Everyone hates Circle
In today’s edition, crypto puzzles, ETC struggles, and RIP Tata Coin?
Good morning! Welcome to The Daily Moon. Nobody’s buying Do Kwon’s excuses. South Korea has asked Interpol to locate the Terra co-founder. They’ve claimed that Kwon is “obviously on the run”. Guess his tweets weren’t convincing enough. Watch this space for more.
The markets recovered amidst the Fed stress. Bitcoin was at ~$19,000 while Ethereum stuck to the $1,350 levels. Nasdaq stayed choppy in early trade. Back home, Sensex and Nifty extended gains for the second day in a row.
USDC Is Leaving The Building
Circle’s USD Coin has been dumped. Binance will remove USDC next week. WazirX, which has no connection to Binance, none at all, has taken a similar decision. Those who are silently ushering USDC out the door are increasing.
Why is it getting booted?
Privacy and centralisation. The crypto community has fallen out of love with Circle ever since the Tornado Cash saga. When the US Treasury banned crypto mixer Tornado Cash, Circle jumped the gun to freeze all wallets associated with this entity. Rival Tether took no such action.
Binance announced it will convert all USDC user balances into Binance USD on September 29.
WazirX will also convert USDC into Binance USD next week. Just a reminder, Binance and WazirX still have no connection.
Maker DAO will hold more staked Ether as collateral against its stablecoin DAI. It wants to cut dependence on USDC.
Another worry is centralisation. Since government bonds and cashback USDC, crypto firms want to reduce over-reliance on it.
But isn’t it safer?
Relatively, yes. When Terra and Luna crashed in May, we all asked: how stable are these stablecoins? Circle’s USDC was touted as the alternative since it was backed by real cash reserves. That position still holds.
Now what?
The going gets tough for USDC. If more exchanges drop the stablecoin from trading, the market cap may fall further. We wouldn’t want to be in that Circle boardroom.
Is Crypto Spring On The Way?
Depends on who you ask. The US Fed rate hike is around the corner and the Merge euphoria is over. That means crypto prices may fall further. But institutional investors are very keen on Bitcoin trading.
What’s really happening?
Crypto amid a bull and bear. Bitcoin rose with the stock market last week. Then the Merge happened and crypto prices slid.
Now if the Fed increases interest rates, there may be added panic.
Yay or boo?
Corporate investors are the best indicators. A bunch of institutions now hold crypto assets and trade regularly. Their motivation to diversify into digital assets may bring good news, at least in the near future.
ICYMI You can read about Bitcoin's pull factor here.
Ethereum Not So Classic
The Merge highs for Ethereum Classic are over. The OG Ether, which was formed in 2016 after a split in the blockchain, is back to its $29 levels. Mining activity has slowed down too.
What caused the rally?
Miners wanted an alternative to the Merge. Ethereum Classic was a good Plan B with similar hardware requirements. So, miners flocked to Ether Classic. That led to a spike in hashrate.
FYI Hashrate is the measure of computational power used to verify transactions and add blocks in a Proof-of-work (PoW) blockchain. The higher the hashrate, the more the number of people mining the crypto.
Then what happened?
Within just four days of the Merge, the mining hashrate on the ETC network declined by 48%. Miners have found a new home. They’ve migrated to the newly forked Ethereum proof-of-work network (ETH PoW). But that’s another sob story we’ll keep for some other day.
No Hakunamatata, This One
What’s in a name? A lot, if you add Tata to it. Allow us to explain. The Tata Group wants a company called Hakunamatata (yes, that’s the real name) to stop using the “TATA” name for their crypto.
Wait, what?
Interesting, right? Hakunanamatata sold a crypto token under the symbol TATA Coin. Tata Sons got a whiff of it and sued. The courts ruled with the Tatas.
So now?
If the Tatas have their way, Hakunamata cannot use “TATA” for its crypto trading nor use the brand’s name on the website.
FYI The Tatas tried to stop Hakunamatata in November 2021 as well, but couldn’t prove to the courts that the crypto will be sold in India. The narrative has changed.
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Who are we? There is a lot happening in our world. Everything has layers, and each layer has to be carefully peeled so you, the reader, know how the world of money is changing every day. That’s our promise. Help you unpeel the onions, which are the public markets in the US, India, and crypto, so that you know just a little more.