The Week in Crypto
In this weekly issue:
ð¡What're a few million dollars between friends
ð¡Biden's pro-crypto law
ð¡DeFi euphoria
ð¡Crypto Ukraine
ð£Join the conversation & letâs talk crypto!
ð¡What're a few million dollars between friends!
This famous quote from 2020 continues to be relevant nowadays and while the Fed was printing money and spreading the rumor that there will be no price increasement - inflation didnât get in through the back door. It entered through the front door reaching 7.9%.
Well, unfortunately, it did not manage to reach 8%, but it remains the highest inflation for the last 40 years.
The EU reported 5% inflation on an annual basis. The most affected goods and services are food, petrol, and housing and despite the fact that wages are increasing, they are still growing at a slower pace compared to inflation.
On top of the growing prices, President Biden decided to ban the import of Russian oil, which raised the price of fuel to $140 per barrel.
Till now it is not clear how long this galloping inflation will last, but such moments of devaluation of the reserve currency, social conflicts, and the expansion of the gap between rich and poor lead to only one. It's called a change in global leadership. During the last years, we see the US losing power and China gaining economic leadership. The two countries are competing over trade volumes and other factors, which is the reason for a change in a global order (+ the reserve currency).
This theory is wonderfully explained in the latest video by Ray Dalio! As always, Ray looks at the whole picture and goes 500 years back to find the events that are relevant nowadays.
ð¡Biden's pro-crypto law
Apart from inflation, the second important news for the week from the USA is the so-called executive order, which will be postponed for months.
It was both eagerly awaited by many and avoided by others who believed that the United States would crackdown on the sector.
Well, the truth is that the United States wants to use crypto as an incentive for innovation and technological advantage. The report has no specific legislative effect, i.e it does not force crypto companies to take specific actions. The financial regulators - SEC, CFTC, and Treasury - should prepare reports on relevant crypto topics.
Apart from the fact that Biden obviously wants to take advantage of crypto-innovation (in an attempt to maintain the technological status of the United States), he is also talking about the so-called digital dollar.
The digital dollar in the crypto Twitter. As people who value decentralization, each of us is pessimistic about the digital dollar as well as the digital yuan. However, this is not about crypto, it is about geopolitics. The United States feels threatened (as Dalio's video says) and it will no doubt make every possible decision to extend the life of its empire and the reserve currency. The reserve currency is a very important symbol of power.Â
ð¡DeFi euphoria
The trading volume of DeFi and NFTs is down. During the week the key developer Andre Krone and his partner Anton Nell announced that they are stepping back and will stop some of the DeFi apps theyâve developed. This is not a regular dev developer, Andre is the creator of Yearn Finance and other important protocols. The news created panic for DeFi winter.Â
However, in my opinion, the truth is quite different. Andre shares that he is a developer and the euphoria of the people around him is too much.Â
ð¡Crypto Ukraine
Perhaps after El Salvador, Ukraine is the most famous cryptocurrency country in the world. The battles there have led many to make donations using crypto, and I expect Bitcoin to become legal tender after the war is over.Â
During the week, the NFT collection Bored Ape Yacht Club donated $ 1 million in Eth to Ukraine.Â
In addition, the Deputy Minister of the Ministry of Digital Transformation shared details of where the donations were made. The more specific citizens were provided with 5,500 bulletproof vests, 500 helmets, 3,125 optics, 60 walkie-talkies, as well as 32,427 "medicines" and over 400,000 lunch packages.