Ethereum, the second most capitalized cryptocurrency, showed the most significant growth since the beginning of April

Our experts, believe the rise of the second cryptocurrency is due to the market’s wait for the US Securities and Exchange Commission (SEC) to approve spot exchange traded funds (ETF) on Ethereum.

According to unconfirmed reports, Ethereum ETF issuers held a meeting with SEC officials. This information comes from the co-founder of hedge fund Parataxis Capital. And which specializes in digital assets, Edward Chin and has not yet received official confirmation.

Following the debut of a group of bitcoin spot ETFs in the U.S., several management companies, including BlackRock, Fidelity. And Ark Invest, have filed applications with the SEC to create spot ETFs on Ethereum. The regulator could approve such funds as early as May this year. And according to estimates from S&P Global and ETF market analysts at Bloomberg.

Analysts at brokerage Bernstein published a report estimating the probability of Ethereum-ETF approval before May at approximately 50%.

However, on March 20, the SEC postponed the deadlines for reviewing ETF launch applications from asset managers Ark 21 Shares. And Hashdex to May 24 and May 30, respectively. And after that, Bloomberg analyst James Seyffarth said the chances of an Ethereum-based exchange-traded fund being approved in May have diminished significantly.

According to Jeffrey Kendrick, head of currency and digital assets research at Standard Chartered, the price of ETH could rise to $4k on expectations of Ethereum-based spot exchange-traded funds (ETFs) approval.

While bitcoin is recognized as a commodity in the U.S., the Ethereum cryptocurrency wants to be recognized as a security.

In March, the SEC launched an investigation into ETH. And demanded documents from the Ethhereum Foundation, a non-profit organization associated with the cryptocurrency.

The reason for the investigation was the transition of the Ethereum blockchain to a staking mechanism instead of mining. Many of the crypto-assets, the issuance of which is carried out by staking (proof-of-stake algorithm), have already been equated to unregistered securities in June 2023 in lawsuits against major crypto exchanges.

Bitcoin and Ethereum showed growth for the first time after a sharp drop in late January

The bitcoin (BTC) exchange rate rose by 4% on February 8. And rising at the moment to $44,733 in a pair to the Tether USD (USDT) stablecoin on the Binance exchange. Our experts note that BTC last traded above $44,000 on January 24.

The second largest cryptocurrency Ethereum (ETH) also updated its two-week high at $2.44 thousand, adding more than 3% to its price over the day. The current year’s high for Ethereum was reached on January 12 at $2719 amid investors’ expectations of U.S. regulators’ approval of spot ETFs for Ethereum. And applications for which were submitted by BlackRock, Grayscale and Fidelity Investments.

Now the jump in the price of ETH also came amid the filing of an updated joint ETF application from 21 Shares and Ark Invest, managed by Katie Wood. The document, in particular, updated data on the redemption mechanism for units of the future ETF. And information about the possibility of placing the fund’s coins in staking in external services.

The latter fact caused a sharp growth of tokens of staking services. Thus, the rate of LDO token from the largest staking service Lido jumped by 7% at the moment. And when news of Ark Invest’s updated bid hit the terminals. LDO is among the top 40 largest crypto assets by capitalization with a market cap of over $2.5 billion. According to the official website, Lido hosts $23 billion worth of ETH coins at the current exchange rate.

Other coins from the top 10 by capitalization also rose in price over the past 24 hours. The Solana (SOL) token rose more than 6% over the day, while BNB from Binance, Cardano (ADA), Dogecoin (DOGE) and Ripple’s XRP rose in price by 3 to 9%.

Our experts tell you what you need to know about the Celestia modular blockchain and what’s driving demand for its native token

The price of the native blockchain token Celestia (TIA) reached an all-time high of $20 on January 15. In less than three months of its existence, the token has increased in price almost tenfold. And the demand for it continues to be supported by the excitement around new projects in the network ecosystem.

Celestia Labs, the company behind the development of the Celestia blockchain network, raised $55 million in October 2022, led by venture capital firms Bain Capital Crypto and Polychain Capital. Following this investment round, Celestia’s project achieved “unicorn” status with a $1 billion valuation.

The venture capital arm of the Coinbase exchange also participated in its funding. And the cryptocurrency arm of major market maker Jump Trading, Mike Novogratz’s Galaxy Digital and a number of other venture capitalists and business angels. Prior to that, Celestia developers raised $1.5 million in a seed round in 2021. And in October 2023, the OKX crypto exchange announced its investment in this project.

Modular blockchain

Celestia Labs has been led by Mustafa Al-Bassam. As a 2019 PhD student in Computer Science at University College London, he published a paper titled “LazyLedger”. And in which he presented a radical rethinking of the principles of blockchain. He described the possibility of separating the various functions of a distributed ledger. And in particular, how users request data, into separate “application layers”. A key benefit of this approach would be to minimize the total amount of resources required to run the underlying blockchain.

Al-Bassam is co-authoring three research papers with Ethereum ecosystem co-founder Vitalik Buterin. In one of his 2022 talks, Buterin presented Celestia as a solution for scaling so-called rollups. These rollups leverage such “second-level” solutions in various forms. Such as Optimism or Arbitrum, and with their help users can make much cheaper and faster transactions than in Ethereum at the base level.

Celestia’s primary use case is expected to be offloading the Ethereum blockchain from having to process the massive amount of data being produced by the rapidly growing ecosystem of rollup-based networks. Celestia’s solutions further improve the efficiency of the Ethereum core network. while taking over data storage and streamlining transactions. And then further transferring that data to other blockchains to complete transactions.

Technically, the Celestia blockchain is used exclusively for these needs. It does not perform smart contracts or computations, unlike other blockchain networks. Instead, the Celestia model outsources these functions to rollups or other blockchains. And this is a key component of its flexible, modular design. That said, developers building applications on the Celestia network can combine different elements of its infrastructure while keeping them compatible.

Token launch

To use Celestia for data processing, rollup developers conduct a separate type of transaction on the network. And for which they pay a commission in native tokens – TIA. In September 2023, Celestia developers announced the launch of the token and its distribution as an airdrop to early users of the network. And who showed activity and participated in its testing in the early stages.

During the distribution of 60 million tokens TIA distributed to the wallets of 191 thousand qualified participants of the airdrop. And that amounted to about 6% of their total supply of 1 billion units. More than half of the existing tokens are distributed to early investors and developers. And another 140 million TIAs are allocated to fund future project initiatives. A significant portion of these tokens remain locked: early investors will receive tokens in several stages between October 2024 and October 2025, while developers will receive tokens until October 2026.

The token was listed by Binance, OKX, Bybit, KuCoin and other major crypto exchanges on its launch day on November 1, 2023. According to the results of the first day of trading, the price of TIA was fixed at $2.44 with a capitalization of about $344 million.

Less than three months later, in January 2024, the rate of TIA increased almost 10 times. On January 15, the token reached $20, and the size of its capitalization soared to 3 billion, which put TIA in the top 30 largest existing crypto-assets.

Why TIA token rose in price

Airdrop as a tool for attracting users has not only benefited Celestia itself. Developers of several projects that use its blockchain. They also announced the distribution of their own tokens to those who help Celestia to maintain its work, acting as a so-called transaction validator. And with this they provoked even more demand for the TIA token.

The TIA token allows application developers to use Celestia’s blockchain without having to deploy their own validator network. Thus, those who act as validators by hosting their own tokens in staking. now play an important role in the ecosystem: they ensure that not only Celestia itself works correctly. But also those networks that rely on it for data availability.

Demand for the TIA token, as well as its price, began to skyrocket after two projects announced at the very beginning of 2024. They announced that they would airdrop their own tokens to all those who hold TIA in staking. The first of which was Saga. And its developers announced the distribution of SAGA tokens among 27 thousand participants in the list of those who until December 1, 2023 held in staking from 23 TIA tokens.

The Dymension project team soon announced plans to distribute 20 million DYM tokens to everyone who held at least 1 TIA in staking. The tokens themselves haven’t launched yet. But qualified participants of the distribution are already putting them up for pre-sale on OTC services, where the price of a DYM token reaches almost $5.

Against this background, more and more market participants started buying and placing TIA tokens in staking. And expecting new giveaways from other projects.

Airdrops proved to be an effective marketing tactic for new crypto projects. Projects like Berachain, Monad or Manta, which also rely on the Celestia infrastructure, are expected to launch in 2024. And our experts note that everyone also expects them to distribute tokens.

Ethereum is lagging behind bitcoin in terms of growth. And the approval of an exchange-traded fund is influenced by additional factors. We break down how much traditional investors are interested in the second-largest cryptocurrency.

BlackRock, the world’s largest asset manager, filed an application on November 9 to register an exchange traded fund (ETF) to invest in the Ethereum network cryptocurrency (ETH). With the ability to directly track its underlying spot price. The price of ETH rose sharply when the news broke. And jumped almost 10% from $1,880 before consolidating above the $2k level.

This is not the first attempt to launch a spot ETF for Ethereum in the United States. For example, in September, Ark Invest and 21Shares filed a joint application for such a fund with the U.S. Securities and Exchange Commission (SEC). And later, Grayscale announced that it had applied to convert its own investment trust for Ethereum into a full-fledged ETF. Today, its trust is the world’s largest Ethereum investment product. And with almost $5 billion under management. But it was BlackRock’s application that triggered a jump in the ETH exchange rate. And which until then had been lagging behind bitcoin in terms of growth dynamics. And even more so from tokens Solana, Chainlink and other leading cryptocurrencies.

The immediate rise in the price of ETH is similar to bitcoin’s June rally. When BlackRock similarly applied to register a spot bitcoin ETF. Such ETFs offer investors a convenient way to invest in cryptocurrencies without having to buy directly from traditional cryptocurrency exchanges and sort out their own wallets. Buying shares of exchange-traded funds is a more familiar form for clients of management companies. And pension funds in the US, particularly those who are deterred by the technical complexities and security issues associated with buying a real asset.

ETH has other prospects for ETF approval

Even if approved by regulators, the actual launch of BlackRock’s Ethereum ETF could take up to several months at best. And with that, there is no guarantee that it will be approved in principle. The SEC has up to 240 days from the date of filing to decide whether to approve the product. And that could push the fund’s possible launch date to next fall. There’s also a key difference in the regulatory status of bitcoin and Ethereum in the U.S., and that could also cause additional delays.

If nearly all stakeholders, including the SEC itself, agree that bitcoin is not a security and does not fall under its jurisdiction. Ethereum’s prospects are less certain. SEC Chairman Gary Gensler has repeatedly dodged the question of interpreting ETH’s status as an asset.

This is not the only factor influencing the launch of an ETF for Ethereum. But the debate over its status could also possibly slow down BlackRock’s application. The SEC will probably want to observe how a spot ETF for bitcoin performs first. Before approving products for other cryptoassets.

Investor optimism is growing

Ethereum occupies a unique place in the world of cryptocurrencies because it acts as a means of accumulating value (like bitcoin). But at the same time, it historically has a higher potential for price growth. This hybrid model has found confirmation in recent years. When ETH was ahead of bitcoin in terms of growth dynamics. But lagged behind tokens such as SOL from Solana or BNB from Binance.

However, in 2023, the scenario has partly changed: the enthusiasm of traditional investors for the possible emergence of a spot bitcoin ETF. And probably made the first cryptocurrency more attractive to them. Ethereum has lagged far behind bitcoin in terms of price momentum. And the basic fundamentals of the network have not changed much over the year. Despite the fact that ETH is starting to grow following bitcoin. But its average monthly volatility is at its lowest level in the last five years.

At the same time, analysts give optimistic forecasts. Marcus Thielen, head of cryptocurrency market research and strategy at Matrixport, called the emergence of BlackRock’s ETF bid “a nuclear winter for anyone who doubted Ethereum.” Large investors, he believes, are already aiming to allocate to cryptocurrency funds.

Thielen noted that despite lagging behind bitcoin, market sentiment indicators show growing interest in ETH. And trades in crypto assets with higher beta coefficients can generate more profits.

The market happening is accompanied by an increase in the trading volume of “ETH”. And the growth of the funding rate in perpetual futures of both bitcoin. As well as ETH, which reflects the growing optimism among traders, our experts note.

Our experts tell us how a complex cryptographic concept found application in the cryptosphere. And why startups that use ZK technology attract millions of dollars from investors

As early as 2019, cryptocurrency-oriented venture capitalists have been supporting startups. Which are engaged in the development of technical solutions somehow related to zero-knowledge proofs technology (zero-knowledge proofs or ZK-proofs, ZK). It is largely thanks to the cryptosphere that the complex cryptographic concept has become a successful marketing tool for startups. Who are creating tools to optimize Ethereum and other networks.

Matter Labs has raised nearly $0.5 billion from foundations to develop its zkSync solution. And the launch of Polygon’s zkEVM software environment by Polygon Labs, with similar funding, was an event in the cryptocurrency community. Projects like Starknet or Scroll are worth billions of dollars. And they all use ZK-proofs technology in one way or another.

In 1985, scientists Shafi Goldwasser, Silvio Micali and Charles Rakoff published a paper called “Knowledge Complexity of Interactive Proof-Systems. This was the first theoretical formulation of zero-disclosure proof technology.

To greatly simplify, this cryptographic technique allows you to prove that you know something without revealing exactly what you know. In the context of cryptocurrency, this can be illustrated, for example, as verifying that the user has the funds to transfer. And without revealing to the other participants of the network who this user is and how much money he has in his wallet.

Such proofs are technically complex and computationally intensive

Since it is very complicated, this technology did not come to any practical realization for quite a long time. And it was discussed mainly in scientific circles. But starting in 2010, researchers realized that ZK-proofs can be implemented on current computers.

So too with the emergence of faster computers and more funding for research in cryptography. And researchers, including Georgetown University associate professor Justin Thaler, have described how to generate zero-disclosure proofs on real computing machines. Thaler is also a researcher at a16z crypto, a division of the venture capital firm Andreessen Horowitz. He also manages four funds to invest in blockchain projects totaling more than $7 billion.

The launch and distribution of cloud computing has also given further impetus to the adoption of the technology. Laptops or smartphones, for example, are slower than the combined power of Amazon’s servers. But with ZK-proofs, a single computer can confirm that multiple computers have executed the program correctly.

When Bitcoin emerged in 2009, there was early discussion about reducing the computational burden on the blockchain and privacy in the blockchain. And then two problems emerged – the relatively slow performance of the blockchain because of its decentralized structure. And also its transparency, allowing analysts to identify and track wallets with ties to real users.

In 2013, a group of scientists, based on improvements in the implementation of ZK-proofs technology, laid out proposals for a Zerocoin solution. And which was supposed to help make Bitcoin transactions completely anonymous. Teaming up with Zuko Wilcox, they eventually launched the cryptocurrency Zcash (ZEC). It was probably the first implementation of ZK-proofs technology on a large scale.

Essence of ZK technology for cryptocurrencies

The essence of technology in the context of cryptocurrencies is not just about privacy. When Ethereum grew in popularity with the spread of blockchain technology. And more and more developers were creating more complex applications to run on it. But they, in turn, needed ways to increase the speed of applications. Ethereum, to simplify things a bit, is essentially a decentralized computer that runs relatively slowly.

Ethereum co-founder Vitalik Buterin has repeatedly said that it is solutions using ZK-proofs. And in particular the so-called ZK-rollups will help to increase the bandwidth of the network. And in the future will be integrated into its software code.

Zero-disclosure proofs allow one to prove the truth of something without checking each statement. Using this property, solutions such as zkSync “minimize”. That is, they compile and process transactions outside of the main Ethereum blockchain and prove that they did so accurately. Already then the main blockchain only verifies this proof. And that takes significantly less time compared to verifying each transaction in the usual way.

Dozens of startups are developing a flood of solutions using ZK, including the same zkSync, Aztec, Scroll, Starknet and others. They compete with another group of Ethereum scaling solutions collectively called Optimistic rollups. And the best known of which are the Optimism and Arbitrum projects. The companies have formed an entire industry within the crypto market and have collectively attracted several billion dollars from investors.

Accelerate Ethereum

On June 8, the Taiko project announced that it had raised $22 million to develop its own zkEVM. It is a solution that Vitalik Buterin called essential for scaling the Ethereum blockchain.

The zkEVM (Zero-Knowledge Ethereum Virtual Machine) is a development that combines Ethereum capabilities with the concept of zero-knowledge proofs. It was the company behind the zkSync solution that Matter Labs first deployed its version of zkEVM to the public along with the launch of the zkSync Era network.

The zkEVM solution is primarily a tool for scaling Ethereum. But which also includes privacy enhancing features. It combines the benefits of ZK-proof technology and compatibility with the Ethereum Virtual Machine (EVM) application environment. While providing faster, cheaper and simultaneously more private transactions.

Simply said, zkEVM allows developers to create second-tier solutions such as ZK rollups. This helps reduce congestion and bandwidth constraints on the core Ethereum network. And that leads to faster and cheaper transfers. The approach of projects like zkSync allows fast and inexpensive transactions in Ethereum. While maintaining data security and privacy.

Our experts point out that the slow operation of the network and high commissions hinder the mass spread of blockchain technology. Therefore, it makes sense for investors to support startups that offer efficient solutions.

The U.S. regulator named securities as the closest competitors of Ethereum. Our experts told us what risks this brings for ETH

From June 5 through June 6, cryptocurrency rates reacted to the SEC’s lawsuit against two major exchanges with a dramatic drop. Bitcoin and other cryptocurrencies fell in price, but by the morning of June 7, they partially recovered their losses. Ethereum was no exception and on June 6 updated its low from May 25 at $1802.

In lawsuits against two major exchanges, the SEC named several cryptocurrencies as securities. These assets reacted with fall of rates more strongly than others and fell in price by 6-15%.

In the first lawsuit were called securities: Solana (SOL), Cardano (ADA), Polygon (MATIC), Filecoin (FIL). As well as Cosmos (ATOM), Sandbox (SAND), Decentraland (MANA). And Algorand (ALGO), Axie Infinity (AXS), COTI (COTI).

In the second lawsuit, Chiliz (CHZ), Flow (FLOW), Internet Computer (ICP) joined them. As well as NEAR Protocol (NEAR), Voyager VGX (VGX), Dash (DASH) and NEXO (NEXO).

Despite the fact that the commission named Ethereum competitor coins (e.g., Solana), the largest ETH itself avoided a similar fate. None of the lawsuits mentioned it as a security.

Why the SEC chose the cryptocurrencies it named in the lawsuits

The SEC sampling algorithm is completely incomprehensible. And it defies logic, our experts note. Either the initiators of this process have outdated data. Even from the time of PoW mechanism in Ethereum network (till September 2022). Or it’s a “show punishment” for trading “tokens nobody needs,” says our expert.

SEC head Gary Gensler told CNBC that cryptocurrencies are essentially unnecessary at all. “We already have a digital currency. It’s called the U.S. dollar, the euro or the yen,” Gensler said.

The very arguments of the U.S. regulator regarding the recognition of PoS and DPoS (validators, not miners) projects as securities are “ridiculous.” But in the moment, these accusations can “create panic among investors” and provoke a local price collapse.

Long-term prospects for Ethereum are positive

If we consider the long-term prospects of Ethereum. It has much more growth potential than even Bitcoin. Because BTC’s growth comes from its status as the first cryptocurrency. As well as popularity and scarcity, which led to the leading position in infrastructure development.

For ETH the main growth driver is the area of decentralized finance (DeFi), says our expert. DeFi is still in its infancy. And in the future it will be able to push the price of ETH, which provides the infrastructure for DeFi projects.

Short-term ETH prospects

For short planning horizons on Ethereum, things are very complicated. Our experts note that on the one hand, Ethereum benefited from the fact that it was “forgotten to be mentioned” in the lawsuits.

But on the other hand, if ETH will be “remembered” later. It could repeat the fate of those coins that are already on the SEC list. As some investors exit from these coins, the assets are rejected by the platforms. Therefore, the risks remain, our Crypto Upvotes expert warned.

Our Crypto Upvotes experts tell us how Ethereum zkSync scaling project with $458 million investment is organized. Why it is used by leading players of the cryptosphere and what conditions the developers name for launching their own token

The mass distribution of cryptocurrencies and Web3 projects is held back by the relatively slow performance of blockchains and high fees, especially during periods of heavy network load. One of the popular technical solutions to increase Ethereum blockchain throughput is the so-called ZK rollups. And the implementation of which is a key part of the Ethereum roadmap. And also about which the co-founder of the project Vitalik Buterin repeatedly spoke.

Such solutions exist on top of the main Ethereum blockchain. And they combine a set of transactions into packets, process them in their own network and then transmit them to the main network. By doing so, they increase the speed of transfer processing and significantly reduce fees. This fee is paid by users every time they interact with the blockchain. For example, when transferring coins, transactions in credit protocols. Or during an NFT purchase or any other Ethereum usage scenario.

If at the base level Ethereum processes no more than 15 transactions per second. The so-called Layer 2 (L2) solutions allow tens of thousands of transfers per second with multiples of smaller fees. There are many competing startups in the race to create the most successful Ethereum scaling solution. For example Polygon, Arbitrum, Optimism, Scroll, StarkWare, Fuel Network and others. They have formed an entire industry. And the largest projects are valued in the billions of dollars.

zkSync project

The most famous solution involving those same ZK rollups. And of which Buterin speaks is zkSync from Matter Labs. Last November, Matter Labs closed a $200 million investment round led by major crypto venture capital funds Blockchain Capital and Dragonfly. Other investors include LightSpeed Venture Partners, Variant and Andreessen Horowitz (a16z). Matter Labs raised a total of $458 million, and that in itself is one of the largest venture capital investments in the history of the crypto business.

Commenting on the closing of the investment round, Matter Labs product director Steve Newcomb told Fortune. About how most of the funding will go to “building a team, further growing, scaling and developing a full-fledged company.” Newcomb founded Powerset before working at Matter Labs. Which was bought by Microsoft and later became part of the search engine Bing. Anthony Rose is also on the zkSync development team. He also led engineering teams at Ilon Musk’s SpaceX, creating software solutions for Falcon, Dragon and Starlink.

The zkSync project roadmap and its development

After reaching several roadmap milestones, the zkSync project has two networks in its current form, Lite and Era. The capabilities of zkSync Lite are limited, and it is essentially the first version of the protocol.

However, zkSync Era is a more mainstream product, opened to a wide range of users and developers in March of this year. The network was the first fully launched software environment with support for Ethereum applications. And thus beating out competitors like Starknet or Polygon. This means it will be easier for developers to migrate applications to zkSync Era. And where they can take advantage of faster transactions and lower fees.

Many of Ethereum’s biggest projects are already deploying on zkSync Era. Among them are popular decentralized finance (DeFi) services such as Uniswap, Curve, Balancer, Maker and SushiSwap. In addition, zkSync Era is used by Circle, cryptocurrency wallet creator Argent or liquid staking service Rocket Pool.

An important feature of zkSync Era is the so-called account abstraction.

And with the help of which it is possible to introduce to crypto-purses the features familiar to more mass users. For example, two-factor authentication or simple access to the wallet through login and password. As a rule, most of crypto-purses are just standard addresses. Which can send and receive funds and interact with smart contracts. With zkSync Era’s solution, developers can adapt to the needs of a wider audience.

Matter Labs representatives say in various interviews that the company is generally geared toward working with traditional businesses. They are particularly interested in the game development industry. In late May, the company hired former Activision Blizzard vice president of community engagement Michael Lee as senior vice president of development. To focus on attracting game developers to the zkSync platform. Earlier, Wemade, a leading Korean blockchain game developer, announced a partnership with Matter Labs. Which is developing the WEMIX PLAY platform. And which, according to the company’s website, has more than 20 million active users.

Launch of zkSync token and airdrop

zkSync has long been considered in the cryptocurrency community as one of the first candidates for mass airdrop . Several large blockchain projects, among them Optimism, Aptos, Blur or Arbitrum, have conducted airdrops for early and active users. And who have received rewards worth thousands of dollars. This has sparked speculation that other projects will follow suit.

Given the impressive amount of investment raised and several other circumstantial signs. And that’s why zkSync is considered one of the most obvious contenders to issue a token and conduct an airdrop. At the end of March, the zkSync ecosystem projects saw a marked increase in activity and turnover following Arbitrum’s sensational token giveaway. At the time of publication, turnover in the zkSync Era network, according to analytics service DefiLlama, exceeds $157 million and continues to grow.

The community notes that the main reason for this may be the accrual of activity. Or so called airdrop pharming. This is when users create a lot of wallets, from which they spend a certain set of actions in network projects. And in doing so, expecting to get more tokens as a reward in the future if the project decides to do an airdrop.

The zkSync developers themselves are apparently aware of what’s going on. As Matter Labs’ Anthony Rose said in a comment for DL News, project teams “should always monitor speculation around tokens and airdrops.”

The company removed the “tokenomics” section from the zkSync website, which was present there until last October. The documentation stated directly that the network’s own token was planned to be used for staking and as collateral for the network’s validators.

Our experts note that the ZkSync Era network remains largely centralized for now. And Matter Labs can arbitrarily update its software code. The company still controls the so-called sequencer and prover. These are the two main components of the network. As Matter Labs CEO Alex Gluchowski clarified, the project will only need a token when it becomes necessary to make the sequencer decentralized. He estimated that this will happen in about a year.

Our Crypto Upvotes experts summed up results of May on the crypto market. And gave their forecasts for leading cryptocurrencies for the nearest future

May was the first month this year that Bitcoin closed with a loss in price. On January 1, BTC was trading around $16.5 thousand, on February 1 – $23.13 thousand, on March 1 – $23.15 thousand, on April 1 Bitcoin rate reached $28.5 thousand, and on May 1 – $29.3 thousand. By the last day of spring the price of BTC went down to $27.7 thousand.

But despite the BTC price decrease by 5.5% in May, it has grown by 67% since the beginning of the year. The total market capitalization of the cryptocurrency decreased by 3.3% in May, but has increased by 41% since the beginning of the year.

Last month on the cryptocurrency market went mainly in the decline in the prices of leading assets

The growth was observed only in certain projects, such as Ripple. And it was primarily due to internal fundamental reasons.

Otherwise, the correction in the cryptocurrency market within the uptrend of the beginning of the year continues. And to say that the market has found the bottom and will go into active growth, it is not necessary yet, says our expert.

May has not been very good for BTC so far this year, with almost 6% fall of the exchange rate. Despite this, we have not seen a strong collapse. For example, as it was in May of the previous few years. Over the past month, BTC and other major cryptocurrencies by market capitalization were in consolidation phase.

On May 25 the price of Bitcoin updated minimum of two months, sinking to the point of $25.8 thousand. But by the end of May BTC got out of this pit, and steadily crossed the point of $27 thousand.

This decline can be attributed to market instability caused by problems in the U.S. banking sector, says our expert. Recession inevitably leads to higher borrowing costs for individuals and companies. And investments are losing yields. So investors tend to invest in conservative instruments. Cryptocurrency traditionally fades into the background at this time.

The U.S. Treasury Department is actively working to reduce inflation. And if it succeeds, then the cryptocurrency segment of the market will go back to growth

Our experts say that even with the current Fed rate, Bitcoin will be able to stop the decline. And even begin to rise in price, albeit slowly. The same will happen to Ethereum and other popular cryptocurrencies.

The most important key events for the crypto market in June. These are reports on the U.S. business activity, inflation and unemployment index, which are published at the beginning of the month. Then after these reports, on June 14, there will be a Fed meeting on the interest rate. And the change of which could very strongly influence the rate of BTC and altcoins.

In case of good economic reports we may expect that the current price level will be kept. In this case, it will be a positive signal for the crypto market. And that will push the BTC price up, to the current resistance level of $31,000, and possibly higher.

Historically, June is considered a low month for Bitcoin. And for the past three years, its exchange rate has fallen in June, our experts remind us.

In May, Bitcoin was supposed to show BTC down to the $25k level. However, it fell slightly short of that target. At the same time, as in the case with Bitcoin, our experts also expect other assets to decline in prices in June.

For example, the correction target for Ethereum is at $1.6k. And other assets with high market capitalization, such as BNB, XRP, ADA, MATIC may also decrease by 5-15% in the first month of summer, our expert thinks.

As for the fundamental aspects, the attention of market participants remains focused on macroeconomics in the USA. Because the pause in rate hike at the June FED meeting is already built into the current prices. But in case of divergence with market expectations, cryptocurrency may decline synchronously with stock assets.

Important events in June among other top 30 cryptocurrencies

Among all cryptocurrency assets from the top 30, Litecoin (LTC) may be stronger than the market. That’s because the LTC network will be halving in August. It is historically bullish on the cryptocurrency exchange price. Also LTC can become one of the leaders of the subsequent market growth. And even if it won’t show good growth in June.

Our experts Crypto Upvotes note that in June several major unlocks of cryptocurrencies are expected. For example such as 1inch Network (1INCH) here will be released 16.6% of the total supply. And Blur here will unlock 6.62% of the total supply. Our expert warned that after unlocks there is usually a fall in asset prices.

Our experts talked about trends in the staking cryptocurrency niche after the Shapella update and its impact on cryptoasset prices

The price of Ethereum cryptocurrency (ETH) crossed the $2,000 mark for the first time since August 2022. After a major blockchain update of the second largest cryptocurrency took place. And fears of a massive outflow of funds from the network were not confirmed. Since the beginning of the year, the coin has grown by more than 60%.

The fears of many market participants were not justified

The April 13 update to the Ethereum blockchain, working title Shanghai. Which was made as part of the Shapella update group gave investors the opportunity to withdraw coins on a first-come, first-served basis. Which they placed as collateral in a special Beacon Chain smart contract, launched back in 2020. This gives them the status of a transaction validator on the network and allows them to be rewarded by issuing new coins, a process called staking.

Accumulated rewards also became available for withdrawal to the wallets. According to the analytical service Nansen, in the first 12 hours after the activation of the update, investors withdrew only 0.3% of the 18 million ETH. Which were placed in the contract for staking.

Contrary to the fears of many market participants, the rate of ETH tested $2,000. It’s safe to say that traders and investors took the update positively. The possibility of withdrawal of coins [from staking] is limited. As it can put pressure on the price.

Only 43.2 thousand ETH can be unlocked in a day. About 170 ths ETH will be sold at market price in the near future. But even if coins will be withdrawn at the maximum allowed limit per day. That figure would fit into the average ETH inflow to the exchanges and would not critically affect the price of the coin. It’s important to understand that many validators are just now starting to test the new feature. And they are withdrawing exactly the earned funds and not the deposit of 32 ETH. Accordingly, they plan to validate transactions further, our experts explain.

What will happen to the price of ETH in the next week

According to Coin Metrics analyst company, about 1.2 million ETH are expected to be withdrawn from staking in the next five days. Which is equivalent to about $2.3 billion at current prices. About $36.7 billion in Ethereum coins remain in the Beacon Chain.

The price of ETH could experience fluctuations in the coming weeks. As some investors will rush to withdraw coins and sell them. But those who were not ready to freeze their assets before. Then now on the contrary, may decide to place coins in a smart contract. Most likely, the upgrade of the network in the medium to long term will lead to the growth of ETH exchange rate. But before that, a period of increased volatility is possible, our experts say.

Staking as a service

Self-staking Ethereum involves setting up equipment. And mandatory minimum deposit of 32 ETH. But even more private investors use stacking services on cryptocurrency exchanges. And decentralized platforms that provide the service of so-called liquid staking.

In this case, exchanges or services act as a validator. Which pools users’ funds into a single pool with a user-friendly interface. And also with the reward for staking in proportion to their investment. The largest staking platform Lido. At the same time, being a validator, manages about 31% of all ETH in staking. Binance, Coinbase and Kraken crypto exchanges are also in the top five largest validators.

Staking from crypto exchanges

The main advantage of staking services from exchanges is simplicity. The user does not need to understand the intricacies. The user only has to press a couple of buttons and be assured that staking works. Interest payments are made by the exchanger. And it also takes the rights and responsibilities. If there are any difficulties, you can write to the support service and get an answer in a short time. This is always suitable for beginners. That is why the popularity of staking through exchanges or platforms will not suffer much from Ethereum updates.

The possibility of unlocking coins is unlikely to have much effect on the popularity of staking services. Their target audience is not so much those investors who were not ready to freeze their assets. But those who simply don’t have 32 ETH to place in a smart contract. The demand for the service, even if it falls, is insignificant, our experts say.

Kraken leads in the number of applications to withdraw coins from staking. The U.S. exchange accounts for more than 86% of the total amount of ETH. Which are now “in line” for withdrawal. The exchange was forced to stop its staking service in the U.S. and pay a $30 million fine when the Securities and Exchange Commission (SEC) recognized its staking service as the equivalent of illegal sales of securities. Because of such bans in the U.S., it is the decentralized platforms where coins will be put. The use of which the SEC will not be able to prohibit technically.

Staking on decentralized platforms

Decentralized liquid staking services allow you to invest in staking coins from Ethereum and other blockchains. Which work on the Proof-of-Stake (PoS) algorithm. And receive derivative tokens of equal value in return. Which are also traded on cryptocurrency exchanges. And can be used for additional earning strategies. Examples of such platforms include Lido, Rocket Pool, Stakewise, and others. Many of them issue their own tokens. Which give you the right to vote in DAOs or get discounts on fees for services.

Our Crypto Upvotes experts point out that the investment appeal of such platforms’ tokens depends not only on the set of their services. But also their overall marketing performance, turnover and trends in the market. Some platforms don’t have a token. But this does not prevent them from attracting users. For example, stake.fish is popular due to the experience and reputation of the f2pool behind it. It is a well-known brand in the niche of mining pools.

Tokens of the largest staking platforms also benefited from the successful Ethereum update. The tokens of Lido (LDO), Rocket Pool (RPL) and Stakewise (SWISE) showed growth of 6-7%.

PostFinance, Swiss national postal service’s bank division, will give customers access to buy, hold and sell Bitcoin and Ethereum

PostFinance, the Swiss post office bank, will partner with Sygnum Bank, a Swiss digital asset bank, to open up cryptocurrency transactions to more than 2.5 million customers. The cryptobank said in an announcement that PostFinance customers will be able to buy, store and sell cryptocurrencies such as bitcoin and Ethereum.

PostFinance is one of Switzerland’s largest retail banks. It is wholly owned by the Swiss Post, which in turn is owned by the state. According to the bank’s website, more than 2.5 million people use its services.

Bank Sygnum is licensed as a provider of cryptocurrency services in Switzerland. And it serves a range of institutions, including cantonal and private banks. PostFinance is integrating Sygnum’s b2b platform into its infrastructure.

According to the report, PostFinance has analyzed the investment needs of its customers. And it identified a high demand for digital investment services.

“Digital assets have become an integral part of the financial world. And our clients want access to this marketplace at PostFinance,” said PostFinance Chief Investment Officer Philip Merkt.

PostFinance’s decision to switch to cryptocurrency was driven in part by an outflow of funds from Swiss retail banks into the digital asset class.

PostFinance has noted a multi-million dollar outflow of funds to cryptocurrency exchanges in recent years. So not only did the bank see an opportunity to generate new revenue in its work with digital assets. But it also realized that it made a big difference in retaining existing customers.

Our experts note that in addition to Bitcoin and Ethereum, PostFinance will later add other cryptocurrencies.