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Out with the old… 👴
The cryptocurrency top ten, as measured by CoinMarketCap, is changing again, with ethereum challenger avalanche the latest coin to make an appearance. The meme-based dogecoin and shiba inu are both out, while crypto.com‘s cro could be making an appearance in the top flight soon.
Avalanche’s avax token is up almost 40% this last week alone as traders pile into what they hope will be the next solana or cardano. The rise of the ethereum rivals has dominated discussion among the crypto community this year with many frustrated by ethereum’s apparent shortcomings but none of the myriad of alternative blockchains managing to gain much in terms of decentralized finance (DeFi) or non-fungible token (NFT) market share.
The bitcoin price is this morning traded downward, with the price moving away from the closely-watched $60,000 per bitcoin level despite news over the weekend of El Salvador’s latest bitcoin gambit (see below for details). Ethereum itself is down around 4%, while solana is a sole riser among the top ten over the last 24-hour trading period.
El Salvador’s bitcoin citadel 🏰
Shining city on a chain: El Salvador, the Central American country that made history when it adopted bitcoin as one of its national currencies in September, is planning on building a volcano-powered “bitcoin city,” partly funded via a $1 billion bitcoin bond. The real-life “bitcoin citadel,” will be circular, and boast an airport, residential and commercial areas, and feature a central plaza designed in the shape of a bitcoin ₿.
Why it matters: El Salvador is doubling down on its bet to harness bitcoin in order to fuel investment in the country at a time when influential politicians and world leaders are increasingly critical of the impact of unregulated and uncontrollable cryptocurrencies. Last week, Hillary Clinton, the former U.S. presidential hopeful and secretary of state under president Barack Obama, warned the rise of bitcoin and cryptocurrencies could undermine the U.S. dollar’s reserve currency status. Not everyone else is against bitcoin and crypto though, with two U.S. mayors, Eric Adams in New York and Miami’s Francis Suarez, both championing bitcoin adoption.
Bond villain: El Salvador’s bitcoin-touting president Nayib Bukele, who in September proclaimed himself “dictator” of El Salvador on Twitter in an apparent joke, revealed the plan on stage at the culmination of a week of bitcoin promotion El Salvador and Likened the plan to cities founded by Alexander the Great. To fund the project, El Salvador will issue $1 billion “bitcoin bonds” from early 2022, it was announced by Blockstream chief strategy officer, Samson Mow, speaking alongside Bukele. Bukele said the city would have no property, income or capital gains taxes but will be funded by a sales tax and money raised from the bonds. “Invest here and make all the money you want,” said Bukele, dressed all in white and wearing a baseball cap backwards, said in the beach resort of Mizata. “This is a fully ecological city that works and is energized by a volcano.”
The bottom line: El Salvador is going full tilt toward total “bitcoin-ization” and those in the crypto community who have long argued “good money drives out bad” are going to have their hypothesis tested for the first time.
Now read this: The bizarre rise of the ‘bitcoin citadel’
The week ahead 📅
👀 Watch out for these cryptocurrency and crypto-related events this week…
🏦 U.S. president Joe Biden is expected to name his Federal Reserve chair pick in the next few days. Current chair Jerome Powell and Fed governor Lael Brainard are the front runners.
💱 The World Trade Organization general council will meet in Geneva ahead of its 12th ministerial conference next week. The world’s growing dependence on digital commerce and China’s influence is on the agenda. Bloomberg has a primer.
🦃 It’s the Thanksgiving holiday in the U.S. this weekend, traditionally a big time for bitcoin and crypto prices with traditional American markets closed for a few days and family members keen to spread the good word about blockchain-based assets.