Welcome to Bitstamp's February Monthly Briefing! This month, we've gathered all the big crypto news to give you a clear picture of where things are heading. We're focusing on how blockchain is changing cross-border payments exploring a variety of exciting topics that have caught our eye. Our goal is simple: to keep you in the loop and prepared for what's coming next.Ready to explore? Let’s get started.Bitstamp Monthly Briefing – February 2024The total crypto market cap increased by 38.8% month-over-month, reaching $2.20 trillion by the end of February. However, the trading volume on the major cryptocurrency spot exchanges we track witnessed a slight decrease of 5.6% during the same period.Bitcoin enhanced its market dominance, increasing by 2.0 percentage points month-over-month to 54.7%.Total crypto market cap (grey) and BTC dominance (green)Source: Total crypto market cap,Bitcoin dominanceTop performing CMC 100 assets in February+ 311.3% JasmyCoin (JASMY) - Bolstered by the Japanese government’s increasingly favorable stance to VC investment in crypto projects+ 219.4% Worldcoin (WLD) - Gained momentum following OpenAI’s launch of a new project named Sora+ 217.1% Arweave (AR) - The launch of Arweave AO enhanced the protocol’s scalability and appealWorst performing CMC 100 assets in February- 15.7% Monero (XMR) - Followed Binance’s announcement of delisting the asset- 10.8% Astar (ASTR) - Struggled as the price failed to surpass the major resistance level at around $0.19- 1.2% Osmosis (OSMO) - Experienced a minor decline as it failed to secure support around the $1.50 resistance level early in FebruaryPast performance is not a reliable indicator of future results. The performance of crypto assets can be highly volatile. Data taken on March 1, 2024.Key macro & crypto events in March 2024March 7: ECB Interest rate decisionMarch 12: US Core Inflation rateMarch 18-20: Blockworks Digital Asset Summit in LondonMarch 20: FED Interest rate decisionMarch 20: FOMC Economic projectionsMarch 21: ECB’s general council meetingMarch 26-27: WOW Summit in Hong KongMarch 30: DEFICONBlockchain for cross-border payments and financial InclusionA recent research paper, titled “Blockchain for Cross-border Payments and Financial Inclusion: The Case of Stellar Network,” explores the dynamic landscape of stablecoins, cross-border payments, and localized stablecoin initiatives, particularly focusing on African nations and the Stellar network.Stablecoins, created to mitigate the volatility of cryptocurrencies by pegging their values to specific assets, have significantly grown in importance since the aftermath of the 2018 cryptocurrency bubble. CoinGecko reports that their market value has reached $144 million, accounting for 6% of the total cryptocurrency market value as of February 2024. Along with the clear advantages, stablecoins face challenges as well, ranging from decentralization concerns to regulatory compliance intricacies. The paper emphasizes that overcoming technical, regulatory, and social challenges is crucial for blockchain adoption in cross-border payments.The paper further argues that stablecoins are becoming key tools for financial inclusion in the realm of cross-border payments. In Africa, a region where technological advancements meet high unbanked rates (exceeding 50% in several countries), localized stablecoin initiatives are proving to be effective tools for promoting financial inclusion. For instance, Afreum, a UK-based decentralized ecosystem, is at the forefront with its AFR stablecoin, which is anchored to a variety of African currencies. Afreum aims for financial inclusivity, offering custom wallet solutions and gamified educational content.Furthermore, the paper highlights Stellar, distinguishing itself from many blockchain networks that restrict transactions to native currencies. Stellar permits users to create digital tokens for payments or trading on its decentralized exchange. This capability presents Stellar as a unique blockchain-based payment network.Recommended readsAnnual Bitcoin Mining Report by GalaxyIn 2023, Bitcoin miners witnessed a significant recovery following a challenging 2022. The year saw a surge in Bitcoin's price, a rise in transaction fees, and a considerable increase in network difficulty. To adapt, miners invested in more efficient equipment and expanded into global markets. The report underscores the critical need for miners to navigate hashprice volatility, particularly given looming challenges like reward halving and fluctuating fees.Ethereum FY 2023 Financial Overview by Jimmy Zheng from ArtemisThis article delivers an in-depth analysis of Ethereum's financial and operational performance for Fiscal Year 2023, enriched with insights from a financial analyst's perspective. Notable highlights feature Ethereum's strong presence in Decentralized Finance (DeFi), the expansion of layer 2 solutions, and its comparative valuation alongside similar blockchain networks. Key discussions include Ethereum's transaction fees, user engagement metrics, the dynamics of its staking process, and the effects of the EIP-4844 upgrade. Despite some metrics showing declines, the article points out areas of progress like product innovations, the development of layer 2 ecosystems, and regulatory changes fostering future growth. Overall, the analysis underscores Ethereum's evolving landscape and its implications for investors.The Cost to Attack Bitcoin and Ethereum by Lucas Nuzzi, Kyle Waters and Matias AndradeEver wondered how much an attack on Bitcoin or Ethereum would cost? The paper "Breaking BFT: Quantifying the Cost to Attack Bitcoin and Ethereum" assesses the economic feasibility of breaching Byzantine fault tolerance (BFT) thresholds within Bitcoin and Ethereum networks. The study distinguishes between profit-driven and ideologically motivated attackers and emphasizes the improbability of profitable attacks due to the substantial costs involved. The TCA model factors in Capital Expenditures (CapEx) and Operational Expenditures (OpEx) over time, providing insights into network security. For Bitcoin, OpEx involves electricity costs, while CapEx includes acquiring ASICs. Ethereum's TCA considers acquiring ETH and the network's proof-of-stake design. The analysis suggests Bitcoin's TCA ranges from $5B to $20B, while Ethereum's TCA is estimated at around $34 billion, highlighting significant economic disincentives for attackers. This underscores the robust security mechanisms of these blockchain networks.A deep dive on Blast by TPanThree months after its launch, Blast has attracted close to 150,000 wallets, with over 645,000 ETH bridged to its platform. As a Layer 2 blockchain, Blast offers native yield, allowing users to earn 4% or 5% by holding Ethereum or stablecoins. Recently, it secured $20 million in funding and was founded by Pacman, who is also behind Blur, a well-known ETH NFT marketplace. Moreover, Blast has integrated Blur's rewards program, offering additional benefits to its users.No information in this blog is intended to provide any personal investment services or advice nor is it an investment recommendation. Clients are responsible for making their own investment decisions. Bitstamp accepts no responsibility for any damage and/or loss arising from the use of information provided herein. Past performance is not necessarily an indicator of future results. Please consider your individual position and financial goals before making an independent investment decision.Bitstamp is licensed to engage in virtual currency business activity by the New York State Department of Financial Services. Licensed as a Money Transmitter by the New York State Department of Financial ServicesNot offered in the following states: Hawaii and NevadaBitstamp UK Limited is registered with the UK's Financial Conduct Authority. Please read the Risk Warning Statement before investing. Cryptoassets and cryptoasset services are not regulated by the Financial Conduct Authority. You are unlikely to be protected if something goes wrong. Your investment may go down as well as up. You may be liable to pay Capital Gains Tax on any profits you earn.
