Read in the Digest:
- Bitcoin registers biggest plunge since january, Altcoins extend losses.
- Terra buys $1.5 billion worth of BTC, now the second-largest corporate Bitcoin holder.
- Central Bank of the Argentine Republic bans lenders from offering crypto.
- Decentralized offshoot of Twitter (NYSE:TWTR), BlueSky, releases its first code.
- Cardano’s TVL to hit $19 billion if staked ADA is added – Charles Hoskinson.
Bitcoin Registers Biggest Plunge Since January, Altcoins Extend Losses
After the Fed’s announcement on May 5th, Bitcoin has moved in tandem with the stock market, registering marginal gains. However, the rally was short-lived, as Bitcoin experienced its biggest single-day plunge since January.
Over the last 24 hours, Bitcoin has lost 10% over its value as the Dow correction marked the worst trading day since 2020. The drop sent the price of Bitcoin below $35,717, before it marginally recovered to its current price of $35,848 as of this writing.
The 1 day price chart for Bitcoin (BTC). Source: CoinMarketCap
Bitcoin is currently trading at its lowest price since February 24th, and has been joined by the broader crypto market. The biggest Altcoin, Ethereum, fell by 9%, dropping from $2,927 to as low as $2,688.
The 1 day price chart for Ethereum (ETH). Source: CoinMarketCap
Solana (SOL) and Cardano (ADA) were the biggest losers in the top 10, losing 12.2% and 10.3%, respectively. As a result of the market crash, the global crypto market cap has plunged from $1.8 trillion down to $1.643 trillion.
The 1 day price chart for Solana (SOL). Source: CoinMarketCap
The 1 day price chart for Cardano (ADA). Source: CoinMarketCap
Flipsider:
- Despite the market crash, TRON (TRX) emerged as the best performing crypto of the last 7 days, retaining gains of 18%.
The 7 day price chart for TRON (TRX). Source: CoinMarketCap
Terra Buys $1.5 Billion Worth of BTC, Now the Second-Largest Corporate Bitcoin Holder
Continuing its resolve to build a $10 billion Bitcoin reserve for its U.S. Terra (UST) stablecoin by the third quarter of 2022, Luna Foundation Guard (LFG) has purchased an additional 37,863 BTC, worth approximately $1.5 billion.
The LFG’s latest bitcoin purchase consisted of two over-the-counter deals made this week. The first was a $1 billion OTC swap with crypto prime broker Genesis for $1 billion worth of UST. The second was a $500 million bitcoin purchase from Three Arrows Capital.
Following its latest acquisition, the LFG now holds a total of 80,394 Bitcoins, worth approximately $3.5 billion at press time. LFG has now become the second-largest corporate holder of Bitcoin, overtaking Tesla (NASDAQ:TSLA).
The crypto market drop the increasing reserves behind U.S. Terra (UST) have earned it the position of 10th largest crypto, with a market cap of $18.7 billion.
The top 10 cryptos ranked by market cap. Source: Coinmarketcap
Flipsider:
- Terra’s LUNA token is down by more than 7% as the crypto market plunged over the last 24 hours.
Why You Should Care
According to Kwon, keeping foreign reserves in the form of a digital native currency will be a winning recipe.
Central Bank of the Argentine Republic Bans Lenders from Offering Crypto
In the same week Argentina’s largest and second-largest private banks, Banco Galicia and Brubank, announced that they would allow customers to make crypto purchases, however the Central Bank of Argentina has banned lenders from offering crypto services.
The ban, which was announced on May 5th, now restricts financial institutions from offering digital assets, which means Banco Galicia and Brubank will have to backtrack on their recent launches. The banks will cease crypto offerings on Friday, May 6th.
The BCRA made the announcement following the approval of a $45B loan facility for Argentina by the International Monetary Fund which came with the stipulation that the country would discourage the use of cryptocurrencies.
Flipsider:
- In a recently conducted poll, 60% of respondents in Argentina have asked for more access to crypto.
Why You Should Care
Argentines have rapidly adopted cryptocurrencies, with the country’s inflation running above 50% annually.
Decentralized Offshoot of Twitter, Bluesky, Releases Its First Code
Twitter’s decentralized social media project, Bluesky, has released its early code for a decentralized social network protocol. The system, ‘Authenticated Data Experiment (or ADX)’, is available on GitHub for developers to test.
According to Bluesky CEO Jay Graber, ADX will be the start of a semi-public development process. He explained that the team will release “work before it’s complete, but also giving ourselves time to workshop new directions at early stages.”
ADX isn’t a single, standalone social network design, unlike traditional social media projects. When fully developed, it will allow users to transfer social media posts and engagement between networks, without eroding the networks’ own moderation options
Graber encouraged developers to “feel free to play around” with the code. However, he warns that they shouldn’t try building their next big social media app on ADX because “things are missing, and things are going to change.”
Flipsider:
- Bluesky has confirmed that it will support content moderation, and hosting providers will still be legally required to “remove illegal content according to their local laws.”
Why You Should Care
Bluesky was announced by Jack Dorsey, the former Twitter CEO, in late 2019. However, the project went independent in February after receiving $13 million worth of funding from Twitter.
Cardano’s TVL to Hit $19Billion if Staked ADA Is Added – Charles Hoskinson
Cardano received a lot of hype and positive energy when it launched its smart contract functionality in September 2021. However, delays to its full deployment have restricted the growth of Cardano in the decentralized finance industry.
In a tweet explaining why Cardano’s TVL (Total Value Locked) was so small, Cardano’s Founder Charles Hoskinson claims that it does not take into account staked coins, because users are not required to lock ADA tokens to stake them.
According to Hoskinson, if staked Cardano (ADA) was added to the mix, the blockchain’s TVL would hit $19 billion. According to the popular DeFi TVL aggregator, DefiLlama, Cardano has a TVL of $203.5 million.
Although Cardano’s TVL pales in comparison to those of Ethereum, Terra, Binance, and Avalanche, Hoskinson is confident that it will surge next month once the ‘Hydra’ hard fork is implemented.
Flipsider:
- 0xngmi, a software engineer at DefiLlama, has refuted Hoskinson’s comments, confirming that the platform does not count native staking at all.
Why You Should Care
The Hydra hard fork is expected to bring massive improvements to Cardano, which could be a major catalyst to entice more developers into building on the network.