Bitazza Crypto Weekly: The Battle For Layer-1 Supremacy Still Ongoing -

Crypto Weekly: 28 March – 3 April 2022

Despite Ethereum retaining its crown as the leading Layer 1 protocol in the blockchain space, emerging competitors with newer technology have started to close the gap. While Ethereum is still leading the market, whether it will be the dominant Layer-1 platform for DeFi, Web3 and Metaverse protocols, and NFTs remains to be seen.

Leading digital asset investment firm Grayscale Investment launched its “Smart Contract Platform ex Ethereum Fund” (GSCPexE), which will focus on non-ETH tokens and offer exposure to Smart Contract platforms and technology outside of the Ethereum blockchain. The fund’s current holdings include ADA (24.6%), SOL (24.3%), AVAX (17%), DOT (16.2%), MATIC (9.7%), ALGO (4.3%), and XLM (4.1%). The ex Ethereum fund is Grayscale’s 18th investment product and its third diversified fund offering.

While Ethereum accounts for 55.4% of the Total Value Locked (TVL) in DeFi, this percentage is down from its January 2021 TVL, which reached as high as 96% of the entire DeFi market. This indicates that Ethereum is facing stiff competition from its challengers, with many of the emerging platforms managing to eat away at Ethereum’s market share successfully.

According to data from ultrasound.money, since implementing the London hardfork in August 2021, over 2 million ETH has been burned to date at an approximate burn rate of 6.09 ETH per minute. The biggest portion of burned ETH was from OpenSea, the world’s biggest NFT marketplace, followed by ETH transfers in second place ahead of Uniswap transactions.

Terraform Labs CEO Do Kwon has revealed that the Luna Foundation Guard (LFG) is planning to use Bitcoin as a reserve for UST, Terra’s native stablecoin. LFG has successfully raised $2.2 billion for its Bitcoin reserve and is targetting the $3 billion mark for the reserve in the short term, with a longer-term goal at $10 billion.

Data from DeFiLama indicates that Cardano’s TVL has crossed the $300 million threshold, with Minswap, a community-driven multi-pool dex on Cardano, accounting for 63.07% of the above value. SundaeSwap, another Cardano-based DEX, is the second-largest protocol on Cardano in terms of TVL at $11 million.

Yuga Labs, creator of Bored Ape Yacht Club has successfully raised more than $450 million in its seed round of funding, making it the largest seed funding in the NFT industry. Leading investors include venture capitalist firm Andressen Horowitz, video game maker Animoca Brands as well as crypto firms like FTX, Coinbase, and MoonPay.

Japanese software giant LINE is preparing to launch an NFT marketplace in Japan on April 13. The marketplace, dubbed LINE NFT, is affiliated with 17 content firms and will sell more than 100 types of NFTs. Those who buy tokens on LINE NFT can exchange them with other registered LINE users. While LINE NFT is currently only planned to operate in Japan, LINE’s partner company Z Holding, is allegedly launching their DOSI NFT marketplace worldwide on April 19.

El Salvador has postponed the issuance of its $1 billion bitcoin-backed bond as the government waits for more favorable conditions in the financial market. Government officials have cited conditions related to the Russia-Ukraine crisis that has impacted the price of BTC but have affirmed that the issuance is ready.

Finally, Russia’s Duma Committee on Energy Chair Pavel Zavalny has stated that Russia is considering selling its oil and gas exports for Bitcoin amidst intensifying sanctions from the West. Zavalny highlighted “friendly” countries such as China and Turkey and stated that Russia is willing to be more flexible with payment options, including settling in Yuan and Lira for China and Turkey. With the value of Russia’s native fiat currency affected by Western sanctions, Russia is seemingly looking to diversify into other currencies.

Weekly Technical Analysis: 28 March – 3 April 2022

Bitcoin (BTC)

BTC broke through last week’s $46,000 resistance level, confirming its upwards reversal. The following key target will be the $50,000 resistance level for this week. BTC is not anticipated to break below the $46,000 mark in the short term; however, so long as the support level at $42,000 remains intact, BTC’s outlook won’t change much. Find a moment to enter a position when prices are falling.

Ethereum (ETH)

ETH rallied in tandem with BTC, breaking through the $3,000 resistance level to confirm a bullish reversal. Last week’s resistance will act as the defacto support level this week as ETH looks to challenge the $3,800 resistance level. ETH’s trend moving forward should become clearer soon, but traders looking to enter a position now can buy when prices weaken.

ApeCoin (APE)

APE is up by +59.8% from last week, with all indicators suggesting that ApeCoin is about to embark on an uptrend. Short-term support is set at 480 Baht, while resistance is set at 560 Baht. If APE continues to create higher lows and higher highs, its uptrend may continue for some time.

Convex Finance (CVX)

CVX is up by +56.6% from last week and will be looking to challenge a critical resistance level at 1,000 Baht this week. If CVX can successfully break through the 1,000 Baht level, it will look to challenge the next resistance level at 1,200 Baht. If CVX’s rally falters, support is set at 800 Baht. So long as the support remains intact, CVX’s trend should continue to be largely positive.

Trading and Investment Considerations For The Week

The conflict between Russia and Ukraine has lasted for over a month. While the geopolitical situation remains unclear and a prompt resolution seems uncertain, the markets are beginning to improve, including the Crypto market and BTC prices. The fact that prices are failing to create lower lows may suggest that the worst of the economic impacts of the war may have come to pass already.

This includes some of the monetary policies set by the FED; however, concerns that the FOMC may enact an immediate/faster than anticipated 0.5% interest rate increase have been gaining traction. Next month’s release of Consumer Price Index (CPI) figures will likely lend some clarity to how the FOMC may rule going into the next scheduled meeting.

Other than Bitcoin, altcoins such as VET, AXS, and AVAX have managed to recover into a sideways uptrend and could make good tokens to enter positions this week. Meanwhile, tokens that have been consistently outperforming the market in the past few weeks like LUNA and RUNE could also be profitable if traders can time entries on price dips.

The overall outlook on the Crypto market is positive, especially with Bitcoin in an uptrend; however, there may be some volatility as we approach the release date of CPI figures. Although the prices of the tokens have shot up, traders are advised not to chase the price. A long downtrend will usually see strong buyback pressure when the trend recovers, often followed by price dips. Use that price dip as an opportunity to enter instead.

*Materials on Bitazza Weekly Newsletter are intended to be used and must be used for informational purposes only. The views, information, or opinions expressed are solely those of the individuals involved and do not necessarily represent those of Bitazza and its employees. The information contained herein is not intended to be a source of advice or financial analysis with respect to the material presented, and the information and/or documents contained in this website do not constitute investment advice.

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