3/4 FAL Weekly Digest
Welcome to the FAL Weekly Digest, a source for this week’s biggest news articles and crypto market updates.
Here is what you need to know:
Crypto and the War in Ukraine
Cryptocurrency continues to solidify its place in the world as its usage increases during major global events such as the Russian invasion of the Ukraine. The international community has rallied behind the defense of the Ukraine, where over $56 million in cryptocurrency has been donated to the Ukrainian government and various non-government organizations (NGOs).
A major reason behind the large amounts of donations in crypto is the fact that cryptocurrencies such as Bitcoin provide a direct link to the cause or organization’s account without having to go through multiple third parties and payment systems which may inhibit the flow of funding to its intended recipients. The Ukrainian government has released receiving addresses for Bitcoin, Ethereum, and other major cryptocurrencies as it continues to collect funding for the defense of its nation.
For more information regarding cryptocurrency’s usage in the war in Europe, please see our article found here.
Market Update - BTC
The overall cryptocurrency market capitalization is about $1.76 trillion, relatively the same figure observed in last week’s valuation of about $1.76 trillion. At the time of publication, Bitcoin ($BTC) is valued at $39,343 per bitcoin with a market capitalization of $748 billion making up 42.5% of the overall market.
Bitcoin and the crypto market as a whole has seen yet another week of extreme volatility, producing an extreme low of $34k on 2/24 and surging to a high of $45k on 3/02 based on speculation that Russian users would turn to crypto in the face of increasing economic sanctions and the exclusion of Russian banks from the SWIFT payment system.
The most recent U.S. labor market reports and statements from Federal Reserve Chair Jerome Powell this week suggest that while the crisis in Europe is a cause for concern, the plans to move ahead with the Fed’s interest rate hikes are expected to continue into March when the first rate increase is expected to occur. A lowering unemployment rate along with an increasing rate of inflation and CPI indicate that the U.S. economy is ready for an increase in interest rates, which may not be beneficial to risk-on assets such as Bitcoin.
Sanctions Against Russia Target Crypto Services
The increasing amount of international sanctions levied against Russia has prompted policymakers to question whether or not cryptocurrency can be used as a means of circumventing their impact. Several crypto-centric platforms such as the NFT marketplace OpenSea have begun complying with U.S. sanctions, where users from designated territories will be blocked from buying, selling, or transferring NFTs on the platform.
According to an official statement from OpenSea representatives, the “Terms of Service explicitly prohibit sanctioned users or users in sanctioned territories from using our services. We have a zero-tolerance policy for the use of our services by sanctioned individuals or entities and people located in sanctioned countries. If we find individuals to be in violation of our sanctions policy, we take swift action to ban the associated accounts.”
Popular cryptocurrency exchanges have also become targets of compliance requests, where several leaders such as the Vice Prime Minister of Ukraine Mykhailo Fedorov have publicly asked major crypto exchanges to freeze all accounts associated with Russian users and comply with established economic sanctions.
Several exchanges have released statements indicating their intentions to not outright ban Russian users, but to follow general sanctions and compliance requests as they arise. While the sanctions may have good intentions behind them, the impact they have on “decentralized” monetary networks such as cryptocurrency has left many in the community questioning how decentralized crypto truly is.
BTC Hash Rate Faces Dip
The Bitcoin mining community has seen tremendous growth following the Chinese mining exodus in May of 2021, where it not only reclaimed similar levels of hash rate prior to the Chinese mining ban but even produced new all time highs in Q1 2022. According to analytics provider Glassnode, the Bitcoin network average hash rate has recently fallen for the first time since November 2021 from an all time high of 248.11 exahashes per second (EH/s) to 197.19 EH/s.
While the recent dip in hash rate pales in comparison to the difficulty nosedive observed in May 2021, it is a sign of the network continuing to function as intended by its creator Satoshi Nakamoto.
As miners join the Bitcoin network and dedicate computer processing power towards processing bitcoin blocks, the network will automatically adjust the mining difficulty to either make it easier to encourage more participants or harder to ensure that blocks are generated at the same rate. After every 2,016th block added to the blockchain, or about every two weeks, the mining difficulty is reevaluated and adjusted based on the current hash rate. Although the cause for the dip in hash rate could be attributed to a number of factors such as instability in Eastern Europe, the future of BTC mining continues to burn bright as more and more leaders in technology enter the market.
Mickey Mantle Baseball NFT Sells for $471,000
The trading card company Topps has made recent headlines with its sale of a non-fungible token (NFT) version of a 1952 New York Yankees baseball card featuring the famed center fielder Mickey Mantle. The auction of the NFT sold for 175 ETH on OpenSea, equaling to about $471,000 and making it the biggest sale of a sports-centric NFT in history.
The valuable collectible is officially licensed by the MLB through a partnership with Topps, the MLB, and the Mantle Estate run by Mickey Mantle’s two sons Danny and David Mantle. “This card has been part of my father’s legacy for 70 years, and it is amazing to see its continued impact with collectors and baseball fans around the world,” the Mantle sons said in a statement. “We are very pleased to share this piece of history with Topps in a new and exciting way through NFTs.”
Thanks for reading! For more information regarding the cryptocurrency space, please visit us at https://www.cryptofal.com/.
