Solana Congestion ⚖️ Solana Sell-off
Solana price falls amid network congestion and FTX Estate sell-off news. DEX Uniswap tops $2T in trading volume. Biden v Trump memecoins battle. Do Kwon found liable for fraud in SEC trial.
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The recent fall in the price of Solana has many theories going around.
Solana is the biggest loser in the top 10 coins amid network issues, but tokens running on the network are falling harder.
Still …
Solana is trading around $176
An impressive 743% gain over the past 12 months.
Boosted by the recovery of the crypto markets and the surge of memecoins.
Network congestion caused by the Wormhole airdrop
Held earlier in the week, led to a surge in unique wallets eligible for the drop, causing congestion on the Solana network.
It caused a significant drop in the value of Wormhole, which plunged by 17% in the past day, and has shed 41% of its value since Wednesday.
Solana co-founder Anatoly Yakovenko expressing his frustration on Twitter.
Memecoin season taking a toll?
Last few weeks have seen a high rate of failed non-vote transactions on Solana Network - ranging around 75%.
The high failure rate is attributed to bots spamming Solana for arbitrage opportunities and the creation of thousands of memecoins.
The situation is bringing in a lot of new users to crypto and Solana, but there are concerns that governments might classify it as gambling and outlaw it in the future.
This surge in activity has raised concerns about the network's ability to handle such intense activity levels, and the blockchain's performance is being put to the test.
FTX Estate sell-off
Sold between 25 million and 30 million locked-up SOL tokens at $64 a token, approximately $1.9 billion value, reports Bloomberg.
FTX was an early investor in Solana.
Its 41 million SOL tokens are subject to a four-year vesting schedule.
They cannot be traded in the market until the deadline passes.
Why? To clear FTX creditors debt.
What did the sale look like?
Two-thirds of a lot of SOL tokens valued at around $2.6 billion.
Galaxy Trading setting up a $620 million fund to purchase FTX's SOL tokens, incurring a 1% management fee.
Pantera Capital established a $250 million fund to acquire discounted Solana tokens from the FTX estate.
Neptune Digital Assets, a Canadian blockchain company, acquired 26,964 SOL tokens for $64 each.
Block That Quote 🎙️
Chicago Mercantile Exchange (CME) head of crypto Giovanni Vicioso
"They (ETFs) do help to further legitimise the space”
In an interview to Blockworks, Vicioso reckons that the introduction of ETFs helped legitimise the crypto space, and the growing interest from institutional clients in the underlying technology of Bitcoin and Ether.
I think that the ETFs are only really scratching the surface. We still haven’t seen some of the IRAs or sovereign funds get into this space. We’ll begin to see who’s actually investing in this space once the quarter ends and the 13Fs are filed.
In the Numbers 🔢
$2 trillion
The trading volume of Decentralised exchange (DEX) Uniswap.
That's larger than the GDP value of Brazil and Australia.
Built on the Ethereum blockchain, it was launched in November 2018.
Uniswap took 42 months to breach the $1 trillion trading volume milestone - doubling to $2 trillion just 24 months later.
Centralised Crypto Exchanges and Derivatives?
Memecoins Battle - Biden v Trump
According to CoinGecko, there are only four notable politician-based memecoins with measurable market caps.
"Joe Boden" (BODEN) and "MAGA" (TRUMP) account for 99.7% of the total value in the "PolitiFi" category.
Both BODEN and TRUMP have seen significant increases in value this year, with BODEN outperforming TRUMP ($487M vs. $222M).
Betting Odds Versus Market Indicators: Betting platform Polymarket expects Biden to win 65% to 26% - a reflection of the memecoins' messaging.
Public Opinion Polls and Real-World Approval Ratings: Based on poll aggregator FiveThirtyEight, both politicians maintain comparable overall approval ratings in the real world, although Trump holds a slight lead.
The Surfer 🏄
PayPal to enable stablecoin-to-fiat option for international money payments. Users can now swap PYUSD for dollars to make international payments via Xoom.
Do Kwon, the founder of Terraform Labs, has been found liable for civil fraud charges by a New York jury, siding with the SEC. They are seeking civil financial penalties and orders barring Kwon and Terraform from the securities industry.
Paraguay has proposed a temporary ban on crypto mining following power grid failures. The ban would last 180 days or until new laws are enacted and the national power grid operator can ensure it can supply sufficient energy.
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