Exploring the Latest Developments in the Crypto Space: Bitcoin Ordinals, $BLUR NFTs, Stablecoins, and US CPI Data
The Hottest Topics Shaping the Future of Cryptocurrencies and Digital Assets
BTC NFTs? Ordinals
Today, we will explore Bitcoin Ordinals, a hot topic that has dominated the web 3 space for the past week. Introduced by software programmer Casey Rodamore on January 21, Bitcoin Ordinals have generated quite the buzz. Bitcoin Ordinals are subdivisions of the cryptocurrency, each consisting of 100M satoshis or "sats." These Ordinals allow bitcoin node operators to inscribe data, creating an NFT that can incorporate smart contracts, thereby enabling NFTs. Unlike traditional NFTs on platforms such as Ethereum and Solana, Ordinals are NFTs that can be created directly on the blockchain. However, with the newness of Ordinals comes the need for the necessary infrastructure for buying and selling these assets. Despite this, Ordinals have brought about a new utility to Bitcoin beyond just transferring sats, and as a fully on-chain product, they do not require a sidechain or separate token.
$BLUR NFT Marketplace
The NFT marketplace aggregator, Blur, is proving to be a competitor to Opensea. On February 14th, they launched their highly anticipated $BLUR airdrop, generating significant buzz in the cryptocurrency community. With a token supply of 3 billion, Blur released 360 million $BLUR, representing 12% of the total supply. Notably, 78% of the supply has already been delivered via two smart contracts, with the remaining 9% to be controlled by a multi-wallet. The team's vesting will take place over a four-year schedule to ensure stability. It's worth noting that, historically, previous airdrops like $X2Y2 and $LOOKS have experienced price dips as users who received airdrops dumped their tokens. As such, the $BLUR price may experience some volatility in the short term.
What’s Happening in the Space
In 2022, the stablecoin issuer Circle filed a regulatory complaint against Binance, citing mismanagement of token reserves before the BUSD issuer Paxos faced a lawsuit. The news caught many in the web 3 and crypto community off guard, mainly when Paxos came under investigation by the SEC last week. According to Circle, Binance needs to store sufficient cryptocurrency in reserve to back its issued tokens. As a result, the New York regulator has called on Paxos to sever its ties with Binance.
At the time of writing, the circulation of the third-largest stablecoin, $BUSD, was approximately a 13.7 billion dollars. However, the stablecoin recently slipped below its one-to-one ratio with the US dollar, which it aims to maintain. Following this announcement, Binance customers began to dump BUSD. Binance's BUSD reserves are down 40% from their all-time-high of $21.9B reached on November 7, 2022. In response to this development, Binance CEO Changpeng Zhao, also known as CZ on CT, stated that they anticipate migrating users to other stablecoins over time.
US CPI Data
In January, U.S. inflation, as measured by the Consumer Price Index (CPI), increased by 6.4% compared to last year's period, slightly exceeding the expected 6.2%. However, this figure is somewhat lower than the previous month's 6.5%. Meanwhile, the core inflation CPI, which excludes volatile items such as food and energy, rose by 5.6% YoY, just above the expected 5.5% and a slight decrease from the previous month's 5.7%.
Despite the slight decrease in overall inflation, core service prices continue to rise, and the labor market remains tight. This has left many experts needing clarification about the future trajectory of interest rates. There is a wide range of expectations for rate hikes, but many analysts anticipate a 25 bps increase in March, with potential cuts later in the year, perhaps in December.
I hope you're all enjoying my crypto and digital asset newsletter! I'm eager to hear your thoughts on any subjects you'd like me to dive into over the next few weeks. Feel free to share your ideas with me!
Not Financial Advice
Please note that all opinions in my newsletter are strictly my own and should not be considered financial advice. It is important to conduct your own research and make your own investment decisions. Always consult a qualified financial advisor before making any investment decisions.