El Salvador’s inaugural digital asset service Provider license has been granted to popular cryptocurrency exchange Bitfinex.

The web3 investment arm of Andreessen Horowitz, a16z Crypto, has released a new “State of Crypto” index, which offers an optimistic overview of the emergent asset class.

Montenegro’s Central Bank has announced a collaboration with fintech company Ripple to explore the feasibility of creating a digital currency for the nation. Montenegro has used the euro as its currency since its introduction in 2022, even though it’s not a part of the Eurozone.

Top stories in the Crypto Roundup today:

• Bitfinex Secures El Salvador's First Digital Asset Service Provider License
• a16z Launches "State of Crypto" Index
• Montenegro Teams Up with Ripple to Explore National Digital Currency
• Ethereum Outlook Ahead of Shapella Upgrade

Bitfinex Secures El Salvador's First Digital Asset Service Provider License

El Salvador’s inaugural digital asset service provider license has been granted to popular cryptocurrency exchange Bitfinex.

The move follows the January legislation passed by the country’s Legislative Assembly creating a framework for El Salvador to launch Bitcoin-backed “Volcano Bonds.”

Paolo Ardoino, Bitfinex’s chief technology officer, said in a statement that the license will allow the exchange to facilitate the issuance and secondary trading of assets with well-defined rights and obligations as outlined by the new digital asset regulations. Ardoino has been actively involved in El Salvador's Bitcoin bond initiative.

Jesse Knutson, head of operations at Bitfinex Securities, mentioned that the new regulatory framework would permit the launch of tokenized shares and yield-bearing assets.

In September 2021, under President Nayib Bukele's leadership, El Salvador became the first country to recognize Bitcoin as legal tender.

a16z Launches "State of Crypto" Index

The web3 investment arm of Andreessen Horowitz, a16z Crypto, has released a new “State of Crypto” index, which offers an optimistic overview of the emergent asset class.

The venture capital firm, known for supporting companies and projects such as dYdX, LazerZero, and Dapper Labs, unveiled the index along with its similarly titled State of Crypto report.

The index takes into account various adoption and innovation metrics, including the number of active developers, mentions of crypto in scholarly research, and trading volumes on decentralized exchanges, but doesn’t incorporate bankruptcies, blockchain breaches, or regulatory enforcement actions.

Bitcoin’s price has dropped by more than half from its peak in 2021, but a16z’s index only fell by a quarter. The index also shows developer count has gone down by 25% from its highest point, while the transaction count has only decreased by 10%, from 1.3 billion to about 1.17 billion.

Some indicators have, however, declined significantly, such as the number of wallet users and the trading volumes on decentralized exchanges compared to last year.

Montenegro Teams Up with Ripple to Explore National Digital Currency

Montenegro’s Central Bank has announced a collaboration with fintech company Ripple to explore the feasibility of creating a digital currency for the nation. Montenegro has used the euro as its currency since its introduction in 2022, even though it’s not a part of the Eurozone.

James Wallis, Ripple X's Vice President for Central Bank Engagements and CBDCs, said that further details of the project would be unveiled later in the year. The initiative will be carried out in stages, beginning with the identification of practical applications for a national digital currency or stablecoin.

Wallis also confirmed plans for a sandbox stage to test the digital currency under controlled conditions, saying Ripple X will work “closely with the Central Bank to determine use cases, key success factors, and timelines."

For months, Ripple has been promoting its growth in the central bank digital currency (CBDC) area. Wallis stated that the company “is working on several CBDC initiatives across the world and is in talks with dozens of global central banks.”

Ethereum Outlook Ahead of Shapella Upgrade

Ethereum’s Shapella upgrade will allow for the withdrawal of locked staked funds and will complete the network’s transition to a proof-of-stake system. It is expected to have a positive impact on the underlying asset, represented by lower negative funding rates and increasing open interest.

Over the past few months, Ethereum open interest has experienced consistent growth. This steady increase in Open Interest has been accompanied by comparatively low trading activity, in contrast to the Ethereum Merge

State of the Crypto by Top Tier Exchange Volume

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