El Salvador, Cardano, and CPAG!
The last 2 weeks have been a blur of Axie Infinity-related news here on Cryptoday, so I decided to step back a little bit and talk about some more general industry news this rainy Monday morning.
El Salvador officially launched Bitcoin as its second official currency (after the US dollar) on Sept 7th, three months after announcing its intention to do so. Immediately the price plunged nearly 20%, from what looked like a healthy $52,000 to a low of $41,000. It has since stabilized at $45,000. This suggests that the market had already priced in the El Salvador launch in the days leading up to the 7th, and everyone was just waiting to take profit. President Nayyib Bukele announced that their government was buying $BTC at a discount as the market was dropping, but as far as I can tell, their treasury is currently under water by about 8%. It’s fascinating to see global brands like McDonald’s and Starbucks being forced by authoritarian legislation to accept $BTC in El Salvador. Bitcoin has always struggled as a payment system, and although Lightning network has made transactions faster and cheaper, the price volatility will continue to be its biggest pitfall. The only way Bitcoin works as a nation-scale payment system is if you somehow force the entire country to abandon fiat and price everything in $BTC, but even Bukele is not enough of a dictator to pull that off.
Last week, Ukraine also officially legalized cryptocurrencies in a nearly unanimous vote. The law has been in the works since July 2020, and aims to regulate crypto exchanges and establish some basic rights for its users. You can auto-translate the actual draft from this page, but it’s pretty standard stuff, and nowhere near as prescriptive as El Salvador’s approach. No, Bitcoin won’t be an official currency in Ukraine. Yes, this paves the way for exchange licensure (something which we’ve had here in the Philippines since 2017).
Cardano has been having a busy month, culminating in the successful launch of its Alonzo upgrade. The hard fork went live just a few hours ago, enabling smart contract functionality on Ethereum’s biggest competitor. Developers have reportedly struggled to write apps for Cardano though, owing to its Bitcoin-like UTXO architecture. In case you’re technically inclined, UTXO is very efficient for protocol-level transactions, but it’s pretty bad for anything more complex than that. This is why Ethereum uses an account-based model for its protocol, as that’s what the average engineer would expect to be working with. The app developers on Cardano are reportedly working on solutions for this, but don’t expect the next Uniswap to be launching anytime soon, and I would definitely wait before throwing substantial money at any Cardano smart contracts for the time being.
I know that I said I wouldn’t do Axie-related news but I just wanted to give everyone a quick update on my new Cryptopop Art Guild, which we will be officially shortening to “CPAG.” The goal of the guild is to finance underprivileged artists with Axie Infinity income, while also mentoring them and guiding them through the NFTart landscape. As of this morning, we have 33 active members and about 12,000 SLP earned. We also have about 30 more artists in the queue waiting to be screened. (Please follow the guild on Facebook!) We’re already starting to see some commissions and job opportunities for the individual members of our guild, and I expect that that will only get more and more common as we help increase their visibility. We raised over 10 ETH from our investors Gabby Dizon, Colin Goltra, James Deakin, AJ Dimarucot, and Team Manila, and we’ve deployed over 90% of the fund. Investors receive 40% of the players’ axie income in exchange for their capital. If you’re interested to support the guild, please contact me!
See you on Wednesday, cryptofam, and remember: All of the opportunities are out there waiting for you, but you still need to be ma-CPAG.