ERC 404 Tokens and STRONG Bitcoin?

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Blockchain community divided over new ERC-404 tokens

The blockchain community finds itself divided over the Ethereum token standard ERC-404, a novel creation blending the technology of ERC-20 and ERC-721. This new standard, introduced by pseudonymous developers under the Pandora project, particularly shines in the realm of fractionalized NFTs. However, not everyone is optimistic about its future.

Despite ERC-404 tokens, like those from Pandora, delivering impressive returns and trading at $23,484 with a $235 million market cap, skepticism exists. Critics, like Miguel Prada from Diva Staking, emphasize concerns about ERC-404 not adhering to standard ERC procedures, raising doubts about its true classification as an ERC token. Prada acknowledges the potential for liquidity in the NFT market but warns of limitations, especially regarding NFTs representing Real World Assets (RWA).

Ryan Lee of Bitget Research echoes these sentiments, emphasizing that ERC-404 is still an experimental protocol and not officially part of the Ethereum Foundation's ERC standard. Lee points out existing protocols merging Fungible Token and NFT, suggesting ERC-404's speculative nature and the market's thirst for innovation.

Contrastingly, Akash Mahendra from Haven1 sees ERC-404 as a game changer, praising its potential to position Ethereum as a leader in real-world asset tokenization. He envisions users gaining exposure to both ERC-20 and ERC-721, likening it to owning an "exchange-traded fund in the decentralized finance world."

However, even Mahendra acknowledges the risks, emphasizing the lack of official approval by the Ethereum Foundation. Investors are urged to tread carefully due to potential bugs and losses, highlighting the uncertainty surrounding this innovative but controversial ERC-404 standard.

Checkout the PRC-20 404 standard GOFURS that just launched on Pulsechain!

Bitcoin 'Stronger’ Ahead of Halving: Grayscale

Since their launch nearly a month ago, spot Bitcoin ETFs have accumulated over 192,000 bitcoins in holdings, suggesting a growing interest in these investment vehicles. The potential impact of Bitcoin's upcoming halving event is also being discussed, with expectations of a steady price increase fueled by reduced selling pressure and a surge in interest in native Bitcoin-based applications.

Grayscale, a prominent crypto asset management firm, highlights the significant improvement in Bitcoin's technical fundamentals and use cases over the past year. The firm believes that these developments make Bitcoin stronger than ever as it approaches its historically bullish halving event. Michael Zhao, a researcher at Grayscale, notes the fundamental changes, despite short-term challenges for miner revenue. Bitcoin is evolving beyond being digital gold, with recent developments indicating its increasing significance.

The introduction of ordinal inscriptions and BRC-20 tokens has rejuvenated on-chain activity on Bitcoin, contributing over $200 million in transaction fees for miners by February 2024. Ordinals, part of the Ordinals Protocol, enable users to embed data on the Bitcoin blockchain, especially references to digital art. The BRC-20 standard, introduced in April, allows users to issue transferable tokens directly through the network.

The positive on-chain fundamentals, coupled with a favorable market structure, are expected to support Bitcoin's price post-halving. Lower rewards due to halving will require relatively lower buying pressure to maintain prices, potentially leading to higher prices with increased demand. The report emphasizes the historical impact of block rewards on potential sell pressure and outlines the corresponding buy pressure needed to sustain prices, which is expected to decrease after the halving event, easing selling pressure.

While the overall sentiment is optimistic, the report also acknowledges the necessity for caution, as uncertainties persist in the crypto market.

US Economy News Today: Investors Think Fed Rate Cut in May Less Likely After CPI

The latest inflation report has caught the Federal Reserve off guard, triggering a significant market response. January witnessed higher-than-anticipated inflation rates, with both headline and core monthly readings at 0.3%, leading to annual readings of 3.1% and 3.9%, respectively.

While an improvement at the headline level, the figures fell short of market expectations, dashing hopes for an initial rate cut in March. Market sentiment has swiftly shifted, with current pricing indicating a 93% probability of rates being held next month, a stark contrast from just a month ago.

The outlook for the year has also shifted dramatically, with only 75 basis points of rate cuts now factored in, down from the previous estimate of 175 basis points a month ago. This adjustment reflects a growing belief among traders that the robust economy will come at a significant cost.

However, as optimism may have been overstated in the past month, there's a question of whether the pendulum has swung too far in the opposite direction. Despite challenges, substantial progress has been made on the inflation front, and there's anticipation for further improvements in the coming months. The delicate balance between economic resilience and potential downsides continues to shape market expectations and policy considerations.

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