.

The Sandbox (SAND) also saw a token unlock in November of 2019. The unlock saw a total of 900 million SAND tokens released, with the majority of them going to game developers who had earned them via the Game Maker’s Reward program. The unlock led to a surge of over 30% in SAND’s price.

We also looked at 1inch Network (1INCH) and STEPN (GMT). 1INCH’s token unlock was in December of 2019 and saw a total of 150 million tokens released. This led to a surge in its price of over 20%. STEPN’s token unlock was in April of 2021 and saw a total of 100 million tokens released. This led to a surge in its price of over 40%.

Overall, token unlocks are significant events that can have a major impact on the market. All six tokens studied saw a positive price increase following their token unlocks. This demonstrates the long-term potential for cryptocurrency projects and their tokens, as the short-term volatility that comes with token unlocks can lead to long-term growth.

USDC: A Dollar with Superpowers

• Circle spoke to over a dozen leaders at the World Economic Forum to „reset the crypto narrative with an emphasis on inclusive growth.“
• USD Coin (USDC) founder Circle attended the World Economic Forum to explain „why USDC is a dollar with super powers.“
• According to Circle’s „State of the USDC Economy“ report published on Jan. 17, USDC in circulation grew from zero to $45 billion in four years.

Circle, the USD Coin (USDC) founder, attended the World Economic Forum (WEF) to explain “why USDC is a dollar with superpowers”. The WEF took place between Jan 16-20th, 2023 in Davos and hosted over 1,500 industry leaders and government representatives from around the globe.

Circle saw the WEF as an important platform to “reset the crypto narrative with an emphasis on inclusive growth, sustainability, and use cases rooted in the utility value of USDC and blockchain technology.” To do this, the company hosted over a dozen conversations with the participants of the WEF to discuss the evolution of money and the regulatory approaches to crypto that promote responsible innovation. Circle also emphasized its vision that “the future of money should include everyone.”

According to Circle’s “State of the USDC Economy” report, USDC in circulation has grown from zero to $45 billion in four years. USDC is the native currency of eight blockchains, supported by wallets from 190 different countries, and has over 200 integrated protocols.

Almost a year ago, in February 2022, USDC started to gain traction in the stablecoin market and began to challenge the dominance of USDT. The growth of USDC’s market share has been steady and in December 2022, it had a market share of 32%. This is a significant improvement from its market share of 19% in February 2022.

The success of USDC has been attributed to its stability, transparency, and security. USDC is backed by fiat currency held in reserve by a growing list of regulated financial institutions and is audited monthly. It also adheres to the ERC-20 protocol, which ensures that all transactions are transparent and secure.

Circle believes that the success of USDC can be attributed to the fact that it is a dollar with “super powers”. It has all the benefits of a fiat currency but with the added benefits of blockchain technology. This allows it to be used in a variety of ways, from payments to trading.

Circle is committed to continuing its work to promote the use of USDC for a variety of use cases. The company is exploring partnerships with leading financial institutions and developing new products that will allow people to use USDC more easily. It is also actively engaging with regulators to ensure that the use of USDC is compliant with existing laws and regulations.

The success of USDC is an example of the potential of blockchain technology to create more inclusive and efficient financial systems. Circle is optimistic that the use of USDC will continue to grow and that it will become a mainstream currency in the near future.

BTC Volatility Falls Below Gold, Dollar, Nasdaq and S&P 500

• Bitcoin’s (BTC) 5-day volatility has fallen below that of gold, the dollar strength index, Nasdaq, and the S&P 500, a phenomenon known as „relative volatility compression“.
• This is only the fifth time that this has happened in the past and is an indication of BTC’s increased stability.
• Historically, this phenomenon has only lasted for 1-2 days; however, this time it has already endured for 4 days, setting a record.

Bitcoin’s (BTC) price has been on an upward trajectory over the weekend, breaking past $17,000. However, in the first 10 days of 2023, BTC has been trading relatively flat with low volatility, as is typical during a bear market. This stability is reflected in the derivatives market and is driven by lower trading activity, indicating a reduction in speculative demand for the largest cryptocurrency by market cap.

BTC’s 30-day volatility has sunk to June 2020 levels, and its 5-day volatility has fallen below that of gold, the dollar strength index, Nasdaq, and the S&P 500, a phenomenon known as „relative volatility compression“. According to an Arcane Research report, this is only the fifth time that this has happened in the past and is an indication of BTC’s increased stability.

Historically, this phenomenon has only lasted for 1-2 days; however, this time it has already endured for 4 days, setting a record, as per Arcane data. This is unusual, and Arcane commented that this could lead to more volatility in the short-term. It remains to be seen whether or not this event will lead to an increase in volatility, or if it is indicative of a larger trend towards increased stability in the crypto markets.

Nevertheless, the fact that BTC’s 5-day volatility has fallen below that of all of the aforementioned indices is an indication that the crypto markets are maturing and that institutional investors are becoming more comfortable with the asset class. This could be a sign of good things to come for the crypto markets, and investors should be prepared for both volatility and stability in the days to come.

Ethereum Token Burns Reduce Supply, Boost Value: Nearly $9B Tokens Destroyed

• Ethereum (ETH) implemented a token burn mechanism on Aug. 5, 2021, through the Ethereum Improvement Proposal (EIP) 1559 upgrade.
• Since then, nearly $9 billion worth of tokens have been burned cumulatively, data from Glassnode indicates.
• The daily burn rate of Ethereum has decreased significantly and nearly stagnated since the collapse of Terra-Luna in May 2022.

Ethereum (ETH) implemented a token burn mechanism on Aug. 5, 2021, through the Ethereum Improvement Proposal (EIP) 1559 upgrade. Token burning is a process by which tokens are made unspendable, effectively removing them from circulation. The purpose of this burn is to reduce the overall supply of ETH tokens, which can help increase the value of the cryptocurrency.

Since the burn mechanism was instituted, data from Glassnode indicates that nearly $9 billion worth of tokens have been burned cumulatively. A total of around 2.8 million ETH tokens have been removed from the supply. The data from ultrasound.money suggests that 1,896.30 ETH, worth around $2.2 million was burned over the past day.

The daily burn rate of Ethereum has decreased significantly and nearly stagnated since the collapse of Terra-Luna in May 2022. During the bull run of 2021, $20 million to $75 million worth of ETH was being destroyed daily. This has fallen to only around $2 million to $4 million worth of ETH burned every day in December 2022.

The implementation of token burn has caused Ethereum’s average gas fees to fall from around 100-200 Gwei in early 2021 to 15-20 Gwei in December 2022. This lower fee structure has made Ethereum more attractive to developers and users, which has in turn helped to increase the overall usage of the network.

Ultimately, the token burn mechanism is helping to increase the value of Ethereum by reducing the overall supply of tokens in circulation. This, in turn, is helping to create a more attractive environment for developers and users, which will continue to drive the overall value of the Ethereum network.

FTX Seeks to Regain $167 Million of Crypto Assets from Bahamas Securities Commission

• Bahamas Securities Commission (SCB) instructed former FTX CEO Sam-Bankman Fried and his associate Gary Wang to transfer $296 million of digital assets to a Fireblocks cryptocurrency wallet controlled by the regulator.
• FTX and its associated debtors said that Bankman-Fried, Wang, and the SCB had no right to take control of the assets and will try to regain the assets and deliver them to creditors through its bankruptcy proceedings.
• The assets transferred by Bankman-Fried are now worth $167 million, and the SCB’s announcement yesterday did not allude to FTX’s claims.

On December 30th, FTX and its associated debtors reported that the Bahamas Securities Commission (SCB) instructed former FTX CEO Sam-Bankman Fried and his associate Gary Wang to transfer $296 million of digital assets to a Fireblocks cryptocurrency wallet controlled by the regulator. The assets allegedly transferred by Bankman-Fried include 195 million FTT, 1,938 ETH, and other assorted cryptocurrencies without significant value. Though those assets were worth $296 million in November, their value is now just $167 million.

FTX and its associated debtors assert that the SCB had no right to take control of the assets in question and that they will try to regain the assets and deliver them to creditors through its bankruptcy proceedings. The company notes that though the SCB holds said assets, the regulator may not be viable to sell this large quantity of FTT tokens at current spot prices — or at all.

FTX’s accusations are based on available evidence, though the SCB’s announcement yesterday did not allude to FTX’s claims. FTX insists that Bankman-Fried, Wang, and the Bahamas Securities Commission had no right to take control of the assets in question. As such, the company is now attempting to regain the assets and deliver them to creditors through its bankruptcy proceedings.

This announcement comes as a surprise to many, as the Bahamas Securities Commission had been relatively quiet on the matter. The $296 million transfer may or may not have been part of the $3.5 billion that the regulator is said to have seized from FTX. The company is now hoping to reclaim the assets and deliver them to creditors through its bankruptcy proceedings.

Regardless of the outcome, this situation is a reminder of the importance of understanding the legal implications of cryptocurrency transfers. FTX’s experience is a cautionary tale for other companies and individuals who are looking to use digital assets as a means of transferring funds.

Valkyrie Proposes Changes to Grayscale’s Bitcoin Trust: Redemption, Lower Fees & More

• Valkyrie Investments has proposed to become the sponsor and manager of Grayscale’s Bitcoin Trust (GBTC).
• The company aims to offer orderly redemptions at net asset value (NAV), reduce GBTC fees, and offer redemptions in both Bitcoin and cash.
• Valkyrie has also launched the Valkyrie Opportunistic Fund LP which will take advantage of the discrepancy between GBTC and the NAV.

Valkyrie Investments recently announced in a statement that it has submitted a proposal to become the sponsor and manager of Grayscale’s Bitcoin Trust (GBTC). The news comes at a time when GBTC is facing difficulty in the marketplace, trading at 50% less than the value of Bitcoin that it holds. As a result, Valkyrie is aiming to improve the current operations of GBTC with a variety of changes.

To begin, Valkyrie is proposing to offer orderly redemptions at net asset value (NAV). This would allow customers to withdraw their funds at a fair value without any issues, thus providing greater liquidity and transparency in the market. In addition, Valkyrie is looking to reduce GBTC fees in order to further improve the fund’s attractiveness. On top of that, the company is proposing to offer redemptions in both Bitcoin and cash, allowing investors to choose the asset they would like to receive when redeeming their GBTC shares.

Valkyrie is also launching the Valkyrie Opportunistic Fund LP, which will take advantage of the discrepancy between GBTC and the NAV. The fund will look to capitalize on the current situation, allowing investors to benefit from the mispricing of GBTC.

In its statement, Valkyrie asked Grayscale to “consider it carefully” and suggested that its proposal is a “significant improvement” over current management of GBTC. Grayscale, however, has its own plans. The firm intends to convert GBTC into an ETF to raise the price of the fund, though its past attempts to do so have failed due to rejections from the U.S. SEC. Grayscale has also suggested other possibilities, including a tender offer for up to 20% of outstanding shares, according to recent WSJ reports.

As the two firms go back and forth in their attempts to improve the operations of GBTC, investors are eagerly awaiting the outcome. With Valkyrie’s proposal, investors will be able to benefit from the improved liquidity and reduced fees, while Grayscale’s potential conversions may help the fund reach a higher price. It remains to be seen which of these approaches will prevail, but both firms’ proposals offer compelling opportunities for investors.

1 Million Wallets Holding 0.1-1 BTC, 2 Million With 1-10 BTC

• The total supply of wallets that hold between 0.1 Bitcoin (BTC) and 1 Bitcoin has surpassed 1 million coins.
• The collective supply of wallets that hold between 1 BTC and 10 BTC has also topped 2 million.
• These wallets have witnessed a steady increase in total BTC supply since late 2013.

The Bitcoin (BTC) network is constantly growing and expanding, and the number of wallets holding coins within the network has also been increasing over the years. According to recent data, the total supply of wallets that hold between 0.1 BTC and 1 BTC has surpassed 1 million coins, and the collective supply of wallets that hold between 1 BTC and 10 BTC has also topped 2 million.

The chart below demonstrates the increase in the total BTC supply held by wallets that hold between 0.1 BTC and 1 BTC since 2010. This metric started to record a stable increase in late 2013, with short exponential growth periods in 2016 and 2018. As of December 29th, the total supply sits at 1.01 million BTC.

The chart above also shows the increase in the total BTC supply held by wallets that hold between 1 BTC and 10 BTC since 2010. This metric recorded an upwards spike in late 2011 and has continued its exponential growth since then. As of December 30th, the total supply held by these wallets is 2.06 BTC.

The increase in the total BTC supply across these wallets is indicative of the growing popularity of Bitcoin among users and investors. Furthermore, the steady growth in the total supply of these wallets points to the increasing number of users that are investing in Bitcoin, as well as the growing confidence in the asset.

Ultimately, the increasing total supply of these wallets is a positive sign for the future of Bitcoin, as it suggests that the asset is continuing to build up its user base and attract more investors. This is likely to be beneficial for the long-term prospects of the asset, and could lead to further growth and adoption in the near future.

Binance Roars Ahead: 14 Licenses, 7.5K Headcount, 120M Users

• Binance saw steady growth in 2022, securing 14 licenses and increasing its headcount to 7,500 people representing over 100 nationalities.
• The exchange currently operates in over 140 countries in the world and holds 14 licenses from 14 different countries across the globe, including Abu Dhabi, Dubai, South Africa, France, Italy, Spain, Cyprus, Australia, and New Zealand.
• Binance enhanced its capabilities in the area of security and compliance by increasing its security and compliance staff by 500% in 2022.

In 2022, Binance had a successful year of growth and expansion. The exchange saw its headcount grow to 7,500 people, representing over 100 nationalities. Binance also increased its compliance team to 750 people from 500, as well as its security and compliance staff by 500%.

Binance currently operates in over 140 countries in the world, and has secured 14 licenses from 14 different countries across the globe. These licenses come from countries like Abu Dhabi, Dubai, South Africa, France, Italy, Spain, Cyprus, Australia, and New Zealand. The exchange is also engaging with regulators in these countries to ensure that it meets all local requirements.

CEO Changpeng (CZ) Zhao said: “Amid the noise that impacts token prices, projects‘ reputations, and the fortunes of individual investors, my goal has been to keep everyone at Binance focused on things that matter the most: building and staying user-focused. I am proud that we remained true to these core values in everything we do.”

Binance is now serving over 120 million users from all over the world. In addition to its growing user base, the exchange is also actively investing in its security and compliance measures. It has implemented measures like two-factor authentication, IP whitelisting, and anti-phishing software to protect user accounts and funds.

The exchange is also making strides to become more compliant with global regulations. It has established an AML/KYC program and is now compliant with the CFT, AML, and KYC requirements of many countries.

Binance has had a successful year of growth and expansion in 2022, and it looks like the exchange is well on its way to becoming the top crypto exchange in the world. As the demand for cryptocurrencies and blockchain technology continues to grow, it will be interesting to see what the future holds for Binance and the industry as a whole.

China Launches Regulated NFT Marketplace, Accelerating Digital Transformation

• China is set to launch its first regulated Non-fungible token (NFT) marketplace, China Digital Asset Trading Platform, on January 1, 2023.
• Institutions and individuals will be able to access rights protection monitoring and copyright protection services through the NFT trading platform.
• This launch represents an acceleration in the cultural industry’s digital transformation in China.

China is set to take a major step forward in the digital asset space with the launch of its first regulated Non-fungible token (NFT) marketplace, China Digital Asset Trading Platform, on January 1, 2023. This platform, created jointly by the Chinese Technology Exchange, Art Exhibitions China, and Huban Digital Copyrights Ltd, will facilitate the exchange of NFTs as a secondary market. This launch is seen as a major milestone in the digital transformation of the country’s cultural industry.

Institutions and individuals will be able to access a number of services through the NFT trading platform, such as rights protection monitoring and copyright protection. This will ensure that digital assets are secure and properly managed. China’s central bank has also recently released trial versions of digital yuan wallet apps on mobile, a move that further indicates the country’s commitment to the digital asset industry.

In 2021, China passed a law that banned all cryptocurrency transactions, effectively banning digital tokens such as Bitcoin. This ban was implemented as a measure to prevent fraud and manipulation in the cryptocurrency market. As a result of the ban, a number of crypto firms in the country ceased operations, including Huocoin. The launch of China Digital Assets Exchange is seen as a positive step forward for the industry, as it will provide a safe and regulated platform for individuals and institutions to trade digital assets.

Overall, the launch of the China Digital Asset Trading Platform is a major step forward for the digital asset industry in China. It will provide a safe and regulated platform for individuals and institutions to trade digital assets, as well as access rights protection monitoring and copyright protection services. This launch marks a significant milestone in the digital transformation of the country’s cultural industry, and is expected to be a major catalyst in the development of the industry.

Advisers Earn $53M in 4 Months After Celsius Bankruptcy

• Lawyers, bankers, and other advisers in the case of Celsius’ bankruptcy earned $53 million for four months of work.
• Among the five advisors, Kirkland & Ellis was billed the most significant amount at $20.1 million, while White & Case’s services as advisors to unsecured creditors committees cost the most expensive at $10.2 million.
• Jenner & Block made a total sum of $1.9 million for its services as the advisor to the examiner, charging a rate of $59,000 per day for 32 days.

Celsius, a crypto lender, declared bankruptcy on July 14, 2022, in the wake of the ripple effect of the Terra-Luna crash. It paid its DeFi loans to Aave, Compound, and Maker, which ultimately led to the firm’s bankruptcy. Despite the unfortunate circumstances, lawyers, bankers, and other advisers have managed to earn a staggering amount from the case: a total of $53 million for four months of work.

Kirkland & Ellis was the company that earned the most significant sum for its services, billing a total of $20.1 million for 212 days of service, charging a daily fee of $166,000. White & Case was the most expensive advisor, earning $10.2 million for 94 days of service, charging $109,000 per day. Meanwhile, Jenner & Block made a total of $1.9 million for its services as the advisor to the examiner, charging a rate of $59,000 per day for 32 days.

Despite the bankruptcy of Celsius, lawyers, bankers, and other advisers were able to earn a large sum of money from the case. On the other hand, it is uncertain what the future holds for the crypto lender and its creditors. Nevertheless, the $53 million earned by the five advisors for four months of work is a testament to the importance of the services provided by these professionals in the context of legal proceedings.