NFTs Make a Comeback, Report Reveals All-Time High of $20.6 Billion in Illegal Crypto Transactions in 2022 and More
NFT traders benefit from lower fees and increased liquidity: Glassnode Report
After a sharp decline in user activity towards the end of 2022, the total gas consumption of non-fungible token (NFT) transactions has increased by 97% in two consecutive months.
> This suggests that activity around NFTs is approaching levels seen during the NFT boom, according to a report from Glassnode.
> The report further states that NFT traders are currently benefiting from lower fees, increased liquidity and improved price discovery in the NFT market due to increased competition and a shift in focus.
> However, creators may feel disadvantaged as the industry cuts back on royalty enforcement.
> Despite the renewed interest in NFTs, the Ethereum ecosystem has yet to see an influx of new users or significant capital infusion.
Illegal Crypto Transaction Volume Hits Record High in 2022, Chain Analysis Report
Despite the ongoing market downturn in the cryptocurrency industry, illicit cryptocurrency transaction volume has increased for the second consecutive year, reaching a record high of $20.6 billion in 2022, according to a report by blockchain analytics firm Chainalysis.
> The estimate is a lower limit, as the actual figure is expected to grow over time as new addresses linked to the illegal activity are identified. Furthermore, the estimate does not capture revenue from non-crypto-native crime such as conventional drug trafficking that involves cryptocurrency as a form of payment.
> Chainalysis has raised last year’s estimate of $14 billion in illegal activity to $18 billion this year, primarily due to the discovery of new crypto scams. Full report here.
Revolutionary Virtual Assets: RAK DAO is the UAE’s latest innovation hub
The Emirate of Ras Al Khaimah in the United Arab Emirates is launching a free zone exclusively for digital and virtual asset companies, called RAK Digital Assets Oasis (RAK DAO).
The zone is designed to support emerging technologies such as blockchain, metaverse, utility tokens, virtual asset wallets, non-fungible tokens (NFT), decentralized autonomous organizations (DAOs) and decentralized applications (DApps).
> The zone will be open for applications in the second quarter of 2023. Sheikh Mohammed bin Humaid bin Abdullah Al Qasimi, chairman of RAK International Corporate Centre, which runs the free zone, said: “We are building the free zone of the future for the companies of the future.” More here.
The cryptocurrency market will rise to $1.1 trillion by 2023
Bank of America (BAC) has released a report saying the cryptocurrency market is off to a strong start this year, with the token universe up 42% year-to-date to $1.1 trillion.
> According to the report, 2023 is expected to be the year of token price divergence, with tokens providing utility and calling for cash flows surpassing meme and governance tokens.
> The report highlighted that cryptocurrencies that power smart contract-enabled blockchain platforms, on which developers can build applications, are growth assets subject to the same risks as growth stocks.
> It noted that these cryptos, along with small-cap floating tokens, have led this year’s rally. Details here.
FTX scandal deepens: Singh’s plea follows guilty pleas from Bankman-Fried associates
Former director of engineering at FTX Nishad Singh has agreed to plead guilty to criminal charges brought by US prosecutors as part of an investigation into the inner circle of FTX founder Sam Bankman-Fried.
> Bankman-Fried was charged with fraud and conspiracy last December, with prosecutors alleging he stole billions of dollars in FTX client deposits to cover losses at his hedge fund, Alameda Research, and lied to investors and lenders about its financial condition to his companies.
> Singh’s plea follows that of two of Bankman-Fried’s closest associates, Caroline Ellison and Gary Wang, who pleaded guilty in December. Continue reading.
Goldman Sachs’ Digital Asset Team Explores Blockchain for Private Equity and Other Markets
Goldman Sachs Group Inc.’s digital assets team is exploring the potential of blockchain technology to improve the efficiency of private equity and other markets.
> According to the team’s global head, Mathew McDermott, the bank remains “hugely supportive” of exploring blockchain applications and will hire “as appropriate” this year.
> McDermott revealed that GS DAP, Goldman Sachs’ private blockchain, had been used by Hong Kong to sell $102 million in digital green bonds, with settlement reduced to just one day after the trade.
> The team currently consists of 70 members, compared to just four in 2020, but McDermott suggested he would continue to add staff as needed. Full report here.
Mt. Gox Bankruptcy Repayments: UBS Strategists Weigh in on Potential Impact on Bitcoin Price
According to UBS strategists, the upcoming bankruptcy payments to Mt. Gox does not have any significant impact on the price of Bitcoin.
> Ivan Kachkovski, a strategist at UBS, explained that the current plan provides multiple repayment options to creditors, including whether to receive payments in fiat or cryptocurrency and to take an early lump sum payment or wait for further asset recovery.
> The deadline for choosing a repayment method is set for 10 March, and payments can begin in September this year.
> Kachkovski further noted that the early lump sum of fiat down payments may require the sale of Bitcoin by the exchange to raise the necessary funds, which could fuel long-standing concerns that Mt. Gox payouts will negatively impact Bitcoin’s price. Continue here.
Crypto firms face stricter regulations in France from January
A proposal passed by France’s National Assembly stipulates that from January the country will impose stricter registration requirements for crypto companies.
> In an effort to strengthen France’s crypto legal framework, the new laws will impose more internal controls, cyber security and conflicts of interest.
> The move comes in the wake of market volatility and as the country prepares to implement new cryptocurrency legislation from the EU.
> France is establishing itself as a cryptocurrency center and has already attracted businesses such as Binance and Bitstamp, which have registered with the country’s Financial Markets Authority (AMF).
> Registration is required for all companies offering trading or custody services in France, and includes compliance checks with governance and anti-money laundering rules. More here.
Bitcoin and Ether poised for modest February win
> Despite experiencing a significant decline earlier this month, Bitcoin and Ether are expected to post a modest victory in February.
> Based on Coin Metrics data, Bitcoin has managed to secure a 0.2% increase this month. Although that pales in comparison to the remarkable 38% gain in January, which was the most impressive monthly performance since 2021.
> On the other hand, Ether has ended the month with an increase of 1.7%, after a 31% increase in January.
