Eterna's Insights - September 2024

U.S. Candidates Embrace Crypto in 2024 Race

Former President Donald Trump made history by becoming the first U.S. president to make a payment using Bitcoin. During a surprise appearance at PubKey, a Bitcoin-themed bar in New York City, Trump bought 50 burgers and 50 diet Cokes for patrons ahead of his rally in Long Island. After the transaction, Trump enthusiastically announced, "I just made the first transaction in Bitcoin," to cheers from the crowd. He described the payment process as "very easy." This event highlights Trump's growing public association with cryptocurrency.

Vice President Kamala Harris has voiced her support for digital assets for the first time. During a fundraiser in New York City, Harris emphasized the importance of fostering innovation in technologies like AI and digital assets while ensuring protections for investors and consumers. Just days later, at a Pittsburgh rally, she further expressed her desire for the U.S. to lead in blockchain technology. These remarks align with the formation of the Crypto4Harris movement, which advocates for a more favorable digital asset policy within the Democratic Party. Harris' comments also follow earlier statements from her campaign advisor, Brian Nelson, who noted her commitment to supporting the growth of emerging technologies.

PayPal Enables Business Accounts to Buy, Hold and Sell Cryptocurrency

PayPal Holdings, Inc. has announced a new feature allowing U.S. merchants to buy, hold, and sell cryptocurrency directly from their PayPal business accounts. This marks PayPal’s latest effort to expand cryptocurrency functionality for businesses, following its previous initiatives aimed at consumers. Merchants can now also transfer cryptocurrencies to external wallets, enhancing flexibility in crypto transactions.

Since 2020, PayPal has integrated cryptocurrency into its services, and in 2023, it introduced a U.S. dollar stablecoin (PYUSD). PayPal has also enabled the use of PYUSD on its Xoom platform for fee-free transfers and recently added support for PYUSD on the Solana blockchain, providing users with more options for blockchain transactions.

Solana’s Firedancer Takes Main Stage at Breakpoint Conference

Solana's "Frankendancer," a prototype of the Firedancer validator client, was launched on mainnet during the Solana Breakpoint conference in Singapore. Developed by Jump Trading, Firedancer is designed to improve Solana's performance and resilience, addressing issues like past network outages. It is the second validator client after the Rust-based Agave client and features a modular architecture, optimizing hardware usage. The interim version, Frankendancer, combines aspects of Agave and includes networking features for transaction processing and block propagation, though its runtime and consensus components are still in development. Firedancer is reported to handle over 1 million transactions per second (TPS), but there is no set timeline for its full release on mainnet.

SEC Approves First Bitcoin ETF Options

The SEC granted "accelerated approval" for BlackRock's spot bitcoin ETF (IBIT) options on September 20, 2024, allowing them to be listed and traded on the Nasdaq. However, further approvals from the OCC and CFTC are still required before these options officially become tradable. The timeline for these additional approvals is uncertain, as it does not follow a fixed schedule. Analysts, like Bloomberg's Eric Balchunas, expect other spot bitcoin ETFs to gain SEC approval for options soon.

September Marks Third Month of Declining Bitcoin Mining Revenues

In September 2024, Bitcoin's average price and network hashrate slightly increased, with the hashrate rising by 2% to 643 exahashes per second (EH/s), continuing a three-month growth trend. Despite this, daily mining revenue and gross profit declined for the third consecutive month. According to JPMorgan, miners earned an average of $42,100 per EH/s in daily block rewards, a 6% drop from the previous month. Gross profit fell to $16,100 per EH/s, reflecting a 38.4% gross margin, marking the lowest profitability recorded recently. These declines in profitability were attributed to the increasing hashrate and falling Bitcoin prices.

Eterna Portfolio Company Spotlight:

0G and OnePiece Labs Launch AI-Focused Web3 Incubator

In April, 0G and OnePiece Labs launched the 0G x OnePiece Labs Incubator Program, aimed at fostering innovation in AI-centric decentralized applications (dApps) for Web3. This partnership blends 0G’s blockchain expertise with OnePiece Labs' venture experience, supporting entrepreneurs in developing scalable, groundbreaking solutions. The 10-week program concluded with a Demo Day on September 12, 2024, attracting significant investor interest from Silicon Valley to Hong Kong. The success of the program ensures it will be repeated, marking a pivotal step for AI-enhanced blockchain applications.