5 Things Blockchain You Need to Know

for February 1, 2022

Crypto winter: What does it mean, and could it extend into an ‘ice age’?

CNBC

Crypto Winter is coming! We are not sure whether or not the recent steep sell-off is a sign of winter for cryptocurrencies. Experts are divided on the subject. Some believe it could be much worse and that crypto may very well head towards an “ice age,” in which prices remain depressed with many investors abandoning ship at this point. Cryptocurrencies are not immune to the seasonal cycles seen in traditional markets. When negative investor sentiment drives prices sharply down for an extended period, it’s possible that cryptocurrencies will follow suit with their own “crypto winter”. This can happen without any sign of recovery till over a year later — much like how stocks experience bear phases.

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White House Wants Crypto Rules as a Matter of National Security

BARRON’S

Crypto is a matter of national security — so says the U.S government. The administration is drafting an executive order that would have federal agencies oversee and regulate digital assets like Bitcoin and other cryptocurrencies as a matter of national security. The national security memorandum, which is expected to arrive in the next few weeks, would place parts of the government in charge of evaluating digital assets and putting together a regulatory framework that covers cryptos, stablecoins, and NFTs. The National Security Council would also be involved since crypto has national security implications. The administration would urge departments to collaborate on internalizing cryptocurrency rules. Agencies would be given three to six months to submit proposals, and the White House would serve as a policy coordinator.

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DeFi Shakeout Seen as Liquidations Lead to Crypto User Exodus

BLOOMBERG

The crypto market has been particularly devastating for decentralized finance protocols. While Bitcoin is down by more than 45% from its all-time high, DeFi’s sector as a whole has seen steeper losses due in large part to recent widespread liquidations that have plagued this new industry following what some are calling “the crypto winter.” The recent cryptocurrency market downturn has been very detrimental to the adoption of decentralized finance applications. $300 million worth in assets were withdrawn from DeFi last week alone, while daily active users for popular DApps decreased by about 20%. This is not surprising given that these protocols saw substantial liquidations and developer departures leading up until today’s news — it’ll be interesting to see how things play out going forward!

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Florida Office of Financial Regulation Issues DeFi Advisory

JDSUPRA

Invest wisely! warns the Florida Office of Financial Regulation (OFR). OFR warns investors to be aware about decentralized finance, or DeFi for short. OFR says that before you decide whether or not to invest in a financial services firm or professional, it is important to do your research so no surprises arise down the road. Also keep in mind that DeFi investment possibilities and markets are new and typically very volatile, so they appear to be more motivated by psychological factors than financial fundamentals and that many digital asset investment opportunities are not asset-backed.

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Financial Inclusion In The NFT World

FORBES

The NFT is a ticket that allows you to join an exclusive club — a non-fungible and freely transferable ticket. Once an NFT is on the blockchain, it can’t be duplicated. With fractionalized NFTs, you can’t fully utilize the perks but it is a more inclusive market. With this type of investment contract without complete ownership like with baseball cards that are only available to collectors in some cases; they hold their value over time even though there’s no intention for them ever being sold. Multiple ways have been found to make NFTs more inclusive. In some cases, people are using them as a way of renting out the property while others use them for art exhibits and museums. Furthermore, fractional ownership offers an opportunity where investors can get involved in real estate without having to buy the entire property!

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