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News overview 9/20: El Salvador, Solana, South Korea, Microstrategy and OpenSea

Bitcoin adoption has continued in El Salvador accompanied by protests and new Bitcoin purchases. Solana’s network was down for over 18 hours. Microstrategy went Bitcoin shopping once again and the NFT marketplace OpenSea was caught in the eye of the storm because of insider trading.

OpenSea employee caught of insider trading

The biggest trend of this autumn has been NFTs. Especially NFT art has been selling with millions of dollars per piece, which has left many investors astonished.

The most popular trading platform for NFTs is OpenSea. It has seen massive growth in trading volumes over the past few months. Lately, the marketplace has been in a nasty uproar after a key employee was caught in insider trading.

Nate Chastain, who worked with the title of Head of Product, had taken advantage of inside information. He knew which NFTs would be promoted on the front page of the marketplace. These featured NFTs saw often a significant increase in price. Chastain bought NFTs in advance and later sold them with a large profit.

He tried to hide his actions by using several different Ethereum accounts. Despite this, he was got caught quite easily. Chastain was eventually fired from his position in the company.

Watch the video below where the Coffeezilla channel goes through the details of the case.

 

This case is a prime example of the fact that the NFT market is like the wild west. If you are planning to trade on NFT marketplaces, be really careful.

El Salvador buys the dip

El Salvador introduced Bitcoin as legal tender on the 7th of September. What has happened in the country since this historical event took place?

The Bitcoin adoption went quite smoothly. All citizens were offered $30 worth of bitcoins for registering a Chivo wallet and completing the KYC process. The technical implementation of Bitcoin has also gone well. Payments in stores and services were possible from the very first day.

El Salvador is also adding bitcoins to its reserves. Last Monday, President Bukele tweeted about purchasing 150 new Bitcoins. El Salvador holds now a total of 700 Bitcoins.

El Salvador has also a separate fund for purchasing bitcoins from citizens who want to convert their BTC to USD. Thanks to this, nobody has to carry the risk of price volatility.

However, there have been also some riots against President Bukele and his Bitcoin law. One Bitcoin ATM was even burned when people protested strongly during the independence day of El Salvador.

Rioting and protests aren’t done solely because of Bitcoin. Some citizens are concerned about the policy advocated by Mr. Bukele. Among other things, the president has pushed through a bill that will allow Bukele a second consecutive term. Bukele is also increasing the size of the army.

The Solana network was down for over 18 hours

Solana is a smart contract platform that competes with Ethereum. It has enjoyed huge popularity throughout the autumn. The price of the SOL token has risen 10x from its bottom in July.

Last week was different, though. Solana received negative attention when the whole network was down for 18 hours. The collapse had a surprisingly small impact on the price of SOL token, though. The price fell by only about ten percent. Investors clearly have a lot of faith in this platform.

Similar cases are very rare, especially in projects with a market cap of more than 10 billion dollars.

The shutdown was caused by a DeFi application called Raydium. It has a token LaunchPad included, which had released the Grape Network token. An avid buyer had set up bots to make more than 300.000 transactions per second.

See the video below for a good overview of the incident.

Due to the number of transactions, the Solana blockchain began to fork out of control. The network validators could no longer keep up. The Solana team had just one choice: to shut down the network until a bug fix could be implemented.

The coders finally fixed the bug after an intense session of work. Solana’s network has worked without any problems ever since.

South Korea tightens the regulation of cryptocurrency exchanges

We have often seen negative news (or FUD) about China and India. One day it’s about banning cryptocurrencies, the next day it’s about exchanges being shut down.

This time we heard some FUD from South Korea. The country’s intentions to regulate cryptocurrency exchanges was reported by the Financial Times.

It is estimated that the tightening regulation will cause two-thirds of South Korean exchanges to close their doors. This might sound scary since the country is one of the leading countries in cryptocurrency trading.

The truth is, however, that four cryptocurrency exchanges control a total of 90 % of the Korean market. These exchanges meet the regulation requirements. The real impact on cryptocurrency trading will be therefore minimal.

It is likely that regulation will have a positive effect, as bad trading platforms will be kicked out from the market.

This piece of news is a prime example of FUD. Financial Times aims to create uncertainty, fear, and doubt around the cryptocurrency market. Good thing they didn’t succeed.

Microstrategy bought 5050 Bitcoins

American company Microstrategy acquired (not-so-surprisingly) another 5050 bitcoins last week. With the newest addition, the company’s total crypto holdings grew to over 114K bitcoins. The market cap of these coins is well over $5 billion.

Below you can find a tweet about the purchase from the company CEO Michael Saylor:

Microstrategy is by far the largest exchange-listed company to invest in cryptocurrencies. You can check out the whole list at bitcointreasuries.net.

In addition to Microstrategy, Tesla and Norwegian Aker have also invested in Bitcoin during the past year. Recently, however, it has been a little quieter on the institutional front.

Photo by LinkedIn Sales Solutions on Unsplash

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