The countries making crypto moves

The countries making crypto moves

Unlike Cones of Dunshire, a game with a crazy amount of rules, the NFT project Loot is more like a deck of cards, perfect for developers who want to design role-playing games. [NBC via Getty Images]

There’s never a dull moment on the blockchain. Here’s what you need to know this week:

International markets eye crypto. A handful of countries are paving the way for crypto adoption.

Mining finds a home in America. The mining industry is in the midst of a great migration.

Crypto Twitter’s obsession with Loot. Breaking down the latest NFT trend.

Planet Crypto

From Afghanistan to Ukraine, crypto adoption goes global

Last week, El Salvador officially became the first country in the world to make bitcoin legal tender — but it’s not the only nation moving quickly on crypto adoption. In the past month, Ukraine has legalized cryptocurrency, Panama introduced a bill that would allow crypto to be accepted for payment, and Afghanistan has seen crypto adoption skyrocket. Each country has different reasons for embracing crypto. Let’s dig in.

  • Ukrainian cabinet officials have been meeting with counterparts in El Salvador to discuss crypto adoption. Ukraine’s President Volodymyr Zelensky also recently toured Silicon Valley to learn how the country can digitize its economy, which has struggled with a devaluing currency for much of the past decade. Ukraine expects to open its crypto market to businesses and investors next year, potentially setting the stage for a transition to a dual currency economy, where bitcoin sits alongside its fiat currency, the hryvnia.

  • In Afghanistan, the Taliban’s ascent has contributed to a rapidly devaluing currency and a severe cash shortage. Local bitcoin exchanges, however, haven’t ceased operating, allowing family members abroad to send money to those back home, who can exchange it for hard currency to buy food and other necessities. 

  • Digital currencies have become many Nigerians’ on-ramp to the global economy, despite government efforts to restrict crypto. Some Nigerians are using crypto to import goods — from China, for example — that can then be resold domestically. And Nigeria isn’t alone. Throughout sub-Saharan Africa, more than $80 million in bitcoin was sent via peer-to-peer exchanges in the last month, or almost as much as was transferred in North America.

Why it matters… Developing economies lead the world in crypto adoption, requiring governments to come to terms with its existence. India, which was reportedly planning a crypto ban earlier this year, is now working on a regulatory structure. Both Nigeria and India are planning to launch Central Bank Digital Currency pilot programs soon (CBDCs are state-issued money, unlike BTC, which is decentralized), joining at least 81 countries around the globe, from China to Sweden.

State of Mine

As mining firms take root in North America, Bitcoin’s “hash power” begins to rebound

In early 2021, China hosted around 70% of the world’s bitcoin-mining operations — when the nation began cracking down on mining in May, markets tumbled hard. Six months later, China no longer accounts for the majority of global mining power, and as mining has spread around the globe, North American miners are growing fast. Here’s where things stand:

  • Bitcoin’s total mining power (or “hash rate”), which saw sharp declines after China’s ban, has climbed more than 50% since June as more North American miners have come online. At the same time, Ethereum’s mining power has hit new all-time highs — driven by booms in NFTs and DeFi.

  • In the last two months, North America added nearly 40% of its total BTC mined in 2021. Publicly-traded mining companies in North America currently have stockpiles of more than 18,000 BTC (worth over $800 million).

  • Miners in North America are increasingly focused on renewable energy. Hut 8, which holds the largest BTC stockpile, is building a vast mining facility in Alberta, Canada. It will be powered by natural gas that would otherwise go to waste. Mining firm Argo, which is set to go public via the Nasdaq, purchased two hydroelectric-powered data centers. 

  • Bitcoin mining is attracting the world’s largest financial institutions. This week, Blockstream announced a partnership with Australian investment-banking giant Macquarie to build a renewable energy-powered mining facility in North America. And BlackRock, the world’s largest financial firm, recently disclosed a nearly $400 million investment in North American mining companies.

Why it matters… The mining landscape’s recent shifts have made the Bitcoin network more secure, as it’s no longer concentrated in a single country. And miners in North America are often finding that the cheapest available energy is generated sustainably. By ensuring strong markets for renewable energy, crypto can incentivize companies to build more green infrastructure, which can further drive down the price of clean power.

Loot Mechanics

Why the cryptoverse is obsessed with a game that might never exist

If you’ve been spending time on crypto Twitter recently, you’ve probably been seeing a bunch of lists of Dungeons & Dragon-y items in white text on a black background: short sword, Divine Hood of the Fox, chain gloves. What’s the deal? 

  • In late August, Vine co-founder Dom Hofmann launched Loot — a set of 8,000 text-based NFT lists (or “bags”) of “randomized adventure gear” that could originally be claimed for free (plus transaction fees). Ranked according to the rarity of objects on each list, Loot bags soon began trading for significant money. As of September 14, total sales volumes were close to $240 million.

  • Loot, at least so far, isn't actually a game — it's simply lists of items that could be used in a game. Proponents compare it to a deck of cards (which are only fun because people created games that incorporate them) and hope that inspired developers will build the NFTs into a variety of crypto role-playing experiences. 

  • One fan created a potential in-game cryptocurrency called Adventure Gold (AGLD);  any holder of a Loot bag could claim 10,000. In early September ALGD spiked above $7 — meaning each Loot-holder’s stash was briefly worth nearly $80,000.

Why it matters... Loot could represent an interesting new model — create the outlines of a world, and let other developers fill in the details. (Indeed, apps that interact with the lists have emerged, like Loot Character, which generates pixelated avatars based on the items in users’ bags.) But critics note there’s no guarantee that Loot — or conceptual copycats like Bloot and SpaceLoot — will ever evolve into an actual game.

Takes

Anthony Hopkins stars in NFT movie, CryptoPunks are a Met Gala look

  • Hannibal Ledger… Zero Contact, a sci-fi thriller starring Oscar-winner Anthony Hopkins, dropped its first trailer last week. The movie will premiere on NFT platform Vuele, which lets users buy unique versions of films with exclusive digital collectibles. “It creates scarcity in copies of the film, and protects against piracy,” the movie’s director told Deadline.

  • Shooting his shot… UCLA basketball player Jaylen Clark is the first college athlete to launch a cryptocurrency. The sophomore debuted $JROCK in partnership with Rally, a “social token” platform. “I’ve seen comments everywhere talking about, I’m the Black Elon Musk,” Clark joked. “It’s just super cool to be the first to do anything.”

  • Artificial Cointelligence... Speaking to crypto podcast Bankless, ARK Invest CEO Cathie Wood predicted crypto’s dramatic intersection with AI: “We’re going to see blockchain technology and artificial intelligence converge and cause explosive reactions.”

  • Serving looks… Reddit co-founder Alexis Ohanian incorporated a CryptoPunk NFT into his outfit at this year’s Met Gala. Ohanian, who accompanied wife Serena Williams to the party, wore a thumbnail-size version of the punk on his lapel and tweeted “Decided to bring a #CryptoPunk of my wife (that I bought for her) to the #MetGala. WAGMI.”

Token Trivia

What is the most secure form of two-factor authentication?

A

Authenticator apps

B

Hardware keys

C

SMS codes

D

Face ID

Find the answer below.

Trivia Answer

B

Hardware keys