Decentral Block Post

It’s not a great day to be in crypto. Perhaps you’ve seen an article (or 20) about this. Perhaps you’ve been on Twitter, where our detractors are cackling gleefully over every headline, each one more harbinger-of-doom-esque than the next. To be fair, things are going badly. Crashed, collapsed, erased, plunged, obliterated and imploded are the operative verbs in most coverage, and they’re not being used incorrectly or in an exaggerated manner. There’s no putting a positive spin on a week where $400 billion in value just evaporated. Even for the most furiously determined buy-the-dippers and diamond-handed believers who feed off detractors and never say die, it’s dire out there.

I’m not interested in making a case for buying the dip or for dipping out forever and getting into, say, stockpiling gold bars in an underground bunker. But I do see this feral, angry, rabid bear market we find ourselves careening through as an opportunity for some much-needed course correction. I’ve argued before that the crypto space at large has lost the plot, forsaking the borderline revolutionary potential of decentralized finance for an inescapable horde of stupid-looking monkeys. I’m not the only person in crypto who feels this way, let alone the most prominent. Vitalik Buterin made similar points in his widely-read profile in the March 2022 issue of Time magazine.

Comeuppances and consequences

Twitter is never a great sample audience, but given the sorry state of crypto’s public reputation, it’s not unfathomable or even unexpected that this crash is being met with derision and schadenfreude by people outside the space. From rampant scams to ugly nonfungible tokens (NFT) to carbon-spewing mining, we’ve given the outside world plenty of reason to not only be skeptical of crypto. Many people still think we’re a bunch of tasteless bros duking it out on an unregulated stock market imitation whose comeuppance has arrived. Even before this crash, some writers and publications openly speculated that a crypto bubble burst would push a group of mostly male, newly broken, and deeply disillusioned people toward fascism and away from democratic values and, by extension, society.

Related: In defense of crypto: Why digital currencies deserve a better reputation

Whether or not you agree with that point — and I certainly don’t — it speaks to the dire state of crypto’s public image. Something has gone horribly awry when journalists at reasonably well-read political publications, however biased, are making even remotely compelling arguments for a crypto-to-fascism pipeline.

The Ethereum (ETH) ecosystem’s biggest roadblock to mainstream dominance is often attributed to the extremely high transaction fees or gas fees it requires to complete a transaction. However, with Ethereum’s average gas fees coming down to 0.0015 ETH, the narrative is set to change. 

The average transaction fee on the Ethereum blockchain fell down to 0.0015 ETH or $1.57 — a number previously seen in December 2020. However, starting in January 2021, Ethereum’s gas fees surged owing to the hype around nonfungible tokens (NFT), decentralized finance (DeFi) and a promising bull market.

For nearly two years, between Jan. 2021 and May 2022, the average gas fee required by the Ethereum network was roughly $40, with May 1, 2022 recording the highest gas cost of $196.638 — as evidenced by data from BitInfoCharts. 

Supporting this sudden drop in gas prices, Cointelegraph uncovered on Saturday that the daily NFTs sales have also dropped to one-year lows. The NFT ecosystem recorded its worst performance of the year in June as the total number of daily sales fell to roughly 19,000 with an estimated value of $13.8 million.

In November 2021, back when numerous investors reported outrageous gas fees, Ethereum co-founder Vitalik Buterin published a decrease-cost-and-cap proposal to reduce unprecedented levels of strain on the network. Buterin had proposed a short-term solution to further cut rollup costs by introducing a calldata limit per block to lower ETH gas costs.

Crema Finance, a concentrated liquidity protocol over the Solana blockchain, announced the temporary suspension of its services owing to a successful exploit that has drained a substantial but undisclosed amount of funds.

Soon after realizing the hack on its protocol, Crema Finance suspended the liquidity services to refrain the hacker from draining out its liquidity reserves — which include the funds of the service provider and investors.

While the company is yet to provide an update based on an investigation that was ongoing at the time of writing, the Crypto Twitter community took it to themselves to track down the hacker’s wallet and gain a better understanding of the situation. 

Based on a personal investigation, crypto community member @HarveyMackinto2 allegedly spotted the hacker’s wallet address. The address in question holds 69,422.89 Solana (SOL) tokens — roughly over $2.3 million, procured through a series of transactions over several hours.

Other members of the crypto community, however, suspect the hacker made away with 90% of the total liquidity from some of Crema Finance’s pools. Henry Du, the co-founder of Crema Finance, too, confirmed that all the functions of the protocol have been suspended indefinitely and asked investors to stay tuned for further information in the form of an update.