This week in Crypto: Week of March 10

We cover weekly key developments in the world of crypto assets and blockchain that have influenced price action and general sentiment.

Reading Time: 4 minutes

this week in crypto

Illustration: MilicaM

Investment developments  

The strong price trend seen in crypto to start off 2023 is seemingly coming to an end as a slew of bad news hits crypto markets. Bitcoin (BTC) fell below $20,000 for the first time this year, with the world’s largest cryptocurrency down over 8% in the last 24 hours.  

The stronger-than-expected inflation report has given credence to the earlier statements made by Federal Reserve (Fed) Jerome Powell, who claimed that the US central bank has more work to do before inflation starts turning around. The broader markets have grasped at straws for any positive information, with the latest developments coming as a slap in the face for all bulls.  

To complicate the matter further, a crypto-friendly bank, Silvergate Bank, announced on March 8, that it will be going into voluntary liquidation and will wind down its business. While speculations abound surrounding this event, it is clear that pressures exerted by the banking regulators and the SEC have pushed the bank to exit its business.  

Similarly, the US Department of Justice (DOJ) moved the 49,000 BTC on March 8, that it seized from Silk Road, a darknet marketplace, with investors speculating that this amount will be dumped on the marketplace. 

Finally, according to data from CoinMarketCap, the global crypto market cap stands at $917.63 billion, a 7.82% decline since yesterday. Meanwhile, the total crypto market volume over the last 24 hours is $74.85 billion, a 68.38% increase since yesterday.  

The Crypto Fear and Greed Index, which uses six measurements to asses the current sentiment in the markets, shows the emotion of fear with a value of 34. The index rates market emotions from 1, extreme fear, to 100, extreme greed.  

this week in crypto

Crypto Fear & Greed Index. Source: Alternative 

These recent readings suggest that there is panic in crypto markets caused by the recent inflationary readings, coupled with Silvergate closing down. If that was not enough, it seems that the DOJ is preparing itself to dump the Silk Road assets onto the crypto markets.  

Crypto Exchange developments  

One of the more popular hedge fund managers, Cathie Woods, is still a firm believer in Coinbase and crypto. Despite the shares of Coinbase tumbling over 8% on March 9, Woods proceeded to buy $17.5 million worth of shares of the second-largest centralized crypto exchange (CEX). With this latest purchase, 30% of all Coinbase stock purchases in 2023 were made by Woods and her funds ARK and ARKW.   

Note, that Woods and her funds invest into technology innovations, with Woods herself being probably the biggest BTC bull, claiming that it will reach $1 million per token in a not so distant future.  

Meanwhile, the woes for crypto exchanges continues with the New York Attorney General (AG) suing KuCoin. In the complaint, AG claims that not only Terra (LUNA), but also Ethereum (ETH), are securities. 

“This action is one of the first times a regulator is claiming in court that ETH, one of the largest cryptocurrencies available, is a security. The petition argues that ETH, just like LUNA and UST, is a speculative asset that relies on the efforts of third-party developers in order to provide profit to the holders of ETH.” 

The Seychelles-based crypto exchange ranks fifth on CoinGecko’s list of crypto exchanges based on “trust score” and 12th in the world based on 24-hour trading volume. The pressure the Securities and Exchange Commission (SEC) and other US government bodies are exerting on crypto businesses will most likely continue based on the move by NY AG.  

Web3 developments 

Starbucks Web3 loyalty program released its first official non-fungible token (NFT) on March 9, aptly called “stamps.” Currently, the program is in beta and is invite-only, which allows users to complete activities (quizzes, in-store purchases) to earn stamps. These NFTs can be stored or traded using Nifty Gateway.  

The first stamps are a 2,000 “limited edition,” which features the company’s siren. The starting price is $100, with users being limited to purchasing only two stamps by connecting their MetaMask wallet.   

Meta, formerly Facebook, is also reportedly looking to grab hold of the Web3 phenomenon. They’re working on a decentralized text-based app codenamed P92. The product should be a standalone app for sharing text updates. While the app is still in development, it is speculated that it will allow users to log in using the existing Instagram credentials (owned by Meta). Furthermore, it should support the ActivityPub protocol, supported by the decentralized social media platform Mastodon.  

During March 8, an NFT collection associated with Ethereum’s co-founder Vitalik Buterin skyrocketed in popularity. The Gitcoin Presents NFT collection soared in value after the minting was finished, though a direct relation of Buterin to the collection has not been officially established.  

According to data from OpenSea the collection managed to trade 7,763 worth of ETH, roughly $12 million worth of NFTs on the secondary market. Note that the floor price for one token was set at 0.5 ETH ($770) at the time of minting the tokens.  

DeFi developments 

SushiSwap joins hands with the popular subreddit r/CryptoCurrency (over 6 million members) to provide users access to its dual rewards program Onsen. The goal is to provide liquidity providers (LPs) with exchange fees, SUSHI, and MOON rewards. Overall, it seems that SushiSwap is looking to attract more liquidity for the MOON token., the DeFi protocol was hacked, sort of. The native token TND plunged 34% on March 7 after the news of the hack was released. Apparently, the protocol was hit by an unusual number of borrowing requests, causing them to pause borrowing altogether. Apparently, a hacker managed to borrow $1.59 million in assets during the attack.  

However, the white hat hacker returned the funds to the DeFi platform, receiving a 62.15 ETH ($85,000) bounty. The attack occurred after upgraded its price feed to show data from Chainlink. After the hacker siphoned the funds, he left a message: “It looks like your oracle was misconfigured. Contact me to sort this out.” reached out and agreed to pay the bug bounty to the hacker, who in turn returned the funds.  

Tech developments 

Hedera network users have had a rough day on March 9, due to network downtime. While this is the first time the network has experienced such an event, it follows the downtime seen in Solana’s network last week. Initially, it was reported that the smart contract irregularities triggered the crash. After the investigation, they came to the conclusion that the crash occurred due to an attack trying to exploit Hedera’s smart contract service code. 

The fact that developers stopped the Hashport bridge, a means for transferring stolen tokens, allowed them to stop the exploit and prevent losses. HBAR, the native token of the Hedera network, was already down, therefore, it is difficult to gauge how much it affected the price action of the token.