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Top Headlines for 9 March, 2022

Ethereum Gas Prices Sink to Six Month Low

In 2021 and early 2022 transactions on the Ethereum network have been expensive. A simple transaction on Ethereum would have cost $50 in fees in fall 2021.

However, by March 2022 gas prices on Ethereum were steadily declining. On-chain data from CoinMetrics show that the seven-day averages for Ethereum gas prices in March 2022 were the lowest since August 2021. Arcane Research reported, “If you’ve been waiting to swap tokens or mint an NFT, now might be a good time.”

However, Arcane also observed that even though the fees for a simple token swap tumbled from $200 in September 2021 to $15 in March 2022, that is still expensive. Even worse, the sudden slide in gas prices coincided with a drop in trading value for ether. In March 2022 the cryptocurrency’s price fell by over 12% in a single week.

A closer inspection of CoinMetrics data reveals that as of March 2020 transaction fees on Ethereum have plunged to a six-month low. Network demand has slumped as users have increasingly switched to scalability solutions like Polygon, Arbitrum, and Optimism that offer lower fees. Moreover, competing networks like Solana and Avalanche are slowly taking Ethereum’s market share by offering similar services at significantly lower prices.

BAYC Donates $1M to Ukraine

Popular Ethereum-based non-fungible token (NFT) creator Bored Ape Yacht Club (BAYC) has donated $1 million in Ethereum to Ukraine’s government in March 2022.

The organization announced the donation on its official Twitter handle, and an Etherscan link shows a transaction of 388.999 ETH (around $1M).

BAYC claimed to be inspired to make the donation after observing individual contributions made by its own community. Bored Apes are one of the highest priced NFTs; a single character token from the series can cost up to 100 ETH or $260,000. The BAYC network has established itself as a status symbol in the NFT community. Celebrities like NBA star Steph Curry, Eminem, Jimmy Fallon, and Justin Bieber are holders of BAYC. The NFT series has recorded over 41,7000 ETH ($1 billion) in secondary sales, making it the second most successful ETH collection.

The crypto industry has been active in supporting Ukraine in response to the Russian invasion. Since the war began, the country has received over $88 million worth of crypto donations in only 15 days. The government of Ukraine plans to raise defense funds by issuing crypto-backed war bonds.

VanEck Unveils Crypto Mining ETF

On 9 March 2022 Global investment management giant VanEck announced the release of its Digital Assets Mining (DAM) ETF.

The exchange traded fund will invest nearly 80% of its available funds in top crypto asset mining firms’ securities to earn at least 50% of its revenue from mining and related activities.

The fund will track the MVIS Digital Assets Mining Index with a net expense ratio of 0.5%.

The biggest holdings for VanEck’s new ETF will be miners, mining equipment manufacturing companies, and blockchain-centric banks. BTC mining behemoth Riot Blockchain represents the largest holding in the fund at 11%, followed by Hut8 Mining at 9.1%. Other weightings in the ETF include Marathon Digital at 8.3%, Iris Energy at 7%, and Cannan at 6.5%.

In February 2022, another asset management firm, Valkyrie, launched their Bitcoin Mining ETF that explicitly tracks miners’ performance using renewable energy sources. However, it dropped by nearly 10% in March 2022, along with the shares of other mining companies and the price of Bitcoin.

Bain Capital Launches $560M Crypto Fund

Asset Manager Bain Capital Ventures has announced the launch of a $560 million crypto fund on 8 March 2022.

A subsidiary of the VC firm will oversee the new fund, investing in emerging crypto and Web 3.0 startups. The initiative will form a portfolio of 30 companies or DeFi protocols that will receive seed investments.

Previously, Bain Capital has invested in 14 crypto and DeFi-related projects, including Parafi Capital, Zero Hash, and BlockFi. The asset manager has also made a significant investment in Compound Finance, a popular DeFi protocol. General Partner Stephan Cohen said that Bain Capital expects crypto to become completely embedded in the traditional business software stack within ten years.