Do you remember NFT? In any case, we shouldn’t discuss this with David Finzer, CEO of OpenSea, the largest non-fungible token exchange, which was forced to lay off 50% of its workforce to cope with a devastating drop in transaction volume. But fans of the industry can hold on to an episode of The Simpsons that may reignite the frenzy. We return to this in Cryptic Analysis after the major news.
Block 1: Essential news
- BlackRock files for Ethereum Spot ETF
BlackRock, the asset management giant, apparently initiated requirement launch a spot ETF (Spot). Ethereum, upon registration of the iShares Ethereum Trust in the State of Delaware, United States of America. This news caused the price of Ether to rise significantly, pushing it above $2,000. The move follows a similar strategy used for a spot bitcoin ETF application, potentially pending approval from the SEC, which is currently reviewing several similar bitcoin applications. To date, the SEC has not yet approved any spot cryptocurrency ETFs.
- Will Grayscale Turn GBTC Into Bitcoin ETF?
Securities and Exchange Commission (SEC) they started discussions with Grayscale regarding the transformation of its GTC into an ETF bitcoin location, following Grayscale’s recent legal victory over the SEC. Michael Sonnenshein, CEO of Grayscale Investments, clarifies that Grayscale has not ruled out further legal action and that no timetable has been discussed with regulators. He emphasizes that Grayscale is ready to run GBTC as an ETF. Watch his interview in the video below.
- HSBC continues its development in asset tokenization
HSBC deals with asset tokenization by creating a partnership with the Swiss company Metaco, using its Harmonize platform to serve its institutional clients. This movement is in accordance with the growing trend of tokenization of real assets, which offers a modern and secure custody infrastructure meeting the requirements of asset managers. HSBC has also recently innovated by becoming the first major global bank to offer tokenized physical gold, allowing its clients to invest in gold with amounts less than an entire bar.
- Robinhood is coming to Europe
Robin Hoodamerican business giant, expands its operations in Europe, starting in the UK with brokerage services and then offering cryptocurrency trading in the rest of Europe. With $87 billion in assets under management and a market cap of around $9 billion, Robinhood is sticking to its diversification strategy. This expansion is also a response to a more favorable regulatory environment in Europe compared to the United States, marking a significant turnaround for the company in its international forays.
Block 2: Cryptic analysis of the week
The non-fungible token (NFT) industry appears to be on the brink of obsolescence. Still, eulogies for this controversial but innovative market may be premature.
Devin Finzer, CEO from OpenSea, the leading NFT market, made a sobering statement. In the midst of a trial media cycle, after Sam Bankman-Fried Finzer announced a significant reduction in its workforce, revealing that OpenSea will reduce staff by 50%, while also indicating a strategic direction for the revitalization of “OpenSea 2.0”.
The reason for the downsizing appears to be rooted in harsh economic realities. A steep decline in trade volume – a cornerstone of OpenSea’s revenue model – paints a murky financial picture. A compiled dashboard by Dune Analytics vividly illustrates this decline: OpenSea’s monthly trading volume on Ethereum, which accounts for the vast majority of its transactions, peaked at $4.87 billion in January 2022, but fell to just $49 million in October.
Trade volume on OpenSea
Even when applying the company’s standard 2.5% fee to Ethereum trading volumes, this year’s trading revenue is a shadow of what it used to be. OpenSea’s revenue from Ethereum transactions so far is estimated at $62 million, up from $484 million last year.
In addition to the numbers, and to top it all off, OpenSea has had to face backlash from major industry players after phasing out “creator fees,” also known as “royalties,” which are royalties traditionally received by NFT creators for secondary sales.
The controversial move, which is expected to be fully implemented by February 2024, has raised eyebrows in the NFT community. The decision prompted Yuga Labs, behind the iconic Bored Ape Yacht Club NFT collection, to cut ties with OpenSea in favor of its competitor Magic Eden.
Despite the financial turmoil and operational changes at OpenSea, NFT’s pop culture impact among fans of the universe remains undeniable. In addition, the general public’s awareness of NFT was clearly boosted by the recent Simpsons Halloween special. Imbued with the signature spirit of the series, the episode offers a narrative steeped in the arcane language of blockchain and the sometimes irrational exuberance of FOMO – Fear of missing out – or the fear of missing out that drives this market.
breaking: @TheSimpsons THE EPISODE SHOWS THE MINTING OF THE HOMER BART NFT
— DEGEN NEWS 🗞️ (@DegenerateNews) November 6, 2023
Here’s a small preview of the episode:
Homer accidentally turns his son into an NFT. Although he is upset that he lost his son to the cryptoverse, his feelings are mixed when he learns that Bart is worth $1.5 million as the first human NFT. To save their son, Marge transforms into an NFT and enters the blockchain, a train known in the series as the “block train” with a talking NFT explaining that it is “powered by the most abundant fuel in the universe”: FOMO”. After accidentally killing another NFT Marge discovers that his value has increased and continues to increase with more and more murders.For the more curious, I don’t Say no more, you can enjoy this 3.0 style episode on your screens.
Strong proponents of non-fungible tokens have relied on The Simpsons’ reputation as fortune-tellers (even a Donald Trump presidency was foretold in one episode). Their pop culture analyzes have confirmed time and time again that this episode certainly predicted the beginning of a new NFT rise. You believe that, don’t you?
Block 3: Tops & Flops
(Click to enlarge)
Block 4: Reading of the week
“Party time!” Crypto Land celebrates the guilt of Sam Bankman-Fried (Wired, in English)
The crypto ATM industry is still booming (Financial Times, in English)
Former NYSE chairman in talks to restart FTX (WSJ, in English)