February 22, 2024 Genfinity News Recap

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27 Mar 2024

Welcome to our February 22, 2024 Genfinity News Recap — Here are a few developments you may have missed within Web3 today.
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Generation Infinity
February 22, 2024
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Welcome to the February 22, 2024 edition of the Genfinity News Recap! As you navigate through your busy workday, staying informed about the latest developments in the realms of Web3 and finance can be a challenge. However, we are here to provide you with an overview of the crypto news you might have overlooked today.

February 22, 2024 Genfinity News Recap
Bitcoin

JPMorgan reports a weakening correlation between Bitcoin price and spot ETF flows. Summarized by CoinDesk, the correlation dropped from 0.78 on Feb. 7 to 0.60, indicating a shift from “highly correlated” to “moderately correlated.” This comes despite record inflows last week, dominated by BlackRock and Fidelity ETFs. While the initial price surge attracted inflows, the recent price stabilization might be leading to softer inflows.

Ethereum

CoinDesk reported S&P Global’s warnings about the concentration risk in Ethereum due to the potential impact of Ethereum ETFs on validator distribution. Ethereum ETFs, especially staking ones, could significantly impact Ethereum’s validator distribution. Large inflows could lead to substantial staking, potentially changing the validator mix. Currently, Lido and Coinbase hold a large portion of staked ETH, raising centralization concerns. However, Ethereum ETFs using diverse custodians could distribute staking across entities, mitigating this risk. Ultimately, the impact depends on ETF issuer choices regarding staking implementation.
The Nakamoto Coefficient, measuring blockchain decentralization, reveals Ethereum’s current centralization issue with a score of 2. This contrasts with networks like Aptos and Avalanche, which boast higher scores but may face regulatory hurdles.
https://nakaflow.io/

Can we do without centralized crypto exchanges?

Cointelegraph dove deeper into their January story regarding Visa and Mastercard re-engaging with the crypto sector and allowing users to convert crypto directly into fiat currency. Currently, over 40 cryptocurrencies can now be easily converted to local money at millions of Visa merchants around the world. This collaboration marked a pivotal moment for crypto adoption and could still attract new users who are hesitant to embrace cryptocurrencies.
While this move benefits users, it raises concerns about the future of centralized crypto exchanges (CEXs). Some analysts argue that direct crypto-to-fiat conversion through Visa eliminates the need for CEXs. However, experts believe this is an oversimplification. CEXs still play a vital role in scaling, providing accessibility, and offering security that many DeFi platforms lack.
Here is a notable quote from their article made by Sami Smart, co-founder and CEO of Transak, a Web3 infrastructure firm: “More users are choosing to directly engage with Web3 through decentralized applications rather than centralized exchanges.” He also noted that off-ramp transactions grew about 24.% from December 2023 to January 2024.
In another story, the outlet reported that users are having an especially hard time getting their funds from KuCoin exchange.
Should centralized exchange users have to start a Reddit thread or have a story posted by a news outlet to get attention on their frozen funds?

Regulation

Yahoo Finance reported that the Law Commission of England proposed new legislation to recognize crypto assets as a distinct property category, aiming to reduce legal uncertainty and enable full utilization of these assets. This follows their recommendation in June 2023 and emphasizes the importance of protecting property rights related to crypto assets.
Public consultation on the draft legislation is open until March 22. Sources close to the matter state that the aim is to provide greater legal clarity and potentially position the UK as a leader in cryptocurrency innovation and investment.
We hope you enjoyed our February 22, 2024 Genfinity News Recap! Come back tomorrow evening for another news summary, and please leave a comment below.
*Disclaimer: News content provided by Genfinity is intended solely for informational purposes. While we strive to deliver accurate and up-to-date information, we do not offer financial or legal advice of any kind. Readers are encouraged to conduct their own research and consult with qualified professionals before making any financial or legal decisions. Genfinity disclaims any responsibility for actions taken based on the information presented in our articles. Our commitment is to share knowledge, foster discussion, and contribute to a better understanding of the topics covered in our articles. We advise our readers to exercise caution and diligence when seeking information or making decisions based on the content we provide.