ICYMI - Last week in crypto: Renaissance Crypto Art in Italy & Magic Eden Breach
New Year✨, New Kings of DeFi 👑
Welcome back Faces! We sincerely hope that you enjoyed a very relaxing holiday season. It's safe to say that 2022 came to an end with a bang rather than a whimper, and there were a few events that you might have missed while you were away for the holidays. This week on ICYMI, we feature the top stories across Web3: Italy taking a stance on Crypto Art, Binance's new partnership with Ukrainian Pharmacy firm - ANC, Magic Eden’s illicit image scandal, and more.
NFT Report: Italy set to lead the crypto art Renaissance
With its long history, rich culture, and vibrant art, Italy is one of Europe's cultural centers. According to a recent report, Italy with the advent of a nonfungible token (NFT) market is now positioned to usher in a crypto art Renaissance.
According to information from Research and Market's "Italy NFT Market Intelligence and Future Growth Dynamics Databook," the country's NFT market is anticipated to grow by 47.6% as of the end of 2022.
The Italian NFT market would then be valued at roughly $671 million.
Moreover, a compound annual growth rate of 34.6% is predicted for the NFT market in Italy over the subsequent five years. By 2028, it is expected that NFT spending will total $3.6 billion.
The report claims that the country's thriving art and cultural scene contributes partly to its success with NFTs. Leading the industry in the adoption of Web3 technologies have been major Italian luxury fashion houses like Gucci and Dolce & Gabbana.
They were innovative not just for Italy but for the entire fashion sector. Dolce & Gabbana and Gucci each made $25.6 million and $11.5 million respectively over the course of the previous year from their NFTs.
These companies also spearheaded efforts to use digital activities and wearables, many of which included NFTs, to engage their communities in the metaverse.
Italy is being propelled into the NFT spotlight by factors other than just fashion brands. The lengthy cultural history of the nation has also witnessed some Web3-related activities.
The Arco Della Pace, also known as the Arc of Peace, in Milan, Italy, served as the first subject for an NFT project called the Monuverse which is preserving historical sites through digital assets.
Italian artists even have their own management organization called "crypto renaissance," which refers to the nation's emergence as a leader in art during the Renaissance period, to assist Italian NFT artists.
Meanwhile, the overall tone of the Italian cryptocurrency market is also improving. Algorand, a blockchain developer, recently announced that it would use its technology to support Italian banks and insurance guarantee platforms. Gemini received authorization to conduct business in Italy in November.
However, Italy's budget documents for the upcoming year were made public on December 1 and included information about a new 26% capital gains tax that will be levied on cryptocurrency profits in the coming year.
DeFi Protocol Lido Finance dethrones MakerDAO, Reaches $5.6 Billion in TVL
With $5.9 billion locked on the staking platform, Lido Finance has surpassed MakerDAO as the market's largest DeFi protocol.
Leading protocol for decentralized lending MakerDAO's market leadership in DeFi has been challenged by Lido Finance, a liquid staking protocol that has the highest total value locked (TVL).
Data from the DeFi market aggregator, DeFiLlama, shows that Lido Finance is currently in first place with $5.9 billion in TVL, followed by MakerDAO and AAVE with $5.89 billion and $3.7 billion, respectively.
The sharp rise in interest in Ethereum staking solutions has been cited as the cause of Lido's TVL (Total Value Locked) increase. The Ethereum Merge, which signaled the network's switch from Proof-of-Work (PoW) to Proof-of-Stake (PoS), according to a recent Nansen report, led to high demand for such solutions.
Lido Finance seized this chance to advance its reputation in the market and solidify its position as the premier DeFi protocol.
According to the Nansen report, Lido currently has a stake in 31% or more of all ETH in circulation. When compared to the market shares of the biggest cryptocurrency exchanges, such as Coinbase and Kraken, which hold 15% and 8.5% of the market, respectively, this dominance is quite significant.
Albeit, the entire DeFi market's TVL significantly decreased over the past year, dropping from over $167 billion in January 2022 to $38.6 billion at the time of writing, a loss of more than 70%.
The rise in hacks and cybercrime in the DeFi industry also contributed to the sector's general decline. According to reports, DeFi protocols lost the most money in 2022. The biggest exploit was the Ronin bridge hack, in which hackers stole digital assets worth over $620 million.
Despite the fact that DeFi yields are still generally suppressed, the market has remained remarkably resilient in the face of what is now recognized as the worst bear market in cryptocurrency history.
Ethereum Name Service (ENS) Wrapped 2022 With Over 2.2M Registrations
Despite the devastating turmoil in the cryptocurrency market, the Ethereum Name Service (ENS) registered over 2.2 million domain names in 2022. Additionally, this accounted for almost 80% of all domains created since its inception.
As of January 2nd, the Ethereum-based distributed domain name service had registered more than 2.82 million names, according to data from Dune Analytics.
Ether tokens are used to purchase ENS domain names. With the crypto asset's price falling sharply over the course of the year, gas fees for network transactions also fell. At various points during the year, this led to an increase in the number of.eth domain name registrations as users took advantage of the lower fees.
The first five months of 2022 saw consistent growth in Ethereum Name Service statistics. In May, there was a notable peak in the number of.eth domain registrations. But there was a drop because of the TerraUSD (UST) crash and the subsequent contagion fears that engulfed the market.
But the recovery happened quickly. July beat the previous high point. Soon after, in September, it recorded a monthly high of 437,365. The Merge might have been a major factor in the uptick in activity.
However, ENS ended the year at its lowest point, with December having the worst performance. More than 52,000 names were generated. The number of monthly registrations, meanwhile, has decreased by 88% since peaking just two months ago.
ENS Lawsuit Against GoDaddy
Regaining ownership of the eth.link domain name symbolized another victory for the ENS community. In its lawsuit filed in September in the US District Court for the District of Arizona against domain registrar GoDaddy, the ENS prevailed on an injunction.
The organization behind ENS, True Names Ltd., filed a lawsuit against GoDaddy for allegedly transferring the ENS's eth.link domain name to domain name registrar Dynadot prior to its expiration date and offering the name for auction. The claim was made in the complaint by ENS, who claimed that GoDaddy had broken the terms of the agreement by failing to "respect, acknowledge, and protect" the eth.link name.
Binance Partners With Ukrainian Pharmacies to Allow Crypto Payments
Customers can now pay for medical supplies and products using cryptocurrencies thanks to ANC Pharmacy, one of the biggest pharmacy chains in Ukraine, and Binance.
Over the past few months, the exchange has frequently offered its services to the nation. Shortly after the start of the Russian "special military operation," it gave $10 million in digital assets to Ukraine and unveiled a crypto card intended for Ukrainian refugees.
Customers will be able to buy medical supplies using digital currencies rather than cash, according to ANC Pharmacy. They need to do this by placing their order on the firm's main website.
The project was made possible thanks to a partnership with Binance, the biggest cryptocurrency exchange in the world. Downloading the exchange app, selecting a product, paying the bill with Binance Pay, and picking up the medication from any convenient ANC location are all options for users.
“First of all, the Binance Pay technology becomes available in pharmacies in Kyiv. We take care of your health while you take care of your cryptocurrency,” the firm announced.
Immediately following the invasion of Ukraine by Putin's forces in February of last year, Binance was among the first to provide financial support. In order to aid locals impacted by the military conflict, it distributed $10 million in cryptocurrency, and it also set up a website where people could donate called Ukraine Emergency Relief Fund.
As of the time of writing these lines, it had nearly 2,936 BTC, or $50 million.
Binance’s Stance on Russians
Since many of its Russian-based customers, according to Binance, have no connection to the conflict in Eastern Europe, the company initially refused to freeze their accounts.
The platform restricted its services to Russian residents whose crypto holdings exceeded the value of 10,000 euros after the EU imposed severe financial sanctions on Russia in April.
Additionally, it deleted some users' accounts who were connected to prominent Russian politicians. Examples include Polina Kovaleva and Elizaveta Peskova, both of whom are children of Vladimir Putin's spokesperson Dmitry Peskov (the stepdaughter of Foreign Minister Sergei Lavrov).
Magic Eden Slams Third-Party Breach for Unsavory Images
Magic Eden, the biggest non-fungible token marketplace in Solana, recently found itself in an odd situation after the platform showed pornographic images and stills from the renowned comedy series The Big Bang Theory instead of NFT collections.
Users started speculating about possible hacks of the NFT market not long after the incident. Magic Eden clarified, however, that the incident was brought on by what was allegedly a security breach at a third-party image hosting provider.
The Solana-based NFT platform announced the news on Twitter and claimed it had not been hacked, reassuring users that their assets were unaffected by the obscene pictures.
Following the incident being reported on Twitter by a few of the company's customers, who requested an explanation from the social media site, the announcement was made.
Before eventually discovering their digital artwork on the social media site, a Twitter user claimed he first saw stills from the Big Bang Theory.
“Anyone else seeing the characters from the series Big Bang Theory very quickly while loading their items on Magic Eden? WTH did I just witness,” the tweet reads.
A hard refresh prior to accessing the platform, according to Magic Eden, would resolve the problem. At the time of publication, the bug appeared to be fixed.
“Hey guys our image provider, a 3rd party service we use to cache images, was compromised. Your NFTs are safe and Magic Eden has not been hacked. Unfortunately you might've seen some um, unsavory images. Make sure you do a hard refresh on your browser to fix it.” - @MagicEden clarified with a tweet debunking the speculations of a hack on the platform.
Indonesia To Launch National Crypto Exchange in 2023
Over the past few months, Indonesia has been updating its cryptocurrency regulations. Regulators recently disclosed their intention to open a national cryptocurrency exchange in 2023. The Asian nation is currently transitioning control of regulation from the commodities authority to the securities authority. Prior to the delegation of responsibility, the platform is scheduled to be established.
Currently, commodity contracts and digital assets are traded side by side under the watchful eye of the Commodity Futures Trading Regulatory Agency, Bappebti. Didid Noordiatmoko, the agency's acting chief, declared on Wednesday that the FSA will take over regulation of the assets over the following two years, by which time the exchange is most likely to be established.
The aforementioned action is a component of a larger financial reform program that the country started in December of last year. Despite the general unrest, investors have been pouring money into the cryptocurrency market.
According to Bloomberg, Indonesia had 16 million cryptocurrency investors during the first 11 months of the year. To put things in perspective, the number was 11.2 million at the end of 2021. However, the trading volume remained unattractive. The report noted the following numbers to illustrate:
“Trading value shrank to about 300 trillion rupiah ($19.2 billion) during that period, a fraction of the 859 trillion rupiah seen in the previous year.“
There are currently 10 regional coins and 383 crypto assets purportedly available for trading in Indonesia. 151 additional assets and 10 coins are also being examined by Bappebti concurrently.
In the area of CBDC, Indonesia has also made progress. The central bank published a white paper on Rupiah-based digital currency in Q4 2022. Following in the footsteps of other federal banks around the globe that have been experimenting and testing their own central bank digital currencies is Bank Indonesia (BI).
Happy New Year, once again. WAGMI🚀