Multi-chain token bridge Allbridge will become the first to offer Stacks (STX) transfers as part of a partnership with Bitcoin software developer Daemon Technologies.
STX is the native token for the Stacks Layer-1 blockchain which settles transactions on the Bitcoin (BTC) network. It currently has a market cap of $1.7 billion. Allbridge currently serves 12 blockchains including Ethereum, various Ethereum-compatible sidechains, Solana, Terra, and others.
A token bridge allows crypto from one blockchain to be transferred to another one. The new bridge will allow transfers between Stacks and all chains served by Allbridge.
The Stacks Bridge will go live in Q2 2022. It will initially only support transfers of STX, but is planned to support transfers of other Stacks protocol SIP010 tokens such as ALEX and the USDA stablecoin. There are also plans to enable NFT transfers between chains.
In a Feb. 10 announcement, Allbridge co-founder Andriy Velykyv expressed how the partnership will help serve the crypto community’s need for access to the Bitcoin ecosystem.
“Creating a bridge that allows for people to interact with Bitcoin-powered applications will help streamline processes that were previously only limited to a single chain and ecosystem.”
Daemon Technologies is providing a $140,000 grant to Allbridge to help facilitate growth of the bridge. Daemon Technologies founder Xan Ditkoff told Cointelegraph that partnering with Allbridge to create the Stacks Bridge will “allow users to come and use the assets within the network for whatever the use case is.”
Ditkoff illustrated what he sees as the beneficial interplay between Stacks’ utilization of the Bitcoin network’s security for transaction settlement and separate blockchains for higher throughput. He said: “It’s good for people who want to transact on faster networks, then bring their assets onto Bitcoin for security.”
The security of token bridges has been in the spotlight this month. In the past 2 weeks, there have been three hacks of token bridge smart contracts. On Feb. 3, $321 million in wETH was minted through the exploit of a bug on Wormhole’s smart contracts on Solana, which created an inorganic surplus of tokens on the blockchain.
Related:Major crypto firms and groups form coalition aimed at promoting ‘market integrity’
Ditkoff brushed off security concerns related to the Allbridge token bridge. He said, “We have a lot of confidence in the Allbridge team.”
“It’s easy for people to forget that these bridges are so new. How long have people been coding with Solana’s VM? Everything is still at the bleeding edge.”
Ethereum creator Vitalik Buterin made an eerily well-timed warning to the crypto community by writing in an early January Reddit post that there are “fundamental security limits of bridges.”
Ditkoff refuted Vitalik’s statement in saying, “I have a hard time seeing a future when bridges are not a huge part of the ecosystem,” and continued:
“The logic behind Vitalik’s words would be that everything settles on one chain that is optimized for the one thing that (Proof-of-Work) is made for: byzantine fault tolerance. Bitcoin doing that better than anything in human history will have an impact on whether one chain eventually dominates.”
Philadelphia is on the cusp of following in the footsteps of Miami, Austin and New York City by partnering with CityCoins to develop a crypto for the city of Brotherly Love.
Philadelphia Mayor Jim Kenney has endorsed the concept and told government news media site Statescoop that his office is “enthusiastic about the potential of donations from a CityCoins program to target pressing problems in the city.”
Philly’s Chief Information Officer and apparent Bitcoin (BTC) supporter Mark Wheeler said that “Philly is ready” to begin working with CityCoins in a Jan. 31 tweet.
@mineCityCoins – Philly is ready. to proceed.
— Mark Wheeler markaroo.btc (@Wheelmrk) January 30, 2022
CityCoins is a software application on the Stacks (STX) blockchain that helps city governments create a unique cryptocurrency. Transactions on Stacks settle on the Bitcoin network.
New York City and Miami are already using CityCoins to increase their treasury holdings. Thirty percent of mined STX tokens are sent to the city’s wallet then sold for USD which goes directly into the city treasury. Miners retain the rest.
In a Feb. 1 interview, Wheeler indicated that the city would begin formally vetting CityCoins to ensure that any potential partnership they enter into together complies with existing laws concerning cryptocurrency.
Wheeler addressed the environmental concern of adopting a program that utilizes a Proof-of-Work blockchain like Bitcoin. He pointed out that CityCoins doesn’t require users to use any additional hardware which could generate further harm to the environment. He told Statescoop on Feb. 1:
“I think we can simply say, ‘This isn’t Bitcoin and it’s not requiring new servers to be set up and it’s not requiring intensive energy use.’ I think that’s a valid, verifiable statement.”
Last November, Wheeler announced that Philadelphia would work toward adding blockchain technology to the city’s government. He took the city of Miami as inspiration for the initiative.
Miami launched its MiamiCoin with CityCoins last August to help the city raise funds which Mayor Francis Suarez said could be used to cover the tax burden for all of its residents.
Related:MiamiCoin has now raised $24.7 million… but who will benefit?
New York City launched its NYCCoin in a partnership with CityCoins last November. As with MiamiCoin, NYCCoin miners receive STX and BTC rewards for supplying the city with tokens.
Austin, Texas has also entered into a partnership with CityCoins, but mining has not yet begun.
Lindsay Lohan will issue “experiential nonfungible tokens” on the Superfandom platform.
The Hollywood star will also act as an advisor to the platform to help it attract more artists and entertainment figures.
“Experiential NFTs” give fans the opportunity to interact with their favorite entertainers in real life by meeting them virtually or in person. In the case of celebrity chefs for example, they could even cook a meal for a fan.
Other stars offering NFTs on the platform include Home Improvement star Richard Karn, movie stars Jake Busey (Starship Troopers) and Riya Sen (30 Minutes), and Hunava Mere singer Jubin Nautiyal.
Superfandom is a subsidiary of Rare Sense, which is backed by developerHiro, and emerged from the first cohort of the Stacks Accelerator. Stacks is a layer-1 open-source blockchain that settles transactions on Bitcoin.
CEO Sophia Perez told Cointelegraph, “These aren’t your typical CryptoPunk or Bored Ape type of art NFT.”
“Experiential NFTs are more suitable for creators because digital art [NFTs are great] if you’re an artist, but what if you’re a chef or an actor?”
1990s TV star Karn is offering fans NFTs that enable them to be his golfing buddy for a day or to have the actor appear alongside them in a video.
Experiences with other stars so far include a gym session, acting coaching, or just hanging out.
Perez indicated that the platform would go live within the next two weeks, enabling fans to begin buying experiential NFTs.
Since a fan will not be eligible to repeat most experiences, Perez said “getting a secondary market out for us is a big priority.” This will enable experiential NFTs to be re-sold and experienced by a new owner.
Related:Year of sponsorships: Celebrities who embraced crypto in 2021
This will continue Lohan’s long foray into the NFT space. She has already released a music single as an NFT and sold a Daft Punk-themed NFT on Rarible.
There is no confirmation yet as to what experiences Lohan will offer on the platform.
One altcoin that seeks to leverage the power of Bitcoin (BTC) is enjoying bullish price action after getting sudden support from Coinbase, the top crypto exchange in the US.
In a new announcement, Coinbase says trading for Stacks (STX) will begin on Wednesday, January 19th if liquidity conditions are met.
Stacks is an open-source blockchain linked to Bitcoin by its consensus mechanism which spans the two chains, called Proof of Transfer. Through this architecture, Stacks aims to leverage Bitcoin’s security and enable decentralized applications (dApps) to use Bitcoin’s state, despite being a different blockchain.
According to the Stacks website, the project aims to bring a series of novel use cases to Bitcoin traditionally reserved for other blockchains.
“The world is converging on Bitcoin as a standard, and demand for use cases around Bitcoin is increasing. There is hundreds of billions of capital locked into Bitcoin, most of it as a passive store of value. Instead of competing with Bitcoin, Stacks can provide novel use cases for holders of bitcoin, such as bitcoin-backed loans, bitcoin DeFi or using your bitcoin to trade NFTs.”
Following the announcement of the Coinbase listing, STX jumped nearly 15% from $2.19 to $2.53. STX was already in a rally earlier in the day, at one point trading below $2.00. After recording a 26% gain in a matter of hours, STX has cooled off and is currently changing hands for $2.23 at time of writing.
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On the first anniversary of the launch of Stacks blockchain (STX), which seeks to make Bitcoin (BTC) programmable, the network achieved over 350 million monthly API requests, 40,000 Hiro (development tool for Stacks to build applications on Bitcoin) wallet downloads, and 2,500 Clarity smart contracts. According to a report by Electric Capital, a venture capital firm focused on cryptocurrencies and fintech, these statistics make Stacks the largest project on Bitcoin.
More than 11,000 users earned more than 100 BTC rewards per month on Stacks due to its unique proof-of-transfer, or PoX, consensus mechanism. Miners bid BTC to verify transactions, execute smart contracts and mine new blocks on the STX blockchain and earn STX as rewards. Meanwhile, the BTC bids are sent to STX holders as rewards for performing tasks like running nodes. To date, the mechanism has delivered over $50 million worth of BTC rewards and surpassed $1 billion in total value locked.
According to the report, there were also decentralized finance, or DeFi, advancements on BTC created through Stacks. These included the launch of wrapped BTC (xBTC), the Arkadiko borrowing and lending protocol, and Bitcoin Lightning decentralized swaps, allowing users to swap STX for Bitcoin, stablecoins and altcoins.
The first projects to launch on Stacks were New York City’s and Miami’s CityCoins, generating $50 million for their respective city treasuries. Brittany Laughlin, executive director of the Stacks Foundation, issued the following statement regarding the milestone:
The Stacks community has proven the incredible potential of smart contracts for Bitcoin, from DeFi to NFTs, city coins to philanthropic efforts, portable identity to new infrastructure, all in a single year. The technology and resources are all here. What happens next is dictated by visionary builders.
Moonray is an NFT-driven metaverse game built on Stacks, a network that makes use of the Bitcoin blockchain.
The developer, Moonray PBC, raised a $3.5 million seed round led by Animoca Brands.
Themetaverse is taking shape, and whileFacebook’s vision of itmight still be years off,Ethereum-based game worlds likeDecentralandandThe Sandboxare alreadyreaping the benefits.Bitcoinwon’t be left out of the metaverse either, thanks to an upcoming game that’s launching on the Bitcoin-backed network, Stacks.
Moonrayis the game, and the stylish PC action role-playing game will roll out early access to select players in March 2022. Today, developer Moonray PBC announced that it has raised a $3.5 million seed round led byAnimoca Brandsto continue developing theNFT-centric action game, which will eventually open up into a shared metaverse experience.
How can a crypto game be backed by the Bitcoin network? Bitcoin itself doesn’t supportsmart contracts, which are the bits of code needed to rundecentralized applications, such as games.
However, Stacks is a smart contract blockchain that rolls up its transactions and settles them to the Bitcoin network. Stacks is the reason that there areNFTs powered by Bitcoin, and howDeFi applications can tie into the Bitcoin blockchain. Stacks founder Muneeb Ali described it toDecryptin October as a “layer 1.5” platform, unlike Ethereum’slayer-2 scaling solutions.
Moonray PBC CEO Rodrigo Etcheto toldDecryptthat his studio are “big believers in Bitcoin,” however he insisted that they aren’t maximalists. He praisedSolanaandAvalancheas “great blockchains,” but ultimately Stacks appealed to them thanks to its ties to Bitcoin.
We’re bringing #NFTs tradeable economy to an AAA Action RPG set in a far-future, surreal sci-fi world.
This is not a cinematic trailer, it’s real gameplay live in Unreal Engine today! EA Q1 22
NFTs dropping soon & generate DeFi yield in #Bitcoin!
👇👇👇👇 pic.twitter.com/fMcUUpRsdh
— Moonray.btc (@moonraygame) September 16, 2021
“We’re not maxis,” he explained. “We think that there’s going to be a lot of use cases, so a lot of blockchains are going to make it and do well. But I do like the security of Bitcoin. To me, that’s still the most decentralized, secure blockchain, and I don’t see that changing anytime soon.”
Etcheto’s team was part of the first cohort for theStacks Accelerator, which helps fund and mentor teams building on the platform. In addition to Animoca Brands, the $3.5 million seed round includes participation from GBV Capital, Metavest Capital, LD Capital, and Lucid Blue Ventures, along with undisclosed angel investors.
The Bitcoin metaverse
Moonray will implement the Stacks network in a number of ways, including in-game collectibles, skins, and weapons that are sold as NFTs. Players will be able to buy the NFTs using Bitcoin at first and eventually credit cards, as well, and they can resell the collectibles via an in-game interface or external marketplaces.
An NFT is a blockchain token that serves as proof of ownership for a rare digital item, and just as it can apply to things like profile pictures and digital trading cards, it can also represent one-of-a-kind video game items.
Etcheto also proposed using NFTs for unique in-game events, such as a special boss battle that can only be accessed by buying an NFT. The upside, then, is players can unlock a rare and potentially valuable item that can then be resold.
The action role-playing game will eventually add online cities with digital land NFTs. Image: Moonray PBC
Moonray will debut with both single-player and online multiplayer content. At some point after launch, the game will expand to incorporate digital online cities in which players can purchase land sold as NFTs—much like in The Sandbox, Decentraland, andAxie Infinity. It will also feature different types of buildings, like a blacksmith’s shop or guild headquarters, that play into the game’s economy and potentially benefit players.
That’s the metaverse aspect of the game. The metaverse refers to a future vision of the internet in which users interact in shared, 3D digital spaces using avatars. Facebook isbetting big on the metaverse, while an array of crypto projects are building towards an open, interoperable metaverse that lets users use owned assets (NFTs) across various platforms and experiences.
Animoca Brands, which led Moonray PBC’s seed round, is a major investor in metaverse startups. In October, Animoca Executive ChairmanYat Siu toldDecryptthat his company is “kind of in a hurry” to help build the metaverse before tech giants like Facebook and Tencent can claim the space. He labeled both as a “threat” to an open metaverse.
Moonray PBC has an ambitious vision for a crypto-infused gaming future, but the game didn’t begin life with blockchain in mind. Etcheto said that the team began developing Moonray as a traditional, premium video game, but saw the potential of blockchain in gaming early enough to pivot the game design and business model.
“When we saw what was happening with blockchain, it just became obvious to us that this is the future of gaming,” he said. “This is a new economic model that I think is going to totally turn the industry upside down.”
Bridging the gap
Built with the same Unreal Engine used by many of today’s top video games (includingFortnite), Moonray is a flashy-looking battler that Etcheto believes will resonate with more mainstream players. It’s part of the reason why he believes that Stacks is such an ideal fit for the game, because Bitcoin is already so widely known even outside of crypto circles.
“We’re really trying to attract mainstream gamers that maybe don’t know a whole lot about crypto, or are skeptical of it,” he said. “[We’ll] create an easy, gentle onboarding for traditional gamers to show them how a token economy and NFT economy should work.”
Skepticism of cryptocurrency and NFTs runs high in the traditional video gaming space. When Discord CEO Jason Citron teased crypto wallet integration for the popular online chat app, theresulting backlash from gamerschanged his mind. Last week, major game publisher Ubisoft likewise encountered significant pushback when itannounced in-game NFT integration, although the company still went ahead with its plans.
Etcheto sees the reaction as similar to when game publishers began selling digital add-ons for games, called downloadable content (or DLC). Now it’s the industry standard. He suggests that players will eventually warm to in-game items sold as NFTs when they realize that they truly own the assets and have the option to resell them or possibly bring them into other games.
“Once gamers understand that what they’re getting is ownership of something that before they’ve really just been renting from companies,” he said, “it’s going to change a lot of minds.”
Ultimately, Etcheto sees Ubisoft’s increasing foray into blockchain gaming as a good thing for the industry, along with interest from major publishers likeElectronic ArtsandSquare Enix.
In fact, he believes that the classic way of releasing games—already impacted by the normalization of DLC and the rise of free-to-play games—will rapidly fall by the wayside. And someday, he hopes to bring Moonray to consoles… should Sony, Microsoft, and Nintendo eventually figure out how to handle crypto gaming.
“In three or four years, some version of a play-to-earn or NFT economy is going to become so normal, the idea of paying 60 bucks to play games is going to be a little bit weird,” he said. “It’s going to happen much faster than the legacy studios realize.”
The Stacks ecosystem is a collection of independent entities, developers and community members working to build a user-owned internet on the Bitcoin (BTC) blockchain. Stacks’ STX cryptocurrency was distributed to the general public through the first-ever Securities and Exchange Commission-qualified token offering in the United States.
Mitchell Cuevas, head of growth for the Stacks Foundation, held an exclusive ask-me-anything, or AMA, session with Cointelegraph Markets Pro users on Dec. 2. During the session, he discussed the Stacks blockchain’s technological capabilities, future growth and major developments.
Cointelegraph Markets Pro User: PoW [proof-of-work] blockchains are known to be the most secure. Does Stacks PoX [proof-of-transfer] match BTC security or are there other vulnerabilities?
Mitchell Cuevas: Stacks’ consensus recycles PoW already done to secure Bitcoin. It does this via Proof of Transfer, a mining mechanism that provides a new take on consensus, allowing for a Proof of Work chain to be leveraged and extended in new ways. As a result, all Stacks transactions settle on Bitcoin, enabling Stacks transactions to benefit from Bitcoin’s security. Every Bitcoin block, Stacks transactions are batched and hashed on the Bitcoin blockchain. In addition, the history of all Stacks blocks produced is recorded to Bitcoin.
CT Markets Pro User: With smart contract capabilities, how long before Stacks will be able to integrate NFTs, gaming, and metaverse experiences?
MC: This can already be done and is being done today. We see massive growth of NFTs, reaching about $6-7 million in daily transacted value of late. The cost varies based on network activity. The minting cost is generally somewhere from $0.15 to $0.50. NFTs can be minted on Boom at boom.money. Monday games are building an exciting metaverse style open-world game. We’ve got teams, such as Jolocom, working on various identity-related efforts, which will be important in the metaverse. It’s exciting because the idea of the metaverse was an early anchor point for folks working at Blockstack back in the day, it was our company book, and we had Neal Stephenson out to one of our summits!
CT Markets Pro User: I only know of a few other platforms that build off of BTC to maximize its security, decentralization, and popularity (Lightning, RSK, Sovryn). So why do you think there aren’t more protocols integrating with BTC?
MC: It’s the difficulty of it. It took core engineers and the Blockstack team a while to crack Proof of Transfer, making the fully expressive contract layer possible in a truly decentralized way. When you have the option of working with a restrictive and unmoving base like Bitcoin or something else (or creating your chain entirely), I think many will end up in that last bucket. It’s an easier path and with how hot crypto is, is I can assume it’s more immediately lucrative, so that’s where the focus has stayed.
CT Markets Pro User: There were congestion issues with Stacks. Has that been resolved?
MC: For the most part — the main bottleneck that was noticed was the popularity of some NFTs and the architecture of the stacks-blockchain-API. Since then, the architecture has changed a bit, so many read-only API nodes can be brought up during higher traffic events, as we noticed in the past. The API write node is still a 1:1 ratio to a Stacks node running in follower mode since any particular blockchain node can be slightly ahead/behind other nodes at any given moment, making load balancing very difficult. In addition, an upgrade to the chain is expected to go live around December 8th that will provide a 2-10x increase in capacity. There are additional exciting future scalability and speed solutions now being explored that should give developers several different options as they build.
CT Markets Pro User: Can you explain microblocks? Is that the main factor to allow Stacks to scale?
MC: This is a great question and one we’ve seen some confusion about in the past. However, it is essential to note that microblocks are NOT a scalability solution; they allow faster transaction confirmations. To put it simply, microblocks are intended to solve transaction latency, allowing transactions to confirm in seconds on the Stacks chain before they are later settled to Bitcoin.
CT Markets Pro User: PoW blockchains have gotten labeled as substantial energy consumers thanks to one guy who will remain nameless. Where does Stacks PoX rate for energy consumption? Since it integrates with BTC, have you had to explain this difference?
MC: As for Stacks, it’s a straightforward narrative: PoX recycles PoW already spent on Bitcoin. This means we’re not burning or consuming new electricity for Stacks transactions. On a more personal note, I’ve been starting to work with some NFT artists that are passionate about making sure their environmental impact is zero or minimal, and they’ve been excited about Stacks. An early launch on Stacks included Cara Delevingne, and this was a vital issue for her as her NFT was going to benefit climate-related topics.
CT Markets Pro User: Each STX block is somehow recorded on the BTC blockchain. How much block space does this take? What is recorded?
MC: You can check this publicly! All of the BTC transactions are showing a size of 352 Bytes. The system’s state settles on Bitcoin — creating a new Stacks block entails sending a well-formed Bitcoin transaction that records the hash of a Stacks block and where it attaches to the blockchain. Settling the system on Bitcoin grants Stacks novel security properties not seen in other blockchains — it leverages the security of Bitcoin to guarantee that all Stacks forks are public and to help to bootstrap Stacks nodes identify the canonical Stacks fork and find Stacks blocks they have not yet downloaded.
CT Markets Pro User: How many full nodes are in operation? Is there a limit to the amount of decentralization that can be achieved?
MC: Short answer, there were a few hundred last we checked. For the rest, great question, and buckle up for a longer answer. It’s important to note that unlike PoW based networks, like Bitcoin, the number of STX miners alone is not an accurate reflection of a miner’s relative ability to win blocks over time. As a result, it does not reflect the security or decentralization of the network. To successfully attack Stacks 2.0, a miner would need to mine a genuinely longer chain than the rest of the network. Unlike a PoW based chain, the Stacks chain quality is measured by its length and not the total amount of BTC burned (or resources expended). This means that simply spending 100x the BTC of every other miner will not result in a longer or better Stacks chain tip. Instead, a miner would have to consistently out-mine every other participant to attack the Stacks chain successfully. To do this, a “bad actor” miner needs to effectively guarantee they could win every block over the period their attack occurs.
CT Markets Pro User: Any plans for interconnectivity with other blockchains? What solutions can be employed today?
MC: Yep! The community has several bridge efforts, including bridges to public blockchains such as Ethereum, BSC, SOL, Polygon, Klaytn, ICON, Orbit, etc. See some of the initiatives below: Stacks Bridge — cross-chain transfer service that allows owners of ETH or STX based NFTs to move their NFTs between blockchains; Banana Bridge — Megakongs will mint on Ethereum and be transferable back forth to Stacks, and this is an essential step. This opens them to Ethereum liquidity and, perhaps more importantly, it gives Bitcoin NFTs a gateway to access some of the exciting Metaverse projects vice versa; Orbit Chain — Orbit Chain is currently bridging Stacks and will soon welcome Bitcoin to the growing $100B+ DeFi Economy. Orbit Chain has built a notable reputation for itself in the past year, having bridged more than $10B worth of assets across other top chains, including Ethereum, BSC, Polygon, Klaytn, ICON, and Ripple.
CT Markets Pro User: Will the relevance of Layer-1/Layer-2 solutions on the BTC blockchain diminish over time should future updates like Taproot occur?
MC: Bitcoin is probably a stable blockchain precisely because it doesn’t change and is predictable. Any proposed changes can take a long time to merge since there is an incentive for the protocol not to change, and there is a large community with many opinions about any proposed change. Bitcoin is stable and predictable — so it’s unlikely that a native on-chain solution will supersede solutions like Stacks. Is it possible? Sure — but it’s also unlikely. Notably, Taproot doesn’t come close to bringing expressive smart contracts to Bitcoin.
Looking at the winners and losers of the past week clearly shows that traders endured some serious heat as the total crypto market capitalization dropped by 12.7% when Bitcoin fell to $41,000. This sharp downside move knocked the figure from $2.37 trillion to $1.92 trillion on Dec. 3 and a total of $2 billion long future contracts were liquidated.
Top winners and losers from top 80 coins. Source: Nomics
Bitcoin (BTC) price retraced 14.6% over the past week, effectively underperforming the broader altcoin market. Part of this unusual movement can be explained by the performance seen in decentralized applications which held up better than most of the market. Data shows Ether (ETH) traded down 6.0%, Binance Coin (BNB) lost 7.3% and Solana (SOL) dropped by 7.8%.
This week’s top gainers include OKEx’s OKB token (OKB) and Bitfinex’s UNUS (LEO). Perhaps these benefited from not having a United States entity because the regulatory uncertainties in the region continue to increase. Moreover, scaling solutions Polygon (MATIC) and Algorand (ALGO) benefited from Ethereum’s $40 or higher network transaction fees.
Terra (LUNA) featured on last week’s top performers after its built-in token burn mechanism significantly reduced the supply. Meanwhile, Stacks (STX), previously known as Blockstacks, pumped after D’Cent wallet included support for SIP010 tokens.
Sharing solutions had a disappointing week
Among the worst performers were three decentralized sharing solutions: Theta Network (THETA), Filecoin (FILE), and Internet Computer (ICP). They were not alone, as some of the sectors’ altcoins below the top-80 also crashed. Siacoin (S.C.) endured a 34% drawdown and Ankr Network (ANKR) dropped by 31.8%.
Chiliz (CHZ) suffered direct competition after Binance successfully launched an independent soccer fan token called SANTOS. Initially, Chiliz’ platform was created to host exclusive promos, services and voting for their fan tokens and more recently the project ventured into the non-fungible NFT market. However, that initiative also lost impact after soccer player Neymar launched a collection with NFTStar.
Despite being among the bottom performers, decentralized exchange aggregator 1inch Network (1INCH) concluded a $175 million Series B investment round and these funds will be used to expand the protocol’s utility.
Tether’s premium and the futures’ perpetual premium held up well
The OKEx Tether (USDT) premium measures the difference between China-based peer-to-peer (P2P) trades and the official U.S. dollar currency, and in the past week it decreased slightly.
OKEx USDT peer-to-peer premium vs. USD. Source: OKEx
Currently the indicator has a 98% reading, which is slightly bearish, signaling weak demand from crypto traders to convert cash into stablecoins. Even at its best moment over the past two months, it failed to surpass 99%, so Chinese players have not been excited about the general market.
The overall impact of last week’s correction was a drop in the total futures open interest, down 28% to $16.7 billion. Nevertheless, the move was expected since the total market cap retraced and some $3.9 billion worth of liquidations took place during the week.
More importantly, the funding rates on Bitcoin and Ethereum futures quickly recovered from Dec. 3 price crash. Even though longs (buyers) and shorts (sellers) are matched at all times in any futures contract, their leverage varies.
Consequently, to balance their risk, exchanges will charge a funding rate to whichever side is using more leverage and this fee is paid to the opposing side.
BTC and ETH perpetual futures 8-hour funding rates. Source: Coinglass.com
Data reveals that a modest bearish trend occurred on Dec. 3 and 4 as the 8-hour funding rate went below zero. A negative funding rate shows that shorts (seller) were the ones paying the fees, but the movement faded as soon as BTC and ETH prices bounced 15% from their lows.
The above data might not sound encouraging, but considering that Bitcoin suffered considerable losses this week, the overall market structure held nicely. If the situation was worse, one would definitively not expect a 99% Tether premium or a positive perpetual funding rate.
The views and opinions expressed here are solely those of theauthorand do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.
Popular crypto analyst Jason Pizzino is detailing which altcoins he believes are primed to surge over the next few months.
First on Pizzino’s list is Curve Dao Token (CRV), the governance token for Curve Finance, a decentralized exchange for stablecoins. Pizzino tells his 244,000 YouTube subscribers that CRV’s Bitcoin chart looks bullish.
“Will it pump like The Sandbox? Probably not, because I don’t think the vision and the excitement and the hopes and dreams can be put into a DeFi project like they can with an NFT/gaming/metaverse project…
But I think there are some big gains to be had in something that is wound up so tightly on a chart like this.”
CRV is trading at $4.73 at time of writing, down more than 4% in the past 24 hours.
Second on the analyst’s list is MATIC, the native token for the blockchain scaling solution Polygon.
Pizzino says MATIC is just starting to “find its legs” after going sideways against Bitcoin. He notes that if the overall crypto narrative shifts to Ethereum (ETH), then Polygon looks good. MATIC is trading at $2.11 at time of writing, up more than 13% on the day.
His next pick is LUNA, the native token for the smart contract platform Terra. Pizzino, however, notes that he’s more bullish on CRV and MATIC than he is on LUNA.
LUNA is trading at $63.94 at time of writing, up more than 12% in the past 24 hours.
The trader’s fourth pick is STX, the native asset for Stacks, an open-source blockchain network and Bitcoin developer project. Pizzino notes that Stacks is already breaking out and could see short-term gains.
“You want to see it stay in the all-time highs… Are they going to be as big as metaverse? I’ve already said that I don’t think so. But I want to look at something that’s going to move this quarter or next quarter.
Because I’m not sure of those larger-cap metaverse cryptocurrencies, because I think they may have had their move.”
STX is trading at $2.70 at time of writing, down nearly 10% on the day.
Another of Pizzino’s picks is RUNE, the native asset for THORChain, a blockchain platform that aims to facilitate the secure and cheap transfer of assets between different blockchains.
Pizzino notes that RUNE has been making higher lows and higher highs against Bitcoin (BTC). The analyst says the asset also has to outpace Ethereum because it’s “the strongest player at the moment.”
RUNE is trading at $10.68 at time of writing, down more than 7% on the day.
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ALEX, a decentralized finance (DeFi) services startup founded by former Wall Street veterans, has today announced it raised $5.8M in a round led by White Star Capital with participation from venture capital firms such as Cultur3, GBIC, and OK Blockchain Capital, among others.
ALEX, which stands for “Automated Liquidity Exchange,” plans to use the fresh funding to grow its current team of 15 people, ensuring that “new recruits are a good fit,” and that the project preserves its vision to create what it calls “the first truly permissionless, trustless, and decentralized financial service for the people.”
“The place we want to secure for ALEX is the “the gold standard” of DeFi: the most secure, most transparent, and most decentralized financial service the world has ever seen. Finance for the people, where we trust only code,” Chiente Hsu, the co-founder of ALEX, told Decrypt, describing ALEX as the piece of infrastructure for the realization of Web3.
The startup is building its full-service DeFi platform on Bitcoin with the help of Stacks, a blockchain that combines Bitcoin with smart contracts. Smart contracts are lines of code that self-execute under predetermined circumstances.
Stacks founder Muneeb Ali previously described Stacks as “Layer 1.5,” distinguishing it from Ethereum Layer-2 solutions like Arbitrum or Polygon.
In line with the concept of DeFi, ALEX allows projects to launch their own tokens, while users can lend and borrow assets, trade on a decentralized exchange (DEX), and obtain returns via yield farming.
Unlocking Bitcoin’s value
What makes the project different, Hsu told Decrypt, is that being Bitcoin-native, it has every transaction recorded on the Bitcoin blockchain, benefiting from its finality and security.
“At the moment there’s approximately $200 billion locked in DeFi protocols. Nearly all of this is on the Ethereum blockchain,” said Hsu. “The market cap of Bitcoin is over $1 trillion, and Bitcoin is the original and most secure blockchain network in human history.”
According to Hsu, “Bitcoin is currently in a dormant state, with hundreds of billions inert in wallets like digital gold.”
“We have the first-mover advantage in unlocking that value and bringing that Bitcoin to life,” she added.
Taking DeFi to a new level
The team behind ALEX is also rolling out two new DeFi services.
First is a fixed-rate and fixed-term lending and borrowing mechanism that recreates zero-coupon bonds—essential financial primitives which, if perfected, could bring higher finance to the DeFi space.
“Lending and borrowing should be basic, boring transactions, but currently they are quite risky in DeFi which limits adoption,” Hsu told Decrypt.
Second is a borrowing tool that boasts zero risk of liquidation. To realize that goal, ALEX uses dynamic collateral rebalancing pools with a pair of riskless and risky assets, like a stablecoin and Bitcoin.
As explained by Hsu, the weighting of the pool actively responds to market movements, and “should an outlier event occur, the collateral is moved into riskless assets rather than [get] liquidated.”
Next steps for ALEX
Slated to launch on the mainnet next month, ALEX will be also fully integrated with the CityCoins—a Stacks-powered protocol that allows people to invest in cities by buying or mining their corresponding tokens.
In return, users can earn yields in BTC or STX, the native token of the Stacks blockchain.
CityCoins is already used by projects like MiamiCoin, which was launched in August with the backing of Mayor Francis Suarez, and the recently unveiled NYCCoin.
Drawing the parallels between the current landscape of the crypto industry and the internet in 1998, Hsu believes that the times ahead look very exciting.
“I think without a doubt, crypto will continue to grow. It will be an absolutely transformative force which is difficult to predict in many ways,” Hsu told Decrypt, adding that Bitcoin to her is already the ultimate form of money, even if many people haven’t realized it yet.
