In this week’s crypto update, eToro’s market analyst and crypto expert Simon Peters discusses Bitcoin’s resilience, Ethereum’s ‘Merge’, VC interest rates and Reddit’s NFTs.
Bitcoin holds over $ 20,000 as The Merge approaches Ethereum
Bitcoin continues to hold above $ 20,000 after rising above $ 22,000 last week – for the first time since mid-June – as it continued to show signs of resilience.
The crypto asset has been moving in this area for more than a month now, stopping steep declines earlier in the year.
Ether has similarly moved between $ 1,000 and more than $ 1,200 since the big fall in April-June, and is currently trading just over $ 1,100 on the eToro platform.
The eyes are fixed on ether at the moment as the Ethereum network merger moves closer. Big attempts have gone smoothly and the signs are good that it will soon take place.
Although it is impossible to know what effect the transition to a proof-of-stake network will have on the cryptocurrency price, it is theoretically deflationary as it encourages holders to bet instead of selling their tokens.
Although broader market price levels for cryptocurrencies are well below last year’s highs, performance is now normalizing and the majority of tokens on eToro have shown more stability in recent weeks.
The message to investors at the moment is to hold on tight and keep up with the market. We see regular institutional movement and ongoing growth in the sector as a key indicator that the game is not up. What is important to remember, however, is that diversification within the sector, as in any asset class, is crucial for spreading risk.
VCs are looking for cryptocurrencies
VC company Konvoy has launched a $ 150 million fund to look for blockchain-based gaming opportunities. The fund launch is a good example of the underlying interest in blockchain and crypto markets despite continued market adversity.
Konvoy looks at a fairly specific segment of the cryptosphere in games and blockchain, but both are part of a significantly growing area that does not lack exciting innovations. Gaming is a huge industry and blockchain-based projects are an increasing proportion of this.
We have seen examples of VC and other fixed-income capital flowing into the financing of crypto projects in recent weeks and months. Although it is neither a drop in the ocean nor a proposal for marketing, there is clear evidence for investors that despite depressed market assessments, there are still opportunities available for future investments in the sector.
Fund managers lobby for access to blockchain funds
Fund managers request access to blockchain technology to help utilize general ledger technology in fund trading. The comments, from Investeringsforeningen, are an eye-opening call at a time when blockchain and crypto are more broadly facing a degree of difficulty.
IA says it wants the UK to adopt a new class of “blockchain-traded funds” that use distributed ledger technology to execute and record transactions. In many ways, the group is representative of the old fund management sector, so it is very encouraging to see that it requires blockchain solutions.
What is clear here is that a major representative of the TradFi sector sees the value in blockchain technology and simply wants to use it. Under the current circumstances, this is a very positive signal for the crypto sector, which wants to offer this type of infrastructure solutions.
Reddit launches NFTs
Popular digital discussion forum Reddit has launched NFT avatars and a marketplace to get them. Although neither the first nor the last to enter the room, Reddit has a significant user base and will probably look to build on this as an entry point to more crypto technology for its platform.
It is not leading in this regard, but it is a positive indicator that the market is still there to get. NFT members have had a roller coaster ride since they really became known to the public.
There is a great deal of discussion about the direction of the sector and the quality of some offerings, but this is ultimately no different from the early days of crypto, which is now much more developed and sophisticated in terms of ideas and offerings.
With any emerging market, there will be problems with dental problems, but the ideas and innovations remain relevant, and organizations like Reddit use the opportunity to get involved often, which will see the space grow organically in the long run.
