Read in the Digest:
- Bitcoin slumps to $33.5K throwing market into extreme fear, mining & difficulty climb to all-time highs.
- Solana Network suffers another Outage, SOL nosedives on Monday morning.
- NFT sales surge amidst market crash, Huobi launches $100 million metaverse support.
- Fantom overtakes Avalanche and Solana, becoming 4th biggest DeFi chain.
Bitcoin Slumps to $33.5K – Throws Market into Extreme Fear, Mining & Difficulty Climb to All-Time Highs
Bitcoin investors were faced with a major shock as the value of the “digital gold” harshly fell over the weekend, succumbing to even more sell-off, and hitting a new low of $33.5k. This means that Bitcoin has fallen to below half of its all-time high on November 10th, with 20% of the losses occurring over the last seven days.
The seven day price chart for Bitcoin (BTC). Source: Tradingview
At the time of this writing, Bitcoin is currently trading at $33,780. In line with Bitcoin falling under the $36k mark, the market dropped into extreme fear, as the Bitcoin Fear and Greed Index hit 11 out of 100.
Many investors are unsure what the future holds for bitcoin and the crypto market at large, with the IMF chief explaining that the Fed rate hike, due to growing interest rates, could ‘throw cold water’ on global market recovery.
Despite the massive losses, the Bitcoin mining hashrate and difficulty have risen to new all-time highs. The mining hashrate clocked a new all-time high of 198.86 exahashes per second, while its difficulty level rose by 9.32% to 26.64 trillion at a block height of 719.712.
Bitcoin’s hashrate now sits at 191.3 exahashes as of this writing.
- The rise in Bitcoin’s mining hash rate comes just as North America’s largest Bitcoin miner prepares its debut. Rechristened Core Scientific Inc. announced that it would commence operations following a SPAC vote.
- As the price of Bitcoin plunged, El Salvador increased its Bitcoin holdings by 410 BTC, at an average price of $36,500 – the cheapest the country rate has ever bought. The country now has 1,801 BTC in its portfolio.
Solana Network Suffers Another Outage, SOL Nosedives on Monday Morning
Making a name for itself as the most scalable blockchain, Solana was pitted against Ethereum, with many speculating that it could become the leading defi chain. However, in its bid for scalability, Solana seemingly sacrificed stability, as made evident by persisting network outages.
Over the weekend, Solana was faced with further network instability, causing outages that lasted for almost 30 hours between January 21st and 22nd. According to Solend, the outage was caused by the market’s crash, which generated arbitrage opportunities.
The postmortem on Solana concluded that bots swarmed the network due to cheap transactions, and the profitability of a successful arbitrage being high. Solana validators faltered as thousands of duplicate bot transactions caused an artificially heavy load.
Over the last 24 hours, the price of Solana (SOL) dropped by 19%, freefalling from $103.3 to $83.430. The one-time darling of the crypto space is now 68% down from its ATH, and has been flipped by Ripple’s XRP, Cardano’s ADA, and USDC.
The 24 hour price chart for Solana (SOL). Source: Tradingview
- The Bank of America believes that if Solana solves its stability challenges, it could become the Visa of crypto, ahead of Ethereum.
Why You Should Care
Although it leads the pack in scalability, the frequent technical disruptions indicate the need for further system developments and improvements.
NFT Sales Surge Amidst Market Crash, Huobi Launches $100 Million Metaverse Support
Despite the crypto markets being pushed to new lows over the weekend, the sale of non-fungible tokens (NFTs) has continued to rise. In the week ending January 22nd, over $4.7 billion in NFT sales were completed, marking an increase of 81% from the previous week.
According to CryptoSlam, $4.33 billion worth of NFTs has been sold across all chains over the last seven days. Ethereum still dominates the NFT sector, contributing $4.25 billion, or 98% of all NFT sales. Ronin follows, contributing $32.29 million.
NFT sales as of January 24th, 2022, according to CryptoSlam
To accelerate the development and adoption of the metaverse, leading crypto exchange Huobi, has launched a $100 million Lunar New Year campaign. The Prime Fest: Tiger Year, which encourages people to explore the vast potential of the metaverse, is set to run until February 14th, 2022.
Huobi announced that $100 million fund would be distributed as different forms of prizes and rewards, which will include access to new metaverse token listings under Primelist, PrimeEarn, and special blind box draws under PrimeBox.
- Despite being the apple of the market’s eye, experts have opined that companies are yet to figure out how an all-inclusive metaverse should be built.
Why You Should Care
Having once been called a bubble, the NFT markets are managing to forestall the crypto markets that have been stagnating for months.
Fantom Overtakes Avalanche and Solana, Becomes 4th Biggest DeFi Chain
Despite the sustained price decline across the cryptocurrency markets, Ethereum challenger Fantom (FTM) has stood apart from the crowd, reaching new heights in the process.
As he total value locked in Fantom has continued to soar, it has also overtaken leading DeFi chains Avalanche and Solana. TVL represents the total capital held within the smart contracts of a defi protocol or DeFi chain.
Over the last 24 hours, the TVL of Fantom has increased by 14.37%, with the chain now holding $13.02 billion as of this writing. Fantom’s rise has been both rapid and consistent. Over the last month, its TVL has increased by 170%, and by over 1,200% across the four months prior.
Fantom has also managed the impressive feat of surpassing Ethereum in terms of active daily transactions, cementing its place as a top competitor.
The TVL of Fantom: Source: Defillama
- While Fantom is quickly gaining ground, its accessibility remains an issue as it lacks listings on Coinbase and Kraken, and withdrawals are often blocked.
Why You Should Care
According to multinational investment bank JP Morgan, the rise of scalable DeFi chains like Fantom will catalyze the transition to DeFi dominance from Ethereum.