Search Results

Too Long Didn’t Read Summary: The Market Update: Recovering from the crash and entering a bull market? We are seeing some bullish trends in the market. This may be due to what is called market psychology. Also, breaking news as Russia is following suit after India's announcement to legalize and tax (rather than ban) cryptos, 300 millions dollar hacks and more. Read more below! Concept of the Week: The Compelling Use-Cases of NFTs NFTs have been on the forefront of headlines in recent weeks as we’ve seen a surge in capital and investors entering the space. Currently a common misconception of NFTs is that they only use case revolves around digital art. This is of course a very exciting application, allowing greater for autonomy and income streams for artists. However, there are a variety of exciting use-cases of NFTs that outside of the digital art space. Read more below to find out more! Investor Joe Updates: Joe dives into the inner workings of algorithmically backed decentralized stablecoins with Terra’s LUNA. Read below! The Market Update: The Micro Perspective: We are seeing some bullish trends in the market. BTC is now sitting around 44K, a 31% increase from the low we saw at the end of January. BTC prices aren’t the only thing that have pumped, market sentiment has changed drastically looking at the fear & greed index; it has nearly doubled from last week. This example of low market sentiment can be better understood by reading into Market Psychology which counters other more conventional financial theory where it is assumed that prices were always based on rational considerations and failed to account for the potentially irrational impact of market psychology. The Fear and Greed Index Data: The Macro Perspective: [BREAKING] Russia is following India's lead on the path to regulating crypto assets rather than ban them. The tweet is from Russian news outlet Kommersant. India's journey thus far: Read Here Russia Story (can be translated): Read Here Note: For those new to the space, twitter is often a source of alpha as it has become the industry standard for Companies and CEOs to make announcements from billion dollar hacks to new updates or partnerships. It's not all good news however, this week has seen some of the largest hacks in crypto history. A 300 Million USD exploit on a wormhole network. To put this into perspective the wormhole exploit sits at #2 on the leader board for biggest hacks in defi. Deep Dive: The hack was reversed engineered on this twitter thread Concept of the Week: The Use-Cases of NFTs NFTs have been on the forefront of headlines in recent weeks as we’ve seen a surge of capital and investors entering the space. Currently, a common misconception of NFTs is that their only use case revolves around digital art. This is of course a very exciting application, allowing greater autonomy and financial opportunities for artists. However, there are a variety of other exciting use-cases for NFTs in our increasingly digital world, including real estate and gaming. First of all, an interesting perspective of NFTs surrounds it’s potential in solving problems that are inherent in today’s internet. Given the digitalisation of our world, there is an increasing need to assign properties of physical items to digital ones; namely scarcity, proof of ownership and uniqueness. This is where NFTs step in. NFTs would allow you to purchase and truly own various digital items, such as video game character skins and iTunes mp3 which you can then exchange and trade in online marketplaces. Giving you, as a consumer, significantly more utility. The applications of NFTs in gaming is a great area to look at in order to show the potential scale of this. As of 2021 the gaming market was valued at $173.70 billion dollars and projected to almost double by 2027. In which approximately 69% of the 2.7 billion global players, have confirmed to have spent money on in-game cosmetics such as emotes, skins, etc.. Despite this, these cosmetic items are currently ‘stuck’ in the game it was purchased in and not resalable. However, in the near future these items can be minted into NFTs. This would make them transferable to various gaming ecosystems and foster a thriving economy within the gaming industry in which players can transact these in-game products for real-world money. In addition to this, the video game developers can also program in a fee structure within the smart contract behind the NFT minted item which allows them to take 5% (for example) of the selling price every time a transaction occurs between players. Creating a win-win situation where players gain greater utility from in-game purchases due to the inherent scarcity, uniqueness and transactability of these items whilst developers are able to generate new incomes. Another exciting application surrounding NFTs can be found in the real-world; specifically, real estate. This is ultimately possible because NFTs allow for significantly greater efficiency within the property-buying process. Currently real estate is filled with seas of red tape involving various intermediaries such as solicitors, banks and real estate agents which simply add expenses and time to a transaction which should be relatively straightforward and between two parties. NFTs can cut this red tape significantly through essentially replacing these intermediaries with through smart contracts which enables an extremely safe, effortless transfer of ownership. In addition to this all ownership and rights history can be almost immediately verifiable as it is recorded onto the blockchain. These are just some examples of the potential use cases of NFTs. I hope you’ve learned something interesting and come to find that this technology is more than a simple jpeg image of digital art with extra steps. See you next week! /Alexander Ekberg Investor Joe Updates Who is Joe? We explain everything here. Previous positions remain unchanged. This week Joe continues his DCA strategy with 100$ split as: 50$ into BTC - why 40$ into ETH - why 10$ into LUNA - Read an in depth explanation to why here A Quick Look at Terra (LUNA) Terra is programmable money that rivals fiat backed stable coins (cryptocurrencies that are collateralized 1:1 with a specific fiat currency). With Terra’s algorithmically backed stable coins it has become a rival to leading fiat-backed stable coins due to its native transparency and decentralization. With the growing demand of Defi, the qualities of transparency and decentralization are likely to persist where stable coins are needed. Luna is Terra’s native token which is used to stabilize the pegged on the stable coins, a process of seigniorage (the video linked below explains this well). Links to Learn More: - Terra White paper - Terra Website - Terra (Luna) Price Chart - Investor Thesis (dated but great overview): - Easy to follow video Here are Investor Joe’s Current Holdings: REMEMBER this is not financial advice, and is purely for educational purposes only, always DYOR! /Erik Gunnarsson DISCLOSURE: SOME DIGITAL ASSETS SOCIETY MEMBERS ARE INVESTED IN CERTAIN TOKENS AND COINS WHICH MAY HAVE BEEN SPOKEN ABOUT ABOVE. THESE STATEMENTS ARE INTENDED TO DISCLOSE ANY CONFLICT OF INTEREST AND SHOULD NOT BE MISCONSTRUED AS A RECOMMENDATION TO PURCHASE ANY COIN OR TOKEN. THIS CONTENT IS FOR INFORMATIONAL PURPOSES ONLY AND YOU SHOULD NOT MAKE DECISIONS BASED SOLELY ON IT. THIS IS NOT INVESTMENT ADVICE.

Too Long Didn't Read Summary Market update: At the time of writing the crypto market has seen an uptrend this week with major players Ethereum rising 9.7% and Bitcoin 1.54%. This is possibly due to the lower market prices of recent weeks. The craziness of the NFT space has continued into this week, mainly involving LooksRare and Opensea. In which LooksRare having double the daily trading volume of Opensea despite having a fraction of users. Recent reports suggest this is due to wash traders. Read more Below to find out more about the LooksRare wash trading and the effects of the lower crypto prices. Concept of the week: Protocols and Layers - The Architecture of Crypto Assets When reading about cryptocurrencies you may have come across terms such as “layer one or layer two protocols.” These are foundational concepts for understanding the technical aspects of digital assets are protocols and layers, namely layers and protocols. Ultimately they facilitate data sharing and dictate processes such as transaction validation, system security, the interaction between participating nodes, etc.. Layers specify the set of protocols used in certain components of the blockchain architecture. Think of it as different layers to a cake with each layer serving a unique purpose. The layered architecture of blockchain technology can be split into six categories which then are grouped into three distinct layer protocols. Many different crypto assets (such as Ethereum) are essentially these layered protocols. Read more to find out and understand why! Investor Joe Updates: Joe looks into a new Altcoin; namely Helium and its fascinating approach to telecommunications. Read more below! We are not advocators we are educators This Week's Market Update This week has been a somewhat better one for the crypto asset market with major players Ethereum rising 9.7% and Bitcoin 1.54% (at the time of writing). This can possibly be attributed to one primary factor, lower prices in recent weeks which have led to new investors and investor sentiment regarding more bullish appetite for risky assets. In addition to this, Polkadot pushed dogecoin out of the top 10 crypto assets based on market cap. In the NFT space we’ve seen plenty of action within NFT exchanges. The new decentralized NFT marketplace LooksRare, which aims to be an alternative to Opensea, has seen a rapid rise to the forefront of news cycles as it reports daily trade volume (USD) that is more than double that of Opensea despite significantly lower users. However, this is not why it ended up in the spotlight, rather it is due to the traders taking advantage of its low fee structure to wash trade. Wash trading refers to the same trader buying and selling an instrument to create artificially high trading volume and manipulate the market price of the asset. This is thus what explains LooksRare's insane volume in recent weeks, suggesting that these volumes are not sustainable. Concept of the Week: Protocols and Layers - The Architecture Crypto Assets When reading about cryptocurrencies you may have come across terms such as “layer one or layer two protocols.” These are foundational concepts for understanding the technical aspects of digital assets, namely layers and protocols. Let’s begin with explaining protocols. There are various types of protocols. Ultimately they serve as a set of rules which allow for the exchanging and processing of data between computers. Think of it as a language between humans; without a shared language (e.g. English) they wouldn't be able to engage and communicate. Blockchain protocols facilitate data sharing and dictate processes such as transaction validation, system security, the interaction between participating nodes, etc.. Ultimately, protocols are what facilitated the decentralization inherent within crypto by defining how information and data is distributed without the need for a centralized entity. Layers specify the set of protocols used in certain components of the blockchain architecture. Think of it as different layers to a cake with each layer serving a unique purpose. The layered architecture of blockchain technology can be split into six categories which then are grouped into three layers: The Hardware/Infrastructure Layer, also known as Layer 0, can be seen as the baking sheet which makes the cake possible. It involves all components which allow for blockchain networks to function and be a reality, this includes the internet, hardware and connections. The Implementation Layer, also known as Layer 1 protocols, is the system associated with the base architecture of a blockchain network. These protocols set the rules and parameters for the entire network such as the consensus processes, transaction throughput, dispute resolution, etc.. Bitcoin and the Ethereum Network are all layer 1 protocols. Meaning when you purchase these tokens you are investing into a layer 1 token. Layer 2 protocols, also known as Layer 2 (L2) Solutions, are the protocols and overlapping networks which sit on top of the base layers and provide scalability. This is primarily to provide interoperability features and scalability for layer 1 networks by carrying some load. The primary difference from layer 1 protocols is that layer 2 is a third-party integration used in conjunction with layer one to enhance system efficiency and the number of nodes whilst layer 1 is the blockchain of the decentralized ecosystem. Thus layer two crypto are tokens and systems which are built on top layer 1 networks. An example is Polygon (Matic) which is a cryptocurrency built on top of the Ethereum network to address ETH’s scalability problems when facing mass adoption. The application layer, also known as Layer 3 protocols, consists of protocols which all applications run on the blockchain. The applications are known as Decentralized Application (Dapps). Layer 3 is ultimately what gives blockchain real-world applications by allowing for the implementation and execution of use-cases. Sources (Excellent further readings for learning): Guide To Understanding the Layers of Blockchain - Coin telegraph What is a Protocol - Cloudfare What are Application Layer Protocols - Coinmarketcap Hope you learned something new or interesting. Feel free to email us with questions, suggestions or criticism and I'll see you next week! /Alexander Ekberg Investor Joe Portfolio Updates For this section we encourage you to click the links in order to learn and understand the investment reasoning and how Investor Joe works. Who is Joe? We explain everything here. Previous positions remain unchanged. This week Joe continues his DCA strategy with 100$ split as: 50$ into BTC - Read why 45$ into ETH - Read why 5$ into HNT - Read an in depth why here Quick take on Helium (HNT) Helium has the grandiose ambition to take over the telecommunications sector with its decentralized machine network. The network is built up of hotspots or ‘gateways’ that also act as miners (they look and act similar to a simple home wifi router). Based on the coverage that your miner/hotspot has as well as the traffic on it, Helium miners are rewarded with Heliums native token HNT. A few of many use cases include for these hotspots: IoT sensors, tile-like trackers, dog tag trackers (Map Link) This map shows a map of all miners in the world. Here’s a screenshot of Stockholm (each hexagon has >1 miner in it) Investor Joe's Current Portfolio: ⚠️ DISCLAIMER ⚠️ This is not financial advice, and is purely for educational purposes only, always DYOR! ______________ /Erik Gunnarsson Thank you for reading this far! We hope you discovered something new or interesting. We are constantly striving to improve and would thus appreciate your feedback. If you have any comments, ideas or thoughts you would like to express to us, please send us feedback through the form at the bottom of our website. DISCLOSURE: SOME DIGITAL ASSETS SOCIETY MEMBERS ARE INVESTED IN CERTAIN TOKENS AND COINS WHICH MAY HAVE BEEN SPOKEN ABOUT ABOVE. THESE STATEMENTS ARE INTENDED TO DISCLOSE ANY CONFLICT OF INTEREST AND SHOULD NOT BE MISCONSTRUED AS A RECOMMENDATION TO PURCHASE ANY COIN OR TOKEN. THIS CONTENT IS FOR INFORMATIONAL PURPOSES ONLY AND YOU SHOULD NOT MAKE DECISIONS BASED SOLELY ON IT. THIS IS NOT INVESTMENT ADVICE.

Too Long Didn't Read Summary Market update: The cryptocurrency market has been experiencing a crazy ride up and down(Mostly down) during the past week. Overall pursuit of safe assets and liquidity among investors has pushed down the prices of all assets that can be regarded as risky, thus explaining the Correction in the cryptocurrency market. Meanwhile, the NFT market (and/or frenzy) continues to thrive with big players such as Meta (Instagram & Facebook) and Walmart starting to create plans for different kinds of NFT- integration. Finally, the topic of adopting Bitcoin as a legal tender is becoming hot. However, it is indeed a polarized question. Read more below! Concept of the week - NFTs - what is it really about? NFTs are digital properties in their essence. More specifically, a NFT is essentially a token which proves the ownership of a digital good,which really has not been possible before in this new digital world. NFT as a concept matters because it enables the shift from the age of information to the age of value to occur, which in turn economically empower people on a global level. Not only is it something philosophically beautiful to be able to both create and acquire digital property, it also provides endless opportunities with regards to providing utility for people owning these digital assets. In short, NFTs simply empower individuals, on a global level, to create, buy, sell, own and use digital assets. Read more below and stay updated for more learning sessions where we discover the world of NFTs! Investor Joe Updates: Learn about what investor Joe has invested into this week and why. Are You New to This Space? Don't Worry! As we have gained a lot of new subscribers we would like to welcome you all to the DAS newsletter! We provide a market update, a concept of the week and finally a portfolio update from Investor Joe. Since this newsletter may contain slightly complex topics and you may be new to the world of digital assets, we would like to invite you to look into our website where we have created a learning section for you to gain a better understanding of this fascinating ecosystem. Hope you enjoy reading! We are not advocators we are educators This Week's Market Update Micro View: Wow! If you haven't learned about the meaning of Volatility or even heard about the term before, aggressive up and down(mostly down) movements in the cryptocurrency market has been the real practical teacher. Starting off the week with BTC at approximately 42 000 $, the whole cryptomarket experienced a severe sell-off during this week, with BTC plunging under 34 000 $ before bouncing back to a level of 37 000 $. Ethereum was even more damaged while smaller alt coins in general were down the most(Which often is the case when the market experiences a correction). Macro View: As stated under the Micro View, a real correction occurred during the past week. The main reason for the correction was a severe and aggressive sell-off of all different kinds of assets that people perceive as risky, which caused dramatic movements in the stock market, which in its turn was spread like a virus to the cryptocurrency market.The increased fear and thus motivation to dispose high-risk assets itself, can mainly be described by a combination of the current geopolitical crisis with Russia together with fear of increased interest rates due to higher inflation expectations worldwide. Meanwhile, while the cryptocurrency market has been characterized by FUD(Fear, Uncertainty and Doubt) lately, the frenzy in the NFT-space continues. Big players are starting to really take this seriously, probably because they are realizing the potential of this market and ultimately the cost of NOT adapting in a constructive way. For instance, Walmart has recently filed several trademark applications related to NFTs, which indicates that they will soon create their own projects using this technology (Web3 Founders Welcome Walmart and Its NFTs to the Metaverse - Decrypt). Moreover, NFT features are on their way to enter our social media platforms, such as Instagram and Facebook, in a truly integrated way (Web3 Founders Welcome Walmart and Its NFTs to the Metaverse - Decrypt). Different perspectives on the topic of adopting Bitcoin as a Legal Tender are arising. On the one hand, The IMF(International Monetary Fund) recently warned the president of El Salvador (Yes, El Salvador has Bitcoin as a legal tender), stating that Bitcoin as a legal tender poses a severe threat to the financial stability and integrity in the country, which in its turn could make it hard for El Salvador to loan from IMF in the future(IMF urges El Salvador to remove Bitcoin as legal tender). On the other hand, Fidelity Investment research department recently came up with the opposite conclusion, using the concept of game theory to explain how NOT adopting Bitcoin as a legal tender today is a too big cost for the future even if the country doesn´t believe in its benefits, since the assumption is that other countries will start following El Salvador´s path(Fidelity: Countries That Secure Some Bitcoin Today Will Be Better Off Than Their Peers). /Viktor Svensson Concept of the Week: NFTs - What is it really about? Maybe you have been following the explosion of interest in this phenomenon called ´´NFT´´. Or maybe you have no idea where I am going with this text. Either way, the only thing you really need to know is that this is not a joke or something that will be here on earth for a limited time. NFT as a phenome non and its underlying implications is here to stay and will disrupt society in many respects. Let's try to explore and understand this area further! What is a NFT? Well, by googling its pure definition you will find out that NFT stands for ´´Non-Fungible Token´´. However, this may make you even more confused than you were before. What does it actually mean? Ultimately, It is a digital asset. Or more profoundly explained, it is digital property, like a digital validated certificate, stored on a Blockchain, which ensures that there is only one original, rightful, owner of that property, or asset if you want. That is, a token which proves the ownership of a digital good, which really has not been possible before the emergence of NFTs. Could that work as an overall, more broad, explanation? Well, maybe as an abstract concept, which you may or may not understand. But how about its relation to reality, to real life application and utility? Well, now it becomes interesting and also, hopefully, more intuitive, because here is the truth: The only limit to what could be constructed as a NFT is your imagination, more or less. As long as it is something digital, you can in theory turn it into this unique kind of token and thus into a digital asset. In practice, this could be digital art, a music clip, a twitter-post or just a collection with the purpose to create a coherent community where the owners of these NFTs are provided with real life and/or metaverse Utility. Why is this relevant? The concept of NFTs is revolutionizing this digital world. Why? Well, the simple, broader, explanation is that this innovation enables a shift on the internet from the age of information to the age of value. That is, through NFTs, people who think that what they have created online is being demanded in the market can actually be paid for that value creation in a fair, distributed, decentralized and effective way. Not only once, but every time the token is being sold (Due to royalties, just like for artists in the physical world). At the same time, people who want to buy these digital assets (or digital property you want) now have that opportunity, no matter if the motive is speculation, collection, flexing, becoming a part of a community and/or receiving utilities. NFTs simply empower individuals, on a global level, to create, buy, sell, own and use digital assets. How to think about NFTs? You may argue that the current frenzy movements on the NFT market is a strong indication of a bubble. Well, it all comes down to how you define a bubble. If the argument is that NFT prices will drop at some point, maybe substantially, due to excess supply and overall greed, like the Internet-bubble burst year 1999, that may or may not be the case. However, NFTs as a concept and its importance, is not going anywhere. In an increasingly digitized world, people will continue to pursue ownership and construct digital property, just as people do today in the physical world. Rational or not, but really, the root reasons for buying NFTs are not different from the motives to buy physical properties of different kinds such as cars, paintings, collectibles, scarce commodities, land and so forth. I hope that this text has helped you to grasp the concept of a NFT and why it matters to you, the society and the world. Although this is far from sufficient and is only the tip of the iceberg, hopefully you are now equipped with a basic, fundamental, understanding of this area of digital assets. This journey has just begun and we look forward to continuing exploring this fascinating ecosystem of NFTs together with you. Thank you for reading. /Viktor Svensson Investor Joe Portfolio Updates For this section we encourage you to click the links in order to learn and understand the investment reasoning and how Investor Joe works. Who is Joe? We explain everything here. Previous positions remain unchanged. This week Joe continues his DCA strategy with 100$ split as: 50$ into BTC — Read why 50$ into ETH — Read why The Quick Take: With this week's bloodbath it has allowed Joe to pick up both BTC and ETH at their lowest points yet for Joe! An example of why ‘DCAing’ can be more effective than lump sum investing. However with the continued uncertainty, Joe will not go for any smaller alt coins this week. Portfolio Value and Holdings: ⚠️ DISCLAIMER ⚠️ This is not financial advice, and is purely for educational purposes only, always DYOR! ____________ Written by: Erik Gunnarsson Questions? Reach me at hey@erikgunnarsson.com Thank you for reading this far! We hope you discovered something new or interesting. We are constantly striving to improve and would thus appreciate your feedback. If you have any comments, ideas or thoughts you would like to express to us, please send us feedback through the form at the bottom of our website. DISCLOSURE: SOME DIGITAL ASSETS SOCIETY MEMBERS ARE INVESTED IN CERTAIN TOKENS AND COINS WHICH MAY HAVE BEEN SPOKEN ABOUT ABOVE. THESE STATEMENTS ARE INTENDED TO DISCLOSE ANY CONFLICT OF INTEREST AND SHOULD NOT BE MISCONSTRUED AS A RECOMMENDATION TO PURCHASE ANY COIN OR TOKEN. THIS CONTENT IS FOR INFORMATIONAL PURPOSES ONLY AND YOU SHOULD NOT MAKE DECISIONS BASED SOLELY ON IT. THIS IS NOT INVESTMENT ADVICE.

Too Long Didn't Read Summary: This Week's Market Update A fairly flat week for cryptocurrencies in general. The big question is whether a new bull run is on the way or if the crypto winter has already begun? On the macro front there are a lot of things happening as well. The correlation between the stock market and crypto is increasing, the internet has been shut down in Kazakhstan, institutional investors are still hungry and soon you will be able to buy an NFT with your credit card! Read more below! Concept of the Week: Valuing Bitcoin as if it were Facebook You can define a specific cryptocurrency (in this case Bitcoin) in many ways. One way is to view Bitcoin as a global, independent and decentralized, monetary network. If it is a network, the value should increase as the overall network grows. Consequently, in order to make this concept easy and intuitive, the value of the Bitcoin network and thus a Bitcoin can be valued as if it was Facebook or Tiktok. Read more below! Investor Joe Update Find out who Investor Joe is, what he has decided to invest in this week and why below! Are You New to This Space? Don't Worry! As we have gained a lot of new subscribers we would like to welcome you all to the DAS newsletter! Since this newsletter may contain slightly complex topics and many of you are new to the world of crypto, we invite you to look into our website where we have created a learning section filled with information and sources that you can read and gain a better understanding of crypto assets. Hope you enjoy! We are not advocators we are educators This Week's Market Update The Micro-view: Starting off zoomed in, it's been a fairly flat week for bitcoin (BTC). With a high at 44K and a low of 41K we are seeing some of the lowest volatility ever on BTC with a mesure well bellow 3% on the 30 day volatility estimate (source). Seems that both bears and bulls are sitting tight as the pile of macro factors, such as signs of regulation coming, are now starting to settle. The next few weeks are likely to determine how the rest of this year's market will play out. That is to say if we see the lead up to another crazy bull run or if a crypto winter has already set in and we see a continued downtrend. As always only time will tell. The Macro View: The correlation between Crypto and the Stock markets has increased as digital assets continue to see a wider adoption. The IMF (International Monetary Fund) recently spoke about their fear that the increased correlation between stocks and crypto may lead to a dip in the stock market (S&P 500) if the crypto market crash (link to report, it’s nice and short read). Where IMF argues correlation, others argue causation (A & B effect each other v.s. Only A effects B) What do you think? The internet shutdown parallel to the riots in Kazakhstan are now confirmed to be the government’s action, in order to control the population during the riots. If you are out of the loop here, the TLDR (too long didn't read) is that Kazakhstan has seen a flood of Bitcoin miners enter their nation state after China set a blanket ban on Crypto mining. Therefore the internet shut down resulted in the BTC market crashing as it rendered the miners useless. (Read our previous newsletter here for more info) As mentioned in last week's newsletter the floodgates of institutional investors (ex. venture capitalists, angel investors, hedge funds etc) are still hungry. This week we saw FTX launching a 2 Billion dollar VC fund for crypto start ups! (yep, it's the same group behind FTX.com) Concept of the Week: Valuing Bitcoin as if it were Facebook When trying to grasp your head around how to value different cryptocurrencies, there is no generic truth. How you value a cryptocurrency will be based on not only the cryptocurrency itself but also how you define it. If you define it as a network of users, you can think of it as Facebook or Tiktok. If no one uses it, it has no value and vice versa. How does this work? Valuing a Cryptocurrency such as Bitcoin as if it was Facebook is done by focusing on the network effects. This can be done by using the Metcalfe’s Ratio (MET), which is based on Metcalfe's law. Strange name, I know, but Metcalfe's law essentially states that: "The value of a network is proportional to the square of the number of the network’s connected users." Why is this relevant for a cryptocurrency (most appropriate for Bitcoin)? Bitcoin can be viewed as a store of value, as digital money, as digital property or even digital energy. In its essence, however, Bitcoin can also be described as a global, independent and decentralized, monetary network. Given that we define it as a network, the value of a Bitcoin should reasonably increase as the network grows bigger. Hence, Metcalfe's law helps us understand how the value of a Bitcoin is supposed to change as the size of the network changes. How do you calculate this? Although simplified, the calculation is straightforward: The value of the network should be valued as the square of the number of participants. That is, The value of the network= (Active addresses) ^2 . Read more on addresses here. Hence, the MET Ratio= Current market cap / Daily active addresses Want to dig into the rabbit hole? If yes, this is for you: metcalfeslaw_websiteupload_7-5-18.pdf (caia.org) Thank you for reading and remember that this is only one of many different tools and perspectives available in this space! /Viktor Svensson Investor Joe Portfolio Updates For this section we encourage you to click the links in order to learn and understand the investment reasoning and how Investor Joe works. Who is Joe? We explain everything here. Previous positions remain unchanged. This week Joe continues his DCA strategy with 100$ split as: 50$ into BTC - Read why 40$ into ETH - Read why 10$ into ATOM - Read why Investor Joe's Current Portfolio: ⚠️ DISCLAIMER ⚠️ This is not financial advice, and is purely for educational purposes only, always DYOR! ____________ Written by: Erik Gunnarsson Questions? Reach me at hey@erikgunnarsson.com Thank you for reading this far! We hope you discovered something new or interesting. We are constantly striving to improve and would thus appreciate your feedback. If you have any comments, ideas or thoughts you would like to express to us, please send us feedback through the form at the bottom of our website. DISCLOSURE: SOME DIGITAL ASSETS SOCIETY MEMBERS ARE INVESTED IN CERTAIN TOKENS AND COINS WHICH MAY HAVE BEEN SPOKEN ABOUT ABOVE. THESE STATEMENTS ARE INTENDED TO DISCLOSE ANY CONFLICT OF INTEREST AND SHOULD NOT BE MISCONSTRUED AS A RECOMMENDATION TO PURCHASE ANY COIN OR TOKEN. THIS CONTENT IS FOR INFORMATIONAL PURPOSES ONLY AND YOU SHOULD NOT MAKE DECISIONS BASED SOLELY ON IT. THIS IS NOT INVESTMENT ADVICE.

Hope you enjoyed the new ‘weekly market peek’ dashboard. We soon will insert an in depth overview of what all the indicators mean and how to read them on our website. Quote of the Week "The real trick in highly reliable systems is somehow to achieve simultaneous centralization and decentralization." - Karl E. Weick Too Long Didn't Read Summary: A Brief Introduction to Crypto Assets: We begin this week with the start of a series of articles in our newsletter in which we introduce and explain digital assets in a more thorough, straightforward manner. With this, we begin by answering the questions we all have when we first start our educational journey into this space such as 'what is a blockchain,' explain how one should view these assets given their generally misleading name and much more. Read more below! Investor Joe Update Find out what Investor Joe has decided to do this week and why below! We are not advocators we are educators A Quick Market Update The Micro-view: We’ve seen another red week in the markets with a 3 month low on BTC around $39,7K. The recent sideways market seems now to show a trend downwards. That said, we are seeing some bullish indicators such as an ATH leverage ratio, indicating traders are more non-risk averse than ever before and eager to capitalize, read more HERE. Perhaps this could indicate an upcoming final bull run rally? Only the future will know for sure. Macro View: The floodgates of institutional investments (VC, angel investors, Hedge funds etc) into the crypto space see little sign of slowing down from 2021, which was by far the largest year yet. These investments will lead to more innovation opportunities, and positive long term price action for successful and competitive projects. Read more from the Binance Custody department HERE. A Brief Introduction to Crypto Assets The most common misconception within the Web3/crypto space is that all crypto assets = currencies. This misconception is understandable since the media keeps referring to “cryptocurrencies” and mostly writes about Bitcoin and other “coins”. But let’s take a step back and look at how space has evolved. What is a blockchain? Blockchain can be thought of as the internet, but with a built in accounting system that enables secure payments and keeps track of all ownership. On top of this “internet”, it is then possible to build companies that use the novel features of this accounting tool. Bitcoin, why and how? Currently when making transactions online, we have to trust a bank (centralized third party). What Bitcoin managed to create, is a peer-to-peer (person-to-person) digital currency that works without having to trust a centralized third party. This is possible thanks to the novel features of a blockchain. Next, Ethereum. In 2014 a new blockchain called Ethereum launched. While Bitcoin is a hugely valuable invention and widely adopted ($1 trillion market capitalization), it has limitations. Bitcoin only makes it possible to send and receive Bitcoin. Ethereum however, makes it possible to build projects on top of the blockchain. These projects, i.e. Decentralized Applications aka dApps, are built using smart contracts (the code/logic). Let’s try to understand a fairly simple dApp. Aave If it’s possible to keep track of ownership and have secure payments, why not build a bank. Imagine a global bank, where people can deposit their money, take out loans and the interest paid by the borrower is split between the depositors and the bank. Voilà, that’s the business model for Aave, a lending dApp built on top of the Ethereum blockchain. Today, Aave has hundreds of thousands of users and around $8B in borrowing volume (ie. loans outstanding). As seen in the chart below, on the 11th of January, Aave received around $900k in interest payments. Of this $900k Aave takes an approx. 10% cut that goes to the protocol treasury which is managed by the token holders and the rest goes to the supply-side (lenders). The token holders own and govern the protocol. This sounds quite similar to shareholders in a traditional company, right? Hence tokens in protocols shouldn’t be thought of as a speculative currency, but rather as shares in a company built on top of a blockchain. Summary: The key takeaway from this brief introduction to digital assets is that not all crypto assets are random speculative “shitcoins” with no real use case. Blockchain technology makes it possible to create new kinds of digital companies with real services and actual cash flows. These dApps can be valued in a similar manner as traditional companies by looking at their founders, users, brand and financial metrics. /Sebastian Motelay & Robin Borgström Here are our sources if you are interested in reading more: Balaji Srinivasa: Applications Today & 2025 Token Terminal Balaji Srinivasa: Crypto Applications 2020-2025 AAVE Investor Joe Portfolio Updates Previous positions remain unchanged (view HERE). This week Joe continues his DCA strategy with 100$ split into: 50$ into BTC - WHY 30$ into ETH - WHY 10$ into DOT - WHY 10$ into SOL - WHY ⚠️ DISCLAIMER ⚠️ This is not financial advice, and is purely for educational purposes only, always DYOR! ____________ Written by: Erik Gunnarsson Questions? Reach me at hey@erikgunnarsson.com DISCLOSURE: SOME DIGITAL ASSETS SOCIETY MEMBERS ARE INVESTED IN CERTAIN TOKENS AND COINS WHICH MAY HAVE BEEN SPOKEN ABOUT ABOVE. THESE STATEMENTS ARE INTENDED TO DISCLOSE ANY CONFLICT OF INTEREST AND SHOULD NOT BE MISCONSTRUED AS A RECOMMENDATION TO PURCHASE ANY COIN OR TOKEN. THIS CONTENT IS FOR INFORMATIONAL PURPOSES ONLY AND YOU SHOULD NOT MAKE DECISIONS BASED SOLELY ON IT. THIS IS NOT INVESTMENT ADVICE.

Quote of the Week "Our money is destined to become digital" - Michael Saylor Too Long Didn't Read Summary: What are DAOs and how can they change the world?: Cryptocurrencies and blockchain technologies has allowed for the flourishing of various innovations. One that has come to the forefront of this space are Decentralised Autonomous Organisations (DAOs). These block-chained based organisations have shown to have a number of incredibly exciting and potentially disruptive applications to various areas of our society. Read more below! Concept of the Week: The MVRV Ratio What is really the "fair value" of a cryptocurrency? Well, although many people argue that cryptocurrencies have no real cash flows(which in itself is not necessarily true) and thus can´t be discounted to a present value, there are still a lot of valuable metrics and tools to use in this regard. One of these tools, specifically designed to grasp the "fair value" of a cryptocurrency, is the ratio called MVRV-ratio. This can be used to understand how undervalued or overvalued a cryptocurrency such as Bitcoin really is, which also could be valuable for understanding price movements. Read more below! Investor Joe Update Find out what Investor Joe has decided to do this week and why below! Today's Crypto Fear & Greed Index: Read and learn about what the Fear and Greed Index is here We are not advocators we are educators A Quick Market Update Total Market Cap: $2.0 trillion ( -9% roughly from last week) BTC dominance 39.60% Kazakhstan’s Internet Shutdown Drops Bitcoin Hashrate by 12%Some last minute news as the markets take a hit. The short story is that ever since China banned bitcoin mining, the miners have needed to move elsewhere, including the US and Kazakhstan. However, with increasing energy prices, miners have started to hike prices whilst protests have started to arise. To make matters worse, earlier today Kazakhstan suffered a internet shutdown, which was allegedly state-imposed. *Note that this is breaking news, new information is continuously being published on the matter* What are DAOs and how can they change the world? As you may already have figured out by now, the decentralised feature of cryptocurrencies and blockchain technologies has allowed for the flourishing of various innovations. One that has come to the forefront of this space are Decentralised Autonomous Organisations (DAOs). Simply put, DAOs are blockchain based organisations or companies that are collectively controlled and owned by its members. Decision-making occurs proposals and voting in which various tools can be integrated to encourage efficient collaboration and work delegation among members (For visualisation over how a DAO is structured and operated, look at the diagram below). Ultimately, what makes DAOs possibly disruptive is its ability to instigate decentralisation without sacrificing efficiency. The rest of the article will explore the potential applications of DAOs although we will definitely revisit this topic in the future so feel free to message us with questions you need answers to. You can also find additional links for further learning at the end of this article. The key thing with DAOs is the fact that they act like your basic organisation but decentralised and fully transparent. Thus, in theory, it has the potential to be applied to multiple sectors of society from governments to venture capital funds. In fact, we have already seen DAOs being built up to build products, collect NFTs, invest and even provide services. Recent years has unfortunately seen a collapse of the public's institutional trust towards corporations and even governments. Which thus suggests a problematic area where DAOs can offer solutions. Below is a small list of use-cases where this type of organisation may provide value: Charities: DAO charities can accept donations and membership from anyone and the group can decide where the money should based on various proposals from experts. Companies: Employees can have pooled ownership, incentivize performance and work towards a shared goal and access a more democratic approach to decision-making without sacrificing significant efficiency. Governments: DAOs can allow for the more efficient, transparent and democratic governance of states or communities through allowing for direct accountability whilst delegating tasks towards experts rather than relying on a few individuals to manage multiple domains. Although this is a stretch and would initially be very challenging to incorporate. In general, there is a multitude of possibly beneficial applications of DAOs which makes it evermore exciting to read about. Although this article simply explored this at the surface level, here are some sources that you can look into to learn a bit more about this topic: What is a DAO? 15 Ways the World is being Transformed by DAOs The Structure and Operations of DAOs & The Current State DAO Tooling's Hope you discovered something new or interesting from this read and I will see you next week! Best regards, Alexander Ekberg Concept of the Week: The MVRV Ratio Why is this Relevant? The MVRV Ratio can provide you with some valuable insights with regards to the price of a cryptocurrency. More specifically, this ratio functions as an indication of how close the price is to its ´´fair value´´, which in its turn can be used to make sense of the historical, current and future market movements The MVRV ratio is constructed by comparing two crucial factors: The current market capitalization(For a cryptocurrency that is simply the current price times the amount of coins issued). Realized capitalization(Essentially the value of all coins at the price they last transacted on chain. That is, what people actually paid for cryptocurrency X). How is this Calculated? The ratio is quite straightforward: MVRV = Market Cap / Realized Cap Hence, if the ratio is 1, the value of the cryptocurrency can be viewed as "fair". In all other scenarios, the price will deviate from this "fair value" to a certain extent, which has some interesting implications. Now let's try to answer the question that you probably have right now: How can we make sense of this concept in terms of real, valuable, insights and ultimately actions? Well, essentially, this ratio tells you how many people are sitting in front of their Coinbase screens, enjoying their healthy profits and bragging about their investment-skills. This is a little simplified, admittedly. However, the logic is as follows: As the market cap increases relative to the realized cap, this is a strong indication of a higher degree of unrealized profits in the ecosystem, which can be viewed as a sign of the cryptocurrency being overvalued since the price is above the ´´fair value´´ in this respect. Conversely, as the realized cap exceeds the market cap, this indicates that investors are not profitable, which can be regarded as the cryptocurrency being undervalued Let´s be more precise and specific with the numbers by providing 2´´rule of thumbs´´! For instance, some general consensus within the Bitcoin - community with regards to the MRVR Ratio is as follows: MVRV> 3,5 = Generally sign of late stage bull cycles. Meaning: You probably do not want to sell off all your assets and go all-in Bitcoin at this stage (That is, holding all other factors constant). MVRV<1 = Generally sign of late stage bear cycles. Could potentially be the bear market bottom. Meaning: Could be an attractive opportunity to start accumulating (or accumulate more) Bitcoin. As always worth mentioning, this is one of many valuable tools. Use your "macro -mindset". That is, do not trust wholeheartedly on one specific ratio to do the job or create successful outcomes in any respect. That simply won't happen. Instead, add this to your toolbox which you have started to construct and realize the valuable insights this concept can provide you with in specific situations and circumstances. Thanks for Reading! Best Regards, Victor Svensson Investor Joe Portfolio Updates Previous positions remain unchanged (view HERE). This week Joe continues his DCA strategy with 100$ split into: Positions and Reasoning: 60% BTC: Had a the long awaited taproot upgrade recently (Taproot upgrade batches multiple signatures and transactions together). 40% ETH: Ethereum has become a trendsetter with its innovation in trust-less permission-less contracts known as “smart contracts”. Smart contracts can be placed on top of the blockchains in combination with a DAPP (Decentralized applications) leading to disruptive innovations like the NFT space. DISCLOSURE: SOME DIGITAL ASSETS SOCIETY MEMBERS ARE INVESTED IN CERTAIN TOKENS AND COINS WHICH MAY HAVE BEEN SPOKEN ABOUT ABOVE. THESE STATEMENTS ARE INTENDED TO DISCLOSE ANY CONFLICT OF INTEREST AND SHOULD NOT BE MISCONSTRUED AS A RECOMMENDATION TO PURCHASE ANY COIN OR TOKEN. THIS CONTENT IS FOR INFORMATIONAL PURPOSES ONLY AND YOU SHOULD NOT MAKE DECISIONS BASED SOLELY ON IT. THIS IS NOT INVESTMENT ADVICE.

What a year it has been. From the Gamestop short-squeeze to the surges of memecoins, 2021 was the year of the retail trader. As a result, one of the defining events of this year has been the continued ascent of cryptocurrencies and Web3 in general. Thus, we have created a summary of the key events that have happened in the space this year as well as an 2022 outlook of what coming changes we believe will occur, and last but not least, a look at how investor Joe has done these past months. Some links to key terms will appear throughout the text if you want to learn more. Happy holidays, enjoy! What made this year so special? A time period becomes special as a result of the underlying events within them. For crypto, 2021 was very special and extremely hectic. Here is a quick summary of the key moments that occurred every quarter. What made this year so special was the explosion of growth and innovation within the ecosystem of this space. This was the year in which the use cases unrelated to Bitcoin (Defi, smart contracts, NFTs, etc.) became validated. From the acceleration of the adoption rate of cryptocurrencies among individuals, governments and companies, to the outburst innovative projects in multiple sectors, one can see 2021 as one of the early years wherein crypto has cemented its foundations within the world. The Bitcoin Journey As with all aspects of life, your perspective changes as time spent on a topic (and thus knowledge) increases. On the surface, this whole space of digital assets can not only look messy but, frankly, greedy. Admittedly, it is hard to see how this industry has the potential to change the world for the better if just looking at the crazy memes on Instagram. However, as your journey continues, you will gradually start to discover how this truly fascinating and revolutionizing space serves a greater purpose than making some crazy TikTok millennials rich. To exemplify this, below you will see an own-designed figure highlighting this concept in the case of Bitcoin. Of course the space in itself is revolutionary, Bitcoin is an excellent example given the events of this year. Not only have major companies such as Tesla begun adopting it, but it has become a legal tender and currency in the nation state of El Salvador. Despite it being so recent, it has already shown promising success in certain aspects with more people having Bitcoin than bank accounts in the country. Thus, already having an incredible impact on financial inclusion. The figure bellow shows what you can think of as a general development of motives as your knowledge and time spent in the Bitcoin- rabbit hole increases. As you move upwards to the right, you will start to discover really why Bitcoin is inherently disruptive. The Investor Joe Summary Allocation and performance of the 600$ invested over the past 6 weeks. It hasn’t been the best months for investor Joe, but he is still bullish on the space and has told us he is willing to continue trading into 2022! After all he is a strong believer that time in the market > timing the market. He aims to outperform the S&P 500, if he plays his cards right he thinks he can outperform BTC, by getting into sound alt coins. Joe will continue to DCA 100$ every week. (As our team grows we will get more manpower to dissect trades further and build more complex strategies however) for now Joe aims to keep it simple, occasionally picking up alt coins to expose readers about the space beyond the dominant BTC and ETH. Our Predictions for 2022 To finalise the end of this year, we thought it would be fun to share with you our individual outlooks regarding what we can expect for Web3 (cryptocurrencies, NFTs, decentalised technology, etc.) in 2022. Of course you should NOT take this as financial advice but rather a set perspectives to hopefully learn from. Sebastian Motelay: Bitcoin will outperform the SP500 Ethereum will outperform BTC NFTs will get an even broader adoption and new use cases will emerge Decentralized stablecoins will grow 5-10x in market cap Erik Gunnarsson: Will see another BTC & ETH all time high, followed by a crypto winter, although perhaps not as aggressive as the 80% drawdown as seen in 2017/2018 Defi market cap will hit an all time high Algorithmic based stable coins will flip centralized ones, such that top 10 stable coins will be algorithmic dominant. 2022 P2E gaming yields > 2021 P2E gaming yields Viktor Svensson: Defi market cap will hit an all time high. Today Defi represents less than 1 % of global banks market cap, i.e the long term upside is huge BTC will continue to demonetize gold and other assets sharing the purpose of preserving monetary energy. More specifically, BTC will outperform all other forms of store of value-assets (Gold, S&P 500, real estate, debt etc) Regulations will hit the market hard (Tax, KYC/AML, stablecoins and so forth), causing at least one or several temporary corrections The ´´meme-hype´´ will become less prevalent. Investors will become more selective in their allocation of capital as the market matures, pursuing only worthwhile projects characterized by real use cases and value creation. Hence, the evolution will accelerate, which will threaten the survival of (at least in terms of the price) so called ´´shitcoins´´. ETH will reach an all time high, but it needs to watch its back - there are a lot of competitors trying to dethrone ETH SOL will increase its market cap substantially relative to ETH BTC will become official legal tender in at least one more country Alexander Ekberg: The continued adoption of Bitcoin as a legal tender and national currency among developing economies as they want to move away from their reliance on the US Dollar and slow inflation Projects which focus on the core infrastructure within Web3 (DAO tooling, inter-protocol bridges, etc.) will rise to prominence as one of the hottest investments in the space given their existential need in order to generate greater efficiency, scaling and interoperability within the space. The cryptocurrency market in general will reach all-time-highs as there is further adoption among institutions and individuals in terms of both investment and uses (e.g. smart contracts) The Conclusion To conclude, 2021 has been an incredible, exciting year for crypto. We've seen a Cambrian explosion of innovations coupled with the mass recognition that this is has potential to be disruptive. However, this is just a beginning. As more financial and human capital flows into the space, we can expect an exponential trend of productivity, efficiency and adoption over the coming years. 2022 will hopefully prove this expectation. The Digital Assets Society want to thank you for joining us on this journey of learning and exploring this space. Hope you have learned something new or, at the very least, gained a new excitement and interest. We can promise you a continued improvement of this weekly newsletter as well as future events, meetings and a podcast. So stay tuned! Here are some book and report recommendations you should add to your 2022 reading list: Messari Research Report: Crypto Theses for 2022 The Bitcoin Standard - Saifedean Ammous Principles - Ray Dalio Digital Gold - Nathanial Popper The Age of Cryptocurrency: How Bitcoin and Digital Money are challenging the Global Economic Order - Michael Casey & Paul Vigna If you want more please check out our website. We will soon be adding a page where you can find all forms of sources to learn from. Anyhow, Happy New Years!!! Hope 2021 was a great year for you all and that 2022 becomes even better :)

Welcome to the Digital Assets Society's newsletter! We send this out every Thursday in which we discuss a range of topics surrounding the space of digital assets such as blockchain technologies, NFTs and cryptocurrencies. Our primary goal with this is to learn and expand our knowledge of this space in conjunction with you (the readers). Thus we try our best to make it as interesting and informative for people of all knowledge levels regarding this space. In this page you can find all the previous news letters we've written. If you find this enticing and would like to learn more about digital assets and our upcoming events, Subscribe below.