Is BTC up or down?
In today’s edition, P2E is a winner, Celsius is slithering, and SOL’s worried
Welcome to The Daily Moon. BlockFi needs to make up its mind. A few hours after saying that it won’t accept Grayscale Bitcoin Investment Trust (GBTC) as collateral, it has backtracked. Now it claims that “we are not saying that we won’t support GBTC”. Apparently, it will evaluate collaterals on a constant basis. Things people do when the market bleeds.
It was a day of losses for the markets, with BTC trending towards $19,000. Ethereum saw another day of decline. The R-word meant Nasdaq witnessed sharp selloffs. Back home, Sensex and Nifty declined due to a fall in oil & gas, IT, and banking stocks. On the positive side, the weekend isn’t too far.
Why Is P2E On Fire?
Sluggish crypto markets have seemingly left the play-to-earn (P2E) segment untouched. Just over the past year, the global GameFi industry has grown by over 2000%. Wallet user dips have also been slower, meaning that player stickiness continues.
Power up
P2E, to be fair, is just another form of mining. The only difference is that there is active entertainment attached to it. Let’s call it sachet mining. Now, all mining is down because of all the reasons we’ve told you before. But P2E has beat the bear. For one, the investments range from $100-5,000, depending on the game. Compared to mining, which requires capital upwards of $10,000.
Meanwhile, traditional assets are not as lucrative as they used to be because of rising interest rates and falling yields. Alternative assets such as NFTs, despite the surrounding pessimism, are becoming popular. NFT sales for popular games such as Axie Infinity are on overdrive. After a brief lull, the NFT market is at its strongest yet. For context, there were 12 million NFT transitions in Q2 alone.
Investors stay glued
GameFi’s Unique Active Wallets (UAW), that is new wallets on the blockchain, dropped just 5% since April. In contrast, the rest of crypto lost 26%.
Naturally, VC investments are pouring in. GameFi firms raised $2.5 billion in the March quarter. And with investors such as a16z setting up dedicated funds for this space, there’s no looking back.
It’s something like dipping your toe in the pool of crypto, while not risking the capital traders have. The native crypto tokens are unique and are easily redeemable. This means, strangely enough, gaming has managed to survive the crypto winter. We should now add gaming next to alcohol as a recession free trend.
Is Celsius Really Back?
Celsius, it seems, is ready to rise like a phoenix. Reports indicate it has paid back Aave about $81 million in USD Coin. With the biggest chunk of DeFi protocol Aave’s loan settled, Celsius is now debt-free. But regulators think it is now broke.
Ouch, that must hurt
Celsius has repaid DeFi platform Maker’s loans too. That frees up $440 million worth collateral. Similarly, it has recovered over $400 million after repaying Aave.
But what’s intriguing is that the crypto firm transferred all its staked Ethereum (stETH) to an unidentified wallet. This means 416,000 tokens or about $418 million. stETH is a 1:1 derivative of ethereum.
Sigh. Again?
Vermont is the sixth US state to launch investigations against Celsius. The state’s lawmakers alleged Celsius doesn’t have the assets to fulfil customer obligations. They’ve claimed that the company has been selling unregulated securities.
Despite these concerns, Celsius is still tight-lipped about its finances. No status update about when withdrawals will resume either.
Where’s BTC Headed?
Bitcoin projections move both ways, depending on who you ask. One side believes that the worst is over, while the other side wants to brace for harsher times. Then there are shrimps and whales who want to keep the market afloat.
Why no consensus?
The market is highly volatile, and all there seems to be no oracles around. Bitcoin astrologers can sometimes be extreme. Like American entrepreneur Arthur Hayes, who foresees a $1 million price for Bitcoin “eventually”.
However, fears of a US recession, rising inflation, and lower growth estimates will impact Bitcoin prices. So while Bitcoin could be “stuck for now”, Coinshares expects it to touch new all-time highs in the next 24 months.
There are no easy answers, yet. Meanwhile, the realists want to hold on and simply survive. What does this mean for you? Just like everything else on the internet, it is right or left, black or white. Pick your side and strap in.
In other news…
Indian crypto exchange Bitbns has announced “zero TDS” on crypto SIP investments. It will bear the 1% tax on behalf of customers who make SIP investments for at least a year. We’ll see what the taxman has to say about it.
SOL’s In Trouble
Solana is under pressure. Not only are the crypto’s prices on a slide, it is being dragged to court over making money on an “unregistered” security. Investors have filed a class-action lawsuit against Solana Foundation and Labs, its founder Anatoly Yakovenko, Multicoin Capital, and FalconX.
Not decentralised
Solana has fallen to $34 levels compared to $43 a month ago. And there’s a legal case to handle.
Investors believe that Solana’s backers allegedly profited by buying tokens for cheap and sold them at a premium to unknowing investors. The lawsuit claims that Solana will be considered a security under the Howey test, meaning the SEC will regulate it.
And what about $50 dreams?
While Solana prices are on a downward trend, experts are bullish. There is an expectation that the crypto would rally to $50 before the next big collapse.
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