The proportion of extended ETH holders surged in 2023, surpassing Bitcoin for the second time in history. Based on insights via the on chain analytics platform IntoTheBlock, Ethereum has demonstrated notable progress in the percentage of investors maintaining their assets for over a year, marking a significant milestone for the blockchain, with the majority of current investors adopting a long term holding strategy.

ETH Long Term Holders Take Lead Over BTC

While the price performance of ETH lagged behind Bitcoin throughout 2023, this trend is expected, given the sheer dominance exhibited by BTC in bullish indicators and investor confidence. However, data indicates a growing number of Ethereum investors committing to holding ETH for an extended period, likely fueled by the anticipation of substantial future value appreciation.

Long term holders, characterized by their reluctance to sell during market volatility and price declines, play a crucial role in sustaining blockchain health, contributing to stability and mitigating price fluctuations.

History Repeats Itself

Ethereum has previously surpassed Bitcoin in this metric only once before, and it is noteworthy that during that instance, ETH went on to maintain leadership in this category over the subsequent months. Conversely, other metrics reveal that Bitcoin still maintains superiority over Ethereum in terms of profitability. Presently, nearly all BTC addresses show profitability at the current price, compared to ETH addresses which do show profitability albeit to a lesser extent.

In any case, the heightened profitability of Bitcoin is attributed to a significant number of early BTC assumed to be permanently lost. Consequently, the metric indicating holders who purchased at the current price places Ethereum ahead of Bitcoin.

The Cosmos community has given the green light for a substantial allocation of more than 975,000 ATOM tokens to create the ATOM Accelerator DAO (AADAO), representing a significant advancement in the development of the Cosmos ecosystem. This endeavor aims to establish a durable, community owned entity dedicated to fostering and progressing the Cosmos Hub and its intrinsic ATOM token.

Formation Of The ATOM Accelerator DAO

The ATOM Accelerator DAO is positioned as a cornerstone within the Cosmos ecosystem. Endowed with a substantial fund of 975,811 ATOM tokens, the AADAO is uniquely positioned to lead projects and initiatives that will fortify the Cosmos Hub. Its focus transcends immediate advancements, laying the foundation for sustainable, long term success.

The creation of the AADAO unequivocally signals the proactive stance of the community in shaping the future of the Cosmos network. By establishing a fully funded and community governed DAO, Cosmos takes significant steps towards a more inclusive and decentralized operational and decision making model.

Objectives And Impact of the AADAO

The primary goal of the AADAO is to stimulate innovation within the Cosmos ecosystem and drive the adoption of the ATOM token. This objective will be accomplished through strategic funding and resource allocation to projects and ideas aligning with the broader vision of the Cosmos Hub. The DAO aims not only to support existing projects within the ecosystem but also to attract fresh talent and ideas, cultivating an environment of continual innovation and development.

The anticipated impact of the AADAO is extensive. By providing a dedicated platform for funding and support, the DAO will play a pivotal role in expediting the growth of the Cosmos ecosystem. This includes augmenting the utility and market presence of the ATOM token, thereby fortifying its standing in the broader cryptocurrency market.

Finally, the long term vision for the AADAO is to forge a self sustaining and robust organization that not only supports the Cosmos ecosystem but also contributes to the broader blockchain and crypto industry. With a focus on innovation, adoption, and community governance, the AADAO is poised to become a pivotal player in advancing decentralized technologies and applications.

Decentraland (MANA), introduced in 2017, is an Ethereum (ETH) based virtual reality platform reshaping digital spaces through decentralization. Users not only interact with content but also influence and monetize it using unique digital assets, namely the LAND and MANA tokens. Decentraland was also among the first platforms to truly utilize the metaverse concept to its fullest potential.

The Evolution Of Decentraland

As such, Decentraland has had a very interesting journey thus far. It was a very simple Stone Age concept in 2015 but has now evolved to an envisioned Iron Age, demonstrating innovation and user empowerment. The technical infrastructure relies on blockchain for LAND ownership, decentralized storage systems, and a real time layer for immersive interactions.

Moreover, the economic model revolves around the LAND and MANA tokens, facilitating transactions and digital land acquisition. Within the virtual world, the economy encourages users to create, trade, and engage in various commercial activities, reflecting the overall vision of Decentraland which is the formation of a fully self sustaining virtual space.

Heading Into Web3

The Decentraland whitepaper outlines a vision of a decentralized virtual world where users are creators and entrepreneurs. Despite its evolution, Decentraland remains committed to its initial goal of establishing a decentralized virtual domain, showcasing dedication to cutting edge technology and community driven development.

However, the platform faces challenges in managing decentralized content distribution and scripting. Robust technology is crucial to address logistical complexities and ensure a seamless user experience. Still, with the world becoming increasingly digitized and pivoting toward a Web3 era, it could only be a matter of time before platforms like Decentraland are incredibly commonplace.

The Ethereum (ETH) team aims to address the intricacies and scalability challenges of its current signature method, to which end Vitalik Buterin has delineated three alternative strategies aimed at improving the overall efficiency and user experience within the Ethereum ecosystem.

The Solutions

Initially, Buterin advocates for a substantial reduction in validators by establishing a minimum deposit requirement of 4,096 ETH and capping validators at this number. Doing so would markedly decrease the computational load on the network and streamline the consensus mechanism.

Alternatively, Buterin proposes the implementation of a two tier staking system. Validators would be categorized into the heavy layer, requiring a minimum deposit of 4,096 ETH and responsible for core consensus mechanisms. The light layer, comprising validators with no minimum deposit, would contribute to overall network security without the same level of direct involvement in consensus.

Finally, Buterin suggests a rotating participation model, randomly selecting a subset of 4,096 validators for each slot to engage in consensus. This would ensure a diverse and dynamic validator set while upholding efficiency and scalability. Buterin contends that this particular approach strikes the optimal balance between accountability and decentralization. The rotating participation method could therefore establish a more decentralized staking system without compromising security.

Still Some Complications

Dramatically reducing validators might lead to a concentration of power among a smaller group. Moreover, despite noble intentions, the practicality and successful execution of these proposals remain uncertain and could encounter significant obstacles.

Still, while acknowledging that his proposal deviates significantly compared to what the current design of Ethereum is, Buterin insists that the benefits are too substantial to overlook. He firmly believes this restructuring would fortify overall network security, decentralization, and accessibility to new users.

In any case, the outlined changes have the potential to revolutionize Ethereum. Given its status as the second largest cryptocurrency by market capitalization, these alterations may redefine the Ethereum network itself and possibly reshape the broader crypto industry landscape going forward.

While Bitcoin saw a modest increase over the past 24 hours, nearing $44,000, various altcoins have outperformed it, causing a roughly half a percentage reduction in its market dominance within a day. BNB has experienced a significant surge of 12%, reaching $330 amid the recent altcoin resurgence.

The total crypto market cap has increased by over $40 billion daily, reaching close to $1.7 trillion on CoinGecko. Bitcoin, while up 1% on the day and trading slightly above $43,000, has seen a decline in market dominance by 0.5% in a day to just below 50%. However, its market capitalization has rebounded to above $840 billion after a recent retracement. 

Altcoins rally

Bitcoin SV stands out as the most notable gainer, alongside others like Arbitrum, Aave, Lido DAO, Optimism, and more. In the same timeframe, SOL has declined by over 6%, allowing BNB to reclaim its recently lost fourth place in market cap.

Elsewhere, ADA witnessed a 9% surge, trading above $0.65, while Ethereum rose by 6%, nearing $2,400. Notable gainers among larger-cap altcoins also included Chainlink (14%), Uniswap (10%), Bitcoin Cash (11%), and ICP (7%). Conversely, Avalanche, Polkadot, MATIC, and Toncoin are in the red.

Bitcoin SV has experienced a remarkable 60% surge, trading above $90, leading the top 100 alts. Other notable gainers include ARB, AAVE, LDO, OP, and XDC, with gains ranging between 15% to 20%.

Other markets

In the financial markets, European equity futures have edged higher as the year-end approaches, with global shares on track for their best annual performance since 2019. Treasuries remain steady, while contracts for the Euro Stoxx 50 rose 0.2% after modest declines in Asian stocks. US futures indicate gains, while the MSCI All Country World Index rallied by approximately 20% this year.

In other news, the United States Dollar (USD) is set for its worst year since the onset of the pandemic, down nearly 3% in a Bloomberg gauge, as Wall Street anticipates a Federal Reserve interest rate reduction after reining in inflation. Despite false starts suggesting the end of the rate-hiking regime, the USD has experienced its steepest annual drop since 2020.

Lastly, oil is on track for its most substantial annual drop since 2020, as war and production cuts fail to boost prices. Brent crude remains above $77 a barrel, facing weekly, monthly, and quarterly losses, while West Texas Intermediate hovers near $72 a barrel. The global benchmark has also declined by about 10% this year, and a broader Bloomberg commodities gauge has additionally dropped by a comparable margin over the past 12 months.

CatalX CTS Ltd., the operator overseeing the Canadian crypto trading platform Catalyx, recently disclosed a security breach resulting in the partial loss of crypto assets held on behalf of clients. The company suspects the involvement of an employee in the incident, prompting the Alberta Securities Commission to issue a cease trade order against the company and its CEO, Jae Ho Lee.

Damage control

In response to the security breach, CatalX has temporarily halted all withdrawals of crypto and fiat currencies through its platform, as well as suspended trading activities. This measure is aimed at containing potential further losses and safeguarding the interests of platform users. The company is actively investigating the matter and taking decisive action.

Canadian regulators swiftly responded to the Catalyx security breach, with the Alberta Securities Commission ordering the cessation of crypto contract trading and launching an investigation. CEO Jae Ho Lee agreed to the 15-day freeze order, set to expire on January 5th, 2024. CatalX is also conducting an internal investigation into the security breach and has enlisted Deloitte LLP for forensic and investigative support.

Stay tuned

The company has pledged to keep customers informed of significant findings or developments as the investigation progresses and anticipates providing updates upon the conclusion of the investigation. Users are advised to stay tuned for further communications regarding the resolution of the security breach and the resumption of normal trading and withdrawal activities.

The loss of crypto assets and the suspected employee involvement have triggered internal and regulatory investigations. CatalX is navigating this challenging situation by prioritizing transparency and collaboration with regulatory authorities to safeguard the interests of its clients.

The temporary freeze on trading activities is therefore a precautionary measure to prevent additional losses and ensure a comprehensive examination of the incident. As the investigation unfolds, stakeholders await further updates on the extent of the breach and the steps CatalX will take to enhance its security measures.

If U.S. Congressman Warren Davidson gets his way, the volatile environment of the Securities and Exchange Commission (SEC) is set to undergo considerable change. Davidson has openly announced 2024 as the optimum time to fire Gary Gensler, the current SEC Chair, in a passionate plea for change. His audacious allegation is more than just a declaration of purpose, as it reflects growing dissatisfaction with the leadership of the SEC and its operational direction so far.

A time for change

Davidson has been a vociferous opponent of the SEC for a while now, particularly in its dealings with the emerging digital asset sector. The SEC has adopted what many regard as an overly tough and enforcement focused regulatory posture under Gensler.

This tactic has not only alienated major stakeholders in the cryptocurrency business, but it has also cast doubt on the overall regulatory effectiveness and impartiality of the SEC in general. Congressman Davidson has put his criticism into action by introducing the SEC Stabilization Act. If passed, this bill will drastically alter the SEC, potentially forcing Gensler out of his current job. 

A long way to go

The legislative proposal is more than just a criticism of Gensler, as it is a larger push for SEC change. The legislation aims to improve the accountability, openness, and responsiveness of the agency to the growing needs and dynamics of modern financial markets. By campaigning for the elimination of the accredited investor restriction, Davidson hopes to democratize investment opportunities, perhaps allowing a broader spectrum of investors to engage in profitable market deals.

The idea, while audacious and perhaps transformative, faces a difficult road ahead. To remove a sitting SEC Chair, significant political maneuvering and legislative impediments must be overcome. It takes not only the support of colleagues in the legislature, but also a persuasive case that can survive scrutiny by Congress and beyond.

MicroStrategy remains deeply committed to Bitcoin, as its Founder and Chairman Michael Saylor recently announced the acquisition of an additional 14,620 BTC, totaling $615.7 million. This latest purchase coincides with the upward surge in the value of Bitcoin, reaching heights exceeding $42,000.

Going all in

MicroStrategy initially entered the Bitcoin market in August 2020, initiating a substantial investment of $250 million in BTC. Since then, the company consistently augments its Bitcoin holdings, implementing a treasury reserve strategy that now boasts over 189,150 BTC valued at over $8.11 billion at the present moment.

According to Saylor, on December 27th, 2023, MicroStrategy disclosed that, between November 30th and December 26th of this year, it, along with its subsidiaries, procured around 14,620 BTC for roughly $615.7 million in cash, averaging about $42,110 per BTC, inclusive of fees and expenses. 

No stopping now

As of December 26th, MicroStrategy and its subsidiaries collectively possessed approximately 189,150 BTC, obtained at a total purchase price of about $5.895 billion and an average acquisition cost of approximately $31,168 per BTC, inclusive of fees and expenses.

With the impending fourth Bitcoin halving and potential early approval of the first spot Bitcoin ETF in the United States of America, MicroStrategy persists in its robust Bitcoin investment approach, showing no indications of slowing down.

Integrating smart contract functionality into the Cardano (ADA) network has led to a substantial increase in growth metrics, positioning the network as a contender against established platforms such as Ethereum (ETH).

As of December 26th, the Plutus smart contracts platform on Cardano accommodated 14,302 smart contracts, combining both V1 and V2. This signifies a remarkable growth of over 200%, as per data sourced via Cardano Blockchain Insights. Notably, the surge in the smart contract count for Cardano corresponds with intensified efforts in network development aimed at enhancing overall functionality.

Cardano continues its development

Cardano reports that the team has focused on expanding script capacity through the introduction of the Plutus V2 Cost Model network upgrade. The continuous pursuit of improvement is evident in the year-end report, where the core technology team implemented an update to provide ample time for teams to adapt their components in preparation for the V9.0 release.

The Plutus team, dedicated to smart contracts, also achieved noteworthy improvements in the costs and sizes of most scripts. Concurrently, the scaling team, Hydra, unveiled version 0.14.0, reinforcing the resilience of the Hydra network.

In addition, the reports underscore key updates in network statistics, with the total transactions of ADA surpassing 80 million, and the total number of native tokens reaching 9.17 million. The reports also note active development, with over 1,300 projects in progress on the blockchain, and 153 projects already launched.

A serious contender

Analyzing the price of ADA, it is currently trading at $0.61, reflecting a 0.72% increase in the past 24 hours. This contrasts with a 0.49% loss over the past week but contributes to an impressive gain of 53.66% in the last month. Over the past year, ADA has experienced a notable surge, marking a remarkable increase of 134%, positioning the asset favorably against 65% of the top 100 cryptocurrencies in the same period.

Additionally, the current trading status indicates that the asset is positioned above the 200-day simple moving average, signaling a positive trend. Furthermore, the asset demonstrates positive performance relative to its token sale price, with 17 positive gains in the last 30 days.

Creditors of the now-defunct Bitcoin exchange, Mt. Gox, are reportedly getting fiat repayments for their BTC holdings that had been inaccessible since February 2014. Mt. Gox is sending repayments in Japanese Yen to users through PayPal. Creditors who have been waiting for the return of their long-frozen assets for years are closely monitoring the unfolding situation.

A long time coming

This marks a significant development nearly ten years after the funds got stuck on the defunct exchange on February 24th, 2014. It is important to note that these reports have yet to be officially confirmed. One Reddit user, Free-end254, enthusiastically stated that he recently got paid and shared a screenshot of the PayPal payment receipt. Another user initially suspected a phishing scam but later found a legitimate payment in their PayPal account.

However, one user mentioned that only a portion of their 0.125 Bitcoin claim had been repaid, receiving 30,283 Yen, equivalent to $200 at the current exchange rate, and still awaiting an approximate payment of $748. Repayments to creditors are expected to occur in multiple installments, including the base repayment, early lump-sum repayment, and intermediate repayment. The first instances of these repayments became public on December 21st, when a pseudonymous Japanese user announced receiving their Mt. Gox claims via a bank transfer in Yen.

A developing story

This development follows an email by Nobuaki Kobayashi, the trustee overseeing the Mt. Gox estate. The email was sent to rehabilitation creditors on November 21st, notifying them of the commencement of repayments. The email also mentioned the intention of the trustee to start cash repayments in 2023 and continue the process into 2024. However, no specific timeline for repayments to individual rehabilitation creditors was provided.

Notably, on September 21st, the Mt. Gox trustee extended the repayment deadline to October 31st, 2024. Nevertheless, the trustee indicated that some repayments could be made as early as the end of this year for rehabilitation creditors who had already provided the necessary information.

Amidst a changing economic environment, the Bank of Japan (BoJ) is set to adjust its longstanding monetary policy, indicating a possible departure compared to the prolonged era of an extremely accommodative monetary approach. This shift, as suggested by BoJ Governor Kazuo Ueda, depends on the increasing likelihood of Japan achieving its elusive 2% inflation target on a sustainable basis.

As the BoJ embarks on this new course, the world observes with anticipation. The potential policy adjustment is not only of national significance but also serves as a test case for global economic strategies in a post-pandemic world. It entails a delicate balance between fostering growth and maintaining stability, a challenge that the BoJ appears ready to navigate with a forward-looking perspective.

Navigating economic uncertainties

As the Japanese economy gradually emerges via the challenges of low inflation and stagnant wage growth, the potential new direction taken by the Central Bank could signify a notable turning point. The recent statements by Ueda indicate a clear understanding of the intricate relationship between wages, prices, and economic stability. The current focus is on whether the upward trajectory in wages will persist into the coming year, potentially triggering additional increases in service prices.

The journey toward this policy adjustment presents challenges and uncertainties. While the economy is slowly shifting towards growth, with external demand offsetting domestic consumption weaknesses, the BoJ remains cautious. There is no predefined timeline for modifying pre-existing monetary policy, which is arguably the most accommodative among major economies. This caution arises due to the unpredictable nature of economic and market developments on both domestic and international fronts.

Policy and perception

The Japanese government anticipates a slight improvement in economic growth for the current fiscal year. This optimism is fueled by a recovery in sectors like inbound tourism and automobile manufacturing, previously impacted by global challenges such as chip shortages. Despite positive signs, the Central Bank maintains a vigilant stance, prepared to adjust policies in response to the evolving economic landscape.

Governor Ueda highlighted a fundamental shift in perspective at the BoJ. For years, the institution has stressed the importance of patience in maintaining its ultra-loose policy. Now, there is a growing acknowledgment that altering public perceptions regarding prices and wages is vital for economic revitalization. This new approach could lead to more effective labor allocation and, crucially, grant the BoJ the flexibility to significantly lower rates in the future to counter deflation.

Moreover, this cautious optimism aligns with the overall economic outlook, envisioning a gradual normalization of inflation rates and a steady increase in nominal GDP. However, achieving a sustainable and stable inflation target remains challenging, given the high uncertainties surrounding global and domestic economic conditions.

The seemingly numerous Bitcoin ETF proposals are currently under scrutiny by the SEC, which has established a deadline for final modifications. There are indications suggesting a potential approval of the ETFs in early January. With just a few days left until the new year, enthusiasm surrounding Bitcoin exchange-traded funds has reached unprecedented levels.

As such, the US Securities and Exchange Commission is conducting thorough reviews with applicants to ensure meticulous preparation before potentially endorsing one of the most groundbreaking financial instruments, poised to reshape the financial landscape indefinitely.

Deadline set by the SEC

Reports reveal that the SEC is gradually becoming more receptive to Bitcoin Spot ETF proposals and is anticipated to make a significant decision by January 10th, 2024. This date serves as the ultimate decision point for the SEC to either grant or reject the application for the inaugural Spot Bitcoin ETF.

In anticipation of the January decision, US SEC officials have engaged with representatives via at least seven applicant companies, including BlackRock, Grayscale Investments, and 21 Shares, all seeking to launch Bitcoin spot ETFs. The SEC has also reportedly directed at least two firms to submit conclusive adjustments by the end of this business week on December 29th, 2023.

A decision with massive implications

Applicants failing to meet the aforementioned deadline for final adjustments will not be considered for the initial wave of potential Bitcoin ETF approvals in early 2024. Also, despite the mounting signs of a potential spot ETF approval in early January, it is crucial to recognize that the SEC maintains the authority to outright reject proposals on the deadline. Until now, the regulatory body has postponed its decision, leaving the market in suspense regarding whether it will accept or decline the proposal.

A crucial aspect of the potential ETF approval is the firm insistence by the SEC that investments in these assets must be executed exclusively in cash. This cautious stance on crypto spot ETFs underscores the view adopted by the regulatory agency that crypto assets are not on par with traditional ones.

In any case, the forthcoming decision to greenlight the inaugural spot Bitcoin ETF could redefine the dynamics between traditional finance and the burgeoning digital asset sector, paving the way for the latter to finally enter the mainstream.