Bitcoin Begins 2022 With A Crash | First NFT Billionaires

CRYPTO CRUMBLES

The cryptocurrency combined market cap has now lost $1 trillion in value since its peak of $3 trillion in November. The bitcoin price has crashed from a high of almost $70,000 per bitcoin less than two months ago to lows of just above $40,000 today—a decline of around 40%. Meanwhile, other major cryptocurrencies ethereum, Binance's BNB, solana, cardano and XRP have all lost a similar amount.

The latest crypto price crash, wiping billions of dollars from the bitcoin and crypto market in a matter of hours, came after it was revealed the U.S. Federal Reserve could accelerate its planned 2022 interest rate hikes and begin shrinking its massive balance sheet—something that weighed on equity markets as well.

A LESSON FROM KAZAKHSTAN

Bitcoin’s mining hashrate, or the amount of computational power dedicated to churning out new units of the cryptocurrency, has fallen 12% amid the nationwide internet shutdown in Kazakhstan where thousands of protesters, fired up by fuel price hikes that came into effect on January 1, took to the streets and stormed government buildings.

In recent months, the Central Asian nation has become a major destination for bitcoin miners expelled from China in the wake of an intensified crackdown on cryptocurrency-related activities. According to the Cambridge Centre for Alternative Finance, Kazakhstan is home to as much as 18% of bitcoin’s total computational power, second only to the United States. Its growth as a mining hub has been a key contributor to bitcoin’s hashrate temporarily hitting a new all-time high on January 2 before the outages.

Source: Messari. Prices as of 4:00 p.m. on January 07, 2022.

THREE COMMA CLUB WELCOMES FIRST NFT MEMBERS

The founders of giant NFT marketplace OpenSea have become billionaires following the fresh funding round announced Tuesday that values the four-year-old company at $13.3 billion—up from $1.5 billion just six months ago. With estimated 18.5% stakes in OpenSea, cofounders Devin Finzer and Alex Atallah are each worth about $2.2 billion, Forbes estimates.

Thanks to the booming popularity of non-fungible tokens, OpenSea has grown rapidly over the past year. In March 2020, the five-person outfit counted roughly 4,000 active users doing $1.1 million in monthly transactions, for about $28,000 in monthly revenue. Its luck changed in February 2021, when platforms like the Winklevoss twins’ Nifty Gateway generated buzz by auctioning off high-end digital art. By July, OpenSea had closed a $100 million funding round led by venture capital firm Andreessen Horowitz and recorded about $350 million worth of transactions that month. In December, the marketplace processed more than $3.3 billion worth of sales, generating about $82.5 million in revenue.

ELSEWHERE

Congress Is Preparing An Oversight Hearing On Bitcoin Mining's Environmental Impact: Sources [The Block]

SEC Punts Again On NYDIG Bitcoin ETF, Delaying Decision To March [Bloomberg]

China Releases Digital Yuan Wallet as Bitcoin Crackdown Continues [Decrypt]  

Steven Ehrlich
Editor 
Forbes CryptoAsset & Blockchain Advisor

Nina Bambysheva
Reporter
Forbes Money & Markets

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