CryptocurrencyScripts

Newsletter

Tag: luna

  • 2022 Bear market: The ‘Big players’ ruined the game.

    2022 Bear market: The ‘Big players’ ruined the game.

    bear market

    “Your last chance to buy bitcoin at $30K” may sound like a failed prediction, but on a second and deeper thought, your favorite influencer and ‘trader’ might be right. Judging from recent events, bitcoin at 30k is a huge target and is growing further every day. “Plan B” might have gotten his $100,000 bitcoin prediction wrong, but he’ll have more issues if he actually followed his own analysis and bought through them. Most influencers are too clever to follow their own predictions anyways. No jibe about his brilliance anyways, his analyses are still reasonable. Unfortunately, the crypto market hardly follows ‘fundamentals’

    Bitcoin was close to some historic values. $69,000 would have been an orgasmic figure, things like that don’t happen too often…naturally. A slow and rather disappointing regression followed; hitting lower points and breaking downward resistances, bitcoin’s off-brake downtrend pulled the rest of the crypto market into a great depression. The bull market looked all synthetic; the market always looked programmed, but this time it was close to obvious. A total market capitalization of $5 trillion was realistic. If bitcoin reached the $100,000 target, that would have been easily possible…

    Everyone is a hero in a bull market. Billion-dollar meme coin projects, tons of high-profile airdrops, invincible traders, and ‘rich folks’. The buzz was felt worldwide; Peter Schiff tried to warn everyone and squeeze in his gold superiority arguments along the line. Wasn’t a really good time for him; can’t say the same about the current situation.

    Under the flourishing market, a number of projects rose to absolute fame and reveled in bitcoin’s glory to create wealth…and a little bit of utility. Corny developers had their feast and quickly filled the space with tons of projects built in the shortest time by a team of rookies who joined the space when Elon Musk was riding his doge to the moon. Heard he’s got a court case to attend to in that respect. Well, the dogefather went from moon to court, not a bad move…at all. I’m certain he has enough wits to pull that one off, easily.

    Elon’s SNL session marked the absolute top for bitcoin and dogeCoin. I’m forever skeptical about the “to the moon” slogan. Things gradually went from bright to dim and the bandwagon of mainstream artists claiming to have adopted blockchain technology quickly began to disperse. Lil Yachty and Soulja Boy made more from their shills than they ever made from jumping in and out of the booth. Making money has never been so easy. ‘Lil Boat’ never bothered to release an album since then. I wouldn’t blame him though, his last one was forgotten too quickly and he certainly has more people listening to his shills than his mumble raps.

    Do Kwon at the peak of his wealth might be worth a few billion, but his ego was worth many times that figure. It’s logical anyways, USDC was meant to die by his hands; the reverse was the case but he did put up a good fight. Unfortunately, LUNA investors took all the hit while he was left to worry about a strange knock on his door. The Luna2.0 incentive must have saved him from more strange knocks. Airdrop recipients who managed to sell at launch probably made some of their money back. Can’t say the same about those who held on. The new Luna is 90% down already, and the old Luna…you’ll need a stick to count the zeros. All good, it was fun while it lasted.

    A few friends were comfortably living off the returns they got on the bitcoin they locked on Celsius’ lending platform. The temperature quickly got too hot and it was all close to melting. Don’t know the exact degree but somewhere above the boiling point of water. Celsius claimed to be decentralized, but just like my bank, users’ funds were locked when the market conditions became ‘unfavorable’. Alright, they offered more returns than my bank anyways, so I’d still stick to the juicier offer, even if it means risking being liquidated along with the rest of the market.

    3AC? A very long story I’d love to skip…

    While traders’ and investors’ greed rose to its highest levels; developers’ and project teams’ egos and arrogance also grew to similar levels. You could get the coldest replies for suggesting a fix for some discovered bugs. Who cares about bugs and fixes when prices are going haywire and investors are rugged slowly and swiftly? The big players in the space basked in the health market to fill up their pockets and cared less about the feasibility of their solutions and the sustainability of their strategies.

    The real argument is if they had any strategy at all. LUNA and UST’s collapse probably clouded a lot of events, but a few other stablecoins got pretty unstable. Justin Sun mastered the act of following the trend; USDD was basically born in an attempt to bring the Luna sort of price growth to the Tron ecosystem. USDD was in no way an improvement from UST. Just another copy facing the same issue. In Mr. Sun’s case, $600 million is an easier war to fight. USDD stays de-pegged for a number of days now. His Excellency will ultimately do something when his stablecoin gets to the same price as Cardano.

    It’s another situation where I find enough reason to justify bitcoin maximalists’ stand on altcoins and any other thing apart from bitcoin. The orange coin’s tragic fall to $17,000 is a result of these irregularities from ‘shitcoin’ projects. that name has never been more proper. Microstrategy will have to bear their losses for now while Elon Musk gets himself a lawyer, there are a few hundred billion on the line. The rest of the space will have to hope we don’t fall into a proper “great depression”

  • Algorithmic stablecoins; the future of stablecoins?

    Algorithmic stablecoins; the future of stablecoins?

    algorithmic stablecoins

    Following the recent tragic developments in this space; ‘algorithmic stablecoins’ must be a huge caveat for you. Maybe there are exceptions such as when they have a 60% APY attached. I’ll always say it; cryptocurrency’s biggest achievement is, capturing human greed. When the yield is great, anything goes. In absence of tangible returns like this, most investors will pass up on anything involving stablecoins backed by algorithms and computerized economic policies.

    Commodity-backed stablecoin projects are having a good time currently. The big argument used to be how Tether is backed ‘by air’ and should be cracked down. Taking a look at it again, it’s amazing how it managed to retain its dollar peg to date. We might have to re-calculate the strength of ‘air’.

    I’m still not a fan of Tether or other shady stablecoins backed by unverified commodities and fiat though.

    Terra blockchain’s Luna was on course for some incredible growth — price-wise, the ecosystem itself was booming. The foundation had billions in its reserves and the project founder was beaming with some serious ego. I’d recommend his interview on the fate of cryptocurrency projects as a reminder that nothing is too big to fail. That aged very badly and too fast, in my opinion.

    It was going great until Terra’s stablecoin lost its dollar peg and caused a ghastly downward spiral for the Terra ecosystem. The whole crypto space was caught in the crossfire as bitcoin briefly traded below $26,000. Recovery hasn’t been easy and Terra’s LUNA and UST have since lost hope of a comeback.

    In contrast to commodity-backed stablecoins; algorithmic stablecoins are programmed to respond to presiding supply and demand forces in order to maintain a pre-defined peg; most popularly, the US dollar. Stablecoins’ algorithms might have tangible differences in their core functionalities but a major similarity is that they are backed by ‘mathematics’ and logic rather than real assets. As long as the logic controlling the functionality of the coins works, the supply and demand continue to vary and the price stays relatively stable and around the value of the pegged figure.

    The failure of Terra’s UST casts a shade on the growth of algorithmic stablecoins; but prior to this event, this concept was growing and was on track to pose a huge challenge for stablecoins backed by air and an efficient printer…pun intended.

    But despite the unfortunate events, algorithmic stablecoins still have a place in the crypto space and still have good chances of being the preferred medium of value preservation in the crypto space. If not for any reason, the fact that they are backed by the same concept that powers the whole space — logic, makes them more traditional.

    Tether, the most used stablecoin remains one of the blurriest operators in this space. Regulatory attempts have been channeled towards it but this hasn’t really resulted in a tangible breakthrough in at least making it a more transparent system. Popularly termed ‘cryptocurrency’s doomsday’, Tether’s stablecoins have reached a market capitalization of over $70 billion. Thanks to incessant and unexplained emission, billions of tokens pegged to the value of the United States dollar has filled the space. During this time, the value of cryptocurrencies has seen incredible growth as well. Yet, it will be hard for the most experienced crypto enthusiast to explain how exactly this stablecoin works and if it is fully backed.

    Commodity-backed stablecoins have become prominent figures in the crypto space. In addition to vague backing and conformation to legal specifications, they are controlled by one entity and are grossly centralized. The issuing organization controls the supply and distribution. Consider these issuing institutions the new Central Banks. They have since minted billions of dollars and are trading on the most reputable exchanges.

    Algorithmic stablecoins present a more transparent and decentralized alternative to these institutionalized and centralized stablecoins. With emission and distribution controlled by the community; and the peg maintained by a well-explained algorithm, they present a competent system for the preservation and transfer of stable value.

    When the heat settles and algorithmic stablecoin projects develop a sustainable stablecoin system, decentralized stablecoins will take their rightful place in the crypto space. There are no perfect systems and just like every new concept, algorithmic stablecoins are prone to early days inconsistencies; we have seen one of the most terrible instances in UST’s failure. If we are being realistic, there might be even more coming, but this does not mean that algorithmic stablecoins are dumb…at all.