What Does The FedNow System Mean for Crypto?
A new instant payment system is taking the banking sector out of the stone age. But what does it mean for crypto?
GM!
Today's top news includes:
Federal Reserve releases FedNow instant payment system
Moonbird Mythics debut at 0.6 ETH
OpenSea launches Deals
Pentoshi to cut Flightless Birds mint after reveal
CyberKongz announce new mint, doubling their NFT supply
🤔 Does FedNow Make Crypto Obsolete?Â
Have you ever experienced the pain of going to a bank to send a wire payment? Or waiting 48 hours for an ACH to clear over a weekend?
That's all about to change.
Yesterday the U.S. Federal Reserve launched its new instant payments service, FedNow.
It's a huge step up for payments in the banking industry, moving them out of the stone age.
But now the question is - what does it mean for crypto?
What Happened?
The Fed's FedNow system features 35 banks and credit unions including the giants like JPMorgan Chase and Wells Fargo.
The pitch is simple - it significantly reduces money transfer time.
A few details around the announcement:
FedNow enables almost immediate money transfers, unlike the conventional U.S. system that takes hours or days
The service will operate around the clock, allowing payments to be processed within seconds
There are no plans to link a digital dollar (CBDC) to the system at this time
That last point is key, though many are raising valid concerns that this is a stepping stone to an eventual CBDC (Central Bank Digital Currency) even if the Fed says no.
The other impact and debate that this has stirred - why do we need crypto if the bank has instant payment rails?
Why Crypto?
At a high level, FedNow enables instant money transfers, a functionality that has long been championed by crypto maxis as one of its primary advantages.
So it's a natural competitor to crypto in that regard, and that advantage is mostly gone.
But this announcement was a great reminder of the other reasons that so many believe in crypto and its need for broader society.
Features that cryptocurrencies boast over FedNow:
Decentralization:Â One of the primary appeals of cryptocurrencies is their decentralized nature. This means they are not controlled by a single entity or authority like a central bank. For many, this decentralization represents financial freedom and resistance to censorship.
Transparency:Â Transactions made with cryptocurrencies are immutable and transparent, recorded on a public ledger known as the blockchain. This transparency can provide a high level of security and trust.
Global Access:Â Cryptocurrencies provide global access to financial services, especially for unbanked or underbanked populations. Anyone with an internet connection can potentially access and use cryptocurrencies.
Smart Contracts and DeFi:Â Cryptocurrencies like Ethereum enable programmable money and smart contracts, which have given rise to the booming DeFi (Decentralized Finance) sector, allowing peer-to-peer lending, borrowing, and other financial services without the need for intermediaries.
It's easy to forget about these reasons in our day-to-day lives, especially those of us living in the U.S. where some of these features aren't necessarily needed on a daily basis (i.e. decentralization).
But the fears of a CBDC where a government and perhaps a bad actor with the highest power could effectively turn off payments for certain individuals or block payments to certain industries are valid. And the primary defense that citizens would have in that scenario would be crypto.
Ideally we don't get there. But let's also not lose the plot.
FedNow is a great enhancement for the banking sector. Hopefully it leads to some healthy competition that drives both banking and crypto forward.
🚚 What else is happening in NFTs?
Here is the list of other notable headlines from the day in NFTs:
Trading volume came in over 8k ETHÂ on Thursday; leading NFTs were mostly red with Penguins, Potatoz and HVMTL leading the way in green
The Floor App announced it will be launching in-app mobile NFT purchases as part of its Icons program, starting with 10 weeks of curated art drops starting with Vinnie Hager
OpenSea introduced a new "Deals" feature to enable peer-to-peer trading within its platform
Moonbirds Mythics debuted with a fun reveal process that allows minters to choose 1 of 3 NFTs, with the 2 not chosen burned forever; 67 have been minted so far, and the floor is at 0.6 ETH (thought on just 1.5 ETH volume)
Yuga's Chief Creative Officer Figge announced that Gucci's cloth will be redeemable for co-branded 10ktf x Gucci gear (wallet or duffel bag)
Crypto influencer Pentoshi saw just 27% of his 10k "Flightless Birds" sell out at the 0.25 ETH mint price and then announced this morning that the mint will close tomorrow after reveal and supply will be capped at the final mint count
CyberKongz shared new details for their upcoming Genkai mint, with 16,000 NFTs coming (7k airdrop, 9k minting at 0.25 ETH) along with 4k NFTs coming somewhere TBD
🌎 Around Crypto and Web3
A few other Crypto and Web3 headlines that caught my eye:
The crypto market was down on Thursday;Â BTC -0.8% at $29,800; ETH -1% at $1,890; XRP -3% at $0.77
Sorare revealed major updates for the 2023-24 football season, with new gameplay and competition formats aimed at enhancing user engagement, ownership, and connection
McDonald's Hong Kong is collaborating with The Sandbox to create McNuggets® Land, a metaverse playground celebrating the 40th anniversary of Chicken McNuggets with digital and physical rewards
🚀 NFT Total Volume
BAYC (2,637 ETH, 32.8 ETH)
DeGods (1,094 ETH, 8.56 ETH)
Azuki (655 ETH, 5.48 ETH Floor)
MAYC (651 ETH, 5.99 ETH)
Pudgy Penguins (388 ETH, 4.1 ETH)
📈 NFT Floor Price Increase
CryptoPhunks (53%, 0.55 ETH Floor)
Mutant Garden Seeder (47%, 6.6 ETH)
Combat Crates (40%, 0.49 ETH)
Loot (40%, 0.54 ETH)
Yamabushi's Horizons (30%, 2.58 ETH)
🗓 Upcoming NFT Mints and Reveals
Today is a slower day rounding out a very busy week of new drops.
The primary mints to watch will once again be on Prohibition, with their 4th and 5th projects launching from artists Loren Bednar and Rosen Lykke.
Priced at 0.25 ETH and 0.1 ETH respectively, these will be geared more at collectors than flippers. Especially with poor secondary performance of recent gen art drops.Â
But with that said, if you like the art - go for it.
If you want more, see the full list of today's drops from Swizzy's daily mint monitor.Â
Skyborne Legacy - Nexian Gems (9:00 a.m. ET)
Memes by 6529 (11:00 a.m. ET)
Prohibition - Afterimage (1:00 p.m. ET)
Prohibition - Magine (5:00 p.m. ET)
Enjoy this write-up? Follow along with me on Twitter @tyler_did_it or reach out via email tyler.warner@luckytrader.com.
For all volume and floor price data, see Lucky Trader's Project Rankings page.
For all upcoming mints, see Lucky Trader's NFT Calendar page.