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Crypto bear market guide: how to beat the beast

The crypto market is continuing its extended winter slump, with the price of Bitcoin and other cryptocurrencies staying at relatively low levels, especially compared with the all-time highs they saw towards the end of 2021. Hodlers who were looking to cash out at this time may find themselves wondering whether to cut their losses or hodl on for dear life until the next bull run, but is there a way to make money on the bear market? As any experienced trader will tell you, there certainly is. Trading tactics for crypto bear markets are similar to those used in the stock market or on fiat currency financial exchanges. In this article, we'll talk about some strategies for bearish times.

Shorting

A short call or option is trading terminology for basically betting on an asset's price going down. The term hit the mainstream thanks to Michael Burry and his 'Big Short' strategy. Burry saw the signs of the dot-com crash, and later, the subprime mortgage crisis, and bet against overvalued companies in both cases, shorting their stocks and winning value for his hedge funds in the bear market. Just like with companies' stocks, a short strategy can also be carried out for a profit with crypto during a bear market.

So, how can crypto be shorted? StormGain offers a few different ways. A StormGain client recently had some success with this strategy. Predicting that the market downturn would continue, our client decided to open put options on Bitcoin (BTC). Even when the price of BTC dropped below $37,000, our client reserved the right to sell at the strike price of $40,000, marking a profit of $3,000 per BTC from the downturn.

Even without using put options, profit can be made in a bear market by short selling. This is when you sell an asset and wait for the price to drop before buying it back, keeping both your asset and the price difference as profit. The most famous example of short selling comes from George Soros, who made a short sale on the pound in 1992. Soros' fund bought and sold every pound it could get its hands on, throwing the Bank of England into chaos before buying back the pounds after their value dropped and keeping the $1 billion difference in profit.

Short-selling cryptocurrency works the same way. In fact, crypto's high volatility can make short selling especially effective. Take Shiba Inu (SHIB), for example. One StormGain user opened a short position of SHIB at $0.00006129 per coin and closed it at $0.00002055. He made thousands of dollars in profit and told about this success in his social account.

Buying the dip

If you don't feel comfortable betting against crypto, you can still use the bear market to bet on crypto's success in the long term. In the 'buy the dip' strategy, price drops are not disasters but rather signs that it's time to accumulate and hodl until the next bull run. In that case, price drops are a chance to pick up more assets for the portfolio at a discount while they are 'on sale' and wait until they are profitable to withdraw.

Shorting, hodling and more with StormGain

A bear market can be just as much of an opportunity to make money as a bull market, just using different strategies. StormGain provides all the tools you need to profit in both rising and falling markets, thanks to our advanced analytics and easy-to-use platform. Don't forget that the StormGain Bitcoin cloud miner continues to reward active users with Bitcoin, regardless of market conditions! To find out how to profit from the crypto bear market with StormGain, sign up in just a few seconds and open a demo account to try out these strategies risk-free in simulated real-market conditions!

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Why AXS's 51% growth in 4 days is only the beginning for this token

Over the last four days, the cryptocurrency market has come to life as total capitalisation rose by 15%, while Bitcoin shot up 18%. Out of all the altcoins, AXS has done particularly well following the Axie Infinity team's decision to reconsider its economic model in favour of reducing inflationary pressure.



Axie Infinity is an incremental online card game that allows players to earn money. The game uses NFTs (non-fungible tokens) that represent creatures (Axies). Players can enhance their Axies' skill sets through battles and even buy and sell the characters themselves on the in-game exchange using the AXS token. The game became so popular in 2021 that it was #1 in terms of transactions and #3 in terms of turnover on the NFT marketplace.



In order to attract as many new players as possible, the developers pay out in-game tokens known as Smooth Love Potion (SLPs) for completing quests, campaigns and player-vs-player battles (PVPs). Users, on the other hand, burn tokens on Reconnaissance campaigns and other in-game actions. The problem is that SLPs are generated at around four times the rate that they're burned. This leads to an economic imbalance and inflationary pressure, which threatens the token's "unavoidable economic collapse", according to the project's developers.



After discussing the problem with users, the Axie Infinity team announced on 3 February that it would be making its economic model more hawkish. As such, it will be removing the rewards for daily adventures. This measure will enable it to slash its daily token issue to 130 million SLP. A further 45 million SLP per day will be done away with by cancelling remuneration for daily quests. The update will also change how PVPs work, and rewards are reduced if bots are found to be used.



As of November 2021, SLP has been trading below its list price, reaching a low of $0.009 on 3 February. Once the announcement about these changes to its monetisation, the token's capitalisation shot up 35%, while its daily turnover skyrocketed 400%. The rise in the value of these in-game coins will increase spending on building characters and their value. If the game remains as popular as it currently is, this will, in turn, lead to increased demand for the ASX token.


StormGain analytics group
(cryptocurrency trading, exchange and storage platform)

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What happened to the crypto scammers who stole 119,754 Bitcoin ($4.5 billion in today's prices) from Bitfinex?

Cryptocurrencies provide their users with super anonymity, something that scammers the world over use to their advantage. In actuality, the majority of networks (Bitcoin included) store full transaction history. This enables investigators to unravel even the most labyrinthine of trails from among thousands of transactions and dozens of user records.

It was recently revealed that US authorities had arrested couple Heather Morgan and Ilya Lichtenstein on charges of fraud, money laundering of illegally gotten funds and crimes against the United States. The Department of Justice has already made the biggest bust in its history, seizing coins worth ₿94,000 ($3.6 billion in today's price) stolen in the Bitfinex heist.



The Bitfinex robbery took place in 2016 and involved 2000 transactions to an external wallet with the ID 1CGA4s5.... Hackers were able to walk away with ₿119,754, which was worth $71 million at the time. In a bid to hide their tracks and cash in the coins, over the ensuing years, the fraudsters created numerous accounts on the darknet site AlphaBay and several accounts on various crypto exchanges using made-up names or false identities.



To hide their transaction history, Lichtenstein and Morgan made transactions from one account to another, often favouring coins with higher levels of anonymity, such as Monero. However, as is usually the case, they left crumbs of evidence here and there. For example, when creating accounts on one crypto exchange (VCE1), the scammers used similar e-mail addresses hosted with providers based in India. After being asked for additional documentation by the exchanges, Lichtenstein and Morgan went silent, which led to 18 accounts with total funds of $186,000 being frozen.

The stylistic similarity of the different accounts enabled investigators to go over the chain of transactions one by one until they established a link. Several of these were transferred to accounts opened in 2015 under the name of LICHTENSTEIN on a US-based cryptocurrency exchange (VCE5).



Since Lichtenstein used his driver's license to open accounts on the US crypto exchange, investigators were able to ascertain the suspect's identity along with other profiles and accounts in the United States. It emerged that Lichtenstein had created a fictitious company named SalesFolk that had been allegedly accepting cryptocurrency as payment for the provision of services. Further analysis of the transactions confirmed a direct link between the funds stolen from Bitfinex, which had flowed through an elaborate chain into Lichtenstein and Morgan's bank accounts.

At one time, the fraudsters started to believe they were invulnerable and started using Cluster 3686mu to make purchases with cryptocurrencies, cutting the chain short in the process. For instance, on 3 May 2020, a Walmart gift card worth $500 was purchased using the account. The IP address used was altered, but security services sent a request to the cloud provider to reveal the owner and their e-mail address, which led directly back to Lichtenstein. A new iPhone was also purchased and delivered to the couple's home address.



Once sufficient evidence had been gathered against the couple, the security services secured a search warrant against the network provider and requested copies of all personal documentation held on the cloud. After the encrypted files were deciphered, investigators received access to all the crypto addresses in the chain, as well as their respective private keys. This enabled law enforcement to withdraw the entire remaining funds to DoJ-held accounts without the fraudsters' knowledge.

As it stands, the evidence collected is insufficient to prosecute the duo for the Bitfinex heist, but investigators are hoping to secure a plea deal in light of the 20-year prison term that Lichtenstein and Morgan face on the other charges.


StormGain analytical group
(cryptocurrency trading, exchange and storage platform)

[stormgain]

Inflation will see Bitcoin rise to $150,000

Due to the unrestrained monetary policy of a variety of financial regulators and rising global inflation, the leading analytical agencies are once again comparing Bitcoin to gold. Unlike fiat, gold and Bitcoin both have limited reserves.

For the past two years, the US dollar money supply (M2 monetary aggregate) increased by 38%, while the Fed's balance sheet has swollen by more than 200% through various Treasury and commercial bond purchases. Simply put, the regulator was printing additional money in order to cover state expenditures.



It's unsurprising that US inflation is currently at a 40-year high, having reached 7.5% in January. For virtually the entirety of last year, Fed chair Jerome Powell had been calling rising prices "transitory", covering his eyes to the causal link between central bank policy and inflation. That's what prompted famous gold bug Peter Schiff to post the following Tweet: "Because the #Fed has no ability to fight #inflation without crashing the markets and the economy it pretended that inflation was transitory to justify its failure to start a fight. Now that it stopped pretending inflation is transitory [it's] now pretending [it's] prepared to fight it!"



Schiff suggests that the only refuge from price rises is gold, while JPMorgan has noted increased institutional demand for Bitcoin as a hedge against inflation. The amount of gold on the planet is limited, and mining it becomes more and more labour-intensive with each passing year. The same is true of Bitcoin: the rising number of miners means that calculation difficulty is constantly increasing, while total reserves are limited to 21 million coins. Beyond these factors, cryptocurrency has an in-built deflationary mechanism known as halving: every four years, the mining reward for each block is reduced by 50%. This is in stark contrast with national currencies, which can be printed ad infinitum to fill budget holes.



JPMorgan's long-term Bitcoin price target is $150,000. The cryptocurrency will only reach this level when its market capitalisation ($818 billion) is equal to that of gold ($11.6 trillion). According to analysts, high volatility is Bitcoin's biggest flaw and the primary factor delaying this process.

Bank of America shares more or less the same opinion with regard to the shift in investor interest from gold towards Bitcoin, noting reduced volatility in the cryptocurrency over time.



Rising capitalisation and falling volatility are interconnected processes. As the market matures and the number of participants grows, both decentralisation (stability) and capitalisation will increase. At the same time, a legal framework is beginning to take hold in the crypto industry. All of this provides inertia that will make Bitcoin less volatile.


StormGain analytical group
(cryptocurrency trading, exchange and storage platform)

[stormgain]

Launderers who took Bitfinex for $5.2 billion planned to flee to Ukraine

From our previous article detailing the calculating methods of this fraudster couple, the thing that surprised our readers the most was their utter fecklessness. For one thing, who buys gadgets with stolen crypto and then has them delivered to their home address? However, the latest revelations from their trial would suggest that Lichtenstein and Morgan simply didn't manage to pull off their plan in full.



US citizen Heather Morgan studied monetary policy at Bilkent University in Turkey, going on to pursue an MA at the American University in Cairo after graduating from her Bachelor's course. Ilya Lichtenstein, for his part, has dual US and Russian citizenship. Relocating abroad wouldn't have been a big deal for this couple at all, but what they were actually planning was to escape the watchful eye of Big Brother for good.

The investigation's deciphering of Lichtenstein's personal archive led to a file entitled "passport_ideas", which contained links to various counterfeit passport sellers on the darknet, as well as plans, scanned documents and user account records from Yandex.Money (YooMoney as of September 2020). The couple visited Ukraine in 2019, after which the files with counterfeit documentation were edited multiple times. A transcript showed how one seller had offered to check the status of the document via the Ukrainian Federal Migration Service: nd.dmsu.gov.ua.

Another file revealed in detail methods of receiving mail anonymously via the Ukrainian postal service, including information on the locations of video surveillance cameras in post offices. A search of their apartment found a bag labelled "burner phone" and a Kievstar SIM card.



Investigators used these grounds to have a New York court's decision to grant bail overturned. After several hours, a District of Columbia judge approved the request due to Lichtenstein and Morgan being significant flight risks.

The Bitfinex crypto exchange heist saw 120,000 bitcoin stolen, which was only worth $70 million before 2017. This explains why the pair only began taking active steps to hide their identity in the last four years.



This story will soon be the subject of a TV drama: Netflix has ordered a multi-year series on the motives behind "the biggest financial crime in history". It's possible that TV decides to give Lichtenstein and Morgan a less mundane ending.


StormGain analytical group
(cryptocurrency trading, exchange and storage platform)

[stormgain]

Cryptocurrency recognition on the rise: from Belarus to the NYSE

The media is positively febrile with reports of the Federal Reserve's impending monetary tightening, with a correction forecast for the entire financial sector, including stocks and crypto. However, because of its relative youth, the cryptocurrency market's level of adoption will prove a more influential factor than the strength of the US dollar or cheap price of credit.



While the debate in Russia continues between the central bank and Ministry of Finance as to the status of cryptocurrencies, the Republic of Belarus is putting the finishing touches on a legal and regulatory framework for the circulation of crypto assets. As such, a government decree dated 14/02/2022 provides for the creation of a registry of virtual wallets used for criminal activities.

"Belarus is seamlessly developing a legal and regulatory framework for activities associated with digital assets, and in contrast to many other governments, it permits the free circulation of digital currencies. At the same time, this requires constant monitoring of the situation and, where necessary, supplementation and clarification of regulatory standards".

The cryptocurrency sector's emergence from the shadows began on 21 December 2017 with the signature of Decree No. 8 "On the development of the digital economy". Several licensed cryptocurrency exchanges currently operate in Belarus, while the tax holiday on these assets has been extended to 1 January 2023.

Also in 2017, JPMorgan CEO Jamie Dimon called Bitcoin "a fraud". However, just one year later, the bank began testing its own crypto platform before releasing JPMCoin shortly thereafter. In 2022, JPMorgan became the first credit institution to open an office in the Decentraland metaverse. "In time, the virtual real estate market could start seeing services much like in the physical world, including credit, mortgages and rental agreements," said a recent JPMorgan report.



The New York Stock Exchange sees just as much potential for development in the crypto industry, too. On 10 February, the NYSE sent an application to the US Patent Office to register a trademark for an online NFT marketplace. It would appear that the exchange is planning to launch a competitor to OpenSea, Rarible and Magic Eden. The NYSE's interest has no doubt been influenced by the phenomenal growth of the NFT market from $33 million in 2020 to $12.5 billion in 2021.



Bitcoin had a bullish year in 2021, and net investment inflows into crypto funds reached $9.3 billion (a 36% YoY increase). All that happened despite the ban on crypto transactions and mining in China (the world Bitcoin hashrate leader). After all these trials and tribulations, the Fed's rate hikes are unlikely to pose a significant threat to the cryptocurrency market.


StormGain analytical group
(cryptocurrency trading, exchange and storage platform)

[stormgain]

Metaverse starter kit: what you need

The metaverse continues to generate hype as a vehicle for crypto investment and projection for the future of the internet, but there's actually a lot you can do with it right now. Multiple virtual worlds already exist for gaming, business, socialising, creativity, investing and more. Because the modern concept of the metaverse proposes cryptocurrencies for governance and virtual economies, exploring the metaverse can be a great way to meet and connect with like-minded people, i.e., crypto enthusiasts, gamers, tech enthusiasts, innovators, etc. So, what do you need as an early adopter to enjoy the metaverse today?

Virtual reality headsets

To have the most immersive metaverse experience, a VR headset is a must. Although this hardware sector is seeing an increase in sales and adoption thanks to interest in the metaverse, it's actually been around for a few years. Now, however, it's now much more accessible to the average consumer. Higher-end VR kits tend to cost around $1,000 and require setting up base stations in the room you intend to use them in, not to mention a powerful PC to provide the best graphics. For that price, you'd be well-equipped for the most visually impressive, smooth metaverse experience possible. However, there are more affordable models around the $400-$600 range that have built-in tracking cameras and don't necessarily need to be tethered to a computer. These sacrifice some visual and tracking details for convenience but are a good way to start in the metaverse while we wait for the top-level tech to be refined.

Whatever your entry point, a VR headset and controls will allow you to experience the most exciting part of the metaverse — interacting in virtual spaces with your own hands and eyes, picking up virtual objects, walking around digital land and buildings, playing games and, of course, interacting with other people's avatars.

Your smartphone

For those to whom full VR immersion seems too uncomfortable or expensive, there's still a lot of metaverse interaction to be had through the handy piece of hardware that we all carry in our pocket. And no, we're not talking about strapping your smartphone screen to your face with a cardboard frame. Thankfully, smartphone-based VR is no longer something that companies are trying to push on us. Instead, you'll want to look at your smartphone's AR capability. AR, or augmented reality, is kind of like VR's little sibling. It uses your smartphone camera to overlay digital objects over the real world. This technology saw its biggest success in the last decade with the global phenomenon that was Pokemon Go, and when it comes to showing off your NFTs or blockchain multiplayer games, AR still has huge potential for another hit, letting you view metaverse elements without wearing clunky VR glasses.

Even without AR, many metaverses also allow access via mobile apps. Even digital lands and VR chat rooms can be browsed from your smartphone in a limited form. Although you'll miss some immersive and interactive elements, the everyday smartphone still offers easy metaverse access.

A meta identity

The cyberpunk sci-fi stories that inspired the concept of the metaverse had their protagonists escape from reality in virtual worlds, and that came complete with virtual identities. Online usernames and profile pictures have always been a part of the internet, but the metaverse takes it to a new level. You may have to consider the look of a full-body life-size avatar! If you're looking to build a brand or business in the metaverse, even with the power to look like whatever you want, you might want something that is consistent and appealing. Put some thought into your online appearance (and your name) and how it could be represented across multiple platforms. Will it be realistic? Fantastic? Based on your prized NFT or favourite crypto meme?

A place to hang out

We all have our favourite places to relax and socialise in real life, and the metaverse is no different. Different metaverse platforms have different expectations, social rules, and 'atmospheres'. Browse the available apps and think about your preferences. Do you prefer to play online games with others or hang out and share memes with weird avatars in VR chat rooms? Perhaps you prefer to spend time chatting with metaverse investors in their houses built on plots of virtual land? Whatever you choose, the interaction with others will elevate the metaverse over just another VR game.

NFTs

NFTs are becoming popular as speculative assets and digital collectables, but the metaverse is where owning a digital object will actually mean something—clothes, homes, weapons, etc. As such, the early days of the metaverse represent an opportunity to claim items that could become more rare or valuable later. Ideally, the NFTs you acquire should have some value in the community of the metaverse you acquire them from so that you don't have to rely on speculative marketplaces.

Metaverse tokens

Metaverse tokens are cryptocurrencies used in the metaverse, but which one? Although many metaverses may use tokens for purchasing digital items, player rewards and contracts or for governance rights, the fact is that digital tokens are often not interoperable or exchangeable between platforms. For the time being, they have to be exchanged with more commonly used cryptocurrencies or fiat currencies. Although metaverse tokens can usually be acquired in the platforms (e.g., through play-to-earn models or as an early adopter bonus), they can also be purchased outright for an advantage.

Get a head start in the metaverse with StormGain

Getting your hands on the right metaverse tokens in the early days can be key to profiting from the next evolution of the internet before the market becomes crowded. StormGain offers the best conditions for buying, selling and exchanging some of the most interesting metaverse currencies right now. Trade SHIB, AXS, ENJ and more with high leverage, low commissions and fantastic perks. New to StormGain? Sign up in just a few seconds and find out what the world's best crypto platform can do for you!

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Is the supercharged NuMiner 440 ASIC an investor illusion?

On 3 February, Sphere 3D announced it was buying a new fleet of highly efficient NM440 ASICs for $1.7 billion. After this information was released, the company's share price shot up 40%. However, the latest information would suggest that this is nothing more than an illusion, "the presentation of something that is within reach, tangible, but which does not in fact exist". In the event of the immediate expansion of its computational arsenal, Sphere 3D will become the biggest publicly traded Bitcoin miner on the planet with a 16% share of the global hashrate — a promise that had many investors sold on the company.



The announced energy efficiency of the NM440 is 20.2 joules per terahash, which is 4.5 times better than existing models and 36% better than the Antminer S19 Pro+ Hyd, which is due to go on sale in early autumn. The S19 Pro+ Hyd owes much of its positive energy efficiency characteristics to its water-cooling technology. It is thus unclear how the NM440 will deal with heat transfer given its apparent lack of a water coolant circuit.



All that the crypto community has actually been able to get its hands on is marketing hype and a graphic mockup of the fabled ASIC. But this appeared to have been stolen from Cerebras, and the presentation model even revealed the sign of another firm's logo. Following complaints, NuMiner deleted the image from its website, saying that it was "drawn for marketing purposes".



CoinDesk has sent several requests for comment to the technical partners and laboratories named in the presentation. Taiwan Semiconductor Manufacturing (TSMC) could not find NuMiner in its list of direct clients, and Xilinx reported that it had supplied five chips through its distributor network. Xilinx later demanded that NuMiner delete its logo and other mentions of the company from its website and presentation.

It also looks like a similar story with the laboratory that supposedly performed full-scale testing on the ASIC. The presentation named TÜV Nord as the BACnet certifier, but the German institution refuted these claims. NuMiner then admitted that there was a mistake in its promotional materials, and the laboratory that actually performed the BACnet certification was BTL Inc. However, BTL was also unable to find the NM440 in its list of tested equipment and requested to see the report's ID number.

It's still too early to make any definitive conclusions. Perhaps NuMiner made a mistake in their presentation or was afraid to reveal its unique design in the form of a photograph, or maybe the laboratory was the one to blame for the misunderstanding. But it isn't just the headline-grabbing results and the announcement of the biggest deal in the history of mining that is casting the shadow of doubt on the company. Legal trouble involving one of Sphere 3D's subsidiaries and the indictment of two of its directors on charges of "securities fraud" and "misrepresentation of information to investors" are also matters of concern.

Will this super-efficient ASIC see the light of day, or has it all been nothing more than window dressing? Investment firm Volt Equity is so certain that it will be option two that it has opened a short position on Sphere 3D.


StormGain analytical group
(cryptocurrency trading, exchange and storage platform)

[stormgain]

Bitcoin accumulation is close to its record high of 60%

For any state currency, leading growth factors are a strong national economy, high demand for goods from abroad, international authority and the confidence of its citizens in the future of the country. The future of decentralised currency Bitcoin is not dependent on national ties, which is why the key driving force behind its growth is the faith of the community, propagation rate and crypto adoption.



Since Bitcoin is recognised as a store of value by most analytical agencies, one of its key metrics is coin accumulation. The more people believe in future price growth, the more they will actively hold Bitcoin in their wallets. According to the latest data from Glassnode, the share of coins that have not moved in one year or more exceeds 60%.



The longer coins remain motionless, the duller the colours used to show them on the chart are. Every subsequent correction (i.e., the sell-offs of 2018 or 2021) causes a reduced supply flow to cryptocurrency exchanges since fewer and fewer coins are changing hands. Mining is still going on, but 90% of all coins have already been mined.

Due to the overwhelming HODLer sentiment, crypto exchanges are seeing capital outflows of 42,900 BTC per month.



However, accumulation and faith in a bright future alone are not sufficient to turn the tide from correction to growth. Investors have been presented with several challenges in 2022: monetary tightening from the world's biggest regulators, an escalation of the conflict on the Russia-Ukraine border and rising inflation across the globe.

And the data suggest that an exit from the current correction is unlikely. As such, Peter Brandt projects that Bitcoin will hit a new all-time high in the next 21 to 40 months.



If Brandt is correct, we won't see a new all-time high before August 2023.


StormGain analytical group
(cryptocurrency trading, exchange and storage platform)

[stormgain]

Is Web3 the Key to Mass Crypto Adoption?

Web3 is one of the most bandied-about buzzwords in the tech sphere right now, especially in the crypto space. If you believe the hype, this upcoming blockchain-based upgrade of the Internet is what will move cryptocurrencies, NFTs, DeFi and VR from niche environments to mainstream adoption. Web3 is being promoted not only by forward-thinking startups but by big tech giants such as Meta. Although we're still in the conceptual stage, the involvement of major players confirms that something is definitely developing in this area. So, what exactly is Web3, and why is crypto essential to it?

What even is Web3, anyway?

The Internet as we know it now, or Web2, has certain issues, especially with privacy and the undue influence of huge, near-monopolistic companies. It's a far cry from the anarchic early days of the technology's conception, which was a vehicle for largely anonymised free sharing of information and user-generated content (as in, users would make their own websites, communities and platforms, not provide content for existing social media platforms). Today, a large section of the Internet is captured by platforms that extract value from the data and content made by their users.

Web3 can be seen as an attempt to break the control of mega-platforms and empower individual users and organic communities. Effectively, we're talking about building a decentralised Internet based on privacy, peer-to-peer sharing and democratic governance outside of powerful platforms or intermediaries. Does that sound familiar?

Where crypto comes in

The crypto space already provides models for this kind of organisation, made possible by blockchain technology. For example, the use of crypto tokens for governance used in DeFi and DAO projects, smart contracts for collaborations and encrypted but publicly-accessible blockchains for security and privacy. Blockchain provides the necessary tools to build trustless, direct peer-to-peer collaboration and democratic control of platforms. It's also impossible for a single entity, even a large one, to completely take it over.

Add to that the fact that Web3 also includes the development of 3D digital environments and VR/AR interactivity, and crypto becomes even more useful for Web3. NFTs can track ownership and rights to digital objects and let users conduct business with them. In a truly free Internet, even crypto tokens as currency can limit the influence of governments and banks, making the Internet less vulnerable to, for example, political crackdowns and sanctions. This scenario lines up neatly with the ideology behind the creation of Bitcoin (BTC): to create a digital peer-to-peer medium of exchange outside institutional control.

With the transition to Web3, the use of crypto will have evolved far beyond the limited capability of Bitcoin today. Almost 5 billion people use the Internet every day, and in the 10+ years it would likely take to implement Web3, this would mean billions of people using blockchain and crypto as part of their daily lives. This can include the use of crypto as payment to peers around the world, for governance in online platforms or as NFTs for the metaverse avatars and lands.

Some cryptocurrencies already involved in Web3 use cases include Filecoin (FIL), Chainlink (LNK) and, of course, Ethereum (ETH), all available on StormGain along with 40+ crypto instruments.

Can mainstream crypto adoption happen without Web3?

Crypto has reached a new wave of popularity since the COVID-19 pandemic, but there are only so many people who will be attracted to crypto for pure speculation, and this interest will eventually peak.

To truly go mainstream, crypto needs to offer the masses a use case beyond trading for profit. As it currently exists, crypto also suffers from serious scalability issues, a problem that most new blockchain projects cite as one of their major goals to solve.

To overcome the issues of adoption and scale, a large number of resources, both monetary and human, need to be applied to the problem, and that will only happen with a desirable end goal, such as Web3.

These are still the early days, and there will be many competing visions of Web3s development, including from Meta and other big tech platforms that the more privacy-oriented elements of the crypto community will be wary of. Governments that wish to foster the development of the tech sector in their own countries while seeking to regulate crypto operations will also play a part. Whatever the eventual result, all agree that blockchain and crypto will be at the centre of the project.

How to prepare for Web3

The long-term investor should ask themselves, "What will the crypto ecosystem look like in the next decade? Which projects are likely to survive and develop promising use cases?" It will be important to keep an eye on the crypto market, tech industry news and governmental regulation to judge the changing situation and make trades accordingly.

StormGain provides the best perks for trading crypto pairs in both rising and falling markets, with cumulative loyalty rewards, analytics and even a free Bitcoin cloud miner all in one easy-to-use app. Whether you're looking to bet on the future of Web3 or build a crypto portfolio to profit from, try StormGain today and see what the best crypto trading platform can do for you!

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BTC/RUB close to all-time high

The sharp decline of the Russian rouble has provoked a frenzy on the crypto market: on 1 March, the daily BTC/RUB turnover reached 1.5 billion roubles, with one Bitcoin now costing 4.4 million roubles.



The stablecoin Tether is seeing similar demand growth, and the daily volume of USDT/RUB is now in excess of 1.3 billion roubles. Robust demand for cryptocurrencies from Russian and Ukrainian users has seen Bitcoin rise 29% from February lows.



Global data also suggest that further growth is on the horizon for Bitcoin: despite a significant pullback from all-time highs, exchanges are not seeing major inflows of cryptocurrencies of the kind that would signify a sell-off.



The biggest losses have been sustained by investors who bought Bitcoin during the last three months. For long term HODLers, this correction is no reason to exit the market. What's more, HODLers are continuing to increase their volumes, with the number of BTC that haven't moved in the last three months currently sitting above 335,000. The last time we saw this level was in June-September 2021, and it was then followed by a new rally.



In its note to investors on 25 February, Bank of America pointed to the unlikely onset of a "crypto winter", despite impending monetary tightening measures from the US Federal Reserve. Adoption and user activity are both on the rise, which will help increase the crypto's market capitalisation over the long term.

We would also be remiss not to discuss rising global inflation, which is pushing up energy prices and perpetuating disruptions in the supply of raw materials, replacement parts and electronic components. As Bitcoin returns to the $50,000-$60,000 range, people are beginning to speak of the original digital currency as an inflation hedge.


StormGain analytical group
(cryptocurrency trading, exchange and storage platform)

[stormgain]

A Top 10 coin is preparing to hit a new all-time high

Individual market participants’ warnings of a coming ‘crypto winter’ have yet to subside as one promising network has moved to seventh place by market capitalisation, and its token is on the cusp of setting a new all-time high (ATH). The coin? LUNA (Terra).

LUNA is the native coin of the Terra project. It has a floating exchange rate and is algorithmically linked to the network’s stablecoins, such as UST. If demand for stablecoins increases, LUNA validators receive an additional reward. With a drop in demand and excess coins, the system burns part of them. Algorithmic stablecoins are seeing increased interest in them since their issuance is not tied to the issuer’s whim. In other words, more of them can’t be ‘printed’ to extract more profit.



LUNA’s drop in value during the winter was due to the crypto market’s overall correction as well as with problems with one of the project’s partners, Daniele Sestagalli. In January, the public became aware that Sestagalli had hired Michael Patryn (aka Omar Dhanani), who had been repeatedly convicted of fraud, as Wonderland’s financial manager. We discussed the scandal in detail in an article. Because UST was indirectly affiliated with Wonderland, it was also sold off and stress-tested.

LUNA’s current growth is due to both confirmation of the network’s resilience and increased interest in the Anchor DeFi platform. Anchor is built on the Terra blockchain and offers passive income for staking stablecoins. Over the past six months, Anchor’s total value locked (TVL) by users has risen from $2.5 billion to $11.7 billion, propelling Terra into second place in the overall DeFi standings this year, behind only Ethereum.



In terms of total market capitalisation, Terra has risen to seventh place this year, threatening to overtake Ripple in the coming days. In addition, UST holds first place among algorithmic stablecoins, with a market capitalisation of $13.4 billion.



Ripple and Terra both have the same goal: both projects aim to become the key link between fiat and cryptocurrencies. The primary difference between the two is that Ripple is a centralised network burdened by complaints from US regulators. Terra, on the other hand, is a decentralised blockchain protocol with algorithmic stablecoins.


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Ethereum's DeFi market domination is under threat

Thanks to smart contracts, the non-fungible token (NFTs) and decentralised finance (DeFi) segments of the crypto economy came into existence. Ethereum enjoyed wide use as the first blockchain with full-fledged smart contract support. However, as smart contract adoption and integration grew, the burden on the network rose to critical levels. This led to a record rise in commission market-wide.



Ethereum is based on a proof-of-work protocol, where miners are responsible for a cluster of transactions in the block. It takes an average of 13 seconds to insert a new block into the network. Since each block contains 100-200 transactions, this equates to around 12 transactions per second, which doesn't meet current user needs.



The slow network speed and high commissions led to the emergence of competitors who ditched the clunky proof-of-work model for a proof-of-stake protocol. For example, the Terra blockchain processes over 1,000 transactions per second with a commission of 0.1 to 1.0 SDR (1 SDR = $1.40). This year, Terra stormed to second place in the DeFi market in terms of the volume of stacked funds, acquiring a 10% market share. Meanwhile, Ethereum continues to lose ground and will soon account for less than 50% of the market.



Ethereum's loss of standing is reflected in the cryptocurrency's value. As such, the LUNA coin from the Terra blockchain has already recovered from its winter correction and is preparing to test its all-time high, while Ethereum's recovery is lagging behind even Bitcoin.



Ethereum remains the only decentralised network with smart-contract support, but its market share is gradually being chipped away by faster blockchains. The transition to proof-of-stake could steady the ship for Ethereum as its two network branches (ETH and ETH 2.0) merge, with this move planned for Q2 2022. However, this development seems to be delayed every year, which is prompting new projects to turn their back on Ethereum as a base blockchain.


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Music in the metaverse? How Snoop Dogg and Death Row could open up a new market

Music NFTs could be poised to disrupt both the recording and crypto industries. This movement is spearheaded by hip-hop legend Calvin Broadus Jr., better known as Snoop Dogg, who may turn the iconic Death Row Records into a non-fungible token (NFT) label, according to comments by the rapper on the social media platform Clubhouse on 15 February.

"Death Row will be an NFT label. We will be putting out artists through the metaverse and a whole 'nother chain of music," said Snoop Dogg in a call via the Clubhouse social media platform in February. "I want to be the first major [record label] in the metaverse".

Snoop Dogg is well-placed to make his ambition a reality. The star rapper recently acquired ownership of the label, just ahead of his Super Bowl halftime performance, where he performed along with fellow hip-hop stars and collaborators Dr Dre and Eminem.

Snoop Dogg gets high-tech

The image of the gangster rapper doesn't fit with stereotypes in the tech scene, but Snoop Dogg has been active in new technologies for a long time. The rapper has streamed video games and made cameo appearances in many. But Snoop's not just playing around. The hip-hop star was also an early investor in RobinHood and Reddit back in 2014 and pioneered making Bitcoin (BTC) a viable payment option for purchasing his albums. In 2013, he also publicly backed Dogecoin (DOGE), naturally.

So it's no surprise, then, that this tech-savvy rhyme smith is making inroads into the NFT space. Snoop Dogg's NFT journey started as a collector. He claims that his personal NFT wallet holds multiple Meebits, CryptoPunks and Fidenza NFTs, with one notable CryptoPunk (no #3831) currently worth $2.57 million on its own.

The rapper has also released several NFT collections using his own image of music. On 9 February, he partnered with Gala Games to launch the Stash Box, an NFT series connected to the songs on his latest album, Bacc on Death Row. The NFTs have already grossed more than $50 million in sales. Earlier this week, he dropped a collection of thousands of Doggie voxel avatars, inspired by his appearance and personal style, in The Sandbox metaverse platform. The avatars are divided into various formats and rarities to entice collectors looking to stand out in the metaverse. Snoop himself has purchased real estate in the Sandbox, where plots of lands can cost hundreds of thousands of dollars.

But it's Snoop Dogg's latest NFT venture — a set of songs on the NFT marketplace OpenSea — that could represent a more significant change for the music industry.

A game-changer for remixes

The NFT collection is a series of 'Mixtapes' with names like Dogg on it: Death Row Mixtape Vol. 1' and  Death Row EDM Vol. 1. The songs are appropriately blockchain-themed, directly referencing Bored Apes, Dogecoin, OpenSea and crypto culture. The audio files are even linked to images from the Bored Ape Yacht Club and Mutant Ape Yacht Club, but the most interesting thing about them is how the tracks are split up.

Versions of new songs are split into files that have only the instrumental track, only the vocal track (a capella), or some combination thereof, whether with parts of vocals or the complete song. Each track version comes with a limited amount of tokens. For example, the vocal track for 'High' has a cheeky 420 tokens.

The description for these NFTs reads: "Own it. Remix it. Master it." Basically, Snoop Dogg is inviting buyers to make and distribute their own remixes for his tracks. The rapper confirmed as much on his Twitter account, saying, "You buy it. You own the rights to it all. Buy the Snoop Dogg beat? Make your own track."

Remixes and samples have been a staple of hip-hop music since its inception, but it has also raised thorny issues of rights and plagiarism, resulting in many high-profile lawsuits in the music industry, and not just with hip-hop. Even star artists like Jay-Z, Kanye West, Kendrick Lamar and Nicki Minaj have found themselves in legal trouble over samples.

A new way forward for digital ownership?

In addition to the issue with unauthorised but artistically important remixes and samples, the recording industry has struggled with online piracy since the beginnings of the digital world back in the 1990s. NFTs offer an opportunity to preserve artists' rights in the digital landscape, so could they also represent a new accord between the producers of a piece of music, the fans and the remixers?

Can purchasers of these NFTs legally monetise their remixes? If Snoop Dogg fully owns his masters, then he would be in a position to give away 100% of the rights to those tracks online. But ownership of an NFT does not legally grant those rights by itself. Some kind of external contract by Death Row records that confirms that these specific NFTs function this way would be required to legally protect anyone trying to make money from their Snoop Dogg remixes.

At the moment, Snoop Dogg's OpenSea customers get a promise, rather than a legal guarantee, with their tokens. But Snoop has said he wants Death Row to become a "metaverse label", releasing NFTs alongside its music. If he is serious about this, then more explicit terms should be released to clarify things for artists and remixers.

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Ripple Labs continues XRP sell-off

Eighteen months ago, Ripple was the third-largest cryptocurrency with a market capitalisation of $28 billion. Between then and now, the network's value has risen to $37 billion, while XRP has slid to sixth place on the leaderboard. This underperformance compared to the wider market is due to a combination of negative attention from regulators and a sell-off by the coin's developer, Ripple Labs.



Ripple Labs has consistently denied any involvement in the issuance of coins. Apparently, developers David Schwartz, Jed McCaleb and Arthur Britto simply donated 80 billion XRP out of simultaneously minted 100 billion XRP. According to data from crypto intelligence agency Messari, the company has generated coins worth a total of $1.2 billion over the past four years. This was not well received by the US Securities and Exchange Commission (SEC), which deemed such a move tantamount to an ICO. As a consequence, the US regulator called for the virtual currency to be reclassified as a security. To this day, the disagreement between the SEC and Ripple has yet to be resolved, and litigation between the two parties continues.

Meanwhile, Ripple continues to use its existing coins to finance its activities. Indeed, the circulating supply of XRP has risen from 40 billion to 48 billion over the past four months, while its exchange rate has declined 50% over this same period. At the same time, around 800 million XRP (~$613 million) were put into escrow and could be added to the circulating supply in the near future.



Analytics agency Santiment has also reported the prevailing XRP correction, stating that every major uptick in search activity relating to Ripple is followed by a correction in its flagship coin. According to their forecasts, the medium-term price target for XRP is $0.55-$0.60.



Beyond increases in supply, the US Federal Reserve's key interest rate hike (to be announced on 16 March) is also putting price pressure on the cryptocurrency. Fed Chairman Jerome Powell has already warned of an upcoming 0.25% increase, but a more significant rate change would mean an even sharper correction for XRP.


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