Market UpdateNFT Market Update - Week 10, 2023
Stablecoin Meltdown Sparks Crypto Bloodbath
NFT Market Update - Week 10, 2023
**This Market Report is Not Financial Advice, This is my Personal Opinion of the current conditions and you should Always Do Your Own Research**
| ETH: $1,475 (-6.07%) | BTC: $20,616 (-8.16%) | SOL: $18.14 (-14.51%) |
The past week has been a complete shit show for the world of cryptocurrency and NFT markets. Unfortunately, it's been mostly downhill, with charts showing a sea of red and plenty of instability. One of the biggest concerns has been the USDC stablecoin, which is designed to be pegged to the US dollar but ended up dropping below its $1 value.
What caused this? Well, it turns out that Silicon Valley Bank, which held cash reserves for several stablecoin issuers (including Circle, which controls USDC), collapsed. As a result, $3.3 billion of Circle's cash reserves are now stuck in the failed bank, which is causing disruptions in the stablecoin market. This has raised concerns about the safety and transparency of stablecoin issuers' reserve management practices.
But don't worry, Circle is working on alternative solutions to ensure the stability and liquidity of USDC. However, in the meantime, gas fees have skyrocketed as people try to offload their USDC, and "whales" (people who hold large amounts of cryptocurrency) have been dumping the token. Binance and Coinbase have even suspended USDC conversions to protect users from potential losses.
This situation has caused concerns in the cryptocurrency industry, as five other stablecoins have also slipped below their parity. Some experts suggest that this could be due to issues with the banking system or even market manipulation.
The closure of Silicon Valley Bank is one of the largest banking failures since 2008, when Washington Mutual failed during the global financial crisis. The impact of the SVB collapse is being felt throughout the cryptocurrency industry, and stablecoin issuers are re-evaluating their reserve management practices to prevent similar situations from occurring in the future. As the cryptocurrency market continues to grow and evolve, it's crucial for regulators and industry players to collaborate in order to ensure stability and transparency.
Mints & News Of The Week
The co-founder of Ethereum, Vitalik Buterin, has created an NFT collection to raise funds for a good cause. He sold the NFTs through a "quadratic funding" model, which means that the more people that contribute to the cause, the more funds are raised overall. The funds raised will go towards supporting public goods and projects, such as open-source software development. The collection was a great success, raising millions of dollars in just a few hours.
Animoca Brands launched "Mocaverse", an NFT collection aimed at connecting their projects, investors, employees, and supporters. The "MocaMint" NFT minting was a huge success with 8,888 NFTs being sold for 3,552 ETH (equivalent to 5.5 million USD) within 48 hours. The NFTs are split into five tribes and aim to bring together the Web3 community to share ideas and create a better future. NFT owners gain access to exclusive Web3 events, AMAs with crypto experts, exclusive game passes, in-game assets, accelerator programs, and social causes. The Mocaverse NFTs are not just profile pictures but a gateway to Animoca Brands Web3 community, showcasing the power of community and shared values in Web3.
Christoph Zaknun, founder of DAO Maker, has built Degen Zoo, an NFT-based game, in just 30 days, using the abandoned 'Crypto Zoo' project originally proposed by Youtuber Logan Paul. The game allows players to hatch eggs into animals that can be staked to earn passive income, with each animal having its own unique APR rate. Players can consume other NFTs to increase the overall APR and release $DZOO tokens, which can be obtained by burning the NFT, increasing the rarity of all other instances of that species. Degen Zoo has gained a significant following, with its IDO registering over $700 million in pledges, and will donate all proceeds to charity.
Yuga Labs recently concluded the auction of its debut Bitcoin NFT collection, TwelveFold, with 288 successful bidders spending a combined $16.49 million worth of BTC. The collection garnered a total of 3,246 bids during the 24-hour auction. Yuga Labs, the company behind the dominant NFT collection Bored Ape Yacht Club, has only ever released NFTs on the Ethereum blockchain, and TwelveFold marks its first foray into Bitcoin NFTs. The collection features generative art pieces inscribed to the Bitcoin blockchain via Ordinals, a recently launched method of committing art to Bitcoin. The bidding process was controversial, with bidders required to deposit the full amount of their bids directly with Yuga in order to be considered in the auction. This prompted criticism from the creator of Bitcoin Ordinals, Casey Rodarmor, who argued that the process legitimized a system that could be easily manipulated by nefarious project creators to steal funds from bidders.
Tweet of The Week
Doodles, a popular NFT collection, has unveiled its Doodle Map, showcasing its expanding universe, including the OG Collection, Doodlebank, Dooplicator, and more. The map has fueled trading activity, with Doodle outperforming other blue-chip NFT collections over the past seven days, achieving a trading volume of $24.58 million and a floor price increase of 44% to $9,850. Doodle's recent success has drawn attention to other notable collections in the NFT space.
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Web3 has gone through a shit storm the past week, with the USDC stablecoin dropping below its $1 value due to the collapse of Silicon Valley Bank. The impact of this failure is being felt throughout the industry, with stablecoin issuers re-evaluating their reserve management practices. However, amidst the chaos, there have been some positive developments, such as Vitalik Buterin's NFT collection raising millions for a good cause and Animoca Brands launching Mocaverse, an NFT collection that aims to bring together the Web3 community. The NFT market continues to expand, with the revival of Crypto Zoo into Degen Zoo and TwelveFold generating significant interest and controversy. It's an exciting and dynamic time for the cryptocurrency and NFT markets, and we look forward to seeing how they evolve in the future.
Disclaimer Investing in anything, whether it's stocks, crypto, or NFTs, always carries some level of risk. In fact, it's been estimated that about 99% of all NFT projects will go to zero at some point. Yikes, right? That's why it's so important to always do your own research and invest wisely.
And here are a couple of key points to keep in mind:
Not your keys, not your crypto or NFTs: This is a reminder to keep your holdings in a secure wallet if you're not actively trading. You don't want to lose access to your assets because you didn't hold the keys!
If you buy stocks, you're an investor. If you buy crypto or NFTs, you're a customer: It's important to understand the difference between these two roles, as they come with different levels of risk and potential rewards.
Finally, just a friendly reminder that my reports are for informational purposes only. They're not financial advice, and you should always do your own research and make investment decisions based on your own goals and risk tolerance.
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