Written by

Jaran Mellerud

Analyst

09 Jun 2022

The Friday Focus: Issue 37

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Weekly happenings

Regulators are increasing their focus on the crypto industry. Terra creator Terraform Labs is in trouble with financial regulators in South Korea and the US. In addition, the SEC is reportedly investigating Binance's BNB token.

If you haven’t already signed up, click here and subscribe to receive the newsletter in your inbox every Friday.

Weekly happenings

Regulators are increasing their focus on the crypto industry. Terra creator Terraform Labs is in trouble with financial regulators in South Korea and the US. In addition, the SEC is reportedly investigating Binance's BNB token.

US senators, including crypto-friendly Cynthia Lummis, introduced a bill to bring regulatory clarity to the crypto industry. Meanwhile, last week's bill putting a two-year moratorium on bitcoin mining in New York is waiting to be signed into effect or vetoed by the state's governor. A county in Washington state introduced a 29% power rate hike specifically on bitcoin miners.

Bitcoin mining's political hurdles in the US and Europe pave the way for jurisdictions further south to attract bitcoin mining operations looking for greener regulatory pastures. Both Kenya and the Central African Republic have announced that they welcome bitcoin mining and crypto companies in general, and now the Central African Republic has even stated a plan to tokenize the country's vast mineral resources. Not all African countries are as open to crypto, exemplified by the Ethiopian Central Bank saying that business transactions using bitcoin are "illegal".

Private capital has undoubtedly dried up in the crypto industry, showcased by Blockfi's new $1B valuation, which has plummeted from $3B in March 2021. Still, we saw a few sizeable capital raises over the past seven days, as VC firm Felix Capital raised $600M to boost its web3 exposure, and Indonesian crypto exchange Pintu raised $113M to meet the country's crypto boom.

Even though the crypto market keeps struggling, Citi is still bullish on the metaverse-related economy, projecting that it could be worth up to $13T. Bitwise and Multicoin Capital are eager to grab a share of this and are spinning up a metaverse index and fund. NFT game Illuvium sells in-game land for $72 million in just a few days, proving that the interest for NFTs and the metaverse is still high.

Ethereum is making progress in its transition to proof-of-stake, with its Ropsten testnet completing "the merge", preparing the mainnet to complete its merge in Q3/Q4 2022.