The fever for the crypto world does not stop: after the new records ringed by Bitcoin followed by a significant turnaround, the spotlight in recent hours they’re all on Ether, waiting for the upcoming update of the Ethereum network. But investors are also looking at the blaze of the titolo Bakkt a Wall Street, following the news of the agreement reached with the US credit card giant Mastercard.
Bakkt is a digital asset platform, born with a spin off from Intercontinental Exchange, and landed on Wall Street last week, via SPAC.
Let’s start with Ethereum which, as a Bloomberg article points out, has been reporting a better performance than other digital currencies for days, in view of the upgrade that will allow its network to become faster.
Ethereum does better than Bitcoin pending network update
The second largest cryptocurrency in the world has taken a rise of more than 10% since last October 19th while, in the same time frame, Bitcoin fell by 3%.
Ether has also done better than some alternative digital currencies such as the Binance Coin and the Cardano.
The upgrade of the network, which is scheduled for tomorrow, Wednesday 27 October, will make the Ethereum faster, probably also translating in a drop in commissions for those who use it.
It should be noted that the Ether flew by almost + 1000% on an annual basis, compared to the + 380% rally in Bitcoin. Since the beginning of 2021, the rise was 473%, compared to + 117% for Bitcoin.
Crypto fever on Wall Street: euphoria on Bakkt after agreement with Mastercard
The enthusiasm for the crypto world is confirmed today also from the trend of the Bakkt stock, which spikes to new highs after the buy boom on the eve, which led to prices soaring by more than 230%. The news of the agreement reached triggered the euphoria between Mastercard and the company:
the two groups have signed a partnership that will make it easier for merchants, banks and fintechs active in the United States on the Mastercard network to adopt and offer “a wide range of services and solutions related to cryptocurrencies. Consumers, on the other hand, will experience greater access to the ecosystem of digital assets ”.
Basically, with the agreement, Mastercard will enable thousands of banks and millions of merchants who use its payment network to integrate cryptocurrencies into their products soon, thanks to solutions such as Crypto-as-a-Service in Bakkt:
banks and merchants will be able also issue crypto credit and debit cards, enabling customer-consumers to buy, sell and hold digital assets through Bakkt-backed wallets.
Mastercard customers will also be able to offer cryptocurrencies in the form of loyalty rewards. This means that consumers will be able to earn and spend cryptocurrency rewards in lieu of loyalty points and convert exposures to crypto to pay for their purchases.
“We want to offer all our partners access to crypto services, whatever they are doing – Sherri Haymond, Deputy General Manager of Mastercard’s Digital Partnership Division, told CNBC – Our partners, who are banks, fintechs or traders, they will be able to offer their customers the ability to buy, sell and hold cryptocurrencies through integration with the Bakkt platform ”.
21Shares: Polkadot and Cosmos undertone, but things will change
In general, looking at cryptocurrencies, in the meantime, keep an eye on the note of Eliezer Ndinga, Head of Research Team of 21Shares:
“In the group of 15 largest digital assets by market capitalization, the two that underperformed were Polkadot and Cosmos, two interoperability protocols that have not been particularly popular with investors. However, at 21Shares, we believe things are about to change. Indeed, since i competitor di Ethereum are continuing to grow, the demand for interoperability between blockchains will begin to grow, especially when Polkadot reaches full operation thanks to ‘chain guards’ or ‘Layer 1’ (L1). In a nutshell, blockchains such as Bitcoin, Ethereum or Solana can be loaded on the Polkadot platform and begin to be interoperable with each other, thanks to the so-called ‘Relay Chains’ “.
“The Polkadot structure – continued Ndinga – provides that these chain guards must be approved through a user vote, structured as an auction and called ‘crowdloan’, before they can be operational in the system. Polkadot’s native cryptocurrency, aka DOT, it will also be used by the community to access this voting system for each new chain guard. Most of these votes took place on Kusama, the testnet of the Polkadot blockchain, created to replicate real-world conditions, before implementing them on Polkadot. This has led to the raising of millions of dollars thanks to the crowdloans on Kusama and we at 21Shares believe we will see the same phenomenon in the future next month when the community votes to add a new chain guard. However, these platforms for interoperability they have yet to be launched or become fully operational; for this we have seen a surge in value in solutions for scalability this L2 – Which StarkEX: The Arbiter of Optimism – grew by 592% in the third quarter alone, reaching a capitalization of 2.5 billion dollars ”.
“It should be emphasized – the note continues – that Arbitrum was a real outlier, recording an extraordinary growth of 1,547,253.8%, going from a capitalization of just 92 thousand dollars (data updated as at 30 June 2021) to over one billion dollars at the end of the third quarter. This growth is likely to be confirmed in the future as well, given that more and more applications will be integrated and that the existing ones will see improvements over time, thanks to upgrades and optimizations, consequent to a greater diffusion. In short words, these L2s group transactions and regulate them on the Ethereum network at a later time. In this way, the calculations and archiving processes present on Ethereum are removed, thus being able to increase the number of transactions processed per second to 20 thousand; all for commissions of only a few cents, when those on Ethereum exceed $ 30. Currently, the maximum limit of complex transactions that Ethereum can resolve in one second is 15. Put simply, it is as if Ethereum were the Fedwire that regulates the transactions of commercial banks, while the L2s are commercial banks that offer customer-oriented services. This is great news for the entire crypto and cryptocurrency industry decentralized finance (DeFi) itself, as they indicate that next year we could see the boom of interoperability between all blockchains, not just those compatible with Ethereum. This will improve the user experience and unlock the next generation of internet services that are already burgeoning into financial services (DeFi) and the media, in art and games (NFT) “.