Dissecting past cycles and projecting the narratives & market catalysts ahead of the next Bitcoin Halving

BITCOIN

The Setup for the next Crypto Cycle

Increasing Adoption by TradFi Institutions

In the ever-evolving landscape of finance and investments, one phenomenon has been making waves: Real-World <a href="https://www.blockchainappfactory.com/tokenization-platform-development?utm_source=Backlink&amp;utm_medium=tokenization+platform+development&amp;utm_campaign=Sharuk+S" target="_blank" rel="noopener ugc nofollow" class="PlaygroundEditorTheme__link">Asset tokenization</a>. This groundbreaking innovation has the potential to reshape the way we invest, access assets, and manage portfolios. In this comprehensive article, we will delve deep into the top 5 trends in RWA tokenization for 2023.<h2 class="PlaygroundEditorTheme__h2">Increasing Adoption by TradFi Institutions</h2>The Institutional RevolutionTraditionally, large-scale assets like real estate and government bonds were the domain of institutional investors. However, the emergence of tokenization is democratizing access to these assets. A recent survey by BNY Mellon revealed that a staggering 97% of institutional investors believe that tokenization will revolutionize asset management. With an increasing willingness to pay for enhanced liquidity and faster asset turnover, the trend is clear.One notable example is MAS’ Project Guardian, a collaboration involving JP Morgan, DBS Bank, and SBI Digital Asset Holding. They conducted transactions using liquidity pools on the Polygon blockchain, involving tokenized Singapore and Japanese government securities bonds. German-based Siemens also issued a $63 million digital bond on Polygon, aiming to streamline processes and open new markets.This trend is set to continue as institutional investors seek improved asset liquidity through tokenization.<h2 class="PlaygroundEditorTheme__h2">Growth of Tokenization Platforms and Infrastructure</h2>The Skyrocketing GrowthRWA tokenization is a thriving sector within the blockchain space, poised to become a colossal $16 trillion business opportunity by 2030. This represents a phenomenal growth rate of over 50,000% compared to $310 billion in 2022. Investment giant Citi echoes this sentiment, predicting that blockchain tokenization will outshine traditional financial infrastructure.Moreover, rwa.xyz reports an astonishing 87.4% growth in Total Active Loans Value since the beginning of 2023, reaching an estimated $476 million. These loans offer investors an enticing average annual percentage rate (APR) of 11.96%, significantly higher and more sustainable than typical DeFi protocols.<h2 class="PlaygroundEditorTheme__h2">Expansion of Asset Classes for Tokenization</h2>Diverse OpportunitiesThe tokenization market has expanded rapidly, with various asset classes now available for fractional ownership. Here are some notable up-and-coming RWA protocols:<h2 class="PlaygroundEditorTheme__h2">OpenEden — Unlocking T-Bills</h2>OpenEden provides round-the-clock access to on-chain US T-Bills, managed by a regulated financial institution. Stablecoin holders can mint TBILL tokens via the OpenEden TBILL Vault, offering a nearly 5% annual risk-free rate as of March 2023.<h2 class="PlaygroundEditorTheme__h2">Polytrade — Empowering Invoice Factoring</h2>Polytrade focuses on decentralized trade finance, specifically invoice factoring. This involves purchasing due invoices from suppliers at a discount and profiting from collecting the full invoice amount. The invoices often originate from SMEs but are payable by large corporations like IKEA.<h2 class="PlaygroundEditorTheme__h2">Goldfinch — Collateral with Real-World Assets</h2>Goldfinch introduces a decentralized credit protocol, enabling businesses to access crypto lending without needing crypto collateral. Instead, they use real-world assets as collateral. In just over a year, Goldfinch has reached over $100 million in active loans across 28 countries, benefiting hundreds of thousands of end borrowers.<h2 class="PlaygroundEditorTheme__h2">RealT — Fractionalizing Real Estate</h2>RealT disrupts the real estate market by fractionalizing U.S. properties into RWAs. It replaces traditional paper deeds with digital tokens based on the Ethereum and Gnosis Chain blockchains. Now, you can own a piece of real estate starting at around $50 and receive weekly rental payments.<h2 class="PlaygroundEditorTheme__h2">Increasing Reliance on Oracles</h2>The Critical BridgeOracles play a pivotal role in tokenization by bridging the gap between on-chain and off-chain data. They provide trustworthy and secure data feeds to smart contracts, enabling the execution of tokenized asset terms. A prime example is Chainlink’s Proof of Reserve. Without reliable oracles, smart contracts risk inaccurate and untimely information, potentially leading to financial losses and undermining tokenization’s credibility.According to Defillama, Chainlink commands a 46% market share with 262 protocols under its belt. While this dominance is impressive, it also poses a potential single point of failure in extreme scenarios. Investors should remain vigilant about regulatory and centralization risks that could disrupt the market.<h2 class="PlaygroundEditorTheme__h2">Increasing User Interest on Twitter</h2>The Social BuzzRWA tokenization is not only gaining traction in the financial world but also generating significant interest on social media platforms. Prominent founders and enthusiasts are sharing their insights and opinions on this transformative trend. This increased visibility is indicative of the growing excitement and curiosity surrounding RWA tokenization.Real-World Asset tokenization is on the cusp of revolutionizing the investment landscape. As adoption continues to grow among traditional financial institutions and diverse asset classes become available for tokenization, investors and enthusiasts should keep a close eye on this dynamic and promising sector.<h2 class="PlaygroundEditorTheme__h2">Launch Your Own Asset Tokenization Platform</h2>As you read about the top trends in Real-World Asset (RWA) tokenization for 2023, you might be wondering: How can you get in on this exciting opportunity? The answer is simple — by launching your own&nbsp;<a href="https://www.blockchainappfactory.com/tokenization-platform-development?utm_source=Backlink&amp;utm_medium=tokenization+platform+development&amp;utm_campaign=Sharuk+S" target="_blank" rel="noopener ugc nofollow" class="PlaygroundEditorTheme__link">Asset Tokenization Platform</a>. And to make it a resounding success, you need to partner with the best in the business.<h2 class="PlaygroundEditorTheme__h2">Unlocking the Potential of Asset Tokenization</h2>Before we dive into why you should consider launching your Asset Tokenization Platform, let’s briefly recap why asset tokenization is so crucial.Asset tokenization allows you to convert physical assets like real estate, fine art, or even government bonds into digital tokens on a blockchain. This process democratizes access to traditionally exclusive assets, making them available to a broader range of investors. With RWA tokenization, you open the door to enhanced liquidity, increased efficiency, and a world of new investment opportunities.Now, let’s explore why launching your Asset Tokenization Platform is a strategic move.<h2 class="PlaygroundEditorTheme__h2">The Opportunity of a Lifetime</h2>Tap into a Thriving MarketThe RWA tokenization market is on a meteoric rise, predicted to reach a colossal $16 trillion by 2030. This exponential growth presents a unique window of opportunity. By entering the market now, you position yourself at the forefront of a financial revolution.Institutional investors are already recognizing the potential of asset tokenization, and they are willing to pay a premium for enhanced liquidity and faster asset turnover. By providing a platform for asset tokenization, you can cater to this growing demand while unlocking new revenue streams.<h2 class="PlaygroundEditorTheme__h2">Partnering for Success</h2>Why Go Solo When You Can Partner?Now, here’s the crucial step: Partnering with a top-tier asset tokenization platform development company. Building a robust and secure platform from scratch can be a monumental task. It requires technical expertise, blockchain proficiency, and an in-depth understanding of regulatory compliance.By collaborating with an experienced development company, you gain a competitive edge. These experts bring a wealth of knowledge and a proven track record to the table. They understand the intricacies of blockchain technology, smart contracts, and the importance of secure data handling. This partnership allows you to focus on your business strategy while leaving the technical aspects to the pros.<h2 class="PlaygroundEditorTheme__h2">Key Considerations for Choosing a Partner</h2>What to Look for in a Development CompanyWhen selecting a development partner for your&nbsp;<a href="https://www.blockchainappfactory.com/tokenization-platform-development?utm_source=Backlink&amp;utm_medium=tokenization+platform+development&amp;utm_campaign=Sharuk+S" target="_blank" rel="noopener ugc nofollow" class="PlaygroundEditorTheme__link">Asset Tokenization Platform</a>, consider the following factors:<ol class="PlaygroundEditorTheme__ol1"><li value="1" class="PlaygroundEditorTheme__listItem">Expertise: Ensure they have a strong background in blockchain technology, with a portfolio of successful projects.</li><li value="2" class="PlaygroundEditorTheme__listItem">Regulatory Compliance: Verify that they understand the legal and compliance aspects of tokenization to avoid any regulatory hurdles.</li><li value="3" class="PlaygroundEditorTheme__listItem">Security: Security is paramount in the blockchain space. Your partner should have a robust security protocol in place.</li><li value="4" class="PlaygroundEditorTheme__listItem">Scalability: Your platform should be designed for future growth. A capable partner will ensure scalability to accommodate a growing user base.</li><li value="5" class="PlaygroundEditorTheme__listItem">User Experience: A user-friendly interface is key to attracting and retaining investors. Look for a partner that prioritizes UX design.</li></ol><h2 class="PlaygroundEditorTheme__h2">Your Path to Success</h2>Seize the MomentIn conclusion, the world of Asset Tokenization is brimming with possibilities, and now is the perfect time to launch your own platform. By partnering with a top-notch development company, you can turn your vision into reality while tapping into a thriving market. As the financial landscape evolves, your platform can become a catalyst for change, offering investors unprecedented access to a world of assets.

2023’s Top 5 Trends in Real-World Asset Tokenization

We are on the precipice of what could be the greatest transfer of wealth that has ever happened in human history.

Even the most novice degens know that the only rule that applies to&nbsp;<a href="https://www.entrepreneur.com/money-finance/5-tips-for-using-cryptocurrency-in-your-small-business/426438" target="_self" rel="follow" class="PlaygroundEditorTheme__link">cryptocurrency</a>&nbsp;markets is that there are no rules. Not even the world's brightest minds can outpace the mayhem that is the world of digital assets. One minute, Michael Saylor and Microstrategy could be live on CNBC discussing their latest billion-dollar Bitcoin purchase, and the next,&nbsp;<a href="https://www.entrepreneur.com/growing-a-business/why-jim-cramer-thinks-small-business-owners-can-do-more/397309" target="_self" rel="follow" class="PlaygroundEditorTheme__link">Jim Cramer</a>&nbsp;could be telling America that he'd never touch Bitcoin with a ten-foot pole, only a couple of weeks after calling it digital gold — it's crazy.The market has been rather uninteresting due to asset prices traveling sideways for the better part of this year. Nevertheless, hope in the vision of the Federal Reserve's mythical "soft" landing, combined with the upcoming Bitcoin halving, has the&nbsp;<a href="https://www.entrepreneur.com/en-ae/technology/the-world-of-web3-a-beginners-guide-to-a-space-thats-set/433957" target="_self" rel="follow" class="PlaygroundEditorTheme__link">Web3</a>&nbsp;community salivating at the prospect of many life-changing opportunities that could be within reach soon. With greed in the air, it would be foolish to ignore the difference in the landscape as the market sentiment shifts.Whether it's the likes of BlackRock looking to issue ETFs to commercialize&nbsp;<a href="https://www.entrepreneur.com/topic/cryptocurrency" target="_self" rel="follow" class="PlaygroundEditorTheme__link">crypto</a>&nbsp;exposure, corporate adoption, multiple&nbsp;<a href="https://www.nytimes.com/2021/04/14/business/coinbase-ipo-stock.html" rel="nofollow noopener" class="PlaygroundEditorTheme__link">IPOs</a>, the rise of artificial intelligence or the attempted onslaught of regulation, there hasn't ever been this much discourse around the digital asset class. That's exactly why you need to know three key things to capitalize on what's to come.<h2 class="PlaygroundEditorTheme__h2">1. Dumb money following smart money is still dumb</h2>One of the most common mistakes prospective investors make, regardless of the target market, is outsourcing critical thinking skills instead of developing their own. Most investors would rather follow someone else's investment decisions instead of doing their own analysis.That's not to say that there is anything wrong with seeking the guidance of someone with more experience; however, it's important to remember that finances, goals, and risk appetite vary from person to person. Blindly following anyone's advice, no matter who they are, is a surefire way to make losing trades. Instead, cultivate the ability to ascertain the&nbsp;<a href="https://www.entrepreneur.com/en-in/finance/how-can-one-calculate-the-fair-market-valuation-of-a/300774" target="_self" rel="follow" class="PlaygroundEditorTheme__link">fair market value</a>&nbsp;of an asset so that you can capitalize on whatever arbitrage opportunities exist within a given market.During times of prosperity, it's quite common for novice investors to fall victim to scams. Whether it's a personal security issue gone wrong that leads to a complete loss of funds or being fooled into investing heavily in a meme coin pump-and-dump, it's important to remember that there's no such thing as easy money. Being equipped with the tools to properly evaluate the&nbsp;<a href="https://www.entrepreneur.com/money-finance/angel-investors-may-be-your-startups-key-to-long-term/444050" target="_self" rel="follow" class="PlaygroundEditorTheme__link">viability</a>&nbsp;of an investment on its merit alone is the biggest key to financial freedom.<h2 class="PlaygroundEditorTheme__h2">2. Crypto's tiny!</h2>As I write this article, the crypto market&nbsp;<a href="https://www.entrepreneur.com/en-in/topic/market-capitalization" target="_self" rel="follow" class="PlaygroundEditorTheme__link">capitalization</a>&nbsp;(i.e., the total size) is hovering around $1 trillion. By all accounts, this is an outrageously large number for an asset class still unacknowledged by some of the nation's&nbsp;<a href="https://www.cnbc.com/2022/04/30/warren-buffett-gives-his-most-expansive-explanation-for-why-he-doesnt-believe-in-bitcoin.html" rel="nofollow noopener" class="PlaygroundEditorTheme__link">elite</a>. However, it pales compared to the vast majority of other asset classes. For context, the US stock market cap is about $47 trillion, while Apple ($AAPL) alone, with a market cap of $3 trillion, is roughly 3x larger than the entirety of crypto.Should crypto's mission to update our archaic financial system as well as financially connect the most economically ostracized parts of the world succeed, the potential upside is undeniable. For example, the recent progress we've seen in developing a Bitcoin spot ETF will drastically increase opportunities for the everyday person to gain crypto exposure without having to take on the operational risk of self-custody.There is an astronomical disparity in the global sentiment towards digital assets. Namely, we've seen more liberated financial markets overseas, like the United Emirates or various countries in Latin America, embrace crypto with open arms while many Americans remain emotionally scarred by the narratives that have been weaponized against them to discourage participation.According to a study done by the Pew Research Center, 75% of&nbsp;<a href="https://www.pewresearch.org/short-reads/2023/04/10/majority-of-americans-arent-confident-in-the-safety-and-reliability-of-cryptocurrency/" rel="nofollow noopener" class="PlaygroundEditorTheme__link">Americans</a>&nbsp;are not confident in the safety and reliability of crypto. This stark contrast sets the stage for rapid price swings. It brings to light the potentially misaligned incentives that might've come into play amidst a weakening dollar and ever-changing geopolitical landscape.<h2 class="PlaygroundEditorTheme__h2">3. Utility</h2>Perhaps the most significant change that has occurred over the last market cycle is the influx of use cases that have finally come to fruition. The overwhelming success and adoption of non-fungible tokens (NFTs) in the world of art and ticketing and the likes of Gucci,&nbsp;<a href="https://www.entrepreneur.com/business-news/el-salvador-makes-history-as-first-country-to-adopt-bitcoin/374156" target="_self" rel="follow" class="PlaygroundEditorTheme__link">El-Salvador</a>&nbsp;and the world's most prestigious brands and countries deeming cryptocurrency legitimate currency, Web3 is no longer possible; it's happening.Various breakthroughs in decentralized technologies have largely addressed the initial limitations of many decentralized protocols. The emergence of proof-of-stake and its many derivatives have enabled builders to put&nbsp;<a href="https://www.entrepreneur.com/en-au/technology/decentralized-technologies-in-sectors-of-the-real-economy/361033" target="_self" rel="follow" class="PlaygroundEditorTheme__link">decentralized technologies</a>&nbsp;in the hands of consumers and drastically expand their applications. And while most degens have been of the opinion that the world of distributed ledgers is 'winner takes all,' it now seems that the broader Web3 community is interested in finding ways to build bridges to bolster collaboration, an essential ingredient for mass adoption.<h2 class="PlaygroundEditorTheme__h2">Conclusion</h2>We are on the precipice of what could be the greatest transfer of wealth that has ever happened in human history. The essence of blockchain is to create an equitable world where no one would ever fall victim to the abuse of power.Bitcoin's creator, Satoshi Nakamoto, dreamed about a more financially free world where everyone can participate. And while he could not, in his wildest dreams, envision how it would all play out, he must be happy to see both the financial and lifestyle benefits of his technology becoming reality for so many people worldwide.

Why the Next Crypto Bull Run Will Be Like Nothing We've Ever Experienced

et ready for the newest release of Crypto™

The Casino on Mars

The regulatory landscape for crypto in the U.S. has seen some positive developments over the past few months.

Emerging Catalysts in Crypto

Bitcoin has an historical tendency for a poor performance in September.

Grayscale's recent victory in its&nbsp;<a href="https://www.theblock.co/post/248030/quest-for-spot-bitcoin-etf-faces-unsettled-path-despite-grayscale-win" target="_blank" rel="noopener" class="PlaygroundEditorTheme__link">ETF case</a>&nbsp;is unlikely to prevent bitcoin from closing August with a negative monthly return. The digital asset began the month above $29,000, but now hovers above the $27,000 level.The digital asset's performance in August casts uncertainty over what September will bring. August was marked by&nbsp;<a href="https://www.theblock.co/post/244644/bitcoin-volatility-hits-all-time-low-as-trading-volume-slumps" target="_blank" rel="noopener" class="PlaygroundEditorTheme__link">record low volatility,</a>&nbsp;declining trade volume, and a&nbsp;<a href="https://www.theblock.co/post/246164/bitcoin-market-reignites-with-volatility-as-grayscale-decision-drags-out" target="_blank" rel="noopener" class="PlaygroundEditorTheme__link">flash crash</a>&nbsp;that sent the BTC price into $25,000 territory. According to CoinShares head of research James Butterfill, August's price decline "has underscored bitcoin's vulnerability from larger trades, exacerbated by current low volumes."Butterfill predicts market indecision will characterize the beginning of September. He expects traders to waver between excitement over ETF possibilities and doubts over SEC approval. Despite Wednesday's&nbsp;<a href="https://www.theblock.co/post/247947/bitcoin-price-soars-after-grayscale-win-in-dispute-with-sec" target="_blank" rel="noopener" class="PlaygroundEditorTheme__link">court ruling</a>&nbsp;favoring Grayscale, Butterfill told The Block, "It is unlikely to accelerate the timetable for an SEC approval as there is still the potential for an appeal."<h2 class="PlaygroundEditorTheme__h2">Dollar strength weighs in on risk assets</h2>In a recent&nbsp;<a href="https://www.linkedin.com/feed/update/urn:li:activity:7101927351885680640/" target="_blank" rel="noopener" class="PlaygroundEditorTheme__link">note,</a>&nbsp;Butterfill questioned whether market conditions in September would be able to defend bitcoin at its current value. Pivotal to his assessment is "a rising DXY that has affected risk assets at large."The dollar was recently strengthened after more hawkish nuances from the Federal Reserve&nbsp;<a href="https://www.theblock.co/post/247508/bitcoin-falls-after-feds-powell-takes-hawkish-tone-at-jackson-hole" target="_blank" rel="noopener" class="PlaygroundEditorTheme__link">last Friday</a>. A strengthening U.S. dollar index diminishes the risk-adjusted return associated with bitcoin, making the digital asset less palatable.Butterfill also pointed to bitcoin trade volumes being lower than this time last year as a negative sign. "This is more than just the seasonal impact," he added. According to the researcher, bitcoin trade volume last summer averaged $7.5 billion per day, compared to $4 billion this summer.Butterfill explained that several factors have coalesced to result in the digital asset's current inactivity. On-chain data shows investors are in a holding pattern, awaiting the SEC's decision on approving a spot-based ETF in the U.S. He emphasized that recent&nbsp;<a href="https://www.theblock.co/post/244886/binance-asks-for-protective-order-over-claims-sec-is-conducting-fishing-expedition" target="_blank" class="PlaygroundEditorTheme__link">regulatory crackdowns</a>&nbsp;have had an impact on U.S. exchange volumes. He also pointed out the Binance fee holiday "that began in March 2022 ended in March 2023, resulting in sharp volume declines."<h2 class="PlaygroundEditorTheme__h2">September brings market uncertainties</h2>Historically, September has been a poorly performing month for bitcoin. Krown Trading's Eric Crown noted in an&nbsp;<a href="https://twitter.com/krowncryptocave/status/1696388813256298721" target="_blank" rel="noopener" class="PlaygroundEditorTheme__link">post</a>&nbsp;on X (formerly Twitter) that "nine of the total 13 prior Septembers have had negative returns open to close and an average loss return of -12.80%." Therefore, investors remain wary of additional downside pressure.One analyst sees trade volume and volatility picking up in September. "We don't expect the volatility in September to be as low as August," Sergei Gorev, risk manager at YouHodler, told The Block. He added that traders will be liquidating more positions in light of the U.S. fiscal year ending next month."The fact of fixing profits in general portfolios may affect the sale of cryptocurrencies in particular in September, this can cause negative dynamics in the crypto market," Gorev added.James Butterfill underscored September as a time for "fund managers to allocate when back from holiday, and hawkish rhetoric has likely impacted their investment decisions." However, Butterfill has a more positive forecast for bitcoin in October and November. "My suspicion is that central banks are likely to begin pivoting soon as macro data deteriorates. This would be more supportive of Bitcoin. Timing is tricky though, and we may have to wait for October and November for this scenario to play out."

Bitcoin faces uncertain September despite Grayscale victory, say analysts

After years of getting bullied by regulators, Grayscale caught a W today when an appeals court handed them a victory in their lawsuit against the SEC. Today, we unpack the ruling and signal what could come next!-Bankless teamGrayscale just won a monumental legal victory against the SEC and the entire crypto industry has cause to celebrate 🥳In a decisive ruling, Judge Neomi Rao of the DC Circuit Court of Appeals ordered the SEC to vacate its own order denying Grayscale’s application to convert its trust-based BTC product into an exchange-traded fund (ETF).Under GBTC’s current trust scheme, shares can only be created, not redeemed, meaning there is no market mechanism to force the market value of a share to track its net asset value (NAV). Converting the Grayscale Bitcoin Trust into an ETF, however, would allow the GBTC to be redeemed for the underlying Bitcoin and the presence of this arbitrage opportunity would close the instrument’s discount to NAV.Approval of a spot BTC ETF is seen as a bullish unlock for the crypto industry, as it would allow investors to circumvent the challenges of crypto custody and quickly become the go-to investment vehicle for US retail and institutions seeking exposure to the asset. No longer must you make the choice between burdensome self custody or potentially unsafe CEX. Instead, outsource your worries to TradFi in exchange for an extremely low fee Bitcoin investment vehicle that comes stocked with bells and whistles like leverage and options 🚀Bitcoin’s price has rallied over 8% on optimism that ETF approval is imminent and the discount of GBTC’s market value to its NAV sits at levels unseen since the closing days of the bull market in 2021!<img class="PlaygroundEditorTheme__image editor-image" src="https://lh6.googleusercontent.com/buPWfrK2AqZ60J0SQ2tG-U8XehijSWOjX8i8ADgNvoZVViFSSmTiz2phs_XJ04qjoA-hzXqaQtbjFMXKZBhNTmCxVzt-jmeRY9-cjGxdbq2WruN2mtKCJVAyRS4eMABmWWRe9OyYrNzuMesYgS8Mvrg" alt="" width="391" height="354">Source:&nbsp;<a href="https://www.tradingview.com/chart/1TigHbrw/?symbol=OTC%3AGBTC&amp;ref=bankless.ghost.io" target="_blank" class="PlaygroundEditorTheme__link">TradingView</a>Judge Rao states in the decision that the SEC failed to adhere to fundamental administrative law principles that require federal agencies to treat like cases alike and that the agency was unable to explain why it was treating Grayscale differently. Specifically, the Court found that Grayscale’s spot BTC ETF would be sufficiently similar to two approved BTC futures ETFs and therefore should have received similar regulatory treatment.Underlying this decision is the rationale that Bitcoin spot and futures markets are closely correlated and the recognition that the GBTC ETF comes with a surveillance sharing agreement identical to the one employed by the futures products.<img class="PlaygroundEditorTheme__image editor-image" src="https://lh6.googleusercontent.com/mRa6ZBFJic8VURP0aCfIqglS3n5qRbS9kRjuXaX5tAEnUUYeFqhDO_IeKNk3Y96s6ongeOXFwRCZ45EAVnqIfpMH2JwqbqpQDDhOWO8A5ex9xCFP4T_8EE-C4opTiQlFWv_RHLnZybFHZ2XqAmdvgdo" alt="" width="432" height="155">Source:&nbsp;<a href="https://storage.courtlistener.com/recap/gov.uscourts.cadc.38827/gov.uscourts.cadc.38827.1208547574.0_1.pdf?ref=bankless.ghost.io" target="_blank" class="PlaygroundEditorTheme__link">US Court of Appeals, DC Circuit</a>While the SEC has been soundly defeated by Grayscale and can no longer deny the company’s ETF on the grounds of fraud and manipulation concerns, the battle for a spot BTC ETF&nbsp;is not over! The Court has not mandated the approval of the application, only that the SEC revisits Grayscale’s proposal again.Given the demonstrated hostility of the SEC towards crypto, it is a sad possibility that the agency picks a new reason to deny Grayscale’s proposal, forcing further costly litigation, however top crypto legal mind and Chief Policy Officer for the Blockchain Association Jake Chervinsky provides a more bullish take.<blockquote class="PlaygroundEditorTheme__quote">5/ But another theory is that the SEC will take the DC Circuit's decision as a (semi-)graceful exit from their anti-ETF position. I'm in this camp. It's the right move. "We disagree, but we're following the rule of law" is a convenient excuse to back out of a losing battle.— Jake Chervinsky (@jchervinsky)&nbsp;<a href="https://twitter.com/jchervinsky/status/1696544317957918816?ref_src=twsrc%5Etfw&amp;ref=bankless.ghost.io" target="_blank" class="PlaygroundEditorTheme__link">August 29, 2023</a></blockquote>While Chervinsky provides no definitive timetables for acceptance, he is confident in the eventual approval of a spot BTC ETF. The SEC’s defeat could serve as a convenient excuse for the agency to back out of a losing battle and make a semi-graceful exit from its long held anti-spot BTC ETF position.TradFi’s titans have been queuing for a spot BTC ETF for well over a month and have likely been exerting tremendous pressure on their SEC connections to approve one! Initial rulings for five of these spot ETFs are due on Friday…Here’s to hoping for another bullish surprise in just a few days 🥂

Grayscale Beats the SEC

And the two biggest narratives in crypto to come.

DeFi

Echoes of the Past: What the Deja Vu Market Tells Us About the Next Bull Market.

A few common sensical rules that are violated now (still) in crypto, and should be corrected through the natural process of the market.

If you followed my twitter (<a href="https://twitter.com/simiao_li" target="_blank" rel="noopener noreferrer" class="PlaygroundEditorTheme__link">@simiao_li</a>) for the past month, you'd probably already seen me reiterating a general theme of returning to common sense. This is so underrated in crypto that I think a dedicated piece is warranted. I'm writing this in one-go and mostly just reflecting what we've been internally discussing since July, so won't bother to edit for perfection. Forgive me for oversimplication. Also, NFA, please don't short local bottom reading this. TLDR:<ul class="PlaygroundEditorTheme__ul"><li value="1" class="PlaygroundEditorTheme__listItem">In markets with extreme degree of reflexivity, the exactness of some "truth" most serious people seek often doesn't matter. But common sense very much does. Don't find comfort in the exactness of "fundamental analysis" while losing sight of common sense.</li><li value="2" class="PlaygroundEditorTheme__listItem">A few common sensical rules that are violated now (still) in crypto, and should be corrected through the natural process of the market.</li><li value="3" class="PlaygroundEditorTheme__listItem">Rule 1: If you see scammy/opportunistic behaviors that rely on easy money falling from the sky, that's not how things normally work.</li><li value="4" class="PlaygroundEditorTheme__listItem">Rule 2: If you still see optics/appearances &gt;&gt;&gt; substance in lots of key opinion leaders, builders, and investors, that's not how valuable enterprises are built. Understand countersignals.</li><li value="5" class="PlaygroundEditorTheme__listItem">Rule 3: Scammy &amp; manipulative behaviors still persist? And little net value accrue to asset holders? That's not the sign of asset classes ready for big-money value investors. </li><li value="6" class="PlaygroundEditorTheme__listItem">The ability and courage to stick to common sense is rare, because crypto and crypto twitter allow for the most obnoxious kind of media-price manipulative complex, and because of trained muscle memory of 10yr of UPONLY.</li></ul><h2 class="PlaygroundEditorTheme__h2"> Bureaucratic Exactness vs. Common Sense</h2> In crypto, perhaps more than in any other markets, the price is exorbitant for pursuing bureaucratic exactness at the expense of losing common sense. <ul class="PlaygroundEditorTheme__ul"><li value="1" class="PlaygroundEditorTheme__listItem">You can calculate every little detail of bluechip projects, and yet still mistake cyclical levered beta as secular growth (e.g. Lido, DeFi in general). </li><li value="2" class="PlaygroundEditorTheme__listItem">Most of the time, the market doesn't give a shit to exact fundamental calculations because we are talking about an emerging onchain native economy (Ethereum) that barely has any existing consumption behavior. Most projects on ETH exist to burn gas through speculative activities and are derivative to the network effect of Ethereum, not really net-value-additive to it.</li><li value="3" class="PlaygroundEditorTheme__listItem">There's no amount of exactness that can compensate for a lack of appreciation in the meta-game being played: </li><li value="4" class="PlaygroundEditorTheme__listItem">Ethereum wants projects that burn gas and increase capital efficiency of existing TVL on this chain. Projects that do either of these most efficiently will rise in price. Often times, one project only does this for a short period of time until the next one spins up. Defi ponzis are dead, so next up is RWA onchain t-bills just to keep TVL staying in crypto. </li><li value="5" class="PlaygroundEditorTheme__listItem">Only when new projects that actually introduce net new inflow of users and capital emerge can we get over this extreme PvP.</li></ul> We are at a time when such PvP games being played have almost run to exhaustion, while little new consumer behavior and actual applications have emerged in the last two years and more. A few greenshoots I'm seeing: <ul class="PlaygroundEditorTheme__ul"><li value="1" class="PlaygroundEditorTheme__listItem">Prediction markets: polymarket et al.</li><li value="2" class="PlaygroundEditorTheme__listItem">Fun casino: Rollbit.</li><li value="3" class="PlaygroundEditorTheme__listItem">Early utility use case of NFT: digital pawn shop for luxury watches.</li><li value="4" class="PlaygroundEditorTheme__listItem">Some early attempts to build payment apps. </li></ul> And really not much else. Gaming (both Web 2.5 gamefi, and fully onchain gaming) IMO haven't found the PMF, but I hope I will be proven deadly wrong on this. <h2 class="PlaygroundEditorTheme__h2"> Common Sense</h2>Rule #1: If it seems like people still largely believe easy money is falling from the sky, and scammy/opportunistic behaviors are getting rewarded, we are not in "value zone".<ul class="PlaygroundEditorTheme__ul"><li value="1" class="PlaygroundEditorTheme__listItem">L2s are the new alt L1 game. Now everyone (old L1s, projects) wants to be a new L2 because it pumps their valuation.</li><li value="2" class="PlaygroundEditorTheme__listItem">NFT bluechip projects milking out the very last bit from their most loyal users (hey Azuki).</li><li value="3" class="PlaygroundEditorTheme__listItem">Clearly over-valued new VC token launches by project that hasn't proven anything (Worldcoin launching at OpenAI valuation). </li><li value="4" class="PlaygroundEditorTheme__listItem">Increasingly desperate pumps and dump behaviors from mostly dead projects in a last effort to squeeze out some more exit liquidity from retail (won't name names since there's too many).</li><li value="5" class="PlaygroundEditorTheme__listItem">VCs investing in new hot narrative (albeit much less so than 6 months ago) based on the belief that when the bull market comes, this will be instantly valued at 100M USD like this other project that launched a while ago.</li></ul>Rule #2: If you see optics/appearances &gt;&gt;&gt; substance in lots of supposedly key opinion leaders, builders, and investors, we aren't quite there yet as far as "builder's market" goes.<ul class="PlaygroundEditorTheme__ul"><li value="1" class="PlaygroundEditorTheme__listItem">All conferences are still way too noisy. HK this, Singapore that. Keynote speakers are more interested still in having a great presence than the actual content of the conference.</li><li value="2" class="PlaygroundEditorTheme__listItem">Being a founder is still automatically something to glorify about (even those that have already liquidated their own bags), even if your product has less than 100 real users and you are more interested in showing up to investor parties than heads down grinding in the pit going forward. </li><li value="3" class="PlaygroundEditorTheme__listItem">Working in crypto too often still means spending L1 foundation money to go around preaching and holding events.</li><li value="4" class="PlaygroundEditorTheme__listItem">VC investors with mediocre track record acting like kingmakers on Twitter talking about how sure they are of next big thing coming soon, while apps built by their portfolio company has a total web visit number mostly attributable to themselves &amp; competitor investors.</li><li value="5" class="PlaygroundEditorTheme__listItem">Conversely, those who have actually built the most for this space are often low profile (Brian Armstrong, Vitalik, Opensea, some new Solana projects etc.), and those new projects that are slowly building legit products don't have their founders timing their releases &amp; announcements and aggressive PR in anticipation of market risk-on. You just build, and ship, and let the users speak with their money and attention.</li></ul>Rule #3: When manipulative behaviors are acquiesced and taken for granted, and the liquid token market remains largely a place for exit liquidity, institutions aren't coming to buy our bags.<ul class="PlaygroundEditorTheme__ul"><li value="1" class="PlaygroundEditorTheme__listItem">Just open any low liquidity shitcoin chart that's been slow bleeding for more than a year with periodic catalyst driven pumps and you will understand why.</li><li value="2" class="PlaygroundEditorTheme__listItem">It's so taken for granted that players like DWF are the new talk in town.</li><li value="3" class="PlaygroundEditorTheme__listItem">Projects with no real users can still casually exit via IEO.</li><li value="4" class="PlaygroundEditorTheme__listItem">Projects that do actually attempt to accrue value to token holders have done well, but are still called ponzis/scams (Rollbit, Unibot) by "serious investors".</li></ul> *This is admittedly exaggerated and somewhat of a simplication for the status quo of the industry (there are pockets where common sense has returned and deals are attractive), but generally a much underappreciated reality.<h2 class="PlaygroundEditorTheme__h2"> Courage &amp; Conviction</h2> 10 years of QE ultra low interest rates and the cult of cryptonativeness have really blinded people's eyes towards common sense. WAGMI because halvening is coming. WAGMI because Powell is saving our asses. WAGMI because Bitcoin always goes up, in the long run. It's in times like this when the courage to insist on simple common sense will be greatly rewarded. I don't think people's conviction has been tested hard enough. What would you do if we go sideways for another three years from here? Would you still believe in crypto? Would you still think this is the inevitable future for finance and human coordination? I would, but I'm sure most people being bullish now wouldn't.True courage and conviction take a complete disregard for consensus and appearances, and a relentless heart for patience. Both are in short supply.

A Return to Common Sense

As big banks develop an appetite for crypto, privacy-centric users are increasingly wary of newcomers.

Institutional investors are more interested in the crypto world than ever before—and now they’re&nbsp;<a href="https://decrypt.co/147925/half-a-billion-has-poured-into-bitcoin-funds-in-past-three-weeks" target="_blank" class="PlaygroundEditorTheme__link">putting their money</a>&nbsp;where their mouth is. Some are wondering, however, whether Bitcoin may lose its raison d’être as a result.&nbsp;BlackRock, the world’s biggest asset manager, couldn’t be more mainstream. Managing $9 trillion, the well-connected Wall Street firm is the epitome of “the establishment.”&nbsp;Yet last month it&nbsp;<a href="https://decrypt.co/144782/blackrock-filing-bitcoin-etf-application-soon-reports" target="_blank" class="PlaygroundEditorTheme__link">filed</a>&nbsp;an SEC application for a&nbsp;<a href="https://decrypt.co/resources/what-is-bitcoin-etf-explained-guide-learn-easy" target="_blank" class="PlaygroundEditorTheme__link">spot Bitcoin exchange-traded fund (ETF)</a>—<a href="https://decrypt.co/147203/bitcoin-hits-its-highest-price-in-over-a-year" target="_blank" class="PlaygroundEditorTheme__link">sending the price</a>&nbsp;of the biggest cryptocurrency to a year high. Its billionaire CEO Larry Fink then&nbsp;<a href="https://decrypt.co/147409/larry-fink-blackrock-ceo-bitcoin-digitizing-gold-international-asset" target="_blank" class="PlaygroundEditorTheme__link">praised</a>&nbsp;crypto for “digitizing gold.”<blockquote class="PlaygroundEditorTheme__quote">Larry Fink, BlackRock CEO, says crypto "is digitizing&nbsp; gold" and "<a href="https://twitter.com/hashtag/Bitcoin?src=hash&amp;ref_src=twsrc%5Etfw" class="PlaygroundEditorTheme__link">#Bitcoin</a>&nbsp;is an international asset."&nbsp;<a href="https://t.co/et1nT4c3FZ" class="PlaygroundEditorTheme__link">pic.twitter.com/et1nT4c3FZ</a>— Real Vision (@RealVision)&nbsp;<a href="https://twitter.com/RealVision/status/1676948339344961536?ref_src=twsrc%5Etfw" class="PlaygroundEditorTheme__link">July 6, 2023</a></blockquote>Bitcoin was originally an anti-establishment initiative. Favored by cypherpunks suspicious of the government and initially bad-mouthed by every major institution—from the&nbsp;<a href="https://decrypt.co/53962/bitcoin-global-regulation-european-central-bank" target="_blank" class="PlaygroundEditorTheme__link">European Central Bank</a>&nbsp;to&nbsp;<a href="https://decrypt.co/110305/jpmorgan-ceo-jamie-dimon-crypto-tokens-bitcoin-are-decentralized-ponzi-schemes" target="_blank" class="PlaygroundEditorTheme__link">JP Morgan</a>—the cryptocurrency seemed poised to break finance free from the shackles of centralization.“Bitcoin was created because the traditional system has huge problems, and making Bitcoin like it is defeating Bitcoin’s purpose,” a long-time contributor to Bitcoin privacy wallet Wasabi who goes by the name Rafe told&nbsp;Decrypt. The difference between the priorities of cypherpunks and regulated institutions “was expected,” he added.Cypherpunks are typically privacy advocates who want social change and who see Bitcoin as a tool to avoid an oppressive government’s prying eyes. Institutional investors are focused on making money—Bitcoin is something in which they can put a part of their large fund to realize a return.Privacy-focused Bitcoiners who spoke to&nbsp;Decrypt&nbsp;said the worry is that institutional interest could eventually provoke governments into strongarm crypto users into restriction, penalties, or taxes.Major crypto exchanges such as Coinbase and Binance already have know-your customer (KYC) measures in place and broadly restrict access to their platforms based on political borders. Lawmakers are also increasingly focused on anti-money laundering (AML) procedures. But the emergence of such compliance measures in the crypto space has&nbsp;<a href="https://decrypt.co/115107/edward-snowden-calls-coinbase-over-compliance-toxic-and-embarrassing" target="_blank" class="PlaygroundEditorTheme__link">attracted criticism</a>&nbsp;from long-time privacy advocates.&nbsp;“Get-rich-quick and mainstream-adoption-no-matter-what” could force crypto users into “totalitarian rules,” Rafe said.And because every transaction is publicly recorded on the blockchain, a combination of strict KYC rules and no prioritization of privacy could create “the biggest global financial surveillance system the world has ever seen,” he added.&nbsp;Harry Halpin, CEO and co-founder of Nym Technologies, a startup working to end mass surveillance, said: “The fundamental innovation of cryptocurrency comes from crypto-anarchist philosophy, and if you get rid of that ethos, then innovation in the crypto space will perish.”&nbsp;Bitcoiners have nonetheless continued to&nbsp;<a href="https://decrypt.co/107376/bitcoin-privacy-problem-what-cypherpunks-are-doing" target="_blank" class="PlaygroundEditorTheme__link">work on privacy solutions</a>&nbsp;for Bitcoin because the asset isn’t fundamentally private. Rafe told&nbsp;Decrypt&nbsp;that having private wallets can keep big government and institutions from barging in on users..&nbsp;Some say that Wall Street&nbsp;is&nbsp;coming for crypto, meanwhile, whether people like it or not. David Schwed, COO of blockchain security firm Halborn, previously&nbsp;<a href="https://decrypt.co/146212/wall-street-coming-for-crypto" target="_blank" class="PlaygroundEditorTheme__link">told</a>&nbsp;Decrypt&nbsp;that the anti-establishment actors in crypto who hate intermediaries will eventually turn to&nbsp;<a href="https://decrypt.co/resources/what-are-privacy-coins-monero-zcash-and-dash-explained" target="_blank" class="PlaygroundEditorTheme__link">privacy coins</a>.&nbsp;For others, though, when it comes to Wall Street making things more centralized, the problem isn’t Wall Street —it’s Silicon Valley.&nbsp;“Meta has proven again last week with their release of&nbsp;<a href="https://decrypt.co/resources/what-is-threads-can-metas-new-social-media-platform-beat-twitter" target="_blank" class="PlaygroundEditorTheme__link">Threads</a>—looking at the privacy disclaimer in the App Store—that they are ruthless about collecting personal data of all kinds,” Bitcoin Design contributor Christoph Ono said.Meta’s new social media platform Threads&nbsp;<a href="https://decrypt.co/147447/threads-app-goes-live-early" target="_blank" class="PlaygroundEditorTheme__link">dropped this month</a>&nbsp;as a Twitter competitor. It allows Instagram users to share text updates but is more aggressive with its data collection than Meta’s other apps—notably location-related information, even when location sharing is disabled on one’s device.&nbsp;Deleting a Threads account is also&nbsp;<a href="https://decrypt.co/147503/metas-twitter-killer-threads-onboards-millions-but-snags-some-with-fine-print" target="_blank" class="PlaygroundEditorTheme__link">impossible</a>&nbsp;without deleting one’s Instagram account too.Ono added that “data is just too big a temptation for the tech industry” and that there was “no way around building good privacy tools that are impossible to penetrate.”&nbsp;So what solutions are available today? While Rafe’s entry, Wasabi, is probably too complex for the average Bitcoin user, Karo Zagorus, who previously worked at the company behind Wasabi, zkSNACKs, told&nbsp;Decrypt&nbsp;that self custody was enough of a solution.Self-custody of Bitcoin or crypto is when a user has full control over their private keys, such as with a hardware wallet. Custodial wallets are more popular, however, because investors do not have to worry about seed phrases and keys. Instead, their cryptocurrency is put into the hands of a third party, like an exchange.

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