All Time High followed by a Flash Crash. Crypto knows how to keep things interesting. But so do we…
Key Market Updates
CEX vs. DEX
Important BTC and ETH Updates
Meme Coins 101
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Our Market Meditations are longer format educational segments. Each letter features a Market Meditation which will deep dive and analyse a relevant crypto event, theme or tool.
💰DEX vs. CEX
Decentralized finance has gained traction very rapidly since the beginning of the year.
Decentralized exchanges (DEXs) like Uniswap, dYdX and PancakeSwap tout some impressive trading volume and total value locked (TVL).
But how do these up-and-comers stack up against centralized exchanges (CEXs) like Binance?
According to a report published last month, the TVL in DEXs rose from $20 billion to $80 billion this year alone – an increase of 400%.
Attractive features like yield farming and liquidity pool rewards, coupled with the advantages of decentralized control, are responsible for DEXs outpacing CEX growth between Q1 2019 and Q3 2021.
Most decentralized exchanges are permissionless, bringing buyers and sellers together to trade without intermediaries.
These key advantages are undoubtedly driving factors in the breakneck pace of DeFi’s expansion. But considering exchanges like FTX and Binance still reign supreme, there must be some counterpoints to the decentralized side of the story.
Centralized exchanges typically offer higher degrees of reliability and security, with some offering recovery assistance, when possible, in the event of erroneously sent funds.
Most CEX fees on networks like Bitcoin and Ethereum are far lower than the gas fees paid on decentralized exchanges.
While DEXs face liquidity problems from time to time, large, centralized exchanges rarely, if ever, experience this problem.
Regardless of which route you take; volume and interest is up on exchanges – centralized and decentralized alike. We can see from the meteoric rise of DEXs that the health of DeFi’s growth is strong.
🥶 Temperature Check: BTC & ETH
The most recent dip didn’t break the $4.4k level.
We want to make sure the price stays about $4.4k.
Above this level, we can be fairly comfortable.
Psychologically, the $60k support level is the one we want to maintain.
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🤪 MEME COIN MANIA
A meme coin is just a cryptocurrency with a humorous meme attached to the name.
Initially, this also meant that the coin had no utility. For instance, when DOGE (the godfather of meme coins) was created, it was purely as a joke, with no intended use case. This is changing, however, with some meme coins being created with utility and some adding utility afterward.
The latter is the case with Shiba Inu.
Although it was launched without utility, the community grew quickly and the developers began creating multiple use cases for it as well as token burns and rewards.
Meme coins like SPELL were created with a utility but also happened to have a funny meme attached to them.
Many users were surprised when CoinGecko listed it under the meme coin category.
When considering the purchase of any crypto asset, especially meme coins, understanding the utility of the coin is a good place to start.
Equally as important, is the community.
A strong community can make or break a project as we have repeatedly witnessed with NFT projects.
Not financial or tax advice. The content in this newsletter is for informational purposes only. Nothing in this email is intended to serve as financial advice. We are not financial advisors. Every investment and trading move involves risk. Do your own research when making a decision. See our important security disclaimers here.
Disclosure. Some of the links we’ve included are affiliate, they give you rewards and discounts and earn us a commission. Additionally, the Market Meditator writers hold crypto assets. See our investment disclosures here.