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02 March 2023

February 2023 Rollup | Latest Trends & Developments

NOAH's February Rollup provides a comprehensive overview of the most significant cryptocurrency events and developments in February 2023. Read to stay informed about the latest trends and happenings in the ever-evolving crypto landscape.

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February 2023 Rollup | Latest Trends & Developments

    Index

    Nigerians Turn to Bitcoin Due to Naira Woes
    Ordinals Take Flight
    No “Crypto Bowl” This Year
    Gemini Reaches Agreement With Genesis Global
    SEC Charges Kraken, Spells Potential Regulatory Troubles
    Coinbase Launches ‘Base,’ a Layer 2 Developer Platform

Stay informed with NOAH's February 2023 Industry Rollup, a comprehensive overview of the most impactful cryptocurrency events and developments. Read now to get up-to-date on the latest trends and happenings in this rapidly evolving landscape.

Welcome to the NOAH February Rollup, a comprehensive survey of the most impactful events and developments in the world of cryptocurrencies. As we navigate this rapidly evolving landscape, we must stay informed of the latest trends and happenings in the crypto world. This rollup is your one-stop source for all the latest news and insights, providing a comprehensive overview of the most significant stories that dominated the crypto scene in February 2023.

Nigerians Turn to Bitcoin Due to Naira Woes

The recent economic crisis in Nigeria, caused by a combination of factors such as the naira redesign, political climate, and economic conditions, has led to an increase in the value proposition of bitcoin for average Nigerians. The naira redesign is a policy change announced by the Central Bank of Nigeria (CBN) on November 26, 2022, aimed at addressing some of the country's economic challenges, such as inflation and counterfeiting. The policy involved issuing new ₦200, ₦500, and ₦1,000 notes, deeming them as the only legal tender moving forward.

The redesign has faced logistical nightmares and a shortage of new notes, leading to long lines at ATMs and daily withdrawal limits. Although the old notes were supposed to no longer be legal tender after February 10, the deadline has been extended until April 20, 2023.

The issues with the Naira redesign in Nigeria have resulted in a rush towards alternative forms of currency, with Bitcoin being one of the most popular choices (Nigeria is the leading country searching “Buy Bitcoin” on Google Trends). The current situation with the naira, where there are three different types in circulation, each with varying levels of adoption, FX rates, and legal status, has made it difficult for people to effectively exchange and use the currency. This lack of fungibility, a necessary component of money, has led to economic uncertainty and a decrease in trust in the naira.

Ordinals Take Flight

The Ordinals Protocol, the latest phenomenon in Bitcoin, has taken the crypto world by storm. On February 13th, 2023, Ordinal inscriptions reached a milestone of 100,000, as users inundated the network with a deluge of content, ranging from images to video games.

The Ordinals Protocol is a recent development with Bitcoin that offers a new way of tracking the distribution of individual satoshis, the smallest unit of the cryptocurrency. The project is the brainchild of Bitcoin developer Casey Rodarmor and consists of two parts: Ordinal Theory and Inscriptions.

Ordinal Theory is the concept that each satoshi in Bitcoin can be assigned a unique ordinal value based on its position in the blockchain. This ordinal value can track the distribution and movement of individual satoshis over time, allowing for greater transparency and accountability within the network.

Inscriptions, however, allow users to encode arbitrary data into the Bitcoin blockchain, allowing users to generate valid Bitcoin transactions that contain any kind of data, such as text files, images, or program scripts.

Ordinal Inscriptions have been dubbed “NFTs on Bitcoin” and have understandably created a stir in the Bitcoin community. For “Bitcoin maximalists”, however, the use of Inscriptions represents a departure from the “original vision” of the network, which was focused on creating a decentralized, censorship-resistant form of money. Furthermore, some also worry that the increasing use of Ordinal Inscriptions might lead to a bottleneck in the time it takes to verify transactions on the Bitcoin network. This could impact the network's ability to function as a fast and efficient form of digital currency, which was one of its original purposes. On the other hand, others say that the use of Inscriptions represents a new era for Bitcoin, one that embraces the artistic and expressive potential of the blockchain.

Despite concerns about the impact on the network, the growth of Ordinal Inscriptions is a testament to the creativity and innovation within the Bitcoin community and the potential for this technology to transform the world of digital assets. Find out more about Ordinals here.

No “Crypto Bowl” This Year

The Super Bowl is regarded as one of the most significant annual sporting events globally, with 113 million viewers eagerly (or regrettably) anticipating the various commercials airing during the game. However, this year's Super Bowl was notably different from previous years, as the NFL enforced a ban on cryptocurrency and NFT advertising.

Last year's Super Bowl, dubbed the "Crypto Bowl," featured four high-profile commercials from major crypto firms, including FTX, Coinbase, Crypto.com, and eToro. These ads were part of a broader trend by crypto companies to gain wider acceptance and mainstream appeal through sports sponsorships. However, in the wake of FTX's founder Sam Bankman-Fried’s involvement in fraudulent activities and the company's subsequent bankruptcy, this year's deals were halted, and no crypto-related commercials were aired during the game.

The conspicuous lack of cryptocurrency advertisements during the Super Bowl reveals a significant public shift in sentiment toward crypto assets. This absence not only indicates a changing approach to marketing and mainstream adoption but also underscores a growing public concern over the industry's lack of transparency and legitimacy.

Gemini Reaches Agreement With Genesis Global

In a significant development, cryptocurrency exchange Gemini has announced an agreement with Genesis Global Capital, LLC, Digital Currency Group, Inc., and other creditors to facilitate the recovery of assets for users of Gemini's Earn program. This deal represents a positive step forward in the long-running saga that has been unfolding since November 2022.

As part of the agreement, Gemini will contribute up to $100 million in additional funds for Earn users. While the process may take several months to complete, with no guarantee of complete asset recovery, this framework marks a critical milestone in the recovery process.

SEC Charges Kraken, Spells Potential Regulatory Troubles

The Securities and Exchange Commission (SEC) charged crypto exchange Kraken for failing to register the sale of its staking-as-a-service (SaaS) program. The SEC has required that Kraken immediately stop selling crypto asset securities and pay $30 million in disgorgement, prejudgment interest, and civil penalties to settle the charges. The SEC said that SaaS programs like Kraken's, which offer an easy-to-use platform and investment returns, pose risks for investors who relinquish control of their crypto tokens without the protection of SEC securities laws. According to the SEC, these charges demonstrate the need for proper disclosure and investor protection for SaaS providers, whether through staking, lending, or other means.

The charges levied against Kraken by the SEC have sent ripples through the crypto community and stoked fears about further regulatory scrutiny across the entire industry. The ruling may deter other crypto intermediaries from offering similar investment contracts in the future, given the need to provide the proper disclosures and safeguards required by securities laws.

Coinbase Launches ‘Base,’ a Layer 2 Developer Platform

Coinbase has launched its Ethereum Layer 2 (L2) network, Base, a secure, low-cost, and developer-friendly platform that allows users from anywhere in the world to build decentralized apps on-chain. Coinbase said the ultimate goal of Base is to further industry development and onboard one billion users to the crypto-economy.

Currently, Base is being incubated within Coinbase, with the company stating its intentions to decentralize the chain over time progressively. In the meantime, the platform serves as a home for Coinbase's on-chain products and an open ecosystem where anyone can build. To this end, the company has made testnet resources readily available on the Base website, allowing developers to begin building on Base immediately.

Thank you for joining us on NOAH’s Monthly Rollup. Keep following us for more updates, and remember to stay informed as the crypto world continues to grow and evolve. Thank you again!

Please be aware that: Cryptocurrencies are unregulated in the UK; Cryptocurrencies are not protected under Financial Ombudsman Service or Financial Services Compensation Scheme (FSCS); Profits may be subject to capital gains tax; The value of investments can go down as well as up.

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