Velvet.Capital blog

Crypto goes 'Mile-High': EthDenver & SEC Defeats

We’re not crying you’re crying! Another EthDenver is in the books, and it was bigger & better than ever! If you still have any doubts on the future of crypto, you certainly were not in Denver over the last 2 weeks. Thousands of builders, investors, enthusiasts, and even newbies flocked to the Mile High City to showcase the incredible progress the community has made. High-end UI’s, a focus on real world use cases, and a genuine sense of optimism could be felt throughout. It was an honor to take part and meet so many incredible people!

Moving towards some more market driven news, we anticipate that the crypto market could remain volatile in the short term, we are keeping an eye out for crucial turning points this year that could signal the beginning of a more enduring upward trend. The US economy has remained defiantly strong and leaves the Fed between a rock and a hard place. We have identified three possible scenarios that we think could facilitate stronger market gains over the long run: 1) a sustained decrease in inflation (especially in the service sector), 2) a pause in the Federal Reserve's rate-increasing cycle (this will come with point number 1), and 3) Regulatory clarity – which is the wild card as Washington seems to be hopelessly gridlocked and ill-equipped to have the vision to understand the promise of crypto.
Until this point, agencies like the SEC have taken it upon themselves to regulate with what could often be characterized as a heavy handed approach. Fortunately, the Us Federal court system has levied a series of defeats at the SEC. According to reporting from Bloomberg, US courts are likely to overturn the SEC denial of a Grayscale spot Bitcoin ETF – potentially unlocking $5.5 billion in value. In another defeat for the SEC, courts have approved Binance Us’ bid to acquire $1 billion in assets from bankrupt crypto lender Voyager Digital. This acquisition is set to make customers approximately 73% whole on what they are owed.
Quick Hitters
Tornado Cash developer is set to stay in jail as the trial continues.
Crypto wallet messaging app Push Protocol integrates with BNB Chain.
Sushi has launched Sushi Studios, in an effort to fortify its DAO's growth objectives.
STX doubles as Building-on-Bitcoin activity surges.
NFT Marketplace Blur surpasses OpenSea after airdrop.
Microsoft entered a partnership with Web3 infrastructure provider Ankr.
Trading platform eToro received its crypto license from the New York State Department of Financial Services.
Bitcoin's market cap ($470.16B) surpassed Visa for the third time in its history.
Huobi Global recently applied for a crypto trading license in Hong Kong.
Alex Gladstein, chief strategy officer of the Human Rights Foundation (HRF), said that Bitcoin fixes broken democracies and fights government corruption.
In The News
The Securities and Futures Commission of Hong Kong (SFC) recently drafted a proposal that would facilitate crypto trading for retail investors in the city. The document proposes, “to allow all types of investors, including retail investors, to access trading services provided by licensed [virtual asset] trading platform operators." It lays out several key criterion and parameters before reopening like risk assessments and potential exposure limits. As crypto becomes more relevant to investors, many institutions are reopening the discussion of retail investment opportunities, with regulatory concessions.
For all we talk about blockchain’s ability to innovate within finance, we sometimes overlook its other use cases. Cointelegraph put together an interesting list of 9 potential use cases for blockchains in healthcare. Some notable examples include medical records, prescription drug tracing, supply chain management, among many others. It will be interesting to see how this industry develops, and potential synergies between different blockchain use cases.
Real World Assets (RWAs) are one of the big use cases popping up in DeFi lately. Investors will be able to buy tokenized stocks via the DEX Swarm. Tokenized Apple and Tesla stocks were available for purchase on Polygon as recently as last week. Bringing stocks and bonds to DeFi can bring a completely new type of investor into the fray.
Wherever there is risk and adversity, there is also opportunity. The regulatory response to crypto worldwide has been perceived as generally negative for investors, especially institutional ones. However, certain tokens have seen significant growth recently, namely FIL (Filecoin – Digital Storage), KLAY (Klaytn – metaverse), DOT (Polkadot). Decentralized digital storage, AI, and metaverse are subcategories to look out for in the future.
A new challenger emerges! For the last few years, NFT trading platform OpenSea has reigned supreme. However, it may have met its match in up-and-comer Blur. Unlike OpenSea, Blur does not impose any sales fees on sellers. Since its launch in October, Blur has seen a steady increase in users as OpenSea’s has decreased. In response, OpenSea is temporarily removing its 2.5% sales fee for sellers, and reducing creator royalty protections. Competition is good for everyone, and it will be interesting to see which platform comes out on top.

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