It’s hump day, and would you look at that, the crypto market has submitted its own temporary mountain — thanks to Fed Chair Jerome Powell, who announced today that the apex bank would accelerate the tapering of its bond purchases. The Fed indicated that it will withdraw $30 billion a month in bond purchases to wind them down by the end of next year, doubling the amount it withdraws now.
This can have a meaningful impact on the economy. Through tapering, the Fed will attempt to curb inflation, which has risen to 39-year highs in recent months. Tapering is typically bullish for the dollar since it means a move toward tighter monetary policy. It’s a sign that the economy is doing well enough that the Fed believes it does not need to provide as much support.
Powell also clarified that cryptocurrencies are not a threat to financial stability and that stablecoins could be useful consumer-serving of the financial system if regulated properly.
This news flung the market into a much-needed upswing. Bitcoin ($BTC.X) and Ethereum ($ETH.X) joined equities in a late-day rally, with the two major coins rallying to $49,300 and $4,000 respectively. Altcoins like Solana (SOL.X) and Avalanche (AVAX.X) joined in, surging in double digits.
Hoping the trend continues as for the rest of the week. Here’s what’s making news today:
- Kevin Durant partners with Coinbase and becomes the face of the exchange’s advertising
- Michael Jordan and his son announce first technology venture, Heir Platform
- Crypto 101: What are social tokens?
- NBA Top Shot maker Dapper Labs raising $80M for startup acquisitions
Before that, check how the major cryptocurrencies are performing:
| Bitcoin (BTC) |
$49,054.38
|
+1.05% |
| Ether (ETH) | $4,035.30 | +3.89% |
| Binance Coin (BNB) |
$542.38
|
+2.31% |
| Solana (SOL) | $178.78 | +9.87% |
| Cardano (ADA) |
$1.32
|
+3.49% |
| XRP (XRP) |
$0.833
|
+2.59% |
| Polkadot (DOT) |
$27.68
|
+5.88% |
| Avalanche (AVAX) | $102.51 | +14.91% |
| Dogecoin (DOGE) |
$0.1825
|
-0.62% |
| Terra (LUNA) | $62.51 | +3.89% |
Crypto Deal
NBA Star Kevin Durant Becomes Face Of Coinbase
NBA star Kevin Durant and his company, Thirty Five Ventures, inked a deal with Coinbase today, making him the face of the crypto exchange. As part of the deal, Durant will promote the cryptocurrency platform throughout his businesses. In turn, Coinbase will also partner with his sports website, Boardroom, to take advantage of digital ads and sponsored content about crypto. The financial terms of the agreement are not disclosed yet.
Durant took to Twitter to share his excitement about the new deal.
“Even when I was younger, I was always curious about the business side of things and always trying to learn from the people I’ve gotten to meet along the way,” Durant told Bloomberg. “Basketball was always number one for me, but it was clear that there was a lot more that I could accomplish if I had the right team around me.”
Durant is no stranger to crypto. In November, he formed a special purpose acquisition company (SPAC), focusing on the crypto sector. The SPAC is a partnership between Thirty Five Ventures (Durant’s investment firm) and investment and banking firm LionTree.
Durant’s Coinbase deal is one more example of a series of partnerships between crypto companies and athletes, and sports franchises.
Coinbase became the official crypto platform of the NBA and WNBA in October. Similarly, FTX, a rival crypto exchange, renamed Miami Heat’s arena as the FTX Arena after signing a deal in March. What’s more, Major League Baseball umpires are now wearing the FTX logo.
Given the primary focus on the youth audience for both the crypto and sports industries, both are betting on each other.
NFT Mania
Michael Jordan Dunks On NFT Space With New Solana Project
Keeping the sport and crypto liaisons going, legendary professional basketball player Michael Jordan and his son Jeffrey Jordan are the latest names to jump into blockchain technology and the biz of web3. The six-time NBA champion and Chicago Bulls legend is launching a fan engagement app platform built on the Solana blockchain to connect athletes and entertainers with their fans.
In their first venture together, the father and son duo has created HEIR to connect professional athletes and their biggest fans. A HEIR token will be minted on the Solana blockchain, and fans will be able to join an athlete’s limited-capacity “huddle” for exclusive access and benefits such as exclusive drops, digital goods, immersive experiences, and more. A few VIP seats will be reserved exclusively for die-hard fans who can leverage Heir tokens and obtain “intimate first-person” non-fungible token (NFT) drops.
This is not Michael Jordan’s first ballgame with crypto. In March, he participated in Dapper Labs’ $305 million funding round, and in November, he participated in Mythical Games‘ $150 million Series C round.
“What Heir Inc. is developing is purpose-built for a new era of athlete enterprise, opening the door for richer storytelling and deeper consumer engagement,” said Jeffrey Jordan.
“The Jordan name has cultivated a loyal community for more than 35 years; the focus now is passing that legacy on to the next generation. We hope to continue to build and invest in businesses that bring that same reverence to the media and tech space.”
HEIR raised $10 million in seed funding led by Thrive Capital. The platform will be launched in 2022 — designed explicitly for Gen Z and millennials.
HEIR is the latest example of a growing social token movement and fan engagement trend in the crypto space. Earlier this year, Kayvon Thibodeaux and Jaylen Clark launched their own creator tokens on Rally. More about social tokens in the ‘Crypto 101’ section below.
Crypto 101
What Are Social Tokens?
Social tokens are a type of cryptocurrency built around a brand, community, or influencer. It’s a way to directly connect the creators and consumers where the creators monetize their efforts and reward the consumers.
You could say the social tokens are a sort of “currency” for communities, DAOs, and people. For example, if you went to an influencer’s blog and read an article, you could earn a social token.
One great example is artist Laura Driskill, who runs a popular Instagram channel under the name “sugarboogerz” and produces videos to promote relaxation and sleep. She created her own social token called $TINGLE for her followers to buy in exchange for further interaction.
Social tokens can be used in three ways: access, exchange, and investment. First, followers may simply buy tokens for the access to content such as videos, articles, etc. . Second, fans can donate tokens to compensate creators using it as a medium of exchange. Third, followers can redeem coins, treating them as investments, while creators can eventually take distributions to enlarge their income.
There are several different types of social tokens:
- Personal Tokens: These are issued and controlled by a primary individual. For example, entrepreneur Alex Masmej issued $ALEX to his fans and asked them to vote on his lifestyle, such as whether to run or eat only vegetables. He raised $20,000 via the “initial $ALEX offering,” and people called it the first Human IPO.
- Community Tokens: These are issued and controlled by a group, often managed by a decentralized autonomous organization (DAO). For example, $JAMM is a social token that’s required to gain access to the organization’s newsletter and other platforms in the Jamm Session ecosystem. To access the newsletter you need 1,000 $JAMM tokens. But here’s the difference between subscribing to the newsletter via credit card vs. $JAMM tokens. If you recommend someone to subscribe to the newsletter, you receive incentives. That’s because you have helped the community. Simply put: the more people subscribe to (or buy $JAMM), the more money the creator makes.
- Social platform tokens: Social tokens are issued by platforms that facilitate the issuance and exchange of social tokens. For example, $SWAGG is a social token backing SWAGG Network creations, upcoming community-initiated products. Token holders can take part in Instagram Lives, discussing lifestyle, fashion, culture, crypto, etc.
While social tokens might look like a new method of rewarding users, they also come with some risks. The value of a social token depends on the content or production of the creator, and if he/she/they fail to deliver it, there’s a chance of devaluation of the token.
Social tokens also beg the question, are we really allowed to issue our own currencies? The challenge there is that it is a bit of a gray area since many countries are skeptical about cryptocurrency in general, and social tokens tend to be too sophisticated for them. So, the major risk is regulation in most parts of the world. In the U.S., the SEC is working on defining the role of tokens, and hopefully can provide some clarity soon.
Acquisitions
Dapper Labs Acquires A “Young, Scrappy” Company
The firm behind the Flow blockchain and NBA Top Shot ($TOPSHOT.NFT) platform, Dapper Labs, has raised money to fund a series of unnamed acquisitions. The Canadian company refused to disclose the acquired company’s name but told Coindesk that the funds were used to acquire a “young, scrappy” firm.
Dapper Labs had raised $6.5 million of its $13.5 million equity goal as of Dec. 9, and earlier this week, it raised $23 million in an offering that opened on Nov. 22 to meet a $71 million goal, per Coindesk.
“We did not raise funds. Instead, as our ecosystem and portfolio continues to grow, we’ve made, and will continue to make, a series of acquisitions that we are choosing not to disclose at this time,” Dapper Labs spokesperson Rachel Rogers told CoinDesk.
NFTs (non-fungible tokens) have seen tremendous growth this year in the sports industry, which is why big crypto companies are investing in them. Crunchbase data shows Dapper raised $607.5 million in private funding since its founding in 2018. It raised $250 million in September alone at a valuation of $7.6 billion.
Dapper Labs is among the most successful companies investing in the NFT boom. It has generated almost $700 million in sales in 2021. Earlier this year, it signed a multi-year partnership with tech giant Google, focusing on developing web3 products, including non-fungible tokens.