It's not been an easy week in crypto.
Terra's collapse has shocked the financial world. We're now undeniably in bear market territory. Having gone through a couple of these before, though, this time does feel a little different.
For one, Bitcoin seems to be holding up relatively well. At the time of writing, it's still above $30k. This is against a backdrop of many tech stocks crashing up to 80%.
Just look at Shopify for example:
With less hype and tougher market conditions, it's the projects with strong fundamentals that will weather the storm.
Active developers, a strong community, a genuine use case and clear vision. On many counts, Terra checked those boxes.
It's a stark reminder that investing in crypto is not for the faint-hearted. Watch your exposure.
Also, try to refrain from getting any crypto tats:
Contents
- Weekly Projects to Watch
- Top News This Week
- Fresh Content from the Team
Weekly Projects to Watch
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Top risers overall
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- The Graph ($GRT) ⬆️ 2%
- KuCoin Token ($KCS) ⬆️ 2%
- FLEX Coin ($FLEX) ⬆️ 1%
- Arweave ($AR) ⬆️ 1%
Top risers by Dev Rank
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- XRP ($XRP) ⬆️ 10%
- TRON ($TRX) ⬆️ 8%
- Arweave ($AR) ⬆️ 7%
- Radix ($XRD) ⬆️ 4%
Top small cap risers by overall rank
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- AlgoVest ($AVS) ⬆️ 56%
- Pinkcoin ($PINK) ⬆️ 52%
- HodlTree ($) ⬆️ 50%
- Unifund ($IFUND) ⬆️ 46%
Top News This Week
The Collapse of Terra (LUNA) and TerraUSD (UST)
On May 9, 2022, the Luna Foundation Guard (LFG) lent $1.5 billion in Bitcoin (BTC) and TerraUSD (UST) for the stablecoin peg. The move came after UST briefly lost its peg to the U.S. dollar.
Terra (LUNA) collapsed in value due to the fact that TerraUSD (UST) dipped in value. LFG failed to stabilize Terra(USD).
The goal of the stablecoin is to maintain a value as close to $1 USD as possible. However, on May 16, 2022, TerraUSD (UST) had a value of $0.12, far under the intended value of $1.
As a result of this, Do Kwon made an announcement on Twitter on May 10, 2022, about a recovery plan, but this did not spark investor and community confidence.
Then on May 11, LUNA’s value decreased to $1, and as of May 16, 2022, it dropped to $0.0001966.
Then, through an official Twitter announcement on May 12, 2022, The Terra Blockchain was officially halted at a block height of 7603700.
Meta's Instagram supports NFTs from Ethereum, Polygon, Solana, and Flow, and more creators are making NFTs.
NFTs from numerous blockchain networks are coming to the Instagram application. Meta has announced plans to integrate NFTs for Ethereum, Polygon, Solana, and Flow.
The pseudonymous founder of the Azuki NFT project revealed his fraught history with abandoned projects, which sent the NFT community on Twitter into a frenzy, and led to the collection's price decreasing.
Twitter user Zagabond, showcased his NFT history through a blog post where he detailed his involvement with CryptoPhunks, Tendies, and Cryptozunks, all of which were abandoned.
The digital artist Beeple and Madonna have collaborated on creating three non-fungible tokens (NFTs), which depict the pop superstar as the mother of all creations. The NFTs titled "Mother of Nature," "Mother of Evolution," and "Mother of Technology" are all graphic, 3D rendered videos of Madonna.
Bitcoin’s decrease in value, sellouts, and overall developments
On May 11, 2022, Bitcoin dropped below $27,000 levels as the crypto sell-off continued. Specifically, Bitcoin was last down to $26,848.20.
El Salvador bought the bitcoin dip and added 500 coins to their balance sheet. The crypto market also saw a crash that led to $1 billion in liquidations.
Specifically, they added $15.5 million worth of BTC despite the sell-off. President Nayib Bukele revealed that the country bought the dip through a post on Twitter.
MicroStrategy Options Hedge also has a risk of a 96% drop after the Bitcoin route, wherewith stock around $230, options target a drop to $10. The shares of MicroStrategy, whose Chief Executive Officer Michael Saylor is regarded as a top Bitcoin evangelist, are used as a proxy for the cryptocurrency due to the fact that the company has been heavily tied to it.
Brazil's Nubank also launched crypto services through a partnership with Paxos. The digital bank will initially offer services with Bitcoin (BTC) and Ethereum (ETH) but has plans to further expand the list of offered digital assets.
Peter Brandt warns Coinbase users that their Bitcoin no longer belongs to them if the exchange goes Bankrupt, but Coinbase's CEO said that there is no risk of bankruptcy.
Coinbase recorded its first net loss of $430 million since the company went public in April of 2021. Coinbase recorded a 27% net loss from the $1.6 billion recorded in Q1 2021 to $1.17 billion in this year's first-quarter earnings.
Peter Brandt, a veteran futures trader, spoke to customers, asking them to close their accounts on the exchange and "flee" due to the fact that if Coinbase goes Bankrupt, their Bitcoin will not belong to them. Note that this tweet was later on removed.
Coinbase Global Inc. Chief Executive Officer Brian Armstrong said that there is "no risk of bankruptcy" for the largest U.S. cryptocurrency exchange, even amid a “black swan” event where the Bitcoin (BTC) cryptocurrency decreased in value.
Fresh Content From the Team
Thanks for reading,
The Stack Team
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