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| The biggest crypto news and ideas of the day Oct. 4, 2021 If you were forwarded this newsletter and would like to receive it, sign up here. Sponsored by Welcome to The Node.
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–Daniel Kuhn
Today's must-reads Top Shelf MINING: International shipping and crypto mining company Sino-Global will invest $10 million to develop a new proprietary bitcoin mining machine called Thor in a joint venture with blockchain technology firm Highsharp. Hive Blockchain, a Vancouver, British Columbia-based crypto mining company focused on BTC and ETH, reported its first-quarter profit surged 10-fold from a year earlier. Finally, Marathon Digital Holdings, another mining company, has secured a $100 million revolving line of credit with Silvergate Bank in bitcoin and U.S. dollars. RISKS AND REWARDS: The U.S Federal Reserve is set to release its review of the risks and opportunities in introducing a central bank digital currency (CBDC) as early as this week. Fed Chair Jerome Powell said on Sept. 22 that a CBDC would only launch if there are “clear and tangible benefits that outweigh any costs and risks.” Meanwhile, the Bank for International Settlements (BIS) has three new reports on CBDCs, with a key conclusion saying a digital currency could have a “manageable” effect on the banking system. UNIVERSITY RANKING: CoinDesk unveiled its second annual Top Universities for Blockchain resource for those looking to study or do research in an academic environment. The ranking includes 230 schools internationally, finding that many of the top universities for crypto are in Asia – the National University of Singapore tops the list. You can read the full methodology of this deeply researched project here. MANY ON POLY: Fueled by non-fungible tokens (NFTs), Polygon’s count of unique daily active addresses rose to a record high of 566,516 on Saturday, surpassing Ethereum for the first time on record, according to data provided by PolygonScan. Ethereum’s tally stood at 527,158 on Oct. 2. The number of active addresses on Polygon has grown by 168% in the past 30 days, while Ethereum’s count has gone up by a meager 0.6%, data from Etherscan shows.
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Overheard on CoinDesk TV... Sound Bites "A lot of developments in the blockchain space that are really core to what we do have come out of universities.”
–Stanford University Fellow Reuben Youngblom discussing the importance of universities in tech, on CoinDesk TV’s “First Mover.”
What others are writing... Off-Chain Signals A Beginner’s Guide to Terra’s DeFi Ecosystem (Crypto Briefing) Axie Infinity is launching a decentralized exchange (The Block) A Tongan member of parliament hopes the country can copy El Salvador in adopting bitcoin as legal tender (Financial Review) Japanese Cardano investors have reportedly failed to pay as much as $6 million in taxes, according to a recent large-scale audit (Nikkei) Another bug has been found in Compound’s code, putting as much as $160 million worth of crypto at risk. The team is working on patches (Decrypt)
A message from Apollo Fintech Gold Secured Currency (GSX) is trust backed by assets, gold and land mineral rights that provide a minimum asset value AND grow your investment. The assets will generate income to maintain GSX and increase its value.
Putting the news in perspective The Takeaway Corporate NFT Partnerships: For Whomst Among Us? Last week, TikTok announced its first foray into the world of NFTs with “TikTok Top Moments” – a set of digital collectibles tied to short videos from Lil Nas X, Grimes, Bella Poarch and more.
For the NFT business, it felt like a big deal. Crypto is fueled by social media and star power, and companies recognize the need for reputable celebrities to legitimize the tech. TikTok, already a partner of the blockchain-backed music streaming service Audius, was making its crypto ambitions clearer than ever.
Press releases went out, and business outlets dutifully wrote up the news. TikTok took out a full-page ad in The New York Times to promote it.
Notably absent from the promotional campaign were the stars themselves. Bella Poarch, who’s previously used her Instagram to promote consumer-oriented brands like Moncler and Fenty, neglected to mention the NFT.
Curtis Roach, less of a celebrity than either Nas or Poarch (he’s best known for a viral song called “Bored in the House”), did do some minor promotion, sharing a headline from a crypto news aggregator, but stopped short of tweeting about the NFTs himself.
The muted reaction from these savvy creators is a good reminder that, outside of crypto, people are still very much grossed out by the idea of NFTs.
A tweet from Variety about Lil Nas X’s involvement garnered about 1,000 likes and 7,000 quote tweets, the vast majority of which expressed disapproval. Among the perennially online, this is what’s known as a “ratio.”
“Noo Lil Nas X don't become an NFT shill, you’re so sexy aha,” tweeted one account.
Another quoted the infamous Twitter comedian @dril: “The only NFTs I deal in are nerds in the F**king trashcan. S**k my d**k.”
For many fans, NFTs are still tainted by their association with energy-intensive proof-of-work blockchains (TikTok says its NFTs are “carbon neutral,” though CoinDesk has confirmed that they’re interoperable with Ethereum, which is not), and with an industry that’s seen as a home for grifters and accelerationists.
Lil Nas X is one of today’s most artful promoters. He has a gift for turning even the most cynical corporate partnerships into goofy posts on social media: when Taco Bell named him its “Chief Impact Officer,” Nas somehow found a way to metabolize it.
That Nas couldn’t spin some ironic joke out of his NFT partnership suggests the subject was too hot to touch, even for him.
The critic Dean Kissick has said that part of the ick-factor has to do with the idea of artists “shilling themselves.” NFTs are not, as an influential venture capitalist once proposed, a “grassroots movement, led by creators.” People can see through that. The industry is flush with cash, and it’s difficult to blame artists for passing up an opportunity to capitalize on their work – but “doing NFTs” still involves a certain amount of reputational risk.
Some of the loudest voices in crypto believe NFTs will “eat the world.” But the industry needs to do some serious rebranding first.
The Ethereum network’s impending shift to a proof-of-stake blockchain – which effectively kills the environmental concern – is a no-brainer. It’s the easiest possible win for this industry, and a crucial step on the path to rehabilitation.
Beyond that, the challenge is cultural.
“NGMI,” short for “not gonna make it,” is the most popular slogan in crypto right now. Much like “have fun staying poor,” it’s deployed to mock anti-crypto sentiment. Bought bitcoin just before a crash? NGMI. More worried about the climate crisis than about gambling with JPEG files? NGMI.
This is, in a word, “sh**ty.” NFTs are a genuinely exciting technological innovation, in many ways – a new framework for buying and selling digital goods, with potentially game-changing implications for the so-called “creator economy.” It’s a shame that they’re still so easily dismissed, but rhetorical tactics like these aren’t helping make the case.
Why not go with a gentler approach? NFT acolytes would do well to assuage the fears of the crypto-curious, rather than shutting them down.
While proof-of-stake may be something of a silver bullet for the climate question (at least for Ethereum – ETH miners will continue to orbit other cryptocurrencies, even after the switch), the cultural one is more complicated. There’s no single answer here. But if NFTs are going to find their way to the general public, the industry should at least acknowledge the problem.
–Will Gottsegen While the pandemic has stunted some industries, fintech development and adoption have accelerated. Join executives from across the financial and technology sectors at Accelerate Finance: Money in a Mobile World on Oct. 13 to understand what's next in tech and how consumer expectations are driving change. Register now.
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