In Crypto: ‘Some exchanges won’t make it through crypto winter’


Cryptocurrency

Cryptocurrency exchanges banking on excess leverage won’t make it through the current bear market, according to Bit.com CMO Toya Zhang.

Bit.com is the second-largest crypto options exchange, established as part of unicorn Matrixport’s ecosystem.

Headquartered in Singapore, it offers spot, futures, perpetual contracts, options and savings. The company founded by Jihan Wu and mining rig manufacturer Bitmain in 2019 recently said it is doubling its workforce despite the large-scale layoffs seen elsewhere in the industry to take advantage of the available talent.

Zhang, who will speak at the 2022 European Blockchain Convention this week on the transition from Web2 to Web3, said the market correction will result in a number of companies falling by the wayside.

“The cryptocurrency market stands at a clear turning point. Companies will either pivot and manage to survive the storm or will suffer the consequences,” she said. 

“The future crypto services format will be a combination of Web2 and Web3. Exchanges must prioritise a customer-focused and on-chain aggregated service approach; those still banking on excess leverage won’t make it through the crypto winter.”

Both traditional and digital finance markets are in turmoil, with an ongoing conflict in Ukraine and significant market uncertainty. The chaos has wiped more than $2 trillion in value off the crypto market, with several institutions going bankrupt and retail investors losing their life savings.

With scepticism at an all-time high, the wider public are lacking confidence in those who they feel are responsible gatekeepers for their assets. As a result, many companies are taking this time to focus on finding ways of maintaining trust with their investors.

“In order to stand out, exchanges like ours will need to provide true value to consumers with services and tools that are built with simplicity at the cutting edge,” added Leslie Hsu, director of business development at Bit.com.

$200m boost for ‘smart exchange’ Unizen

A ‘smart exchange’ which aggregates the most cost-efficient trades across both centralised and decentralised exchanges has secured a $200 million capital growth commitment.

Unizen, which runs on the BNB Chain, aims to attract both retail and institutional investors via the mix. An example of a CEX is Binance, while Uniswap is a DEX.

Global Emerging Markets, a $3.4 billion private equity giant with offices in New York, Paris and Nassau Bahamas, will provide the funding over time as the company hits certain milestones.

Unizen is also actively fostering innovation via ZenX Labs, a CeDeFi Incubator that supports decentralised projects, empowering their growth with technical expertise and growth management as well as ensuring its full compliance.

It says Unizen (ZCX) token holders will benefit from the growth of incubated projects via the Dynamic Multi Asset Staking (DMAS) which allows the community to share rewards reflecting the long-term success of the projects in incubation.

The ZCX token is available on major exchanges including Kucoin, Gate, MEX, BitMart and Uniswap.

“We are proud to welcome GEM to the Unizen Ecosystem as a potent and strategically aligned growth partner that can support the rapid expansion of the Unizen platform, brand and community,” said Sean Noga, CEO of Unizen.

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Cryptocurrency shorts

French MEP Aurore Lalucq has called the country’s decision to hand Binance regulatory approval “surprising and worrying” and appealed to the French market regulator to review its decision.

Collapsing crypto hedge fund Three Arrows Capital has defaulted on its $670 million loan. Digital asset brokerage Voyager Digital says it will continue to operate and fulfil customer withdrawals while it seeks to recover the loan.

Crypto crime in the UK saw one of its smallest annual increases in 2021 – 7% – according to Crypto Head research. However victims still lost £204 million over 9,458 reported incidents. There have been 34,305 reports of crypto crime in the UK since 2016, with an average growth rate of 100% per year. 

Supercar hire company Classic Parade – which has showrooms in London, Manchester and Edinburgh – has launched a cryptocurrency payment system for Bitcoin or Ethereum. The company offers 150 supercars from 28 marques. The £2.4m Bugatti Chiron, for example, costs £200,000, 220.75 ETH or 11.696 BTC a day to rent. Its owner said: “Our clientele are international and want to be able to pay to rent our supercars without the hassle and cost of exchange rates and transfer fees.” 

Polygon co-founder Sandeep Nailwal and Arcanum Capital have invested $2.25m into Lucidao to create Altr. Users will be able to purchase physical luxury collectibles – such as rare watches and cars – in crypto, as well as the NFT related to the product. Ownership of the latter allows them to redeem the physical product, which can be kept in storage, at any time.

Crypto.com is integrating Apple Pay into its app and website. Apple does not support the payment directly but users will have the option of using crypto to make in-app purchases via a credit or debit card.

Paris-headquartered Flowdesk has secured €28m for its digital asset infrastructure and trading platform. The company provides its solution to Web3 players, including cryptocurrency token issuers.

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Crypto prices

The overall market cap of the more than 20,000 coins is at $932.9 billion at the time of writing (7am UK), a 2% decrease in the last 24 hours.

Market leader Bitcoin – the original cryptocurrency created by the mysterious Satoshi Nakamoto – lost 2% to $20,750. BTC is 1% down in a week.

Ethereum, the second most valuable crypto coin – created as a decentralised network for smart contracts on the blockchain – shed 2% to around $1,185. ETH is 3% up over the course of a week.

Binance Coin is a cryptocurrency created by popular crypto exchange Binance to assist its aim in becoming the infrastructure services provider for the entire blockchain ecosystem. Its BNB token lost 1% to $234, leaving it 5% up over seven days.

Cardano is an open source network facilitating dApps which considers itself to be an updated version of Ethereum. Its ADA token, designed to allow owners to participate in the operation of the network, fell 3% to 48 cents and is 3% down over the course of a week.

The XRP token of Ripple, a payment settlement asset exchange and remittance system, acts as a bridge for transfers between other currencies. XRP shed 4% to 34.5c but its price is 6% up on seven days ago. It has climbed back above Cardano in the valuation table by market cap.

Solana is a blockchain built to make decentralised finance accessible on a larger scale – and capable of processing 50,000 transactions per second. Its SOL token lost 6% to $37.79 yet is 2% up compared with its price a week ago.

Meme coin DOGE was created as a satire on the hype surrounding cryptocurrencies but is now a major player in the space. DOGE shed 8% to 7.1c, leaving it 15% up in a week. 

Polkadot was founded by the Swiss-based Web3 Foundation as an open-source project to develop a decentralised web. Its DOT token, which aims to securely connect blockchains, lost 4% to $7.62 and is 7% down on its price a week ago.

Avalanche is a lightning-quick verifiable platform for institutions, enterprises and governments. Its AVAX token lost 5% to $19.25 and is 9% up in a week.

To see how the valuations of the main coins have changed in recent times – and for round-ups of recent cryptocurrency news developments – click here.

For valuations of the top 100 coins by market cap in US dollars, plus 24-hour price change, see below.



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