Dear Valuable Clients,We aim to present you on a monthly basis some key insights which might be helpful for you.
Overall take-home message:General Conclusion: Bitcoin is currently trading at around $19.800 and we have seen some ups and downs over the past week. The whole financial markets in the past weeks have significantly influenced the crypto-ecosystem. In the 27th week of the year we have seen a strong move into altcoins and Bitcoin had lost about 2% of its market dominance. Meanwhile Bitcoin is back at 43%. We are currently still in the phase of identifying the bottom and there are various different scenarios. The bottoms called out are mainly between $10.000 to $13.000 or between $16.000 and $17.000. At the time of writing the range between $16k and $17k seems to be more likely. Still at this point not all parameters are fully clear and the market will need some more time to make the big next move out of the current crypto winter.
1) What happened last month?We have seen Bitcoin trading in the range of about $22.000 and $18.000 over the past weeks. The current situation fits into the current financial market meltdown of up to 80% during Q1-2 2022 which triggered several events:The European Union has agreed to implement regulations for Crypto-Assets (MiCA). It has been decided that Proof-of-Work blockchains are not going to be banned, so Bitcoin will be legal going forward. In regards to Stablecoins it has been decided that the issuers need to hold reserves to guarantee the stability of their issued coins. In total these regulations provide some extra efforts to the issuers but as well brings us the long awaited legal security. Note as of today NFTs are not included in this regulation. The Bank of International Settlements proposed to hold 1% of its reserves in BTC which will sum up to a total of $1.8 trillion. Bankmann-Fried’s FTX is currently reviewing to acquire Robinhood with a approx. market valuation of $7 billion. Crypto brokerage Voyager Digital files for Chapter 11 bankruptcy protection.MicroStrategy acquired another 480 Bitcoin for $10 million. With that the company now owns a total of 129,699 BTC worth roughly $3.98 billion.Binance signed a contract with Christiano Ronaldo whose aim is to create a series of NFT collections for sale exclusively on the Binance NFT platform. The first collection will be released later this year and will feature designs created in collaboration with Ronaldo. Binance also plans to open offices in Zug, Switzerland, Germany as well as in other EU countries.Vasil Hardfork, Cardano is a project that is worth looking into. The update aims at bringing significant performance and capability upgrades by improving script performance and efficiency while at the same time lowering cost.Transaction Fees on ETH have been lowered significantly according to Bitinfocharts as they are now at an average of $1,67 – compared to May where gas fees were still around $30. That is a good evolution for traders and users.
2) Where do we stand?Overall the community seems to lose the negativism and it seems like we are starting to see the light at the end of the tunnel. So far we have seen drop waves in this bear market and according to historical data there normally are five. With that being said, following various open source data there might be the risk of seeing another drop either towards $ 16k to $ 17k but we also have seen people calling or in the range between $ 10k and $ 13k. We need to follow the trend closely and make the right decisions.
3) Outlook: What could happen?Currently we do see a strong sideward trend and it is still hard to predict where we are heading to. As mentioned in the past we are still not out of the bear market and are still waiting for positive market impacts. Even by receiving more and more positive signs we still have to be patient until we have clarity where we are heading to. During the weekend of 9th to 10th July we might have gone through the missing 5th downwards trend before seeing the big relief. With that being said we still will most likely see a sideward trend for the next few weeks. Predictions throughout the market show that we might need to plan with a rally before the end of the year. The current sentiment is around a strategy that fall and winter might be the right time to take profits.
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What do you need to know ahead of the Cardano Vasil Hard Fork?Cardano Vasil Hard Fork will be a major upgrade on the Cardano Blockchain. This in the past has most of the time been a price driver. On 3rd July IOHK announced that the testnet will go live, while the mainet will go through the upgrade 4 weeks later. Here is all you need to know about the upgrade.
Binance – An outstanding Exchange?According to an interview with Binance CEO Zhao they are in a very strong financial position and are currently looking into supporting more than 50 companies which were hit by the bear market. Binance is currently hiring around 2000 people until the end of the year, as during the bear market there is not a lot of competition out there searching for talents and being able to pay them adequately. Zhao points out that Binance does not have any kind of debts and that the exchange is still profitable.Binance does have a very healthy balance sheet as they did not spend huge amounts of money during the bull market on naming rights or Super-Bowl adverts. Just a few days ago Binance secured the Virtual Asset Service Provider registration in Spain.
The Graph – Google for Blockchains?What is The Graph?With the large number of Layer 1 blockchains currently being operated and more being built, the need for a decentralized blockchain search engine (think Google for blockchains), providing reliable and neutral access to on-chain information, is ubiquitous. The Graph, launched in 2020, aims to fulfill this need. The Graph is a decentralized protocol indexing and querying data from currently 26 blockchains. Just as Google indexes the web, The Graph indexes blockchain data from networks like Ethereum, Filecoin (IPFS), Aribtrum, or Avalanche to make this data easily accessible for all. In January 2022, The Graph raised $50 million in a funding round, giving it a valuation of $2.3 billion.
What are Indexers?Instead of indexing services being provided by a centralized company like Google, The Graph offers a fully decentralized indexing process. Data on The Graph Network is processed by a decentralized network of node operators called Indexers. This data then is grouped into so-called subgraphs that anyone can query. Indexers compete to provide the best indexing query processing at the lowest price.Anyone who holds The Graph Tokens (GRT) can help secure the network by delegating their GRT to Indexers of their choice. By delegating GRT, token holders can earn rewards and help Indexers process more data.
What are Curators?Like traditional search engines, The Graph Network has to determine what data is accurate and useful to users. This is where Curators come in. Every curator can propose subgraphs and deposit GRT to signal which subgraphs they think are the most useful, highest quality or should be indexed by Indexers next. Curators then get a portion of fees for these subgraphs. By accurately assessing which subgraphs are most valuable and likely to produce query fees, Curators are able to efficiently allocate resources on the network and help organize the data in an ordered way.
How to choose an Indexer on The Graph NetworkIf you are interested in delegating GRT on The Graph Network, you’ll want to know which Indexers are doing a good job so you’ll earn the best rewards. The best place to start is The Graph Explorer. On the Graph Explorer you can see all the Indexers, how much stake is delegated to them, and how they are performing. Indexers choose which subgraphs to index and how to allocate their stake across those subgraphs. These decisions impact the Indexing Rewards they earn.Indexers also set their prices per query. Make sure to see how many fees Indexers are earning as that impacts how much you make as a Delegator. By choosing Indexers that are providing high quality query services you can earn more rewards while securing and helping allocate resources on the network.
Invest in GRT
Investors not wanting to delegate their GRT can simply store the tokens in their wallet. But be aware: Of the GRT 10 billion hard cap, only 4.72 billion GRT tokens are currently in circulation. Thus, over the next few years, GRT token holdings will get diluted if not delegated to an Indexer. Nevertheless, should The Graph Network prove to be successful, the capital gains should far outweigh the token dilution.
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