Crypto Tag: Cryptocurrency Diary

1. Removal of Supply Cap and Inflation Concerns
The transition from MATIC to POL introduced an inflationary model, eliminating the previous 10 billion token cap. POL now has an annual inflation rate of 2%, with half allocated to staking rewards and the other half to a community treasury. While this aims to support network sustainability, some investors fear token dilution, prompting sell-offs.

2. Instability During Transition
The migration to POL is part of the Polygon 2.0 upgrade, which involves significant changes in tokenomics and technology. Market participants may require time to fully adapt and understand these updates, leading to short-term uncertainty and selling pressure.

3. Decrease in User Activity
During the transition, some users have paused activity due to uncertainty about the new ecosystem or technical adjustments required for compliance with POL.

4. Broader Macroeconomic Factors
The overall crypto market’s performance, including Bitcoin and Ethereum trends, as well as macroeconomic conditions like rising interest rates, may also be contributing to POL’s price decline.

5. Long-Term Outlook
Despite short-term challenges, Polygon 2.0 aims to strengthen its multi-chain ecosystem through enhanced scalability, interoperability, and staking mechanisms. These upgrades position POL for potential long-term growth as adoption increases and the ecosystem matures.

While the price drop may reflect temporary market dynamics, investors are encouraged to monitor Polygon’s progress with a long-term perspective.

It is said that a great reset is on the horizon, but its form and timing remain subjects of debate. Below is an organized analysis of potential forms and expected timing.

Forms of Great Reset

1. Reconstruction of the Currency System
   • Central banks may introduce Central Bank Digital Currencies (CBDCs), phasing out physical cash. This transition could lead to complete digitalization of currency, enhancing government control over asset and tax management.
   • The introduction of CBDCs might partially reset the existing financial system, potentially involving debt reduction or new monetary value standards.
2. Debt Cancellation
   • To address ballooning global government debts, large-scale debt restructuring or defaults could occur.
   • This may lead to currency devaluation (hyperinflation) or transitions to new currency units.
3. Reorganization of Financial Markets
   • Significant adjustments in stock and bond markets could result in changes to the rules and standards underpinning the current financial system.
   • ESG (Environmental, Social, Governance) investments and green economy initiatives might dominate as new financial products and investment criteria emerge.
4. Redistribution of Wealth
   • To address inequality, major tax reforms or increased taxation on the wealthy could be implemented.
   • Extreme measures like asset taxation or deposit freezes are also being discussed.

Timing

While specific timing is uncertain, the following factors suggest it may occur in the near future:

• Fiscal Deficits: Unsustainable fiscal deficits globally, particularly in countries like the U.S., where debt ceiling issues are recurrent.
• Inflation and Interest Rates: Rising global inflation rates and interest hikes are straining economies, necessitating systemic reviews.
• CBDC Rollouts: Many central banks plan to introduce CBDCs by 2025, which could trigger significant changes in currency systems.
• Geopolitical Risks: Tensions such as U.S.-China conflicts and the Russia-Ukraine war could accelerate great resets.

Impacts on Individuals and Countermeasures

1. Investing in Tangible Assets
   • Holding assets like gold, silver, or real estate can hedge against inflation and currency devaluation.
2. Portfolio Diversification
   • Consider diversifying into cryptocurrencies (e.g., Bitcoin) or emerging markets alongside traditional stocks and bonds.
3. Staying Informed
   • Monitor government policies and central bank announcements to adapt asset strategies accordingly.
4. Debt Management
   • Reassess repayment plans to avoid excessive liabilities during rising interest rate periods.

A great reset is not merely a conspiracy theory but a plausible economic restructuring process. Individuals should analyze the situation calmly and take proactive steps to safeguard their assets.

On January 23, 2025, President Donald Trump signed an executive order banning the issuance, circulation, and use of Central Bank Digital Currencies (CBDCs) in the United States. The order also mandates the immediate termination of any ongoing plans related to CBDC development.

Trump criticized CBDCs as a “threat to freedom,” citing concerns over privacy, security, and increased government surveillance. In contrast, he praised cryptocurrencies for their potential to drive economic growth and technological innovation, expressing support for the development of blockchain technology and digital assets.

The executive order establishes a working group tasked with proposing a new regulatory framework for digital assets within 180 days. While this move may distance the U.S. from the global CBDC race dominated by China and Europe, it is expected to accelerate investment in the domestic cryptocurrency industry.

The concept of the new BRICS currency, referred to as “R5,” was advanced during the BRICS Summit held in Russia in October 2024. It is anticipated that the formal establishment of this currency could be decided at the next BRICS Summit, scheduled to take place in Brazil in 2025.

The name “R5” derives from the initials of the currencies of the BRICS nations: Brazilian Real, Russian Ruble, Indian Rupee, Chinese Renminbi (RMB), and South African Rand. Rather than replacing existing national currencies, R5 is envisioned as a digital currency primarily intended for international trade and settlement. While discussions on its issuance and operational details are ongoing, progress is expected after 2025.

The rebranding of MakerDAO to Sky and the transition of its tokens from DAI to USDS and MKR to SKY is a significant transformation aimed at enhancing the accessibility and user-friendliness of decentralized finance (DeFi).

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The Bitcoin.com iOS wallet has now added a Cloud backup feature.

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Introduction

Recently, DeFi (Decentralized Finance) and DEX (Decentralized Exchanges) have been gaining significant attention in the cryptocurrency world. These platforms allow for faster, more transparent, and often lower-cost cryptocurrency exchanges without the need for traditional banks or exchanges. In this article, we’ll explain how to exchange cryptocurrencies using DeFi/DEX, in a way that’s easy to understand even for beginners.

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Introduction: Bitcoin, with its unique characteristics and allure as an investment, has captivated cryptocurrency users worldwide. However, the value of Bitcoin is highly volatile, making value preservation a challenging task. In this article, we will explore effective strategies to prevent the diminution of value in your physical Bitcoin holdings.

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Introduction: Greetings to all who have ventured into the realm of cryptocurrencies. Today, let’s explore this domain from a slightly different perspective. Many perceive cryptocurrencies as an investment, eagerly awaiting value appreciation and eventual conversion into fiat currency. But, is this conversion truly the essence of cryptocurrencies’ value? Let’s shift our focus from the notion of cashing out and instead delve into the untapped potential of cryptocurrencies.

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