Bitget Hot Takes (February 27 - March 05)
Bitget Hot Takes is the exclusive weekly newsletter series by Bitget Academy, the 360-degree onboarding guide for all crypto enthusiasts.
Bitget Hot Takes last week can be found here.
• BGB closed the week with a 2.42% increase while others saw minor losses.
• Silvergate, Binance under scrutiny.
• Yuga Labs new NFT collection on Bitcoin made its debut; winner of Dookey Dash’s top prize sold the key for US$1.6 million.
• The Sandbox, then Coinbase warned users of third-party incidents that led to a phishing campaign.
Another Good Week For BGB
While the drama about Silvergate and Binance took a toll on Bitcoin and Ethereum price, and understandably BNB as well, BGB has been holding on the US$0.40 mark successfully. The token even managed to end the week with a weekly growth rate of +2.42% compared to Bitcoin’s -3.49%, Ethereum’s -1.60% and Binance Coin’s -4.29%.
The 7-day volume remains roughly the same (nearly US$100 million), showing a committed demand for BGB. Check out this quick guide to know why BGB has become the new staple:
… or devour these detailed BGB analyses:
Biggest Dramas Of The Week
On February 21, Moody’s downgraded crypto bank Silvergate from Ba3 to B2 (high credit risk). Less than two weeks later, the agency once again downgraded Silvergate to B3, deeming the bank ‘less than well-capitalized’ due to ‘significant governance deficiencies’. With the bank entering the ‘speculative’ territory, many crypto companies have terminated their partnership with Silvergate:
• Coinbase was the first to announced that they ‘no longer accepting or initiating payments to or from Silvergate’ on March 02, 2023
• Circle: March 02
• Paxos: March 02
• Galaxy Digital: March 02
• CBOE Digital: March 02
• Bitstamp: March 02
• Bybit: March 04 (no name of ‘end-point processing partner’ is specified)
On March 02, Silvergate filed a notification with the U.S. Securities and Exchange Commission (SEC) explaining that they won’t be able to submit the annual report for the ‘fiscal year ended December 31, 2022 ‘by the extension date of March 16, 2023’ and that they are evaluating the impact of recent events in the digital industry on their ‘ability to continue’. On March 04, Silvergate closed their 24/7 settlement service Silvergate Exchange Network (SEN), saying ‘effective immediately’.
Ever since the demise of FTX, Silvergate has been struggling financially and facing a probe from the U.S. Department of Justice with regards to their FTX ties. Silvergate stock (SI) has become the second-most shorted on Wall Street with 71.31% being shorted, way above the dying Bed Bath Beyond (BBBY) at 57.27%.
The second name to be in the spotlight - and not in a good way - is Binance. Following Paxos’ suspension of BUSD minting, Coinbase has decided to suspend the trading of BUSD on March 13 on all their platforms. Meanwhile, Forbes is raising questions about the ‘eerily’ similarities between Binance and FTX’s way of managing customer assets and stablecoin collateral. That adds a massive amount of concerns on the exchange’s credibility, given that Binance once admitted that they failed to maintain a 1:1 backing of their wrapped assets at times. In response to Forbes’ investigation, Binance has published an explanation considered contradictory by many.
Binance’s U.S. entity also has to deal with growing problems: first the SEC, the New York Department of Financial Services (NYDFS) and the Attorney General of the State of New York opposed its US$1 billion deal to acquire Voyager Digital’s assets, then Senators on the Senate Banking Committee demand ‘complete copies of all Binance and Binance subsidiary balance sheets from 2017 to the present’, ‘an estimate of the number and percentage of U.S.-based Binance users during every fiscal quarter between 2017 and the present’, ‘complete copies of all written policies and/or procedures regarding the relationship between Binance and Binance.US’ and ‘any and all such communications between Binance’s CEO CZ and employees that the company should eliminate or limit know-your-customer checks or
otherwise weaken its anti-money laundering compliance program’ before March 16.
On the bright side, the NFT market is able to keep its appeal with data showing that last week’s NFT trading volume on Ethereum reached its peak since May 2022. One of the leader in the NFT sector, Yuga Labs, is experimenting with Bitcoin NFTs for the first time with their TwelveFold collection, which consists of 300 NFTs, among which 288 are up for sale. And their NFT Game Dookey Dash has been nothing short of exceptional: the top scorer prize received a Golden Key and agreed to sell it for 1,000 ETH or ca. US$1.6 million on February 27.
The Bank of America is reported to see ‘encouraging signs of Starbucks Odyssey program’s early success’, including the generation of US$93 million in royalties from secondary sales, a total secondary trading volume of US$164,000 and the price of some Journey Stamps hitting US$1,900. And Homebase, a real estate startup, has listed a NFT backed by a Texas house for sale on Solana.
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