Crypto is crashing, so here're some calming stats...
GM, we take the latest Web3 news and translate it into plain old English - so you can stay up to date, without your eyes glazing over.
In today’s edition:
The crypto markets are crashing, so here are some calming stats...
Would you track and prove your social & financial reputation on the blockchain?
RESOURCE: What is AAVE? Crypto borrowing & lending explained in ~8mins
Coinbase might be about to hit a rocky patch, here's what that means for Web3.
Terms used (click for translation):
Bull Run, Blockchain, Web3, NFTs, DAOs
The crypto markets are crashing, so here are some calming stats...
Fun fake fact:
Downloads of the Headspace meditation app have skyrocketed as crypto investors try to calm their nerves amid the market crash of the last 24-48hrs.
Ok, so we have no idea if that's true, but it wouldn't surprise us if it were.
There are some pretty scary charts floating around right now and we're all entitled to a moment of shock.
In the meantime, we're going to try and save you a costly Headspace subscription, with some calming stats:
Compared to the 2017/2018 bull run, the current crypto market is actually showing strength.
From mid 2017 to late 2018 we saw the total crypto market value go from ~$100B to ~$800B and aaall the way back down again. Meaning, for those who didn't sell - all of their gains were essentially wiped out.
It was painful.
This time that hasn't happened. This current bull run started in mid-late 2020, when the total crypto market was worth ~$350B. Now, two years on - amidst a painful market crash, it's valued at about ~$1.65 Trillion.
Financial markets hate uncertainty. Luckily for the crypto market, we have a rough idea of when the next bull run might begin...
Apr 06, 2024 01:38:36 PM UTC
That's when the next Bitcoin halving cycle is set to begin, which has historically triggered a bull run.
Long story short on how this all works is: every four years the amount of Bitcoin that is added to the market each day is cut in half. This makes it more scarce, which pushes prices up.
And when Bitcoin shoots up, the rest of the market tends to follow.
This time, there's padding.
The 2017/2018 bull run was led mostly by retail investors, who didn't have the financial backing to weather the storm of a downturn, which led them to sell - which collapsed the market.
This time around, there's a lot more 'big money' invested in the space (i.e. institutions with enough cash reserves to wait out the turmoil).
This could be why we're not seeing a bleed as bad as 2017.
So to recap:
The market is still up 4.7x, the next bull run is due in two years, and the sell off is being padded by 'big money'.
Could the market crash lower still? Absolutely it could.
To quote every crypto YouTuber ever:
This is not financial advice and we're not financial advisors. Be careful and always do your own research.
But hey, at least you can cancel your Headspace subscription now.
Would you track and prove your social & financial reputation on the blockchain?
Verifiable reputation, tracked on the blockchain.
It's an interesting concept and it looks like that's what the Web3 payment app, Nuggets, is trying to do.
The upside:
If you're buying into an NFT project or DAO, Nuggets could let you vet the financial track record of the creators.
See some shoddy behavior? Dodge that bullet like Neo.
The downside:
Is this the real world realization of Black Mirror, Season 3, Episode 1 'Nosedive', where a social credit system exists?
...ok, maybe we're going to extremes here.
But some alarm bells do go off when we start talking about pairing our social and financial reputations.
The middle ground:
It appears that the system is intended to only prove each user's financial reputation - the social element isn't there by design, but by proxy of making everything public.
The app is self-managed, meaning it only tracks things you control (like your crypto & bank accounts), so theoretically a third party can't come in and falsely manipulate your reputation.
File this one under: 'a little spooky, but we can see its benefits'.
Resource of the day
What is AAVE?
Crypto borrowing & lending explained in ~8mins
Coinbase might be about to hit a rocky patch, here's what that means for Web3.
As we covered in our first article, the crypto markets aren't doing so hot.
...so what does that mean for companies like Coinbase whose success is tied to the progression of Web3, but operate in the traditional financial system?
Well, there might be a bit of pain.
Coinbase are about to report their earnings for the first quarter of the year; and while this won't cover the downtrend of the last 24-48hrs, it will cover that of Jan-Mar (which wasn't great either).
Ok, so Coinbase's stock might go down in the short term..?
The sun will still rise tomorrow and it's not like crypto is going to just disappear...where's the fire?
No fire - Coinbase should be just fine in the long term.
BUT...if one of the biggest corporate names in crypto is struggling to please the traditional financial market, we might be about to see lowered investment in consumer facing companies that are looking to bridge the gap between Web2 and Web3.
Which SUCKS, because they're the sort of companies that will help solve Web3's 'ease of use' problem.
One that needs to be fixed in order to see mass adoption.
...dammit, why did we cancel our Headspace subscription??
Your Daily Dose of Web3
Twitter declares 'death' of Azuki NFT collection following 45% price drop
Instagram’s push into NFTs is a big win for several smaller blockchains
MicroStrategy faces unrealized losses for the first time in the latest Bitcoin crash
Alright, that’s it for today!
Love to the family,