In today’s cryptocurrency news, we cover a decline in the market, an increase in stablecoin market capitalization, SafeDAO’s new proposal, and the challenges faced by mining companies.
Why Is Crypto Down Today?
The global cryptocurrency market capitalization has seen a decline of 2% in the last 24 hours, dropping to $2.18 trillion. During this period, the total trading volume in the crypto market reached $83 billion.
Only about 25% of the top 100 cryptocurrencies have experienced price increases during this timeframe. Monero (XMR) has emerged as the standout performer, appreciating 4.2% to reach $164.36, closely followed by Flare (FLR), which gained 4.1% to trade at $0.01614. Other notable performers include BEAM, which saw an increase of just over 3%, while the rest of the upward movers have climbed around 1% or less.
On the flip side, FLOKI has taken a significant hit, plummeting 18.4% to $0.0001281. Both Artificial Superintelligence Alliance (FET) and Klaytn (KLAY) fell by 9.7% and 9%, respectively, as the broader market saw most red coins decline by less than 7%.
Among the top 10 cryptocurrencies, only two have seen positive growth in the past day: TRON (TRX) is up 1.2% at $0.16115, and Dogecoin (DOGE) has increased by 0.4% to $0.10087. Solana (SOL) experienced the most significant decline, dropping 3.7% to $139.37. Ethereum (ETH) fell 0.8% to $2,524, while Bitcoin (BTC) remained stable at $59,408.
Despite the recent approval of an Ethereum exchange-traded fund (ETF) by the US SEC generating significant interest, the crypto sector still contends with various regulatory challenges under the Biden administration. Additionally, US spot Bitcoin ETFs reported $71.73 million in net outflows on Thursday, marking the third straight day of declines.
Stablecoin Market Cap Rises 11 Months in a Row
In a noteworthy development, the total stablecoin market capitalization rose by 2.89% in August, reaching $169 billion. This marks the eleventh consecutive month of growth and the highest level since April 2022, excluding algorithmic stablecoins, according to CCData.
Stablecoin market dominance has also increased to 7.59% from July’s figure of 6.88%, highlighting a third consecutive rise and its highest dominance level since January. However, stablecoin trading volumes have fallen by 14.2% to $848 billion but are still projected to rise for a second consecutive month, driven by volatility in traditional markets linked to concerns over the Japanese Yen.
PayPal USD has made headlines by hitting a new all-time high in August, becoming the sixth-largest stablecoin with a market cap of $960 million—a 56.6% increase. Tether (USDT) also reached an all-time high of $117 billion, now making up 69.6% of the overall stablecoin market capitalization, with a trading dominance of 76.9% on centralized exchanges.
SafeDAO’s New Proposal Aims at Monetization
In recent developments, SafeDAO has put forth a proposal aimed at developing specific revenue streams for the Safe Ecosystem Foundation. This initiative represents SafeDAO’s first step toward monetization through a licensing model for third-party integrations within Safe{Wallet}—with Native Swaps as the initial integration.
The proposal anticipates generating annualized revenue of $2.5 million from license fees associated with this integration powered by CoW Protocol. The underlying code and on-chain smart account infrastructure will remain open-source and freely available. Safe, previously known as Gnosis Safe, currently secures approximately $64.5 billion in assets and is working towards establishing a universal standard for secure custody of digital assets.
Miner Debt Results in Bankruptcy
Turning to the mining sector, a concerning trend has emerged among public mining companies struggling with high debt-to-equity ratios while managing mining infrastructure assets. According to BlocksBridge Consulting’s latest Miner Weekly report, Bitcoin’s low hashprice compounds the difficulties for highly leveraged mining operations.
Due to significant debt and the aftermath of Bitcoin’s halving, companies are increasingly forced to either de-leverage or seek new financing sources. Recent weeks have seen acquisitions, restructuring efforts, and bankruptcies, including Griid, Stronghold, and Rhodium Enterprises.
As of June 30, Griid reported more debt than assets, leading to negative shareholder equity, while Stronghold encountered a 241% debt-to-equity ratio. Rhodium Enterprises defaulted on over $50 million in loans, facing an astonishing D/E ratio of 839.56%. Core Scientific similarly faced a deficit in shareholder equity but has made strides in reducing debt significantly over recent months.
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