Bitcoin prices slip, crypto winter’s latest victim, and the hype over Polygon: CNBC Crypto World
Lender bald gets a lifeline from its largest competitor and we explain all the hype around the polygon, blockchain, Music, welcome to cnbcs crypto world im, mackenzie sagalos crypto prices dropping again bitcoin is still stuck under the twenty thousand dollar mark falling about one and a half percent. In the last 24 hours, ethereum also down falling two and a half percent to just under eleven hundred dollars, polka dot, taking a big hit too falling nearly four percent since noon. Yesterday, okay lets talk about todays crypto headlines: first up crypto winter claims, yet another victim on monday, cryptocurrency, lender, vauld, paused, withdrawals and trading as it explored potential restructuring options as it turns out. It only had to wait until today, one of vaulds largest competitors, nexo, is offering a lifeline. Nexo is offering to buy vault in an all equity acquisition, and if that works out, nexo said that it plans to restructure the company and expand in southeast asia and india. Nexo execs did not reveal how much the potential deal would be worth. Vald is based in singapore and has gotten financial backing from coinbase and silicon valley. Billionaire peter thiel, its part of a growing number of crypto firms swept up in a serious liquidity, bottleneck the same one that caused celsius and three arrows capital to collapse as well. Next etoro is no longer going public. The online brokerage, which offers crypto trading just ended its merger deal with fintech acquisition group tech news website.
The information first reported the news last week, and today both companies made it public calling the termination a mutual agreement. The deal was supposed to have been worth about 8.8 billion and finally, englands central bank warns that crypto markets need tougher regulation to keep systemic risks from getting too big too fast. Thats. In response to the recent crypto crash that wiped out trillions of dollars worth of digital asset investments and the stable coin, chaos that caused tara and luna to crash the bank of englands financial policy committee warns that as crypto becomes more and more intertwined with traditional markets. It increases the risks to the wider financial system. In a report out today, the bank said the crypto crash quote: underscored the need for enhanced regulatory and law enforcement frameworks across the digital asset industry. All right. Our main story today is about polygon, the popular layer to blockchain and its matic token. The crypto industry is in a pretty rough place right now, all that hype around web3 and the future of the internet that we heard about earlier this year is taking a backseat to headlines about liquidations and closures. Polygon, though, has been making moves. Last week it launched a modular version of its blockchain on a test network claiming that it can help solve problems with scale taiwanese smartphone maker htc launched its quote: metaverse phone complete with polygon support and arguably most important. The company formerly known as facebook meta just began.
Testing nfts with select creators and to start those nfts are hosted on the ethereum and polygon blockchains cnbcs taneah mckeel took a closer look at how polygon in the world of blockchain based platforms, ethereum reigns supreme, its used for things like nfts and decentralized finance applications and Now a growing number of crypto projects are looking to unseat ethereum and become the new network for big blockchain initiatives. These projects start from the ground up with a completely separate, blockchain. Think of solana. Other projects, though they work alongside the ethereum, blockchain and thats, where polygon comes in polygon, is a layer, two scaling solution, and what that means is its a way to take the limitations of ethereum and make it more. You know make it cheaper and also make it faster, so it can handle more transactions and more use cases. These protocols dont look to replace layer, 1 block chains, but work alongside them. In this case, polygon operates a secondary network on top of the ethereum blockchain to process transactions faster. A lot faster teams like polygon, said, okay. Well, there are these limitations that were already seeing with the network of ethereum, but we still believe that that is like the core chain or ecosystem we want to build for, and so how can you take? You know the transaction limits. How can you take the speed? How can you take the cost and really make that lower, while still, you know, being part of the same ecosystem ethereum can handle about 15 to 30 transactions per second polygon can handle around 65 000 per second.
It also promises to cut transaction fees, also known as gas fees. Ethereum gas fees averaged 26 dollars by the end of 2021.. Polygons fees were less than a fraction of a penny. At that same time, fees are a matter of supply and demand how much space? How much throughput is available on the chain and how many people are trying to use it? Where chains like polygon and solana really shine is when markets are up theres huge amount of excitement and everybody wants to make transactions all at once. At that point, ethereum cannot handle the load, which is why you see these incredible gas price. These fee spikes, the polygon, blockchain processes. Transactions in batches then sends them over to ethereum, taking the workload off that network and because polygon works so seamlessly with ethereum developers can build decentralized, apps on polygons network and still make use of ether. A lot of their growth has been very tied to ethereum. But if you go and do some like analytics on chain, there is a significant user base that uses polygon and does not use ethereum. So over the past few years, youve seen a lot of growth. That is not just converting ethereum people to also use polygon, and so i think, over time they become less reliant on ethereum. To that end, polygon reported more than 19 000 dapps running on its network as of april. Oh and it has its own cryptocurrency thematic token. Of course, growing macroeconomic pressures, fears of a recession and slowing trading volume in crypto has led to a broad selloff across digital assets, and that includes polygon.
The matic token fell around 80 percent in the first half of 2022, but some say the network itself is well run and will weather the crypto downturn. I think what we need to look at is like the activity of the networks and like how the ecosystem is growing and who, who is actually building on top of it. If we really want to project towards the future its going to be the chains or the infrastructure thats being utilized the most, where i think were going to see, you know the real staying power of those projects. So if polygon isnt looking to unseat ethereum whats the goal of the network, my take on the long term roadmap for polygon is that they will move to being something that is multi chain more similar to cosmos or celestia or polka dot. We saw them acquire all of these zk roll up projects and all of these other side chain projects – you know my my take – is basically that they are positioning to launch more chains in the broader polygon ecosystem and i think, thats a really interesting play thats. All for crypto world well be back for more crypto news tomorrow.