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How Long Will the Crypto Winter Last?: Digital Asset Digest Volume #57

Welcome to the 57th edition of ‘The Digital Asset Digest’. Today, we talk about the latest crypto winter, compare it with the previous ones, and then outline our favorite dApps of 2021.

SNIPPETS

Billionaire Marc Lasry on Bitcoin: “I Should Have Bought a Lot More”

Source: U.Today

“A now-abandoned scientific theory about mDuring his June 8 appearance on CNBC’s “Squawk Box,” billionaire Marc Lasry expressed his regret for not buying more Bitcoin”

Flare Raises $11.3M in New Investment Round

Source: NewsBTC

“Flare, the blockchain network running on the Federated Byzantine Agreement (FBA) consensus mechanism, has raised $11.3M in its latest fundraising round.”

China Aims To Have Worlds Most Advanced Blockchain Technology by 2025 According to New Guidelines

Source: BeInCrypto

“In a move contrasting its stance on cryptocurrencies, China has issued guidelines for blockchain development within the country.“

El Salvador President Says Bill to Make Bitcoin Legal Tender Is ‘Simple – Short – Sweet’

Source: Crypo Globe

“On Monday (June 7), El Salvador President Nayib Bukele provided an update on the status on the proposed bill that Zap’s Jack Mallers — who helped with drafting the bill — announced at Miami’s Bitcoin 2021 conference last Saturday (June 5).”

Polkadot’s Kusama (KSM) Statemine Parachain Slot Auctions To Begin Next Week

Source: Crypto Potato

After a successful upgrade of its parachain from Shell to Statemine, Kusama announced today that slot auctioning will be rolled out in the coming weeks.”

How Long Will the Crypto Winter Last?: Digital Asset Digest Volume #57

TOP GAINERS

How Long Will the Crypto Winter Last?: Digital Asset Digest Volume #57

TOP LOSERS

How Long Will the Crypto Winter Last?: Digital Asset Digest Volume #57

INDUSTRY WIDE SNAPSHOT

How Long Will the Crypto Winter Last?: Digital Asset Digest Volume #57

MARKET OUTLOOK

Is This Crypto Winter? How Long Will it Last?

After 12 years, the cyclicality of digital assets is completely clear. This market is prone to periods of excessive hype punctuated by lulls that could last years. The community calls these periods of range-bound price movements “crypto winter.” Now that nearly every digital asset is trading below its all-time high and seems trapped at lower levels, it may be worth considering whether we’ve entered another crypto winter. 

Here’s an overview of all the signs that the market is consolidating and a look back at how long previous crypto winters were. 

Signs of Crypto Winter

Price action is usually the best signal of a crypto winter. At the time of writing, Bitcoin and Ethereum are trading at roughly half their all-time highs. The entire digital asset sector is collectively worth $1.6 trillion, 33% lower than its all-time high from a few months ago.

Another signal is the market’s lack of response to catalysts. The ongoing Bitcoin 2021 conference in Miami has seen major updates from industry leaders such as Jack Dorsey and Michael Saylor. However, the event hasn’t had much impact on mainstream enthusiasm for digital assets.

Investment bank Mizuho recently warned of a “crypto winter” that could drag down Coinbase’s stock price, indicating that this phenomenon was on their radar. Another signal that we’ve entered a cold period in digital assets is the fact that heavyweight developers and decentralized autonomous organizations (DAOs) are diversifying their assets. This is usually seen as an indication of crypto winter. 

Kraken

The most recent crypto winter extended two years, from mid-2018 to mid-2020. A regulatory clampdown eroded market value in 2018. The market’s aggregate value dropped from $800 billion in 2018 to just under $150 billion by March 2020, when the rise of coronavirus created a panic across risk assets.

Earlier winters lasted relatively longer. Bitcoin’s price plummeted tremendously with the collapse of Mt.Gox in 2014 and wouldn’t recover until the hype cycle of 2017. That cycle was roughly three years.

While the market is notoriously difficult to predict, this boom-bust pattern is somewhat evident. If history repeats itself, Bitcoin may not reclaim its all-time high for at least two or three years. Investors and developers may have to wait until then for fresh capital to flood into the industry, pushing adoption higher. 

Takeaway

Some asset classes are cyclical. They go through periods of boom-and-bust. Real estate, gold, and commodities are good examples. Bitcoin seems to be displaying a similar pattern. Bust cycles, like the one we may be experiencing now, destroy tremendous value and could last two to three years. If history repeats itself, digital asset investors and developers may have to wait until fresh capital and adoption enters the market.

That being said, this time could be different and the market could rebound sharply relatively sooner.

EXPLORING NEW IDEAS

3 Popular dApps in 2021

While cryptocurrencies and digital assets are looking increasingly mainstream in 2021, decentralized applications (or dApps) are still on the periphery. Built entirely on blockchain technology, these applications represent a departure from the way digital platforms currently operate. They have no centralized owner or manager and they operate on smart contracts rather than legal contracts.

In 2021, some of these dApps have attracted a staggering number of users and immense capital. The decentralized web could be on the horizon. Here are the top three most popular dApps of 2021. 

Uniswap

Less than three years old, Uniswap is already one of the most popular dApps on the decentralized web. The platform serves as a decentralized finance protocol that is used to exchange cryptocurrencies. In other words, it’s Coinbase without the central authority. 

Despite the downturn in crypto valuations, Uniswap still manages to facilitate transactions worth $2 to $3 million every day on its network. At the time of writing, the dApp has over 52k users and over $9.18 billion in inflation-adjusted Total Value Locked

Pancake Swap

Pancake Swap is a decentralized exchange much like Uniswap. However, this protocol is built on the Binance Smart Chain. It also incorporated many of the popular features of the Ethereum-based, including community governance, the ability to farm liquidity provider tokens, and a bizarre food-based name.

At the time of writing, Pancake Swap appears to be one of the most popular dApps in the industry, with over 345k users and roughly $13.4 billion in inflation-adjusted Total Value Locked.

AtomicMarket

The boom in non-fungible tokens (NFTs) created a new segment of the market that attracted a lot of users. Many of these platforms are far less popular than they used to be when NFT-mania was at its peak, but are still active enough to be considered top-performing dApps.

AtomicMarket – a smart contract that makes it easy to build NFT marketplaces – is one of the most popular at the moment. With over 27k users at the time of writing, this platform is more popular than NBA TopShot, which only has 19k users. 

Final thoughts

Even the most popular and noteworthy dApps on this list only have tens of thousands of users. Meanwhile, startups and tools built on the traditional (centralized) web easily attract millions of users within a few months of launch. This highlights the fact that dApps are nowhere near mainstream yet and may have plenty of room to grow. 

TOKEN OF THE WEEK

BitTorrent Coin

BitTorrent was launched in the early 2000s as a peer-to-peer network for sharing files online. It transformed the way people shared files by running software that reduces reliance on a single server. However, after years of struggling to monetize the platform, the Tron Foundation acquired the file-sharing platform.

The acquisition of the file-sharing platform in 2019 gave rise to a native cryptocurrency, dubbed BitTorrent Coin. The token came about as Tron blockchain creators sought to incentivize participants sharing files on the forum.

The BTT token was introduced through a way of Initial Coin Offering in 2019. During the offering, 6% of the total BTT token were issued to the public raising $7.2 million in the process. At inception, several Tokens were also allocated to the Tron Foundation, BitTorrent foundation, and the BitTorrent ecosystem.

Background

BitTorrent Coin is the native token powering the Tron blockchain. At the core is the BitTorrent platform, which connects parties providing files and those, looking to access files. Transactions on the platform start with a user asking for files from providers who host them on their computers.

Providers split the files into several pieces. Those who wish to download the files can do so from multiple providers. The BitTorrent Coin comes into play as a compensation mechanism through which providers are compensated for sharing files. The token also makes the network distributed, allowing users to access the files from different providers, reducing server and network impact.

A user can pay a provider BTT tokens to receive the said files or local resources such as bandwidth or storage for remote backup.

The Tron blockchain maintains a record of all BTT tokens transacted on the network as BitTorrent software facilitates file transactions.

Use Cases

BitTorrent Coin plays a key role in bridging the gap between content creators and their audience. Content creators and the audience can use the token to give value to their contributed computing resources. 

Additionally, the token is bought and spent by those who request files on the BitTorrent platform. Likewise, anyone who wishes to increase their download speed on the network can do so by spending some native cryptocurrencies. Additionally, providers who share files with the audiences are incentivized or compensated through BTT token payments.

Tokenomics

BTT Token accrues its value as the native token powering the Tron blockchain. It serves as a payment option for people looking to access features of the BitTorrent network. Its value has continued to increase as it is the only form of payment for requesters looking to enter agreements with providers to access files.

BTT token has also continued to increase in value as it offers an appealing way of sharing files in a free and efficient manner. It also continues to elicit strong demand from developers looking to launch new file-sharing applications to benefit from established audiences.

Recent developments

The Bit Torrent platform has been undergoing substantial changes to its business model by signing a number of deals with major movie studios and TV film rights companies. With roughly 100 million users across the world, the team believes the Bit Torrent platform could one day challenge the Ethereum network for decentralized content apps.

GETTING TECHNICAL

BTC/USD

As of this writing, Bitcoin’s spot price is $34,386.26USD, with a 24-hour trading volume of $30,259,936,228USD, 35 bps decrease in trading volume since Sunday, June 6th at 4:25 pm. Bitcoin is down -0.05% within the last 24 hours and -3.34% within the last 7 days. The current market cap represents 40.23% of cryptocurrency traded. Bitcoin remains as the top cryptocurrency trading with a circulating supply of 18,729,356 increased of 2,631BTC since Friday, June 4th.

ETH/USD

The spot price of ETHas of this writing is $2650 with a 7-day up of 2.53%, 24-hour change of -0.13%, and an increase in 24-hour trading volume of 5.25%. As of this writing, ETH Market dominance is 18.99, representing the second-largest cryptocurrency traded and has a circulating supply of116,197,641 coins, an increase of 57,256, since Friday, June 4th.

WEEKEND READ

Rogue states dodge economic sanctions, but is crypto in the wrong?

Source: CoinTelegraph

When the United States first began going after crypto companies for violating its economic sanctions rules, it didn’t exactly start with a bang.”

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