China releases Web3 whitepaper

Dear member,

This week has been rife with significant developments across the Web3 ecosystem. The tale of Bitcoin's turbulent week stole the headlines, kicking off with a 4% rally on the back of the US debt ceiling suspension deal. However, Tuesday concluded with Bitcoin's first loss of 2023.

The heightened volatility was not confined to the price alone. Bitcoin's hash rate resumed its uptrend, moving closer to retesting its all-time high, while futures contracts faced a steep decline.

But Bitcoin wasn't the only crypto in the spotlight. Ethereum had its moment of glory too, sporting a price-to-earnings ratio dwarfing even those of Apple and Tesla by nearly 20x, indicating investor expectations for exponential growth. In parallel, the Ethereum scalability solution, Polygon, received investment from none other than Deutsche Telekom.

On the venture funding front, it was a bumper week for Web3, with investments tallying to $151 million, led by Immutable X and Alchemy. Other notable fund raises include:

On the consumer end, brand giants like Chick-fil-A, Toyota, Pfizer, and Samsung are going deeper into crypto adoption, while Reddit's NFT avatar collection has gained astounding traction, amassing nearly 10 million users. ANA's 70th anniversary celebrations ushered in NFTs featuring historic moments, while the global blockchain gaming market is projected to reach a staggering $300 billion by 2030, propelled by the growing allure of NFTs and DeFi.

Regulatory movements played a significant role as well. In a surprising turn of events, China outlined its Web3 strategy via a comprehensive whitepaper. Crypto exchanges will see stricter regulations in Hong Kong and Russia, while India looks to incorporate AI and Web3 for a future-ready approach.

While this paints a progressive picture, U.S lawmakers are introducing a bill to thwart a digital dollar pilot program, stirring debates on the future of CBDCs in the country.

In another curious turn of events, Peter Schiff's surprising about-face with the launch of a Bitcoin NFT - with a BTC logo on his face. Debates on the debt ceiling and unresolved banking crisis have BitMEX CEO Arthur Hayes warning about a possible financial crisis. But has it already arrived? This continued bear market and shallow liquidity seem to suggest so.

Best regards from the Future,
RFTF.ai 

Market Intel

Bitcoin rose by 4% to after the US government reached a deal to suspend the debt ceiling, seen as a positive development for the economy in the near term. BTC also hit a yearly high of $37,300 as investors buy Bitcoin at a higher price than they have in the past year.

Bitcoin ordinal inscriptions reaches 10 million, a significant milestone as it suggests that Bitcoin is becoming more widely adopted.

Bitcoin funding rates surge to highest level as liquidity market makers take a hit, suggesting that there is a lot of leverage in the market and that liquidity market makers are taking a hit.

Global blockchain gaming market to reach $300 billion by 2030, reported by Grand View Research. This growth is being driven by the increasing popularity of NFTs and DeFi.

Ethereum's P/E ratio of 190 currently at 20x of Apple and Tesla. Investors are expecting Ethereum to grow significantly in the future.

Funding Trends

$151M in funding in one week in Web3 development. A total of $151 million was invested in Web3 projects in week ending May 27, 2023, the highest weekly Web3 funding total since January 2023.

Transak raises $10 million in Series A funding round led by Digital Currency Group with participation from Alameda Research, CMS Holdings, and Wintermute. The funding will be used to expand Transak's product offerings and grow its team.

StepStone VC raises $97 million for two blockchain funds to deploy and invest in early-stage blockchain and cryptocurrency companies.

PayPal invests in new crypto wallet software Curv, a security-focused crypto wallet provider. The investment is part of PayPal's push to adopt Web3 technologies.

Web2 → Web3 Immersion

52% of big U.S. companies are crypto-friendly, a survey by the American Institute of CPAs found. Some of the top brands that are exploring cryptocurrency include Chick-fil-A, Toyota, Pfizer, and Samsung.

Reddit's “Collectibles” avatar NFTs skyrocket to nearly 10 million users. The collection has generated over $100 million in sales since its launch in February 2023.

Japanese airline ANA launches NFTs to commemorate its 70th anniversary by featuring images of ANA aircraft and other historical moments from the airline's history. The NFTs are being sold on the Rarible marketplace.

Deutsche Telekom invests in Polygon. The investment is part of German telecommunications giant's push to adopt blockchain technology.

Regulatory Round-up

APAC

Hong Kong Police Force unveils metaverse platform to train officers and to interact with the public. The platform, called "CyberDefender Metaverse," is based on the Unreal Engine 5 platform and allows users to interact with each other in a virtual world.

Crypto firms to apply licenses from Hong Kong Securities and Futures Commission (SFC), allowing them to provide services such as trading, custody, and asset management. The SFC is the first major financial regulator to issue licenses to crypto firms.

China has unveiled a whitepaper on Web3, outlining the country's plans for developing the technology. The whitepaper calls for the development of a decentralized Web3 ecosystem that is not controlled by any single entity. It also calls for the development of new applications and services that can be used on the Web3 platform.

Bank of Japan completes 2nd stage of its CBDC program, focused on testing the technical aspects of a CBDC. They are now moving on to the 3rd stage of the program, which will focus on testing the economic and legal aspects of a CBDC.

Reserve Bank of India (RBI) asked banks to prepare for the future by adopting AI and blockchain technology. The RBI has said that AI and blockchain can help banks to improve their efficiency and security. It has also said that AI and blockchain can help banks to develop new products and services.

Crypto.com receives digital token license from the Monetary Authority of Singapore (MAS), allowing them to offer cryptocurrency services to consumers in Singapore.

International

Russia set to enact laws to regulate cryptocurrency exchanges, requiring exchanges to register with the government, comply with AML/KYC regulations, and report suspicious transactions to the authorities.

US

A group of US lawmakers has introduced a bill to prevent the US government from launching a pilot program for a digital dollar. The bill argues that a digital dollar would be too risky and could undermine the US dollar's dominance.

5. Interesting Reads

Peter Schiff unveils Bitcoin NFT, flipping his stance on Bitcoin. The NFT is a digital collectible that features the controversial gold bug’s face and the Bitcoin logo.

7 of the 2024 U.S. presidential candidates have dropped clues about their stance on cryptocurrency. The candidates include Ron DeSantis, Tom Cotton, and Mike Pence.

Arthur Hayes has warned that the U.S. is facing a bank crisis and that the debt ceiling could be the "powder keg" that ignites it. The BitMEX CEO said that the Federal Reserve is running out of tools to prop up the economy and that the debt ceiling could be the catalyst for a financial crisis.

MicroStrategy CEO Michael Saylor has said that the banking establishment will oppose CBDCs and that stablecoins will eventually wind down. Saylor has said that CBDCs will be a threat to the banking establishment and that stablecoins are not sustainable in the long term.

Wall Street firms may launch their own cryptocurrency exchanges to compete with Binance, Coinbase, and other crypto native exchanges. The Wall Street firms are reportedly attracted to the growing cryptocurrency market and believe that they can offer a better user experience than the existing exchanges.