The crypto market is having an excellent week as prices have gone up all round, led by the likes of Ethereum, which has grown by over 15% in the last seven days. The positive headlines include a rejection of a Proof-of-Work ban by the European Union and BAYC-owner Yuga Labs raising $450 million in a seed funding round.
- The market looks like it could be on the verge of a strong bull run, improving upon what has already been a strong week.
- The European Union has voted to reject a proposal that would have imposed a ban on Proof-of-Work networks.
- Yuga Labs — the company that owns the Bored Ape Yacht Club, CryptoPunks, and Meebits IPs — received $450 million in a seed funding round that put its valuation at $4 billion.
- Madonna has become the latest celebrity to invest in Bored Apes, purchasing one for $560,000.
- India is considering imposing heavy taxation on the crypto market via its Goods and Services Tax scheme.
The Week in Crypto
Market On a Strong Run as Market Cap Crosses $2.2T.
After a few months of struggling, the crypto market is finally picking itself up. The past week has had double-digit growth for most of the market’s assets, including the vast majority of the top ten assets by market cap.
BTC is now just under $47,000, while ETH has topped $3,300 on the back of such news as the successful integration of the beacon chain on the Kiln testnet. Bitcoin meanwhile reached its highest weekly close of 2022, and the market’s top asset has more small orders than ever before.
The total market cap now stands at $2.2 trillion and, to many investors, last week’s movement feels like the start of a bull run. It’s far too early to tell, of course, but it is clear that the bulls are beating the bears, as liquidations have risen dramatically over the past few days. Coinglass data shows that over $100 million in ETH was liquidated over the last 24 hours, while over $165 million BTC was liquidated.
EU Rejects Proof-of-Work Ban
On a note related to bitcoin, the European Union has rejected a proposal to ban Proof-of-Work networks. The ‘Markets in Crypto Assets’ (MiCA) bill was a highly anticipated piece of legislation that covered cryptocurrencies, blockchain tech, and crypto exchanges. But in a last-minute change, the bill included an amendment that would have banned Proof-of-Work assets like bitcoin for its environmental impact.
The bill saw 32 votes against and 24 votes for it. With one of the largest crypto markets in the world, the proposal, if it had gone through, would have had an enormous negative effect on the market. Fortunately, lawmakers thought better and are working to allow the innovation of technologies through a less restrictive legal framework.
Yuga Labs Raises $450M to Hit $4B Valuation
Continuing its streak of success, Yuga Labs completed a highly successful seed funding round, raising $450 million in a round led by Andreessen Horowitz’s a16z. This makes the owner of Bored Ape Yacht Club, CryptoPunks, and Meebits franchise one of the highest valued blockchain startups, with a valuation of $4 billion.
The company, which also received funding from Animoca Brands, is due to release its metaverse Otherside. The project is due for launch in April, which should undoubtedly shine even more of the spotlight on it. Otherside is described as a decentralised, interoperable world with elements of gamification. Not much has been said about it otherwise, but given past successes, it’s a surefire bet that it will be a success.
Madonna Buys a Bored Ape
While Yuga Labs has been drawing in a considerable amount of funding, its BAYC NFTs have also been the subject of attention — with musician Madonna saying that she had bought a Bored Ape. She changed her Twitter profile image to the Bored Ape and said that she finally entered the metaverse and that ‘we all need protection from evil eye.’
Madonna purchased Bored Ape #4988 for a whopping $560,000. She joins the likes of Post Malone, Steve Aoki, The Chainsmokers, and Snoop Dogg as a member of the BAYC. While interest in NFTs seems to have dropped a little since the feverish heights of earlier this year, such a move might just bring some interest back in.
She did not offer any reason as to why she purchased it. However, it is worth noting that Madonna’s manager is Guy Oseary, who also represents Yuga Labs.
India’s Heavy Taxation on Crypto
However, not all is well in the crypto market, as India is considering imposing some heavy taxation on the crypto market. The country’s officials only recently announced that it would permit the holding and trading of cryptocurrencies after many years of oscillating between a ban and legalisation.
It is worth noting that the suggested taxation under its Goods and Services Tax (GST) scheme is only being reviewed and that no concrete decision has been taken yet. Currently, crypto is taxed at 30%, with 1% deducted at the source as tax. The discussions will see officials mull over whether the GST will apply on the entire value of the transaction, with the rate likely to be somewhere between 0.1 to 1%.
India has one of the most active crypto trading populations in the world, so it will be a shame to see such taxation drive investment away, should it be ratified. Meanwhile, India is also looking into launching its own CBDC, the digital rupee.