​New York Attorney General Letitia James proposed a bill that would, quoting the AG’s office, “…tighten regulations on the cryptocurrency industry to protect investors, consumers, and the broader economy.” The bill, which proposes “…the strongest and most comprehensive set of regulations on cryptocurrency in the nation, would increase transparency, eliminate conflicts of interest, and impose commonsense measures to protect investors, consistent with regulations imposed on other financial services.”
Some of the key bill points are:

• Industry companies must undergo Independent public audits, publish same, and provide investors with material information about issuers, including risks & conflicts-of-interest.
• Require cryptocurrency promoters to register and report their interest in any issuer whose cryptocurrency the promote.
• Digital asset brokers, marketplaces, investment advisors, and issuers would have to be licensed in New York before engaging in business.
• Cryptocurrency platforms would be required to reimburse customers who are victims of fraud or unauthorized asset transfer.
• Prohibit common ownership of crypto issuers, marketplaces, brokers, and investment advisers by preventing any participant from engaging in more than one of those activities.
• Prohibit crypto brokers and marketplaces from trading for their own accounts.
• Prohibiting marketplace investment advisers from keeping custody of customer funds
• Prohibiting brokers from borrowing or lending customer assets
• Ban the use of the term ‘stablecoin’ unless they are backed by US currency or high-quality liquid assets as defined in federal regulations.
• Prohibiting referrals from marketplaces to investment services for compensation
• The Ag would have the right to enforce violations with civil penalties of $10,000 per individual/violation or $100,000 per firm, including damages, restitution, penalties or to shut down businesses.

The bill will likely get modified (currently in draft form) as politician wrangle over the details, but almost all of the above (there are more) items are relatively simple, commonsense regulations that other asset classes already follow.  After the FTX and other crypto debacles, other than a bias against all government regulation, it is hard to come up with reasons to not regulate the cryptocurrency space, and while the attraction for some might have been the unregulated ‘wild west’ concept, hopefully there is a new sheriff in town, at least in NY.

​Last year the Office of Information & Regulatory Affairs, a division of the OMB, noted that they were considering making a recommendation to the SEC that the Commission adopt rules that would address “lack of transparency, conflicts of interest, and certain other matters involving private fund advisers.”  The SEC filed a proposed rule in March that would, under the Investment Advisers Act of 1940, require registered investment advisers to private funds to provide transparency to their investors regarding the full cost of investing in such funds and said funds performance, along with the requirement that private fund advisers obtain an annual audited financial statement for each fund it advises.
The rule specifies that all private fund advisers, including those that are not registered with the Commission, be prohibited from engaging in certain sales practices, conflicts of interest, and compensation schemes that are contrary to the public interest and the protection of investors, such as providing preferential treatment to certain investors in a private fund, unless the adviser discloses such treatment to other current and prospective investors.
The comment period ended in April and was re-opened in May for another month, with a final action date of April of this year.  It seems the collapse of FTX (defunct) has renewed interest in the potential rules, as the SEC has opened investigations into what due diligence was done by FTX investors before the collapse, and the consider increase in capital that has flowed into the VC space over the last few years, although we suspect the SCE’s real focus is to protect pension investors and less on high-net worth investors.  Industry organizations are heartily against the proposed rules, citing the Congressional standing that private funds should not be faced with “the type of granular and intrusive regulatory requirements that generally apply to retail-level investment companies”, and while VC’s generally seem to have accepted the idea of greater regulation as the industry has developed, the cost of compliance will burden VC returns a bit, and the idea of an audit will likely set a more careful and documented review of investment candidates.  That said, it would also allow public view of VC track records and expenses, which would be beneficial to the public overall and would likely lessen the potential for issues such as those that led to demise of FTX…maybe…
 

The President of El Salvador is, to say the least, a big fan of cryptocurrency, and has staked out the country as being the first to declare Bitcoin as the country’s legal currency.  As we noted last July, Naib Bukele, the country’s president, began a program of purchasing Bitcoin for the country’s treasury back in September of 2021 and to date has invested $109.058m of the country’s capital in his program.  Unfortunately the price of Bitcoin has not gone his way and the current value of the country’s Bitcoin holdings has declined by 56.7% to $47.724m, including a purchase he made last November, which, to his credit, is up 13.65%, although even with that purchase, the total portfolio is only up 1.02% from where it was last July. 
It seems that both the president and the parliament remain unfazed by the drop in the value of their Bitcoin holdings and just passed an amendment to the country’s Digital Securities Act (62 for 22 against) that will allow the country to issue $1bil in  “Volcano Bonds”, the fulfillment of the President’s plan announced last November.  The plan entails using half of the bond sale proceeds to by more Bitcoin and the rest to go toward developing the country’s geothermal power infrastructure, which would be intended for low-cost Bitcoin mining.  The development project, known as “Bitcoin City”, will be created at the base of Conchagua, a volcano near the Honduran border, that will provide geothermal power for the city’s infrastructure and crypto mining, along with being a tax haven.
 While no date has been set for the bond issuance, the parliament has set in motion the legal framework for such a financing, which will take place on Victoria, BC’s Blockstream’s (pvt) Liquid Network in the future, while most immediate would be creating and passing government securities laws and licenses to maintain some level of legal control over the process.  Rumors that verbal commitments for over half of the potential issue have not been verified, but the bonds are said to carry a 6.5% coupon and a call on 50% of the profits that the government makes on its Bitcoin investment after it recovers $500m, and while the government expects institutional investors will take most of the offering, they will set aside a portion to be sold to the general public for $100/bond.

​How can you prove you know the answer to a question without revealing the answer, or to put in into crypto terms, “How can you do a transaction that absolutely verifies you have possession of an item to the buyer, without revealing who you are?”.  Hard questions to answer as even in situations where transactions are done on the blockchain, there is a record of the buyer’s identity and the seller’s identity in the public domain.  It might be hard to reconstruct that information, but it can be done and has been done to prove the illegitimacy of fraudulent NFT or cryptocurrency transactions.  But what if you could find a way to prove you are the legitimate owner of something without reveling who you are?  Would that be a good thing, or would it lead to even more fraud?
A small start-up in South Korea, Zkrypto (pvt) seems to have found a way to solve this enigma and is currently working with the Bank of Korea (024110.KS) to run simulations to prove the practicality of their software.  The company was founded by a professor at Hanyang University and carries the university’s support, having already won the ‘Best Innovation Award’ at the upcoming 2023 CES, so it seems to have at least caught the eye of those who have the ability to evaluate such complex software.  The concept is called “Zero knowledge Proof”, and has already been incorporated into the company’s product known as ‘Azeroth’, a digital asset trading platform that can be used for cryptocurrencies and NFT assets while revealing no information about the seller, but can also supply anonymous transfer and audit information to regulatory authorities if necessary, essentially proving a transaction without revealing details about the parties involved.
Of course this immediately sounds like a way for the criminal element to hide all sorts of illegal transactions that might normally need more specific verification and proof of ownership, but before dismissing the idea, there is another application that makes far more sense, even if the crypto application is likely to get the most press.  As the generational gap across the voting public widens, there seems to be a trend toward digitizing some of the voting functions, sometimes just counting cards or tabulating verified votes, but a true electronic voting system has yet to be devised that satisfies both the anonymity of the voter and the ability to verify the same voter’s legitimacy as a single-vote caster.  With accusations of voter fraud causing such a massive rift across the US, the chances for a move to an all-electronic voting system in the near-term is quite small, but as time passes, a generation of those who consider using an electronic device to feed their dog or to show their approval (or disapproval) of someone’s latest comments on social media, that will eventually change, and the Zkrypto system seems like the first step toward that end.
The company already has a voting application called zKVoting, which the company says is the most secure electronic voting system available, as the information resides on the blockchain and can be verified by anyone, yet provides complete anonymity to the voter, while being able to verify that the vote is legitimate, with both individual votes and the full vote system data being  spread across the blockchain and therefore unable to be manipulated.  They even have a voting app that can be downloaded from Google (GOOG) Play or the Apple Store. 
Unfortunately it is almost impossible for us to verify the software itself, so we have to acquiesce to the praise given by those in the know among CES cognoscenti, but if it is even half of what is said about the software, it seems to have the potential to usher in a new level of digital transactions that could give legitimacy to a wide variety of digital functions, particularly the idea of voting without having to fill out ballots or travel to vote drop-off sites or polling places.  While its just another reason for the eventual evolutionary changes that will give subsequent generations fingers with pointed tips and an inability to walk further than the front door, it does seem like a step in the right direction toward legitimizing electronic transactions past current levels.
Ctl+Click to see company video.  It is in Korean so click the closed captions and the settings to get an English translation.
https://youtu.be/keYwJZDNYBo
 

Back in the 1950s and 1960s a theater critic named Martin Esslin came up with the term ‘The Theatre of the Absurd’ which was a moniker for plays that dealt with the philosophy of Albert Camus and how the life of human beings is a series of circumstances that put them in ‘hopeless’ situations that force them into meaningless actions.  While this sounds depressing and painful, many of the plays associated with the Theatre of the Absurd were comedies, pointing out the ‘grin and bear it’ view of the human condition.
But Esslin and ToA playwrights like Ionesco and Beckett could not have come up with a more absurdist plot like the one that played out in the High Court of Singapore this month between Janesh Rajkumar and “Chefpierre”, a person of unknown name or location.  The lawsuit defines NFTs as ‘property’ under Singapore law, which justified the court’s recent injunction against the sale of a piece of NFT art, part of the collection known as “Bored Ape Yacht Club” that are well-known collector’s items in the NFT space.  Prices for some of the ~10,000 cartoon monkeys in the collection have reached ~$150,000, with investors such as Justin Bieber, Madonna, Mark Cuban, and Shaquille O’Neal creating an unusually robust market for the drawings, each of which are promoted as being ‘the only one of its kind in existence’.  The item that is the basis for the lawsuit (Figure 3) is said to have the following ‘special’ characteristics:

• A “jovial mouth” – A trait only 3% of the items in the collection can claim
• “Red Fur” – A trait which only 5% of the items in the collection had.
• A “beanie hat” – A trait which only 6% of the items in the collection sported.
• “Bored Eyes” – a trait which only 17% of the collection could claim.
• A “Purple Background” – which only 13% of the items had.

…and (our favorite)…

• It was a “virgin ape”, which in the court document was defined as not having been “fed with any mutant serum”, which, if fed, would have created a mutated version of the original ape, according to the claimant’s affidavit.

But wait, there’s more…

The claimant acquired the NFT on August 6, 2021 on the OpenSea (pvt) platform for 15.99 ETH, which we calculate was $46,226.13 (based on closing price) from ‘victorjia_eth”.  The claimant used the purchased NFT as collateral for loans to buy other NFTs, being careful to use only highly ranked lenders on the NFTfi (pvt) system, a platform designed to match NFT users with cryptocurrency lenders.  Janesh was careful to specify that the NFT would be held in an NFTfi escrow account until the debt was repaid and that if the repayment was not made on time, he would inform the lender and reasonable extensions could be given, also adding that at no time would the lender utilize the ‘foreclosure’ option on the NFT without first granting the claimant reasonable opportunities to make full repayment and retrieve the NFT from escrow.
As Janesh had used the same criteria for other loans using the NFT above, all of which were paid back in time, he thought there would be no problem when he asked a new lender (chiefpierre.eth) to make a loan for 45 ETH ($153,828.45) on January 6, 2022 for 90 days at 33% interest/yr.  The lender agreed to the terms, including the non-foreclosure option and on March 18, 2022 the lender agreed to another loan for ~$150,000 for 30 days at 45% interest.  When the claimant informed the lender on April 17 that he would need a short extension to pay back the March loan, the lender agreed and reassured him that the NFT would be returned to him once the loan was paid in full.  A few days later, when the claimant informed the lender that he had contacted another entity who would grant him a loan to pay back “chefpierre.eth”, the chief decided to offer a refinance roll-up that would provide fresh funds to Janesh and deduct the outstanding loan.
That said, as one might guess, “chiefpierre.eth” changed his mind and informed Janesh that he must pay the loan back in full by April 22 or he would exercise the foreclosure option on NFTfi,  Janesh was caught without ample time to find alternative financing, and the chief exercised the foreclosure option and moved the NFT from escrow into his account.  While Janesh was ‘devastated’ he assumed that the lender would return the NFT when full payment was made and made a partial payment, but the chief no longer would discuss the matter, returned the partial payment and stopped the platform from accepting any other payments.  Subsequently the NFT was listed for sale on Opensea and had a number of offers from potential buyers pushing the claimant to file a suit, including an injunction against the sale of the NFT.
The court agreed to the fact that the claimant was a Singapore citizen and effected the purchase in Singapore, giving it dominion over the suit, which was extremely important as if the court did not agree that it had jurisdiction, there was no other court that could rule, given that the NFT itself is held in the Ethereum blockchain, a network of computers across the world.  But there was also the fact that the defendant’s (chiefpierre.eth) actual name and location were unknown.  The ruling cited a precedent that stated that the defendant was not required to be specifically named, allowing the proceedings to continue, and also agreed that there was a ‘serious matter to be tried’, a requirement for the injunction. That said, the question remained as to whether the NFT itself was able to ‘give rise to proprietary rights’ as the NFT is really just information which would have questionable rights, but the court saw the NFT as ‘data encoded in a certain manner and securely stored on a blockchain ledger’, and ruled that the NFT did carry the right to be considered property and not just data.
The absurdity comes from a number of points here, the first of which is why some folks consider 10,000 cartoons of apes valuable, but we know the obvious answer is that they consider it valuable only because someone else says so, and there is the possibility that said ‘other’ person might be willing to buy it.  Flashing the names of celebrities in front of people who are unable to control their emotions is certainly a way for some to make money collecting fees and interest, but we have to fall back on the old adage that ‘beauty is in the eye of the beholder’, so if someone finds cartoons of apes beautiful or in some way valuable, it’s their money and they should not be limited in what they want to do with it, no more than the purchase of a Rolls Boat Tail should be limited. 
However, when it comes to defining property under the law the answers about whether a string of numbers that is spread across the globe is property is going to take years to define, and while we commend the Singapore courts for its efforts to define said NFT, we know only one group that is guaranteed to make money on NFTs and that is lawyers who we expect will be arguing for or against whatever NFT questions hit the courts all over the world.  Will there be a unified answer that will stand the test of time?  We doubt it, so for now it all seems like we remain a member of the cast of the Theatre of the Absurd, searching for meaning in the incomprehensible universe of NFTs and cryptocurrencies.

​If you don’t know what Web 3.0 is, you should not feel left out, as the term has a variety of meanings, depending on who you ask, although the basic premise is a system based on blockchain, a decentralized form of data storage that breaks data into ‘blocks’ containing a ‘header’ that identifies the block, the data itself, and a number of ‘identifiers’ that includes descriptive information about the parameters of the block, including some that are used to validate the block before it is processed and others that describe the data.  The blocks, when verified, are added sequentially to the blockchain network, with the links to the previous block creating a chain that cannot be broken, which, in theory, makes the data (transactions, etc.) unalterable. 
After a block is validated it is added to the network, which means every computer on the network has a record of the block and the particular characteristics of the data, whether it is a transaction or or other data.  Only certain nodes do the actual pre-add validation process, but the key to blockchain is the data is ‘copied’ (not actually copied but ‘known to’ all of the computers on the blockchain network, which means if someone tries to change a block on a particular computer, other computers will recognize that the ‘identifiers’ (hash) has changed, as the link to all subsequent blocks will change and the blocks will fail the ‘challenges’ (basically a check to see if the hash is correct) and the data will be ‘unconfirmed’. 
Depending on the network, the number of confirmations needed varies, but without the required number of confirmations the data is not valid, so the more confirmations blocks have the more ‘secure’ the data is considered.  Given the complexity of the algorithms[1] used to confirm a block, confirmation time can vary and this is where ‘miners’ come in.  As transactions are uploaded to the network they enter a ‘pool’ before they are added to the blockchain.  Miners can select these unprocessed transactions, on which they run the complex validation algorithms to confirm the transaction blocks at which point they are added to the blockchain.  Since the mining process is expensive in that it requires high-speed processing which consumes considerable power, each transaction in the pool carries a transaction fee determined by the originator of the transaction.  Miners will take those transactions with the highest fees from the pool first, which means that those transactions that offer lower fees to miners will take longer to get added to the blockchain.
In Bitcoin, mining a block takes about 10 minutes (equal to one ‘confirmation’) so it can take considerable time for those transactions that want more security than the typical three confirmations needed for bitcoin transactions.  In order to speed up the process other networks like Ethereum use a system called POS (Proof of Stake) as opposed to the POW (Proof of Work) system described above, which is a simpler system that allocates block publishing through a lottery using the amount of each ‘stakers’ (equivalent of ‘miner’) holdings across the network.  The POS system reduces the hardware and energy requirements needed to publish blocks to the blockchain network, although it is said to give large stakers more control over the network as the more funds a staker has on the network, the more chance they will be picked to post the next block.
So what does this have to do with our fondness for data?  Web 3.0’s decentralized approach to the internet, as opposed to Web 1.0 (static content) and Web 2.0 (user-generated content), Web 3.0 gives the promise of increased transparency and the security that transparency should provide, and consequently move power away from some of the companies that exert significant control over the internet (Facebook (FB), Amazon (AMZN), etc.).  Of course, this is still up for debate, and our suspicious/cynical nature leaves no doubt that such an idealistic goal will find was in which to be corrupted by ‘other’ power/money hungry companies/institutions as Web 3.0 develops, but in the interim, there seem to be plenty of investors willing to pump billions into private companies that they believe will be the ones that will benefit from Web 3.0.
VCs pumped ~$4.3b and $4.9 into Web 3.0 companies in 2019 and 2020, but really caught the bug in 2021, where that spending increased by 571.5% y/y to almost $33b, and while 2022 has seen a considerable slowdown in VC funding activity, based on the spending in the 1st half of this year and the seasonality of 1H/2H Web 3.0 VC investments, one might assume that  the 2022 estimate derived from 1H VC spend for Web 3.0 this year, would only decline by ~3.1% to $31.78b, as shown in Figure 1.  That said, the detail shown in Figure 2 gives a different outlook on VC Web 3.0 spending for the year given that 3Q spending fell by 89.1% q/q/ and 89.9% y/y to $0.72b, and while we would hesitate to make a stab at a realistic 4Q estimate given the almost inconceivable volatility this year, we would guess that given the current macro environment, it would lead to a lower 2022 spend than the statistical estimate in Figure 1 shows.
Perhaps funding to VCs with a penchant for Web 3.0 investments has slowed and private valuations are reflecting a bit of the lower valuations the market is placing on public companies, however investor optimism on a long-term basis, despite the weak 3Q, seems to have remained high, so as long as VCs are able to exit investments profitably over the remaining few months of this year and the 1st half of next, we expect funding will improve a bit from 3Q’s $0.72b, but while crypto companies are still a relatively small part of overall VC Web 3.0 investments, the rather poor performance of crypto this year casts a negative light on the space to some degree.  Blockchain is certainly a valid data storage and valid technology, especially for financial transactions but the massive spike in early stage investments seen last year and earlier this year might moderate a bit as VCs become a bit more selective toward potential investments.


[1] SHA-256 – A cryptographic function that always produces the same output (hash) for a given input.  There is no known way to figure out what the input should be to get a specific output, so miners must try millions of input combinations before they can match a block’s hash identifier which is 256 bits.

​Back in 2014 Mt. Gox (defunct) was a big deal, accounting for ~70% of bitcoin trading traffic, but the company was hacked and the company lost 850,00 bitcoin, which at the time was worth ~$570/BTC for a total loss of $484.5m in 2014 dollars.  The company declared bankruptcy after the incident, with the loss corresponding to ~7% of all the bitcoin in circulation at the time.  Last year the Tokyo District Court finalized a measure that would return the portion of the lost bitcoin that was able to be recovered to creditors, which is said to be 137,890 BTC, ~16.2% of what was stolen, but at the current price of bitcoin ($23535), the value of the recovered bitcoin is now $3.245b or 6.7x the original lost value.
So those who lost in the hack will recover what they lost and make a 570% profit, albeit having to wait 8 years to receive it, but the celebration is not felt in all quarters as the bitcoin market is concerned that the recipients of the recovered bitcoin will quickly take profits, with that volume (all) representing ~8% of the bitcoin daily volume, which would certainly have a deleterious effect on the market, even if it was for a short time.  The question of how creditors will respond to the ‘windfall’ is open to speculation, although the current thinking is mixed, albeit extremely source biased, with those in the industry thinking that creditors, having taken the hit years ago would be open to speculating further by not selling, while those outside of the industry seem to be leaning more toward the side of selling after having to wait 8 years and undergoing the pain and suffering the hack likely caused.  Either way t is an unusual ending to a bankruptcy and one rarely seen…

El Salvador is unusual in that it was the first and only one of two countries where Bitcoin has been adopted as legal currency. The country’s President, Nayib Bukele, was the driving force behind the bitcoin adoption, which came into effect on 9/7/21 and the country began purchasing bitcoin immediately and soon released plans to build a ‘bitcoin city’ at the base of the Conchagua Volcano, in order to use the local geothermal energy to power bitcoin mining.  President Bukele indicated today that the country had just bought 80 bitcoin @ $19,000 each (~$1.52m US) and thanked the world for selling it at a low price.  While this might sound like a shrewd purchase, taking advantage of the large decline in bitcoin price, it was one of a number of bitcoin transactions that El Salvador has made, leading to some substantial losses.
As the price of bitcoin fell last month, President Bukele stated that “There are people who are concerned about the price of Bitcoin.  Bitcoin investments are safe. As soon as the bear market ends, the value will increase. Perseverance is the key,” and El Salvador’s finance minister added “…there was no loss because we did not sell any bitcoin,” likely not the most reassuring statement coming from the person who is in charge of the country’s treasury.  While he also noted that Bitcoin accounts for only 0.5% of the country’s assets, that is likely of little consequence to a typical wage earner in El Salvador, who makes $384/week, or even the average worker, who makes $830/week.  So far the Bitcoin currency game has not been a profitable one for the people of El Salvador.

​negative connotations, but when applied to what are already highly speculative assets, the results can be both spectacular and disastrous, as the founding partners of Three Arrow Capital (pvt) discovered when they found themselves unable to meet margin calls last week, due to the rapidly falling values associated with the funds cryptocurrency investments, while Crypto lending firm Celsius (pvt) is asking customers to give it more time to stabilize liquidity, after halting withdrawals last week.  Taking the opposite tact, the President of El Salvador a country that adopted bitcoin as legal tender last year, despite a warning from the IMF, told investors to ‘stop looking at the graph and enjoy life”, although not mentioning how they were to do so given the rapid decline in the value of their crypto-assets.
There is little to say about the speculative aspects of cryptocurrency other than it was and remains a classic example of the greater fool theory, but we wonder where the next shoe will drop.  Actually we don’t wonder about that, as we believe the NFT market will eventually find itself wondering what is the real value of digital real estate?   Is it $1t as an 11/2021 study indicated, or is it a ‘collective obsession’ that plays out relatively quickly as its financial underpinnings face an undetermined future?  We would be careful chasing pictures of grinning monkeys or smiling stick figures because they are smiling as their authors quickly convert your crypto into cold hard cash and head for an extended vacation in Ibiza.  P.T Barnum said it well in “There’s a sucker born every minute”, although it’s been said many times before and since in other words.

NFTs are an enigma to most everyday folks and even in the most elite technology circles definition vary considerably and we will not attempt to add our voice to such definitions, but we can at least give investors a bit of understanding as to what the NFT world looks like and potentially what purpose it serves, although the latter is the more difficult question to answer.  Non-Fungible Tokens are a big business, and the platforms on which they are bought and sold have hundreds of thousands of registered and active participants, but it is difficult to gain insight into who these customers are and their motivation for involving themselves in this somewhat arcane world.

While one might assume that NFT traders are a sophisticated and erudite lot, living in full-floor penthouses high above major cities or sitting on the veranda of a beachside mansion in Bermuda, but that is not always the case.  In fact the country that has the largest number of NFT users has a GNI/capita of only $7,040 but an NFT user penetration rate of 8.08%, far above the US penetration rate of 1.14%.  That country is Thailand, where NFT virtual land sales can give Thailanders a chance to become owners of a piece of ‘virtual Bangkok’ (40m x 40m) for a mere $3 or where you can buy collectible cards from the Miss Universe Thailand pageant, the winner of which was given prizes in both cryptocurrencies and NFTs, all of this despite the Thai government’s ban on NFT trading.
Much of the interest in NFTs in Southeast Asia has come from Axie Infinity, a game developed in Vietnam that allows players to earn Smooth Love Potions (SLPs) the more they play the game, which can be converted into Etherium and sold, which became a way for serious gamers to put food on the table during COVID lockdowns, and the concept of digital tokens appreciating in value was a quick step toward NFTs, particularly when the value of early art-based NFTs soared, with collectibles and art generating almost 80% of NFT market value at the end of last year.  We are not saying NFTs look like a get-rich-quick proposition to those in less wealthy countries as the inclusion of the US, Canada, and Germany in the top 10 debunks that concept, but one wonders why some would be willing to risk government wrath and potential financial loss unless there was the promise of a pot of gold at the end of the rainbow, although when you look at Figure 3, which shows the average ‘gas’ price (the fee paid to the platform for any transaction) on Ethereum, there are those who profit with relatively little risk in the NFT/crypto space..