Crypto weekly update
17. March 2022  • clock 3 min •  Daniel Mitrovsky

European Parliament committee upholds PoW cryptocurrencies- Crypto weekly update

This week, the total market capitalization exceeded 1.64 trillion EUR. Increase at the 7-day interval is 4.45 %. Bitcoin increased by 2.97 % during the week to a current value of over 36,900 EUR. Bitcoin dominance is 42.7 %.

Source: Coinmarketcap

European Parliament committee upholds PoW cryptocurrencies 

The Committee on Economic and Monetary Affairs (ECON) voted against a ban on crypto assets based on a proof-of-work consensus algorithm. The provision to ban this type of cryptocurrency is part of the proposed European Union legislation on cryptocurrencies, known as MiCa (Markets in Crypto-Assets).

In favor of the proposal to ban proof-of-work cryptocurrencies, which include Bitcoin and Ethereum, 24 MPs voted in favor, while 32 opposed the proposal.

“It seems that reason and common sense prevailed,” Paris MEP Pierre Person tweeted. “We must continue to defend the principle of technological neutrality. Europe must remain in the global competition,”Person added.

The EU Committee on Economic and Monetary Affairs voted against the PoW ban on Monday, while passing a new amendment that adds cryptocurrency mining to the EU sustainable finance taxonomy.

The Official Press Release of the European Parliament further informs that the broader MiCa legislation has been approved. This means that MEPs agreed on draft rules on supervision, consumer protection and environmental sustainability of cryptocurrencies. A more “conservative” version of MiCa rules, from which the most important point concerning the ban on Proof-of-Work cryptocurrencies has been removed, will now be the subject of negotiations between the European Parliament, the European Commission and the Council of the European Union, who will seek to find a consensus for innovation-friendly crypto regulation. Source

Consensus Layer with a New Staking Record

The Consensus Layer deposit contract, formerly known as Ethereum 2.0, has reached its new historic milestone. Quantitative analysis conducted on popular blockchain site Etherscan has confirmed that more than 10 million ETH, currently worth up to $26 billion, are already staked in the Consensus Layer deposit contract.

Mathematical calculations suggest that the milestone was surpassed during block 14,348,729 in the evening of March 8.

Ethereum 2.0 was officially launched on November 4, 2020, with up to $5 million deposited in Ethereum´s deposit contract in the first eight hours.

In late January of this year, the Ethereum Foundation published an alteration to the network’s terminology, with the initial proof-of-work blockchain, or Eth1, now being referred to as the execution layer, and the upcoming proof-of-stake blockchain, or Eth2, now known as the consensus layer. Source

NFT’s on Instagram?

The CEO of Meta, formerly known as Facebook, revealed at the South by Southwest conference in Texas that crypto enthusiasts and Instagram users could soon be looking forward to NFT tokens on Instagram.

“We’re working on bringing NFTs to Instagram in the near term,“ said Zuckerberg. However, he did not provide specifics on when the implementation would happen.

The world’s most popular social networks are increasingly looking at the possibility of implementing cryptocurrencies and NFT tokens into their platforms. The most famous example in this area is Twitter, which supports NFT profile pictures on its social network. Source

Ethereum one step closer to PoS consensus

One of Ethereum’s best-known developers, Tim Beiko, announced on Twitter on Tuesday news related to the Ethereum network’s transition from a proof-of-work consensus to a new Proof-of-Stake.

Beiko tweeted the news related to the Kiln test network, which underwent a successful merge with Beacon Chain, which is already operating on the new PoS consensus.

Testnet Kiln has so far operated on the original Proof-of-Work algorithm, but after the merger it is now operating on the Proof-of-Stake algorithm.

This merge signals the culmination of six years of research and development in Ethereum and will result in a more secure network, predictable block times, and a 99.98%+ reduction in power use when it is released on mainnet later in 2022,” the Ethereum Foundation stated.

However, it appears not everything went according to plan during testing. According to Kiln Explorer, there were several errors relating to contract creation. In a follow-up tweet, Beiko said a client was not producing blocks consistently, though “the network is stable, with >2/3rd of validators correctly finalizing.” A fellow Ethereum developer, Marius Van Der Wijden, commented on the matter as well, pointing out that Prysm (Go programming language variant for implementing Ethereum Consensus specification) was proposing bad blocks during the transition on Kiln. But this problem was solved.

The entire crypto community can’t wait for the moment when the Ethereum mainnet will merge with the Beacon chain. The Ethereum Foundation says on its website that this phase should be completed during the Q2 2022. Let us be surprised how it all turns out. Source

Fed likely to announce interest rate hike

Wednesday’s Federal Reserve meeting will probably confirm an expected interest rate hike to cap rising inflation before it surges out of control.

Fed Chair Jerome Powell has said he favors increasing the benchmark interest rate by 0.25 percentage points from zero, where it has been since March 2020.

The rate hike will be the first in a series of hikes the Fed plans to make in 2022 and 2023. The Fed chief expressed confidence that inflation will retreat in the coming months under the influence of supply chain recovery and the retreat of the COVID-19 pandemic. However, uncertainty about the financial markets has been brought back by the Russian invasion of Ukraine, which can still play a very interesting role in this scenario. Source

Curiosity : Elon Musk and Michael Saylor debate about inflation

Joining this discussion online, Tesla CEO Elon Musk asked publicly about the probable inflation rate over the next few years to gauge the notion of global investors.

American billionaire and MicroStrategy CEO Michael J. Saylor shared his thoughts on the subject and said that he expects that consumer inflation will continue near all time highs, and asset inflation will run at double the rate of consumer inflation. He also said that he expects some weaker fiat currencies will collapse, causing huge amounts of capital to be transferred to scarce property such as Bitcoin or gold.

Musk praised Saylor’s response to capital inflows into rare assets such as Bitcoin. Musk added that he still owns Bitcoin, Ethereum and Doge, and he won’t sell it. Source

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Daniel Mitrovsky


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