🧠 2022 Crypto Honors

GM Seedphrase Nation 👋 Before we completely erase, destroy, and never speak again about the nightmare of crypto in 2022, let us review. 

📓 Today's Agenda: 10 Most Defining Moments in Crypto 2022

📝  One Word to Describe 2022

We've gone through hell and back this year. The one word we'd use to define 2022: pain. 

People have rushed out of this space faster than you can say non-fungible. Many had breakdowns, panic was a 9 month long state of being, we had bad news every day, and overleveraging was rampant. But we kept rolling with the punches.

Do you still believe?

If you're reading this, chances are you do.

10 DEFINING MOMENTS OF 2022

1. The Crypto Market Crashed by $2 Trillion (1,000,000,000,000)

• That's a lot of f*ckn zeros.

• Mark Cuban and many others view this painful period as a mirror image to the dot-com bubble burst.

• Bad players such as FTX, Luna, and 3AC are being washed out.

• Many argue this market cleansing is a necessary pain for the overall health of crypto.

#2 The Ethereum Merge Finally Happened

• After 8 years of work, delays, and wen merge memes, Ethereum finally changed its consensus mechanism.

• ETH went from Proof of Work to Proof of Stake.

• Here's a visual of what that actually means:

• Outcome: 99.95% of ETH's energy consumption has been eliminated.

• However, PoS might also be the reason ETH will be considered a security by the SEC.

3. Polygon: the Unexpected Underdog

• In 2021, people were focused on ETH and BTC going to $1mil.

• They thought Solana was the next biggest contender to the blue chips...

• But now, Solana has a real possibility of becoming a ghost chain (we'll get to that).

• Polygon is shifting the narrative.

• Brands building on Polygon: Reddit, Starbucks, Meta, Disney, Coca-Cola, and more.

• Not to mention the Trump Trading Cards.

• We'd be surprised if Polygon doesn't make it with that kind of track record.

4. Free Mint Meta Proliferates

• Goblintown.wtf was an NFT project that came out of nowhere in May.

• They claimed no road map, no utility, and no fancy art. They even made that their Twitter bio at one point.

• Free Mint: these green ghouls were one of the first free mints and ended up reaching ATH of 4ETH.

• The impact: thousands of projects followed suit because it fixed multiple issues: (1) free mint nearly eliminates barrier to entry (2) dispells accusations of being a cashgrab/rug (3) radcially increases upside potential in floor price. 

• Watch: The Free Mint Strategy

• Will this last?

🤝 Sponsor of the Day: Ledger

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5. The FTX Crash A.K.A. "Oopsie Doopsie, I'm Sorry"

• For the last month, every media platform has covered the FTX scandal & SBF apology tour, including South Park.

• How it started: FTX received $32B evaluation June 4, 2022.

• How it's going: FTX filed for bankruptcy, SBF is facing up to 100+ yrs in prison.

• SBF gambled with customer funds, which is super illegal.

• Before this was revealed, FTX was the 3rd largest crypto exchange by volume.

• Now, $2B in customer funds are gone. Retail investors, DeFi, VCs, Gamers, Traders, & more have been seriously affected.

• Our favorite video summarizing it all: FTX Collapsed...Here's Why (Coffezilla)

6. The Terra Luna Collapse (More Dead Bodies)

• The most widely used algorithmic stable coin in the entire market lost its peg to the dollar around May 7th.

• $60B is estimated to have been wiped out of the market as a result.

• Do Kwon lied to investors, engaged in a mass sell off before the crash, and now has a warrant out for his arrest.

• So, he's hiding in Serbia.

7. The Celsius Collapse (The Graveyard Gets Bigger)

• The collapse of Celsius, one of the largest crypto lenders, was a domino effect of Lunna's collapse, according to their own bankruptcy filings.

• 1.7M users were on the Celsius network, and they had $25B under management.

• Here's another fantastic video from Coffezilla explaining it all, super simply.

8 & 9. A Few More Graves to Dig: 3AC & Voyager

• Three Arrows Capital was a (crypto) venture capital firm lead by Zhu Su.

• Zhu Su used his 550K followers often to spread FUD and create dumps. Then, he would buy them up.

• While Luna was a trigger for 3AC capitulation, 3AC had sketchy business practices from the start.

• Margin called: 3AC was hit with a flood of margin calls after intense panic from LUNA

• 3AC got liquidated, and had to file for bankruptcy.

• Voyager, who had lent $650M to 3AC, also filed for bankruptcy.

Watch: We break down Luna, 3AC, Voyager, & Mark Cuban in 30 seconds.

10. The Flippening Happened.

• To end on a good note: the flippening we've all been waiting for.

• But not the one you'd expect. ETH didn't flip BTC.

• L2's flipped ETH.

• This means the Layer 2 applications are looking more bullish than the chain they were built on.

• Bullish: Arbitrum and Optimism are the two biggest L2 winners

The 2022 Take Away: DeFi is the answer. Notice that everything that crashed and burned was CeFi. 

Our 2023 Hypothesis

We hate to say it, but it's very likely we'll go further down from here. The macro doesn't look good:

• A recession is underway.

• Inflation has not eased as expected.

• The war in Ukraine shows no sign of stopping.

• Not to mention: Solana might die.

Sounds gloomy, but don't worry. 

We'll be here coaching you through it & feeding you memes, every. single. day.

2023 is going to be full of hidden opportunities & we're going to help you find them. 

Happy New Year Seedphrase Nation!

😂 MEME OF THE DAY: 

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DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research