Solana token falls about 400% in 24 hours. That’s twice as strong as most major currencies except FTT, which is down 75%.
According to CoinGecko, SOL was testing the $15 mark, while the token was worth more than $30 just last night. Compared to the historic highs of almost exactly one year ago, on November 6, 2021, at $293, SOL is down 93%. At the time of publication, the SOL had recovered to $17.8.
The Solana token is falling – whales are on the verge of liquidation
The Solana whale is preparing to liquidate its positions amid a massive collapse in quotations. Renowned Chinese crypto journalist Colin Wu pointed out that one whale used 2.4 million SOL worth just over $51 million as collateral for a $44.8 million USDC loan. The liquidation threshold for that particular address was $43 million.
Worse, the Solana blockchain had technical problems again – at the most inopportune time. An announcement appeared on the network status page: “The Solana network is currently experiencing performance degradation. (Editor’s note: At the time of publication, the network status had changed to “all systems are up and running.”
According to Colin Wu, the overload is related to the oracle update – little consolation for those who use the protocol, which not so long ago was proclaimed “the killer of Ethereum”.
FTX collapse hits Solana and the crypto market
Over the past 24 hours, not only FTT and SOL tokens have collapsed. Most major cryptocurrencies suffered serious losses. The cryptocurrency market capitalization decreased by more than 12% in 24 hours and reached $890 billion, compared to more than $1.1 trillion at the weekend. Thus, more than $200 billion has left the market in a few days.
Bitcoin (BTC) fell below $18,000 and is now trading at $17,700. Ether collapsed under $1,200 and tested the $1,150 low for the first time since July 2022.
Despite the precipitous pullback, markets remain within long-term ranges. However, further losses could lead to a breakout of important support levels and a new bear market spiral.
We previously reported that OpenSea is introducing a forced royalty collection tool for NFT authors.
ETH inflation after Merge started rising again for the first time since November
The annual ETH inflation after Merge has once again turned positive for the first time since early November.
According to ultrasound.money, the annual ETH inflation rate rose 0.08% to 622,000 ETH as of December 6. At the same time, the annual ETH burn rate is 527,000 ETH. This news will also have a negative impact on the current price of Ethereum.
Meanwhile, back in early November, the volume of ETH being burned was overtaking issuance, making the cryptocurrency deflationary.
The cryptocurrency exchange site Uniswap V3 had the most commissions burned (~4192.1 ETH burned in the last thirty days). In second place were commissions burned for ETH transactions on the Ethereum network (3195 ETH). The three most active projects were closed by the USDT Stablecoin smart contract, through which ~2593 ETH was burned.
Almost in a month the Ethereum network burned over 50 000 ETH, and every minute about 1.2 ETH are burned in commissions.
Method for calculating current ETH inflation rate
Recall that before Ethereum switched to Proof-of-Stake algorithm, the amount of ETH issued per day was calculated by the formula: reward per block for miners and pay for PoS-stackers – ETH burned. However, after the transition to PoS, rewards for mined blocks are no longer generated at the execution level or on the main Ethereum network.
Given that the issue at the execution level after the transition to PoS is zero, the number of new ETH is now calculated as follows: the reward for PoS-stackers is burned tokens. At the time of writing, the ETH rate in the ETH/USD trading pair is $1,261, according to Nomics. The market capitalization at the same time is fixed at $154.5 billion.
Previously, we reported on What’s wrong with proving cryptocurrency reserves and why the cryptocurrency community doesn’t believe in it.
British Ministry of Finance wants to restrict the crypto business in the country – media
The British Treasury is finalizing a package of rules to restrict the crypto business. It was reported by the Financial Times, referring to the Financial Conduct Authority (FCA) of Great Britain.
The list of new rules includes restrictions on foreign cryptocurrency businesses in the UK; provisions on how businesses should act in case of bankruptcy, as well as requirements for advertising cryptocurrencies. This news will also have a negative impact on the current price of Ethereum and the cryptocurrency market.
Sources close to the British Ministry of Finance said in a media commentary that the ministry also intends to expand the FCA’s crypto restrictions and supervision over the cryptocurrency market. Details, however, remain unclear. Officially, the timetable for considering a new set of rules for the crypto market remains unknown. but media reports indicate that the British authorities may start consultations as early as early 2023.
In early November 2022, the Committee on Digital, Culture, Media and Sport (DCMS) in the U.K. The House of Commons announced the launch of a study into non-interchangeable tokens (NFT) and blockchain technology.
DCMS committee chair Julian Knight MP said that NFTs burst into the digital world so quickly that there was no time to stop and think. Now that the market is changing dramatically and there are fears that the bubble may burst, it is necessary to understand the risks, the benefits of this disruptive technology, and to formulate regulatory requirements for it, he stressed.
Amid the collapse of the FTX crypto exchange, UK authorities are discussing many initiatives to regulate the crypto market. Rishi Sunak, who took over as prime minister after the short reign of Liz Truss, played no small role here. Sunak is considered a key supporter of cryptocurrency in the government circles of the country.
Previously, we reported that Tether claims its USDT loans are “over-secured.”.
For the first time, a Chinese court recognized that NFT is virtual ownership
Collections of NFTs have been recognized as virtual property under current Chinese law. The court in Hangzhou ruled.
The ruling states that NFTs have property rights characteristics such as value, rarity, manageability, and saleability. The court described virtuality and the technology that provides it as unique attributes of the assets. Whether this will have a positive effect on the current price of Bitcoin, we will see soon enough.
The case was heard in the sale of NFT virtual property by the defendant company. The plaintiff gave the firm personal information and transferred 999 yuan (about $144) before the purchase. However, the company did not deliver the goods, and returned his money a few days later, citing incorrect identification information. As a result, his claim was assessed at 99,999 yuan (about $14,380). The court sided with the seller, confirming the misrepresentation.
“As a virtual work of art, the NFT virtual property digital collection itself combines the original expression of the creator of the art and has the value of the corresponding intellectual property rights. At the same time – they are unique digital assets formed on the blockchain based on the mechanism of trust and consensus between the nodes. Therefore, NFT collections fall under the category of virtual property,” the ruling said.
On that basis, the court ruled that the rules governing online trading apply to asset transactions.
China believes that NFTs can be used for fundraising, including illegally. Therefore, the government has concerns that “underground banks” or loan sharks and shadow banking may soon appear in the country. Therefore, the government has banned not only crypto-assets such as bitcoin, but even ICOs and mining.
However, despite the restrictions, as of the end of May, there were 83 billion yuan (about $12.33 billion) worth of digital yuan transactions in the country. China continues to actively pursue the adoption of digital currency.
Earlier, we reported that Apple forced Coinbase to remove NFT transfers.
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