Weekly Recap: Azuki Elementals, ZK Stack, and More

This week, several more TradFi powerhouses have joined the race to launch a Bitcoin ETF, which has led to the narrowing of the GBTC discount rate and an uptick in Bitcoin's market dominance. Furthermore, major institutions including the Bank of International Settlements and Swiss National Bank have released a report exploring the utilization of DeFi swaps for CBDCs. Meanwhile, in the realm of NFTs, controversy has erupted as the blue-chip NFT collection Azuki releases a new collection that undermines the value of the original artworks.

Bitcoin Dominance Makes a Comeback

– Kunal (@kunalgoel)

Bitcoin has experienced a resurgence in the first half of 2023, regaining 50% dominance of the total crypto market cap, a level last witnessed in Q2 2021. At that time, Bitcoin began to cede its dominance to platform chains that supported new trends like DeFi, NFTs, and gaming. The recent excitement for Bitcoin comes from a potent mix of technical advancements and a favorable regulatory climate. After a long period of stagnation, Bitcoin has begun to experience a technical renaissance. Inscriptions and BRC-20 tokens have ushered in a new ecosystem atop Bitcoin, driving user growth and activity. Greater activity has piqued interest in developing Layer-2 solutions for Bitcoin, with Stacks and Rollkit leading the charge. After being left out of the fun, Bitcoin is finally participating in speculatory trends such as NFTs and meme coins.

Simultaneously, the regulatory landscape is further supporting Bitcoin's price action. There has been a flurry of ETF applications from TradFi giants, including BlackRock, Fidelity, ARK Invest, and Invesco. Previous applications for spot ETFs were rejected by the SEC, but the stature of these applicants suggests a higher probability of success. With a greater likelihood of Bitcoin ETFs being approved, the Grayscale BTC (GBTC) discount has also eroded, falling from 42% to 30% in June.