Happy Wednesday! In today's Daily, Outlier Ventures says it's time to accept that the four-year bitcoin cycle is dead, the CFTC files and settles charges against Uniswap Labs, Mark Karpeles discusses the "transparency" of his new crypto exchange and more.
Meanwhile, Euler EUL
-0.76%
re-emerges to launch its new v2 modular DeFi lending protocol after 31 audits following the $197 million hack on its v1 in 2023.
Let's get started.
Bitcoin's four-year cycle is 'dead'
Head of Research at the web3 accelerator Outlier Ventures, Jasper De Maere, said it is time to accept that the four-year cycle is dead, with bitcoin experiencing its worst price performance post-halving so far this year.
Bitcoin's fourth halving occurred on April 20, when miners' block subsidy rewards dropped from 6.25 BTC
+0.24%
to 3.125 BTC.
Looking at bitcoin's price performance 125 days after each halving event, the foremost cryptocurrency is down around 8% in 2024 compared to a 739% rise following the 2012 halving, 10% in 2016 and 22% in 2020, according to De Maere's data.
The Outlier Ventures analyst said 2016 was the last time the halving had a "significant, fundamental impact" on bitcoin's price.
Since then, Bitcoin miners’ block subsidy rewards have become negligible in the context of a maturing and increasingly diversified crypto market, he added.
Strong price action after the 2020 halving was a coincidence, driven by factors like global capital injections post-Covid and the DeFi boom, the analysts continued.
Bitcoin reached a new post-bear market all-time of $73,836 in March before this year’s halving amid the hype surrounding spot Bitcoin ETF approvals — something that did not happen until after prior halving events.
However, De Maere said the argument that a four-year cycle still holds but that the ETF approvals in January pulled forward demand, leading to a strong run-up pre-halving, is flawed.
"The spot Bitcoin ETF approvals were a demand-driven catalyst, while the halving is a supply-driven catalyst, making them not mutually exclusive," he explained.
While bitcoin's price impacts the broader crypto market, De Maere said it was vital for founders to understand its true drivers to predict fundraising opportunities better, adding that debunking the four-year cycle did not make Outlier bearish on the overall market.
Uniswap Labs settles with the CFTC for $BTC Uniswap Labs has settled with the Commodity Futures Trading Commission for $175,000 over charges related to offering "illegal digital asset derivatives trading."
The CFTC's enforcement action against the Uniswap decentralized exchange developer demonstrates its commitment to applying the Commodity Exchange Act to digital asset platforms, Director of Enforcement Ian McGinley said in a statement on Wednesday.
"DeFi operators must be vigilant to ensure that transactions comply with the law," he added.
Uniswap Labs received a Wells Notice from the Securities and Exchange Commission in April, indicating potential legal action against the firm.
Mark Karpeles' new 'transparent' crypto exchange
Mark Karpeles, the former CEO of Mt. Gox which collapsed under his tenure, aims to launch a new crypto exchange called EllipX in Europe later this month with a focus on transparency and user-friendliness, he told The Block at Korea Blockchain Week.
Karpeles, who will oversee the technical aspects of EllipX as CTO, hopes the Poland-based platform can set a new industry standard for transparency by separating different functions and sharing technical data with customers.
The exchange will implement a structure similar to the New York Stock Exchange, using clearinghouses to manage crypto transactions separately from brokers.
"Mt. Gox was [once] based in Poland, so I do know it [well] as a country," Karpeles said, adding that EllipX is currently working on compliance with Europe's MiCA regulations.
RELATED INDICES
MATIC migrates to POL
Polygon MATIC
-4.06%
developers announced that the migration of MATIC to POL is live, making POL the new ticker symbol for the native gas and staking token on the Polygon PoS chain.
The transition to POL follows a year of extensive community-led discussions as part of Polygon's evolution toward becoming a ZK chain and integrating with AggLayer for consolidated liquidity and state across multiple chains.
MATIC holders on the Polygon PoS chain will automatically upgrade to POL, but those on Ethereum, Polygon zkEVM or centralized exchanges need to migrate via a contract.
POL will maintain MATIC's existing tokenomics and 10 billion supply with a 1:1 initial exchange ratio and a gradual increase of 2% in emissions over 10 years to support growth.
Lara and Tiffany Trump's X accounts locked after apparent hack to promote fake token
The X accounts of Donald Trump's daughter-in-law Lara Trump and daughter Tiffany Trump were apparently hacked and used to promote a token claiming to be related to his sons' DeFi project World Liberty Financial, before being swiftly locked by the platform.
Eric Trump, co-creator of World Liberty Financial and Lara Trump's husband, confirmed the hack and thanked X for quickly securing the compromised accounts, urging people not to click on any links from the affected profiles.
World Liberty Financial will reportedly be built on the Ethereum blockchain, working with DeFi protocol Aave to facilitate a credit account system for decentralized borrowing and lending.
In the next 24 hours
U.S. jobless claims figures are released at 8:30 a.m. ET on Thursday.
Korea Blockchain Week continues in Seoul as the AI Crypto Summit and ETH Warsaw 2024 get underway.
Never miss a beat with The Block's daily digest of the most influential events happening across the digital asset ecosystem.
Disclaimer: The Block is an independent media outlet that delivers news, research, and data. As of November 2023, Foresight Ventures is a majority investor of The Block. Foresight Ventures invests in other companies in the crypto space. Crypto exchange Bitget is an anchor LP for Foresight Ventures. The Block continues to operate independently to deliver objective, impactful, and timely information about the crypto industry. Here are our current financial disclosures.
© 2024 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
