Bitget Hot Takes (December 12 - December 18)
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 shed only 2.75% in a red week for crypto.
• FED increased rates by 50bps, implying at prolonged hawkish period into 2023.
• SBF arrested in Bahamas, currently seeking extradition.
• USDD at US$0.97, Raydium hacked for US$4.4 million.
• Former U.S. President Trump announced the sale of his NFT collection.
BGB Shed Only 2.75% In A Red Week
In a week where both stocks and crypto took a dive, BGB managed to withstand the bloodbath better than most digital assets, second to Bitcoin (-1.86%) only. Meanwhile, even ETH saw a nearly 6% decrease (with a volatility of 35.8%) and BNB declined by 15.69%.
Negative market conditions usually turn out to be a time for BGB to shine - with its resilience! For more details about how that is even possible, please check out the monthly performance analysis of BGB here:
“Reducing inflation is likely to require a sustained period of below-trend growth”
Data for November 2022 came in on Tuesday (December 13), showing a “welcome reduction” in monthly inflation data of the U.S. The actual annualised increases stand at 7.1% for CPI and 6% for core CPI compared to the estimated 7.3% and 6.1%. A 75bps hike didn’t seem justified, and the Federal Reserve (FED) ended up raising interest rates by 0.5%. However, the FED is most likely to remain hawkish in the next month because “reducing inflation is likely to require a sustained period of below-trend growth” and “the historical record cautions strongly against prematurely loosening policy”, as said by FED Chair in his remarks. In short, the FED “will stay the course, until the job is done”, causing investors and markets to react fearfully. On Thursday (December 15) only, more than US$878 billion got vaporised from the U.S. stock market, and US$21,839,626,708 from crypto global market cap.
However, there were still several pieces of good news to cheer up the distressed market. Beginners will soon find it easier to get onboard with crypto thanks to the newly announced partnership between PayPal and MetaMask. The current on-ramp options for MetaMask users are MoonPay, Wyre and Transak, but with a Paypal integration, MetaMask can expand their services to 430 million Paypal accounts all around the world.
WisdomTree Investments is one of the best when it comes to exchange-traded funds and other exchange-traded products with US$76.2 billion in AUM (as of July 31, 2022). The asset manager has received approval from the U.S. Securities and Exchange Commission (SEC) last week to launch nine new funds that all use blockchain technology to “digitise ownership of each fund’s shares”. On the other side of the globe, investors have welcomed the first Bitcoin and Ether ETFs on the Hong Kong Stock Exchange with US$79 million raised in its first trading session on Friday (December 16).
Depeg, exploit and withdrawal suspension
Algo stablecoins are expected to be the backbone of DeFi, but all models until now appear to be highly susceptible to losing peg. USDD, an algorithmic stablecoin that emerges after the LUNA/UST crash, lost its peg last Monday and dipped as low as US$0.970245 before recovering to US$0.98 for the whole week. USDD relies on an improved design of UST (now USTC); it is backed by a reserve system consisting of TRX, BTC, USDT and USDC. This is not the first time that USDD saw a deviation from its peg: the chart below shows that USDD has lost the Dollar peg three times since its inception (in June, November and last week).
Another L1 ecosystem had to deal with a different issue. The 6th biggest DApp on Solana by unique active wallets, Raydium, was hacked last Friday. Dev team reported that the attacker took control of the DEX’s admin address, thus was able to syphon approximately US$4.4 million in assets out of liquidity pools. The team is offering the attacker a 10% bounty in the hope of getting back the stolen funds.
Some CEXs were, on the other hand, getting roasted because of withdrawal difficulties. Some Binance users reported that their withdrawals took quite some time to complete or not completed after Nansen publicised that the 24H outflow from the exchange hit US$3 billion on December 13. The exchange replied that it was a temporary halt for USDC. And OKEx didn’t process any withdrawals in almost seven hours yesterday because of a cloud hardware failure from Alibaba in the Hong Kong area.
Fresh capital flows
One juicy news of the week is the sale of the Trump Digital Trading Cards. The 45th U.S. President announced the launch of this NFT collection on December 15, which was sold out in less than 12 hours after release. Originally priced at US$99, the floor price of the 45,000-piece collection has reached an all-time high of 0.586 Ethereum (ca. US$695) and is still trading at a floor price of 0.3 ETH, data from CoinGecko shows. Despite the public support from the former U.S. President, the collection is not “owned, managed or controlled by Donald J. Trump”, according to their website.
Investment deals of the week include:
• Crypto insurance firm Evertas: US$14 million
• Non-blockchain decentralised network Nillion: US$20 million
• Web3 dog-themed game Dogami: US$7 million
• Decentralised sports prediction market Frontrunner: US$4.75 million
• Web3 intellectual property protocol Spaceport: US$3.6 million
• AR NFT project Onlybots: US$3 million
• NFT infrastructure protocol Decent: US$3.5 million
• Web3 privacy firm Aztec Network: US$100 million
• Crypto payment gateway Utorg: US$5 million
The Latest Bitget News
While Mazars, auditor of several CEXs, announced the pause of all crypto exchange proof-of-reserves reports, Bitget Reserve Certificate is still available and updated regularly for your safety and trust! Access the reserve data of Bitget as a whole here and learn how to check your personal Merkle Tree by following the guide at the end of the page.
Finally, our World Cup 2022 journey has come to an end with the victory going to our Hero, Lionel Messi. Today is also the last day of Bitget’s fierce trading competition KCGI - stay tuned to know the true champion!
Sharing is caring: Seed, Bitget’s first and exclusive NFT collection, is launching, with the first batch directly distributed to FTT holders to assist them on this difficult transition. We are here to help the crypto community with unwavering dedication - check out our US$200 million Bitget Protection Fund and our US$5 million Builders’ Fund as well!
Bitget SharkFin, our new structured investment product that offers good yields at significantly lower risks, was launched last week with two pools (USDT and BTC) of 8.41% - 8.70% APR as the highest yields. While firstcomers are waiting for the earning distribution, all users can set up the reminder to join the two new pools that open tomorrow here!
Another new launch from us is Bitget DCA - the useful tool to help investors trading with discipline and commitment! Currently, Bitget users have got access to DCA 45 spot pairs and 37 futures pairs, more will soon be added to the selection! Check out our full tutorial here to not miss a dang thing about this practical trading option.