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Cryptoverse: The bonfire of the NFTs – Reuters

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Crypto trading firm GSR's corporate NFT collection is seen on digital displays in the company's office, in New York, U.S., July 1, 2022. Benoit Bosc/Handout via REUTERS
July 5 (Reuters) – The NFT dream isn't dead, but it's taken a big non-fungible beating.
The market shone gloriously last year as crypto-rich speculators spent billions of dollars on the risky assets, pumping up prices and profits. Now, six months into 2022, it's looking ugly.
Monthly sales volume on the largest NFT marketplace, OpenSea, plunged to $700 million in June, down from $2.6 billion in May and a far cry from January's peak of nearly $5 billion.
By late June the average NFT sale sunk to $412, from $1,754 at the end of April, according to NonFungible.com, which tracks sales on the Ethereum and Ronin blockchains.
"The crypto bear market has definitely had an impact on the NFT space," said Gauthier Zuppinger, co-founder of NonFungible.com.
"We have seen so much speculation, so much hype around this kind of asset," he added. "Now we see some sort of decrease just because people realise they will not become a millionaire in two days."
The NFT market has collapsed along with cryptocurrencies, which are typically used to pay for the assets, at a time when central banks have jacked up rates to combat inflation, and risk appetite has withered.
Bitcoin lost around 57% in the six months of the year, while ether has dropped 71% .
DIP OR DEATH SPIRAL?
For critics, the crash confirms the folly of buying such assets, tradable blockchain-based records linked to digital files such as images or videos, often artwork. read more
The Malaysian businessman who bought an NFT of Jack Dorsey's first tweet for $2.5 million last year struggled to get bids of more than a few thousand dollars when he tried to re-sell it in April. read more
But Benoit Bosc, global head of product at crypto trading firm GSR, sees the downturn as the perfect time to build a corporate NFT collection – the crypto equivalent of the fine art traditional banks display to impress clients.
Last month, GSR spent $500,000 on NFTs from what Bosc calls "blue-chip" collections – those with large online fan bases.
His purchases include an NFT from the Bored Ape Yacht Club, a set of 10,000 cartoon monkeys made by U.S.-based company Yuga Labs and promoted by the likes of Paris Hilton and Jimmy Fallon.
Such is the hype surrounding Bored Apes that Yuga Labs raised $285 million in April by selling tokens it says can be exchanged for land in a Bored Apes-themed virtual world it has not yet launched. read more
Yet the average sale price for a Bored Ape tumbled to around $110,000 in June, having halved since its January peak of $238,000, according to market tracker CryptoSlam.
In his New York office, Bosc put up three screens on which to display his NFTs, which include various pixelated characters and a Bored Ape bought for $125,000.
"For us, it's also a brand exercise," Bosc said. Owning a valuable NFT and using it as a profile picture on social media is a way to establish "respectability, authority and influence" in the crypto sphere, he said.
GAME OVER? GAME ON?
Nonetheless, the future of NFTs is distinctly uncertain, as the era of low interest rates which encouraged investors to take risky bets comes to an end.
Some market watchers say the influence of NFTs on the art market will shrink. Meanwhile, even though the much-hyped vision for a blockchain-based metaverse hasn't materialised yet, enthusiasts expect NFTs to shake up the gaming industry, for example by allowing players to own in-game assets such as avatar skins. read more
"Everyone believes games are going to be the next big thing in blockchain," said Modesta Masoit, chief financial officer at blockchain tracker DappRadar.
This risky combination of gaming and financial speculation may face difficulties, though. Most gamers prefer games which do not include NFTs or "play-to-earn" components, according to John Egan, CEO of technology research firm L'Atelier.
Although the groundbreaking new crypto regulations agreed by the European Union last week mostly excluded NFTs, Spain is separately seeking to clamp down on the way video games sell virtual assets for real money. read more
Meanwhile, the biggest NFT-based game, Axie Infinity, has seen its in-game token collapse to less than half a cent, down from a peak of 36 cents last year.
For L'Atelier's Egan, the NFT market is unlikely to recover in its current form.
"Ultimately it's a situation where extraordinary amounts of money are being paid for extraordinarily limited assets that don't really produce any cash flow," he said.
But the underlying concept of creating unique digital assets is still "fundamentally important" and will have "massive applications" for the financial sector in future, he said.
Our Standards: The Thomson Reuters Trust Principles.
Cryptocurrency companies will need a licence and customer safeguards to issue and sell digital tokens in the European Union under groundbreaking new rules agreed by the bloc to tame a volatile "Wild West" market.
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FASB Excludes NFTs, Some Stablecoins From Crypto Accounting Project – The Wall Street Journal

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Michael Saylor can't stop: MicroStrategy now holds 130,000 Bitcoin – Cointelegraph

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MicroStrategy bought an additional 301 BTC for $6 million at an average price of $19,851, the company’s executive chairman announced on Twitter.
MicroStrategy now owns 0.62% of all the Bitcoin (BTC) that will ever be mined. The company’s executive chairman, Michael Saylor, announced that the company bought another 301 BTC for roughly $6 million at an average price of $19,851 per BTC. 
In sum, the company is one of the planet’s largest holders of the asset, owning 130,000 BTC. Apparently, Saylor likes round numbers, buying 301 BTC to reach the 130,000 milestone. 
MicroStrategy has purchased an additional 301 bitcoins for ~$6.0 million at an average price of ~$19,851 per #bitcoin. As of 9/19/22 @MicroStrategy holds ~130,000 bitcoins acquired for ~$3.98 billion at an average price of ~$30,639 per bitcoin.https://t.co/5kYW98ij4I
Due to plunging price action, the company’s investment is down substantially in U.S. dollar terms. MicroStrategy’s entry price is roughly $30,639 per BTC, and the Securities and Exchange Commission filing states that the firm has bought 130,000 BTC at an aggregate purchase price of approximately $3.98 billion.
If MicroStrategy started stacking sats (buying Bitcoin) at today’s prices, it would have spent $2.48 billion on 130,000 BTC. Saylor is currently at a paper loss of over a billion dollars.
According to the SEC filing, the company made the purchase with “excess cash.” Saylor recently stepped down as CEO of the company to focus on buying more Bitcoin, while Washington, DC has taken aim at the billionaire in a tax evasion lawsuit.
Bitcoin enthusiasts were quick to commend Saylor’s buy. Referred to as the “Chad” or “Gigachad,” Saylor’s conviction and commitment to buying Bitcoin despite the investment being underwater has garnered both a devout following and numerous critics.
Related: Bitcoin better than physical property for regular folks, says Michael Saylor
Other large wallet addresses include that of crypto exchange Bitfinex, which holds 170,000 BTC, and a Binance reserve wallet that holds 125,000 BTC. Binance is the world’s largest crypto exchange and has several wallets holding six figures of Bitcoin. Regarding individuals, Saylor has stated that he holds Bitcoin, and FTX CEO Sam Bankman-Fried and Binance CEO Changpeng Zhao are also “hodlers” — a meme that became popular jargon for holding crypto.

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NFT Collections Will Be Regulated Like Cryptocurrencies Under EU’s MiCA Law, Official Says – CoinDesk

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