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Polygon QuickSwap Considers Token Split, Bullish For QUICK?

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On a positive trajectory over the last 24 hours and moving along with the general sentiment in the market, Polygon decentralize exchange (DEX) QuickSwap could boost its fundamentals. According to a recent announcement, the project could split its native governance token QUICK.

Related Reading | Polygon Token Price Analysis – New All-Time High This Week For MATIC?

Dubbed the “most important governance discussion to date” on the platform’s official social media channel, a fierce debate has taken place between Polygon users. This process is critical, and could precede a voting on the token split, depending on its result.

The main argument behind the proposal is supported by the potential expansion of the Polygon token, QUICK, supply. The project is currently planning changes on its tokenomics. A change in QUICK’s supply stands as the first and one of the most important.

If approve, the community will vote on possibly splitting the Polygon token on a 1:100 or 1:1,000 relation. The team behind QuickSwap clarified the following:

This would mean that for every 1 QUICK you now hold, you would hold 100 QUICK or 1000 QUICK after the split. QUICK’s maximum supply would increase from 1 million to 100 million or 1 billion.

The split would attempt to “open up” QuickSwap to new users, particularly those with intention to invest but that consider QUICK “too expensive” or with “small chances” of future appreciation. The proposal has managed to secure support from a portion of QUICK holders, others remain skeptical.

QuickSwap’s Co-Founder Roc Zacharias commented the following on the potential implications of the token split on the DEX ecosystem, and its capacity to improve the platform’s components, such as its treasury:

If this split DOES work out like we think it might, it could strengthen the treasury (which is owned by all of you the community, it could increase reward value which can increase liquidity and indirectly volume etc, and most importantly, it can bring new users! Please think hard about this.

Polygon QuickSwap Token Split And The Polkadot Case

Many users, including the team behind the Polygon decentralize exchange platform, have compared this potential token split with the stock market. In the legacy financial system is “common” for companies to issue more stocks via a similar process addressing a concept called Unit Bias.

This idea indicates, as explained by the team behind QuickSwap, that an investors might be willing to own “more of a less scarce asset”. In the crypto industry, other projects have conducted token splits in the past often leading to price appreciation.

The team behind token swap mentioned Polkadot (DOT), as an example. Via their official Twitter handle, QuickSwap said:

(…) when Polkadot did a 1:100 redenomination, $DOT rose from a sub-100 market cap to the 7 position. More recently, Gains Network did a 1:1000 token split & migrated from GFARM2 to GNS. In dismal conditions, GNS did a 6x.

Remains to be seen if history will repeat itself with QUICK. However, Polygon, and second layer solution on Ethereum, seem to be attracting a lot of attention as they provide users with a cost efficient and more scalable gateway into the DeFi sector.

Related Reading | TA: Ethereum Could Avoid a Major Downtrend if it Closes Above One Key Level

At the time of writing, Polygon (MATIC) trades at $1.43 with a 1.7% profit in the last day.

MATIC trends to the downside on the daily chart. Source: MATICUSDT Tradingview

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Why Gold Is Beating Bitcoin In 2022

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Bitcoin continues to underperform as a general “risk-off” sentiment has investors driving toward gold as a safe haven asset.

Not Risking It

Concerns about the Russo-Ukrainian war continue. The U.S. inflation struggles at a four-decade high and Fed rate hike fears prevail. The uncertainty extends to the world economy as a recession is expected instead of a recovery. The IMF’s managing director Kristalina Georgieva called it “a crisis on top of a crisis.”

“The war is a supply shock that reduces economic output and raises prices. Indeed, we forecast inflation will accelerate to 5.5 percent in advanced economies and to 9.3 percent in emerging European economies excluding Russia, Turkey, and Ukraine. ” The IMF stated last week.

Reuters recently quoted Commerzbank analyst Daniel Briesemann, who talked in a note about the factors that have “lent buoyancy to gold in recent days,” mentioning the “strong buying interest on the part of ETF (Exchange Traded Fund) investors” and news about the Ukraine war.

“Russia appears to be preparing to launch a major offensive in the east of the country – that is generating considerable demand for gold as a safe haven,” the analyst said.

This summarizes the “risk-off” sentiment at the moment. As expected, equities suffer as investors are selling risky assets and purchasing the ones negatively correlated to the traditional market. Thus, the crypto space is struggling alongside de stocks market and gold is rising.

Bitcoin Outperformed By Gold

Data from Arcane Research’s latest weekly report notes that it has been a gloomy year for the “digital gold.” In the first three weeks of 2022, Bitcoin sank 25% and it is still down by 18% in the year despite its slight recovery.

Similarly, Nasdaq records a 19% decline in the year, having underperformed against bitcoin “by a small margin,” notes the report, adding that “This is surprising given that bitcoin has tended to follow Nasdaq, albeit with higher volatility.”

The general fear over geopolitical and macroeconomic uncertainty has given gold the safe-haven asset spotlight once more. The asset outperformed all the other indexes seen below with a 4% gain.

Physical gold outperforming “digital gold” in 2022 | Source: Arcane Research

Meanwhile, the currency market is performing with “the same risk-off patterns.” The Dollar has been proving its “risk-off” dominance as the US Dollar Index (DXY) is up 7%. The Chinese yuan has taken a hit over concerns about the country’s “zero-covid” policy –which creates issues for the global supply chain– and the slowing down Chinese economy. In contrast, investors have been running to the US Dollar for safety.

Bitcoin supporters usually refer to the coin as “digital gold” alleging it is a safe haven asset, and this narrative had held well while BTC had been “uncorrelated with most other major asset classes,” but the tide is shifting with the 2022 scenario as investors are rather placing the coin “into the risk-on basket”.

A previous Arcane Research report indicated that bitcoin’s 30 -day correlation with the Nasdaq is revisiting July 2020 highs while its correlation with gold has reached all-time lows.

A pseudonym traded noted that “As Bitcoin adoption goes on and more institutional investors enter the market, the correlation of BTC and stocks becomes more and more tight. That is a paradigm that the crypto world struggled to come to terms with in the past but is now more real than ever. A healthy stock market is good for Bitcoin.”

Meanwhile, the general sentiment of traders seems to be bearish, with many saying that the coin could visit the $30k level soon.

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Bitcoin trading at $39k in the daily chart | BTCUSD on TradingView.com

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Attendees talk the future of NFTs

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The crypto community headed to Nassau in the Bahamas this week for the inaugural Crypto Bahamas conference.

Like most conferences, panels fill up the agenda and on Wednesday the topics at Crypto Bahamas ranged from NFTs to crypto in sports and to asset allocation in Web3. During one particular conversation, titled Evolution of NFTs: Culture, Utility and Regulation, panelists had some insightful musings on the NFT market.

To put the Crypto Bahamas conference into context, Sam Bankman-Fried’s cryptocurrency exchange FTX moved its headquarters from Hong Kong to the Bahamas in Sept. 2021. It recently inked a multi-year partnership with Anthony Scaramucci’s investment firm SkyBridge Capital, and its events arm SkyBridge Alternatives, or SALT. They jointly presented the conference.

That’s why the NFT panel consisted of multiple perspectives from Tristan Yver, head of strategy at FTX U.S., Joseph Doll, attorney at Fenwick law firm, Roham Gharegozlou, the chief executive officer at Dapper Labs, and Sarah Hammer, the managing director of The Stevens Center for Innovation in Finance at The Wharton School. Zack Guzman, writer for the Meta-owned newsletter platform Bulletin, moderated.

Gharegozlou pointed out how new the NFT market truly is when “most people have only been thinking about it for a year and a half,” making valuations “very immature.” As the CEO of Dapper Labs, the company behind NBA Top Shot,  Gharegozlou recognized that “utility, rewards and the how you value and NFT is primarily based on the strength of that of the community.”

He added that a good way for an NFT collection to build a strong community is to have multiple tiers of scarcity. In the case of NBA Top Shot, at the higher price end there is extreme scarcity, but there are also millions of “common” moments so that people can “get their first NFT and see how it feels without breaking the bank.” 

Tristan Yver echoed that the current valuation and pricing model for NFTs is based on a collective perception on value based on the amount of people willing to buy an asset for a certain amount. He anticipated a “movement away from this consensus view to a more unique singular view where people buy things that resonate with them rather than what resonates with a larger community.”

Joseph Doll chimed in to say that “communities need to be thoughtful about democratizing access.” There are some “massive” barriers to entry to certain projects, he said, including not being early enough or not having enough capital at the time. He questioned, “That’s not what crypto is about, right? It’s kind of about the exact opposite of that.” Democratization, he suggested, can come in the form of derivative projects at better price points.

Another important point brought up by Yver was the reality of scams, especially on Discord and Twitter. He said that “we need to move past security aspects to be able to really bring in the next large mass of users.” He recommended talking among family and friends or asking a Discord moderator to make sure “you click the right link when minting that NFT” because “wallet security sucks right now.”

Gharegozlou even said that Elon Musk, the new owner of Twitter, should use Web3 to fix Twitter’s fraud problem, just as Discord should use Web3 authentication and verification as well. “Once NFT’s are the sort of identity bridge across all these different social networks, identity and assets, authenticity, provenance,” then the system can be more resilient he added.

When asked what “main alpha” the audience should bear in mind, Doll said to engage with and be part of these NFT communities even if it’s “scary,” because getting scammed is a “part of the journey.”

Sarah Hammer, who leads the Cypher Accelerator at Wharton business school, said that the school is launching an incubator specifically for NFT projects in partnership with Dapper Labs because the “NFT model is a business model for the future.” She emphasized that the greatest way to grow and innovate in the space is to increase education efforts in order to get more people learning and working together.

Related: Goldman Sachs reportedly eyes FTX alliance with regulatory and public listing assistance

Recently the Bahamian government allowed residents to use digital assets, including the world’s first central bank digital currency, or CBDC, to pay for taxes in 2022.