This Could Replace The Banking System!

Self custody: great in theory, not always so in practice. For many, ‘being your own bank’ is not an appealing notion; after all, if you’re the sort of person who loses five phones a year, are you really the ideal custodian of your private keys?

But then, Bitcoin and banks aren’t exactly natural bedfellows. Bitcoin was designed as an alternative to our corrupt financial system and its genesis block even contained a dig at all those over-leveraged banks that got bailed out back in 2008. It seems like the choice is a binary one that ends up looking like a compromise: take control of your Bitcoin and trust yourself not to mess up, or trust someone else to hold on your behalf.

Perhaps though there is a way to square this circle. A recent report has dug into an idea that could allow BTC holders to access banking-like services, while still not completely compromising the trustless nature of Bitcoin. It’s a fascinating study, which could point the way to a future in which Bitcoin really does become a serious rival to traditional finance.

So, in today’s video, we break down this report and look at its findings and the case it presents for what could be the next phase of Bitcoin’s evolution. Perhaps the death of the fiat system is closer than we think…

You can watch that video here.

📈 Crypto Market Forecast 📈

If you’ve been in crypto since 2020, then the month of March probably holds some significance for you. For those who weren’t there, March 2020 was when the crypto market experienced a flash crash after a global pandemic was declared. Four years later, the crypto market is in a similar part of the cycle, and the world is somehow looking even more uncertain than it did back then.

What’s different this time is that institutions have exposure to crypto, at least BTC. Of course, this is thanks to the spot Bitcoin ETFs, which seem to be resulting in a bifurcation - BTC and altcoins are increasingly acting independently of one another. This is significant, because while institutions seem to see BTC as a safe haven, they certainly don’t view altcoins in the same way.

This in turn is significant, because March is looking increasingly uncertain on both the crypto and macro fronts. On the crypto front, it’s possible we’ll get renewed scrutiny of exchanges. This is because of the news, or rather the allegation, that Binance Nigeria moved up to 26 billion dollars in illicit crypto through the country. This could result in new investigations.

The scary thing is that there’s on-chain evidence to back up some of these allegations. The mainstream media is starting to scream from the rooftops that Chainalysis found that 60% of all illicit activity in crypto is related to sanctions evasion or terrorism. Why is this a big deal? Because they’re talking about crypto. Not Bitcoin. Crypto. BTC is good. Everything else? Bad.

Take a second to consider that Bitcoin doesn’t pose a threat to the traditional financial system, because it’s incapable of providing the same functions (at least without additional tech that’s still in development). By contrast, Ethereum and other smart contract cryptocurrencies are a direct threat to TradFi, because they do provide the same or similar functions.

When you look at crypto regulation through this lens, everything starts to make a lot more sense. Then factor in the fact that asset managers like BlackRock are obsessed with making returns for themselves and their clients, whereas megabanks like JP Morgan are obsessed with ensuring the status quo endures. Behind the scenes, each is lobbying the SEC for their interests.

That’s just the crypto part of the craziness. On the macro front, it’s becoming increasingly obvious that there’s an economic war going on between the US and its enemies. Obviously, the US’s biggest weapon is the US dollar. It’s easy to forget that the biggest weapon of many of the US’s enemies is natural resources, hence why Goldman Sachs was once bullish on the BRICS.

With this in mind, the news that Russia will be pausing petrol exports for six months, and the possibility that the war in the Middle East could escalate and cause further disruptions to energy supplies becomes very significant. Newsflash, this could cause inflation for the US and its allies, forcing them to keep interest rates higher for longer, and doing all sorts of damage.

Besides their economic and social consequences, inflation and high interest rates also increase the risks of political revolutions, which some analysts believe the Global South is intentionally trying to promote. Given that the result of these revolutions would likely be the election of far-left or far-right leaders, it sets the stage for future conflicts that we can’t currently foresee.

All of this is why you need to pay close attention to what Fed chairman Jerome Powell says when he testifies before Congress this week. It’s likely that the mainstream media will focus on the dovish and hawkish stuff that he says. Try and ignore that. Instead ask yourself: what is the Fed watching? Are they noticing these geopolitical risks? If they are, then you definitely should too.

In sum then, this week we could see a continued divergence between BTC and the rest of the crypto market. If any of the risks noted above appear, it’s possible that BTC will benefit while the rest of the crypto market suffers. The silver lining would be that it would prove once and for all that BTC is a safe haven asset. Let’s just hope that the institutions don’t see it differently.

🎇 Blast Euphoria 🎇

About four months ago, we wrote a newsletter segment describing (and warning about) a swanky new layer 2 network bursting onto the scene with risky promises of future yields.

Well, folks, that very same layer 2, ‘Blast’, went live last week on Feb 29th and euphoria is the only word to describe much of the sentiment around it.

While we remain cautious about the project’s exposure to legal risks, we believe it’s time for us to give our two sats on how we see the Blast launch playing out, especially given the excitement surrounding it now.

First of all, the project’s TVL has grown by an impressive amount since the last time we covered it. This TVL currently stands at $2.3B.

What happens to this TVL now that withdrawals have been enabled though is anyone’s guess.

The bear case is that the bulk of the earliest users will withdraw their funds having sufficiently farmed Blast’s points program for the last few months.

The bull case is that the TVL will continue rising as more users FOMO into the project after finding reassurance in the fact that funds are withdrawable at any time.

As for our prediction, we believe there may be a slight dip followed by a gradual rise in TVL over the next month at the least. Our thesis is simple.

First, we believe Blast will follow a similar pattern of activity demonstrated by NFT marketplace Blur during its early days. Notably, Blast and Blur share the same founder - Pacman.

With Blur, Pacman has already demonstrated his expertise in driving activity and liquidity via incentives. If history is a good indicator, then we can expect the same to happen with Blast. Pacman will likely find ways to keep stacking incentives for users to stay on Blast, even after the end of its current airdrop program. (Though as always, some will choose to jump off that boat early. Hence, why we believe there could be a potential dip.)

Second, most of the largest and earliest depositors on Blast are hardcore degenerates. They are also some of Pacman’s earliest believers, who likely made a lot of money with his first product, Blur.

It seems implausible that they would choose to de-risk and forego additional points and airdrop farming opportunities now. Especially since Blast’s airdrop program only comes to an end in May.

Moreover, Blast announced that half of its upcoming airdrop is allocated to developers choosing to build on top of the layer 2. This has resulted in a wave of projects migrating and building on top of Blast.

As part of the initial incentive for these developers, Blast announced a hackathon last month called Big Blast. Winners of and even participants in this hackathon are set to receive an additional allocation of the airdrop.

However, it comes with the caveat that participants will only be eligible to claim the airdrop if they continue building on top of Blast until May.

A total of 3,000 teams participated in the hackathon, with fewer than 50 being chosen as winners and runners-up. X users Jenn and Blast Degen do a great job of going over some of these winning projects. Notably, a lot of thesem seem to focus on high-risk products such as gamblefi, memecoins and NFTs.

The most interesting thing about the projects building on top of Blast though is that most of them have taken a page out of Pacman’s playbook in building hype through points programs and gated access via referral codes.

This means that, in the lead-up to the main airdrop event in May, a lot of the users on Blast will attempt to maximise rewards through farming points within the Blast dapp ecosystem. Notably, a lot of the big projects building on top of Blast do not have a native token yet.

Most of these projects will likely attempt to cement their user base by delaying the distribution of their airdrops to at least a few months after Blast’s native airdrop program in May. This will likely result in a farming frenzy for Blast over the next few months.

As for the valuation of Blast’s native token, 0xShangdidi - the host of the WuBlockchain Podcast, predicts a conservative market cap estimation of $5 billion. The line of reasoning is that Blast’s valuation should be most similar to RON, which is also an application-to-public chain ecosystem with some similarities in the background, and its upper limit would likely be about half of Arbitrum’s market cap.

However, we must note that this airdrop farming frenzy will likely result in a lot of cash-grab projects looking to capitalise on the hype materialising. We’ve already seen the ecosystem’s first rug pull being executed even before the mainnet launch.

So, farming mania or not, safety and due diligence always come first folks.

🔥 Hot Deal of The Week 🔥

Bitcoin seems to be within striking distance of its all-time-highs. However, it seems as if retail is still not here.

So, there is still time to whip that portfolio into shape before we begin that epic altcoin season.

To do so, you’ll need a top-notch exchange, with a wide selection of different altcoins. One exchange that is gaining increasing popularity amongst our team is OKX. Here, you won’t only get access to hundreds of altcoins but you will also get superb liquidity with extensive proof of reserve audits.

Even better, we have been able to secure you with an exclusive trading fee discount of 40% off fees for life!

So, you might want to proactively secure that deal while you can.

👉Try OKX and get a 40% fee discount for life!

🔮 Video Pipeline 🔮

* Quantum Computing & Crypto: Is it a threat?
* Crypto Market Update: What’s the outlook for 2024?
* Filecoin Update: Does FIL still have potential?
* Billionaires Selling Crypto: Truth to the rumours? If so, why?

🏆 What's New at This Week? 🏆

* Ultimate Sui Guide 2024: How to Get Started with Sui!
* StarkWare Review: Advancing Blockchain With STARK Proofs
* What is FUD in Crypto?
* What is the Bitcoin Halving? What it Means For BTC!
* BitPay Review: Leading Crypto Payments Processor
* M6 Labs Crypto Market Pulse: ATHs Incoming

Press Releases

* CoinGecko Enhances Cryptocurrency API with On-Chain Decentralized Exchange Data
* CoinTracking Makes Crypto Taxes Easy With Full-Service In The US

📖 Quote of the Week 📖

Just because a particular cryptocurrency hasn’t rallied with the rest of the market, it doesn’t mean that it could necessarily have “value” or be worth considering. Sometimes, those altcoins that are lagging are doing so for a reason.  

“It’s far better to buy a wonderful company at a fair price, than a fair company at a wonderful price” - Warren Buffet

Team Coin Bureau

Disclosure: Authors may own cryptoassets named in this newsletter. These are unqualified opinions, and a Coin Bureau newsletter, is meant for informational purposes only. It is not meant to serve as investment advice. Please consult with your investment, tax, or legal advisor. 

Guy Turner

Guy is one of the founding members and face of the Coin Bureau. Like many of us, he is just an average joe who became “crypto curious” back in 2013. After recognising the potential of blockchain technology, Guy set off on a mission to create crypto educational content, working with others to start the Coin Bureau website and released our first video on YouTube in 2019. You can learn more about him in his Who is Guy? blogpost.

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