Crypto blockchains analysis. Bitcoin has fallen more than 65% since the beginning of the year as cryptocurrencies entered a bear market. The year on the chart includes everything from hacks to block or upgrade blockchains and everything in between. Here are some of the most important events of 2022 said through graphics.
Bitcoin has fallen around 65% since the beginning of the year, falling from $47,000 to $16,800 at the beginning of the year. As cryptocurrencies entered a bear market in line with traditional markets, several key factors exacerbated the meltdown.
The Wind Carried It
The total amount of money in DeFi hacks has increased significantly in 2022. A major crypto exploit took place in March on the Ethereum sidechain Ronin, supporting the popular game Axie Infinity at the time. A total of 173,600 ETH (which amounted to $590 million at the time) and 25.5 million USDC stablecoins were lost – all thanks to a fake project, as reported in Block. The US government later linked the incident to the North Korean hacking group Lazarus.
The Slope of Terra
Luna’s distributed ledger grew to more than 6.5 trillion in May before the Terra blockchain was shut down for a second time in an effort to save the failing ecosystem. These efforts were inevitably unsuccessful.
TerraUSD – the algorithmic stablecoin of the Terra blockchain – lost its peg to the US dollar in May, leading to a downward trend for Luna, a related token believed to have supported UST’s value. The formation of terraUSD means that the sale of Luna is to help the algorithmic stablecoin maintain parity with the US dollar.
But once terraUSD lost its pack and investors tried to invest in the church, the system put serious pressure on Luna. In early May, Luna’s supply was about 340,000, according to data from Terra Research. Between May 10 and May 12, the network token 176 billion tokens, despite closing the chain for a short time. It reached 6.5 trillion on May 13.
In August, the US Treasury announced that it was supporting Tornado Cash, a cryptocurrency mixing service that allows users to hide transaction details. The organizer added Tornado Cash and 44 connected Ethereum and USDC wallets to the list of selected citizens. The wallets include smart contracts that run Tornado Cash, Gitcoin gift addresses, and Tornado Cash gift wallets.
The SDN list prevents US citizens and companies that want to operate in the United States from partnering with designated companies. In May, OFAC added Blender.io, the first crypto blender name. However, Tornado Cash differs from Blender.io by being a release system. This may be the first example of US restrictions targeting a DeFi user.
The day after the ban, only $6 million was invested in the protocol, according to data from The Block Research. This represents a decrease of 78.5% compared to the same period last week.
ASIC Mining Machine Price Drops (All Year, Later Half Again)
At the height of the bull market last year, bitcoin miners raced to increase the hashrate and were happy to sign purchase contracts with delivery times of several months. But as the mining economy has worsened in recent months, the price for ASIC machines has also fallen. The market was saturated and, per terahash as a whole, the price fell by more than 80%.
On top of that, companies have used these same machines to get loans, which can be a challenge for investors like BlockFi as they face unfairness.
Ethereum Blockchains Combination
The long-awaited transition of the Ethereum blockchain through proof of work will finally take place on September 15th. Instead of miners using GPU machines to support transactions, the network now relies on supporters who put tokens to participate, with greatly reduced fees. This decision takes into account the huge consumption power of Ethereum.
The Future of Ether is More Than Bitcoin
For the first time, ether futures volume surpassed bitcoin futures volume in August.
The number of ether futures exceeded that of bitcoin futures by 1.11 times in August, according to The Block Research. The Block’s Lars Hoffman said that this is a port game in the Ethereum blockchain environment.
Reduction of GBTC and Net Asset Value (NAV)
GBTC’s reduction in net asset value (NAV) fell to an all-time low during the year. The price of bitcoin fell on June 17, when it hit -34%. The decline is narrower ahead of the SEC’s decision on whether to convert GBTC to bitcoin ETFs. The reduction widened to almost a 50% reduction in net profit by December 2022.
Grayscale’s offer to convert its stock into an ETF was rejected based on the regulator’s finding that the company had not demonstrated adequate plans to prevent fraud and fraud. Grayscale then filed a lawsuit against the SEC after the ruling.