Miners Moving to the US?

Good morning. Today marks the return of Altcoin Friday after a long holiday break. We've also got stories on bitcoin mining in Kazakhstan, a new player in the DAO space, and some reading materials to send you into the weekend. Happy Friday!

Bonus Content Coming: I'm targeting early next week to have my notes out from Messari's Crypto Theses for 2022. I'll include a link to my notes in this newsletter, however, the full report is definitely worth a read.

Market Update (as of 7:50am ET):

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Top 5:

1. Kazakhstan’s deadly protests hit bitcoin, as the world’s second-biggest mining hub shuts down
Protests in Kazakhstan that originally stemmed from spiking fuel prices have escalated and turned increasingly violent. In response, President Tokayev requested aid from Russian paratroopers and temporarily shuttered internet services. That shutdown took an estimated 15% of the world’s bitcoin miners offline, according to Kevin Zhang of digital currency company Foundry. The unexpected nature of the shutdown provided another example of the Bitcoin network's resiliency and might encourage miners in the country to move to more stable locations like the U.S. Additionally, energy in Kazakhstan is generated using carbon-intensive methods, so a shift to more eco-friendly jurisdictions would have the net effect of further decarbonizing bitcoin mining.

2. Reverie, a DAO Support Startup
DAOs (decentralized autonomous organizations) are the trend du jour when it comes to fundraising in the crypto world. However, these entities are more than just a way to raise millions of dollars in two days. DAOs are "companies designed for the internet era" that allow anyone with an internet connection to become a contributor and receive financial benefits. The opportunity for DAOs moving forward is huge, but there are still significant challenges to address. Design-by-committee, lack of a clear vision, and disregard for legal implications are all hurdles that can limit a DAO's effectiveness. That's where Reverie is stepping in. The startup offers DAO support by providing scalable organizational structures, growth strategies, and legal assistance.

From Reverie co-founder Larry Sukernik (@lsukernik):

3. Altcoin Friday #4 - Filecoin ($FIL)

Overview:
- Current price (as of this writing) of $31.43
- Market capitalization of $4.6 billion (35th overall)
- Filecoin is a decentralized storage network that serves as an incentivization layer on top of the InterPlanetary File System (IPFS), which is a distributed system for storing and accessing files, websites, applications, and data
-  There is a finite supply of 2 billion FIL tokens

How it works:
Users pay miners to store and retrieve their files using the FIL token as payment. The network verifies that files are being stored and maintained by using two proof of storage schemes:

- Proof-of-Replication (PoRep): to verify that storage nodes have stored data on their hard drives.
- Proof-of-Spacetime (PoSt): to prove that the storage nodes are able to authenticate the sequential PoRep over a period of time.

Users can choose their preferred trade-off between cost, redundancy, and speed by selecting the miner whose storage offer is best suited for their needs.

High-level flow:

Note: Additional research from Binance can be found here, while the Filecoin docs can be found here

4. $139M Terra proposal to ‘bring awesome UST use-cases’ to DeFi projects
On Thursday Terra announced plans to deploy $139 million of its native stablecoin (UST) across five projects on the Ethereum, Polygon, and Solana blockchains. Across each of the five initiatives, Terra would contribute from $250,000 to $50 million in UST to support project growth and develop new UST DeFi use cases. If the proposal is approved the distributions would go out to the following projects:

- Convex Finance (yield aggregator protocol) - $18 million in UST for 6 months to create higher incentives for LUNA (Terra's native token) liquidity providers
- OlympusDAO (reserve currency protocol) - $1 million in UST bonds to remain in the DAO's treasury "forever", along with $425,000 in LUNA incentives for 3 months
- InvictusDAO (fork of OlympusDAO on the Solana blockchain) - $250,000 in UST to create UST bonds
- Rari Fuse (open interest rate and lending protocol) - $20 million in UST to seed fuse pools for 6 months and kickstart UST borrowing
- Tokemak (DeFi liquidity provider and market maker) - $50 million in UST deposited for 6 months to provide widespread liquidity and farm TOKE

5. Friday Tweet and Some Weekend Reading
Two very different things to send you into the weekend:

- First, an "optimistic" view of the markets from Ryan Selkis (@twobitidiot), who is a great follow for broad crypto insights

- Second, some heavier reading from Arthur Hayes (@CryptoHayes) who would certainly be described as bearish in the short-term. The post, which can be found here, covers the market impacts of the Fed's attempts to fight inflation, and Hayes shares his views on how to prepare your portfolio during a potential market downturn.

Top Sharers of the Crypto Top 5:
1. Jake Y. - Greenville, SC
2. Cameron S. - New York, NY
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.