📍Crypto Matters

Author

Nisha Ramesh
October 28, 2022

Good Morning Switchers,

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Diwali, greener markets and a bunch of great news kinda got us to glide through the week like a waterslide. Plus, we hosted another Block-by-Block event — this time in Hyderabad. And man was it great (even if I say so)!

(In pic: Shri Jayesh Ranjan, Principal Secretary of the Industries & Commerce and Information Technology, Telangana; Ashish Singhal, Co-founder of CoinSwitch, Team CoinSwitch, and the amazing Web3 community from Hyderabad!)

Here’s what we’ve got for you:

  • Market pulse

  • You've got to read this from Matt Levine

  • News that makes noise

  • Meme of the day

Market pulse 📈

The market is serving fusion 😐

After two bullish sessions this week, the crypto market had a mixed session yesterday. Most of the top cryptos by market cap were in the red. The total market cap went down by $19.5 billion, ending the day at $940.1 billion on 27 October 2022.

The mixed session is attributed to the US economic indicators and corporate earnings that tested crypto traders' appetite. However, US corporate earnings had a more significant impact. The tech-heavy Nasdaq 100 fell by 1.63% on Thursday.

Coin of the day: Dogecoin

Dogecoin continued its upward momentum, buoyed by Tesla CEO Elon Musk nearing completion of the $44B acquisition of social media platform Twitter. The meme coin witnessed a gain of 5.82% in yesterday's session. Let that sink in!

Bloomberg’s 40K worded Crypto Story in 3 min

It's a biggg deal!

Yesterday Bloomberg columnist Matt Levine dropped an essay titled 'The Only Crypto Story You Need' on the Businessweek. And all he talks about in the essay is crypto!

Who is Matt Lavine and what’s all the fuss about?

This is him đŸ‘‡đŸœ

Yeah, we can see it too—the picture closely resembles Forrest Gump sitting on a park bench no? But the man is a genius. He is:

  • A Harvard educated Investment banker and lawyer

  • One of the most regarded financial writers of Bloomberg and elsewhere

  • Oh and he also runs a newsletter—Money stuff—very popular on the Wall street.

So this guy who comes with all those street creds in finance does a deep analysis of the whats and whys of crypto in just 40,000 words. Even better, this is only the second time Bloomberg is publishing a cover-to-cover issue on a single topic in 93 years (the first was What is Code by Paul Ford).

All this is only screaming one thing: CRYPTO MATTERS!

Here are some highlights of ‘The Crypto Story’

💎Where did crypto come from?

Modern life depends on databases. If you own a stock, the company marks your ownership on a database. If you own a house, your name must appear on the documents which again is a database. For years we have been dependent on databases to run our everyday lives.

The problem with that is—Trust. We are forced to trust some centralized systems to keep our databases accurate. But after the financial disaster of 2008, people lost faith in these centralized systems.

That’s when Satoshi drew up the Bitcoin white paper and proposed a trustless system. A financial system that would run on “cryptographic proof instead of trust”. Bitcoin and all other cryptos are databases that are decentralized and verifiable.

💎Bitcoin is a big thang!

Bitcoin is a technological accomplishment. It has created a decentralized way to create scarcity electronically.

“Bitcoin demonstrated a way for me to send you a computer message so that you’d have it and I wouldn’t, to move items of computer information between us in a way that limited their supply and transferred possession”.

But according to Matt, the technology is not the greatest marvel. It’s the fact that millions of people accepted these messages as payments and made Bitcoin a trillion dollar market. Meaning, mass adoption is the most impressive thing about Bitcoin.

💎What is crypto for?

Crypto is a decentralized financial system. If that’s the use case, why do people trade in crypto?

Matt answers this very beautifully:

Let’s say you are into traditional finance. One day you wake up and realize that there is a whole new financial system. Smart folks building mindboggling things and some idiots making terrible mistakes. There are ways to make money from the mindboggling things and there are ways to exploit the terrible mistakes. Why won’t you want to join in?

💎Community is crypto’s superpower.

One of the key lessons we can learn from crypto is that, a bunch of people can get together and create an online community. They can create a token and bring economic value to their community. This value has the potential to soar 100x in the market.

Matt points out that if online communities are valuable and has the potential to make money, why not make money? Hell yeah, why not!

💎Crypto may soon connect with the real world

Yep, crypto is cool and all, but can you buy food or shelter with it? Not yet, but Matt thinks it may happen over time.

For example, if the world is moving towards online ads, marketing and the metaverse, crypto wont have to have real world usage to become valuable. As the world moves online, crypto can find a place in it.

The whole truth about this entire book dedicated to crypto is that—Crypto is too big to ignore. We are in a time where most of the global authorities including India are considering crypto regulations. So, crypto isn’t going anywhere!

BTW, this is just a small part of what Matt Lavine wrote about crypto in its cover-to-cover edition of ‘The Crypto Story’. So, if you have some time during this weekend, maybe catch up on the full story. It will be worth your while.

Aur, Batao! 😀

Reversing the dominant trend, the crypto market has reportedly witnessed over $750 million in the liquidation of short positions—that is, bets against price rises—as Bitcoin reclaims the $20K level. This means that short position liquidations are at their highest since June 2021.

The National Bank of Kazakhstan (NBK) has decided to test blockchain network BNB Chain for integration into the country’s Central Bank Digital Currency (CBDC) project. The country’s central bank has been developing its CBDC called Digital Tenge since May 2021.

🎊ETH has turned deflationary

Post-Merge, the issuance of ETH dropped significantly. ETH issuance shrunk from 13,000 ETH before the Merge to the current modest figure of 1,600. That’s a 90% drop for you. The deflationary turn has been anticipated for some time now in investor circles.

Two decentralized finance (DeFi) projects on the Solana blockchain, Tulip and UXD, have managed to reopen services after recovering tokens lost in the DeFi platform Mango Markets exploit.

Memewhile Elon at Twitter HQ

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