Ethereum Bomb Delayed
Good morning. Today we've got the Fed's official action-plan to fight inflation, an update on the Ethereum transition to POS, massive crypto adoption in India, and more!
Programming Note: this newsletter will be off tomorrow for holiday travel and back on Monday for a short holiday week
What this is:
A "Top 5" of crypto, digital asset, and other blockchain related news sent to your inbox on a daily basis
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Top 5:
1. Fed Doubles Taper, Signals Three 2022 Hikes in Inflation Pivot
In an announcement on Wednesday, the Fed officially outlined their intention to end the pandemic-era asset purchase program in early 2022 and also indicated a faster than expected interest rate increase. Chairman Jerome Powell said that the Fed does not expect to raise interest rates before the conclusion of tapering and current projections show three estimated quarter-point rate increases in the federal funds rates next year. The vote on the Fed's new policy was unanimous. Bitcoin and altcoins rose generally in response to the announcement.
2. Why Ethereum’s ‘Difficulty Bomb’ Has Been Delayed Again
On December 9th the Ethereum network underwent the Arrow Glacier hard fork with the purpose of delaying the upcoming "difficulty bomb" until June of 2022. "The difficulty bomb is a mechanism to force the proof-of-work network to stop producing blocks, making mining unprofitable and disincentivizing miners from keeping the chain alive after the network merges to proof-of-stake." Ethereum core developers are almost unanimous in the view that the shift to proof-of-stake will occur in the summer of 2022, but indicated that more time was needed to deliver changes to the mainnet before making that shift.
3. Crypto lender Ledn raises $70 million, announces new bitcoin-backed mortgage product
Ledn raises $70 million in a Series B funding round that values the firm at $540 million. The crypto lender has seen incredible growth over the last year, processing around $405 million in loans during 2021 alone. Ledn current offers interest-bearing savings accounts for bitcoin and USDC, bitcoin and USD loans, and a trading feature between bitcoin and USDC. A new launch next year will see the firm offering a bitcoin-backed mortgage product expected to be available in the US and Canada. The company is targeting $100 million in bitcoin-backed mortgage originations by the end of Q1 2022.
4. Indian Crypto Exchange WazirX’s Trading Volume Jumps to Over $43B in 2021
WazirX, the Binance-owned Indian crypto exchange, saw annual trading volume of $43 billion in 2021, representing 1,735% growth year-over-year. Major growth in signups came from smaller Indian cities indicating broader adoption of crypto across the world's second most populous country. Bitcoin remained the most traded asset, followed by tether, $DOGE, $SHIB, the WazirX token ($WRX), and $MATIC. “Only 11% of respondents in the age group of 51 years and above said to have allocated over 50% of their total portfolio to crypto whereas the same is true for 29% of respondents in the age group of 18-24 years,” WazirX noted. “66% of WazirX users [are] below 35 years of age.”
5. Valkyrie Launches ETF to Track Bitcoin Balance Sheet Stocks
A new ETF product from crypto manager Valkyrie will invest in companies that hold bitcoin on their balance sheet. The fund, called Balance Sheet Opportunities ETF and trading as VBB, is long on MicroStrategy, Square, and Tesla and will generally steer clear of investing in companies holding bitcoin futures. BlackRock (owns bitcoin futures), Mastercard, Robinhood, PayPal, Overstock, BTCS and Coinbase round out the fund's top ten holdings.
Top Sharers of the Crypto Top 5:
1. Cameron S. - New York, NY
2. Jake Y. - Greenville, SC
3. Lauren A. - Nashville, TN
Disclaimer: The information contained in this newsletter shall not be understood or construed as financial advice. I am not an attorney, accountant or financial advisor, nor am I holding myself out to be, and the information provided is not a substitute for financial advice from a professional who is aware of the facts and circumstances of your individual situation.