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Blockchain & Web3 Weekly Bytes Edition #20
Coinbase's Smart Wallet, BlackRock's Bitcoin Surge, and Thailand's ETF Approval
Jun 8, 2024
Hello Fellow Enthusiast,
This week’s Blockchain & Web3 Weekly Bytes edition is packed with fascinating updates and insights. Here’s what’s coming up:
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Tech Spotlight: Understanding the fundamentals of token economics.
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Week’s Highlights: Coinbase introduces a smart wallet, BlackRock’s Bitcoin ETF surpasses 300,000 BTC, and Thailand approves its first spot Bitcoin ETF.
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Digital Asset Spotlight: Explore Polkadot (DOT) and its role in the blockchain space.
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Chart of the Week: Check out the recent increase in Bitcoin holdings from US spot ETFs.
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Video Spotlight: A comparison between Bitcoin and Gold to see which is the better investment.
Weekly Trivia
What is a "wrapped token" in the blockchain ecosystem?
A) A token that is encrypted for additional security
B) A token that represents another cryptocurrency on a different blockchain
C) A token used exclusively in private blockchains
D) A token that can only be used for staking purposes
*Find the answer at the bottom of this newsletter.
Tech Spotlight – Understanding Token Economics
Token economics, or "tokenomics," involves creating, distributing, and managing tokens within a blockchain network. It's about understanding how tokens are used to incentivize and reward participants, ensuring the network's health and growth.
Why Tokenomics Matters
Tokenomics is essential for anyone involved in the blockchain space. It helps investors make informed decisions, developers design effective systems, and users understand the incentives driving the network.
Practical Example: Ethereum (ETH)
One of the most impactful applications of tokenomics is seen with Ethereum (ETH). Ethereum uses a combination of mining rewards and transaction fees to incentivize participants. With the introduction of Ethereum 2.0, a proof-of-stake system is being implemented, where validators are rewarded with ETH for maintaining the network.
Components of Tokenomics
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Token Supply: The total number of tokens that will ever be created. A limited supply can create scarcity, potentially increasing the token's value.
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Distribution Mechanism: How tokens are initially distributed among participants. This can include pre-sales, initial coin offerings (ICOs), or airdrops.
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Incentive Structure: The ways in which tokens are used to motivate participants. This can include rewards for mining, staking, or contributing to the network.
Think of tokenomics as the economic policy of a small country. Like a government uses fiscal policies to manage the economy, a blockchain network uses tokenomics to regulate its ecosystem. Proper management leads to a thriving, stable environment, while poor management can result in instability and decline.
In Conclusion
Token economics is the backbone of any successful blockchain project, shaping how tokens are used, valued, and distributed. By understanding its principles, you can better navigate the complex world of blockchain and make informed decisions.
This Week’s Blockchain and Web3 Highlights
Coinbase Introduces Smart Wallet: Coinbase has launched a new self-custody wallet with a simple setup and gasless transactions, aiming to attract a billion new users to the crypto space.
BlackRock's Bitcoin ETF Surpasses 300,000 BTC: BlackRock's IBIT spot Bitcoin ETF exceeded 300,000 BTC in assets under management just five months after launching and is now worth over $21 billion.
Semler Scientific Expands Bitcoin Holdings: Medical device company Semler Scientific has purchased an additional $17 million in Bitcoin, increasing its holdings to 828 BTC. The firm also plans to raise $150 million to buy more.
Binance Resumes Mastercard Payments for Crypto: Binance has reinstated Mastercard services for crypto payments and deposits, with withdrawal services expected to follow soon.
Thailand Approves First Spot Bitcoin ETF: Thailand has given the green light to its first spot Bitcoin ETF, joining the ranks of other jurisdictions that have regulated Bitcoin funds.
Stand With Crypto Exceeds 1 Million Signups: Backed by Coinbase, the advocacy group Stand With Crypto has surpassed one million members and raised substantial funds to influence digital asset policy in the U.S.
Robinhood to Acquire Bitstamp: Robinhood has announced its plan to acquire the U.K.-based crypto exchange Bitstamp for $200 million in an all-cash deal, aiming to expand its global crypto presence.
Hong Kong Explores Ethereum ETF Staking: Hong Kong may introduce staking features for spot Ethereum ETFs within the year, with asset managers drafting proposals to implement staking rewards.
Affiliate Spotlight: Blockchain Council Certified Blockchain Developer
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Why Choose the Blockchain Council Certification?
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Comprehensive Curriculum: Covers all essential aspects of blockchain development, from basics to advanced concepts.
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Hands-On Experience: Gain practical skills through real-world projects and assignments.
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Industry Recognition: Earn a certification that is recognized and respected in the blockchain industry.
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Flexible Learning: Study at your own pace with access to online resources and support from industry experts.
This certification is ideal for developers, IT professionals, and anyone looking to build a career in blockchain technology. Enhance your credentials and stand out in the competitive blockchain job market. Get certified today and take your blockchain skills to the next level!
A Little Blockchain Humor Break
Source: CoinMarketCap
Chart of the Week: Bitcoin ETF Holdings Surge
Bitcoin purchases from US spot ETFs have seen a notable increase, with holdings rising from 819K to 859K BTC. This trend reflects growing investor confidence and interest in Bitcoin as a financial asset.
Key Takeaways
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Increased Holdings: The rise in Bitcoin holdings within spot ETFs suggests a positive sentiment among investors.
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Record Levels: Current holdings are at record-high levels, indicating strong demand for Bitcoin in ETF markets.
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Investor Confidence: This increase in ETF holdings underscores the growing trust and interest in Bitcoin as a reliable investment.
Looking Forward
As Bitcoin ETF holdings continue to climb, it signals a bullish outlook for Bitcoin, highlighting its potential as a mainstream financial asset.
Source: CryptoQuant
Weekly Video Spotlight: Bitcoin vs. Gold: Which is the Better Investment?
Want to know if Bitcoin or Gold is the better investment? This week's video provides a clear comparison of both, highlighting their strengths and weaknesses.
Watch the video here to understand the value, stability, and future potential of each asset. Also, please don't forget to subscribe to the channel for more insightful content and updates!
I appreciate you joining me for this week's edition! We covered Coinbase's smart wallet launch, BlackRock's Bitcoin ETF reaching new heights, and Thailand's first spot Bitcoin ETF approval. We also discussed the basics of token economics, Polkadot's impact in the blockchain space, and the recent increase in Bitcoin ETF holdings.
Trivia Answer: B) A token that represents another cryptocurrency on a different blockchain.
Please feel free to share your thoughts and feedback. Let's continue to grow this community together. Catch you next week with more updates and insights from the blockchain and Web3 world!
Warm Regards,
Ajay Tomar
Disclaimer:
Content in this newsletter is for educational and informational purposes only and is not intended as financial, tax, or legal advice. Always do your research and consult with a professional before making financial decisions. As a solopreneur, I may earn commissions from affiliate links in this newsletter at no extra cost to you. This support helps me bring you valuable content. I only endorse products I trust and believe could benefit you.
Weekly Digital Assets Spotlight
Spotlight on Polkadot (DOT)
Polkadot is a multi-chain platform that allows different blockchains to interoperate and share information. Its goal is to create a decentralized internet where independent blockchains can exchange data and transactions seamlessly.
Notable Features
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Cross-Chain Communication: Polkadot connects various blockchains, facilitating efficient data transfer and communication.
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Enhanced Scalability: By supporting parallel processing of transactions across chains, Polkadot boosts throughput and overall performance.
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Robust Security: Polkadot’s shared security model ensures that all connected chains are protected and resilient against attacks.
Latest Updates
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Parachain Auctions: Polkadot has been actively holding parachain auctions, enabling different projects to secure a slot on its network. This process has drawn substantial interest and investment.
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Expanding Ecosystem: The Polkadot ecosystem is rapidly growing, with numerous new projects and partnerships enhancing its utility and adoption.
Why Polkadot Stands Out
Polkadot’s approach to interoperability and scalability positions it as a key player in the blockchain space. By enabling seamless communication between different blockchains, Polkadot is paving the way for a more integrated and efficient blockchain ecosystem.