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📣 Bridging protocols express 'concern' over LayerZero's wstETH token integration
Interoperability protocol LayerZero is facing a backlash for the way it portrayed the integration of wstETH on its omnichain fungible token (OFT) standard, a technology that's designed to move the token across three new blockchains. Interoperability projects including Connext Network, ChainSafe and Sygma announced a unified call for open bridge standards in a Friday statement, claiming that OFTs endorse vendor lock-ins and that "token-issuing DAOs should be the ultimate arbiters of what version of their asset is canonical on a given chain.”
LayerZero, their deployment of a proprietary representation of wstETH to Avalanche, BNB Chain and Scroll without support from the Lido DAO," the interoperability protocols wrote. "We believe this action is the direct consequence of a broken system of incentives around interoperability that can only be fixed through standardization and healthy competition at every layer of the bridge stack.”. "By unilaterally deploying a bridge and marketing it in an official-seeming way, it feels like you are trying to pressure the DAO into accepting your proposal to avoid liquidity fragmentation and bad UX for users," Hasu added. "Driving users to it through marketing makes accepting an alternate bridge proposal more painful. These actions put the DAO, Lido stakers, and participating chains in a difficult position."
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🟠 Binance Technical Issue Is Now Fixed, All Crypto Withdrawals Are Back
Binance, the world’s leading cryptocurrency exchange, faced a temporary suspension of cryptocurrency withdrawals due to a technical issue. A Binance technical issue, related to a middleware service, momentarily disrupted the withdrawal process. Binance swiftly responded, assuring users that their funds were secure and the problem was being addressed. The CEO of Binance, Changpeng Zhao, reassured users about the safety of their funds during the outage. In an official statement on their social media platform X, Binance acknowledged the problem.
Within an hour, Binance announced the successful resolution of the issue, confirming that cryptocurrency withdrawals were back online and operating normally. The exchange expressed gratitude for users’ patience and apologized for any inconvenience caused. The Binance technical issue briefly reignited concerns reminiscent of the FTX exchange collapse in November 2021. Despite these worries, Bitcoin (BTC) remained relatively stable, trading at $34,413 amidst the temporary disruption. Binance users can now resume their cryptocurrency withdrawals without any further interruptions, as the platform has returned to its regular operational status.
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🪙 VanEck Ethereum Strategy ETF Now Launched To Expand Investment Possibilities
In a recent announcement, asset management company VanEck unveiled that their VanEck Ethereum Strategy ETF (EFUT) is now open for trading. EFUT distinguishes itself by actively seeking capital appreciation via these futures contracts without directly investing in Ethereum or other digital assets. Instead, the fund will invest in standardized, cash-settled ETH futures contracts that are traded on commodity exchanges registered with the U.S. Commodity Futures Trading Commission (CFTC).
EFUT plans to focus its investments on ETH futures traded on the Chicago Mercantile Exchange. This new offering is listed on the CBOE and will be overseen by Greg Krenzer, VanEck’s Head of Active Trading. What sets VanEck apart is its commitment to the Ethereum community. The company has pledged to contribute 10% of all profits generated by their forthcoming Ether Futures ETF to Ethereum core developers over the course of the next decade. Investors now have the opportunity to access Ethereum-linked investments through an exchange-traded vehicle in the form of the VanEck Ethereum Strategy ETF. It’s a unique approach in the world of asset management, promising both returns for investors and support for Ethereum’s development.
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🥇 Drivechains in Bitcoin could be a 'game-changer,' but there's a catch, Bitfinex CTO says
Bitfinex CTO Paolo Ardoino told The Block in a recent interview that drivechains in Bitcoin could be a "game-changer" amid the recently reignited debate surrounding the BIP-300 proposal, originally authored by Layer 2 Labs CEO Paul Sztorc in 2017. "Drivechains in Bitcoin could be a game-changer, since they aspire to faster block times, improved privacy and more complex smart contracts," Ardoino said. "However, they require a change to Bitcoin which could threaten the stability of the mainnet."
Drivechains are native, merge-mined sidechain mechanisms for Bitcoin that require a contentious fork. They could enable users to securely lock their bitcoin using a decentralized two-way peg and mint coins with attributes similar to various altcoins. Drivechains could also offer miners extra fees, boosting Bitcoin's hashrate and security while introducing features such as DeFi, NFTs, security tokens and stablecoins anchored by Bitcoin. Ardoino said he saw how drivechains strived for an optimal balance between harnessing the security of Bitcoin and exploring novel new features. But, as with other sidechain solutions, the safety of the asset when transferring to the sidechain was the main concern.
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💰 'Manchild' SBF's defense is struggling in fast-moving trial, says former Assistant US Attorney
So far a no-nonsense judge and a rapid-paced trial has provided few openings for Sam Bankman-Fried's defense attorneys. Instead, throughout the trial's second week, the prosecutors appear to have had a lot of success casting the former "manchild" billionaire as the ringleader responsible for the disastrous collapse of FTX, according to former Assistant U.S. Attorney Kevin J. O'Brien, who's now a specialist in white-collar criminal defense.
"Every defense lawyer looks for a toehold in reasonable doubt, just something they can argue to the jury, and it's very hard to see how that's going to materialize here," said the lawyer who is now a partner at Ford O'Brien Landy LLP. "It seems to me this is a very difficult chore for the defense." The trial is expected to last around six weeks, so there's still a lot more to come — including the defense's opportunity to take charge and present its version of events. "That's a very hard witness to cross examine. Someone who admits their guilt and takes a counter to felony indictment and awaits sentencing and gets up and testifies 'Mr. Bankman-Fried did the following but I was in on it too and accepting my own guilt,'" said O'Brien.
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🪙 Chainlink’s LINK Is ‘Safest Bet’ to Profit From RWA Tokenization Trend: K33 Research
The tokenization of real-world assets (RWA) narrative is gaining steam in crypto, and Chainlink’s native token (LINK) might be the “safest bet” for investors who seek to profit from the hype, research firm K33 Research said in a Wednesday report. Tokenization is the term for placing traditional financial assets such as private equity, credit and bonds – often referred to as RWAs – on blockchains. The process is touted as a way to reduce cost and operational friction and improve accessibility and transparency.
Global banks as well as crypto platforms are already taking steps to harness tokenization. JPMorgan earlier today, for example, said it carried out its first live blockchain-based collateral settlement transaction involving BlackRock and Barclays. There are still many hurdles before RWA’s can reach their full potential, said Zimmerman in his report. Still, the “narrative will be compelling” enough to potentially kickstart “an isolated RWA crypto bubble before there is widespread substantial impact from RWA on the real world.” Zimmerman explained that Chainlink positioned itself as a key piece of infrastructure to connect blockchains with the outside world via its system of oracles and wide range of partnerships. “It will certainly not be the biggest gainer, but few projects are better positioned to benefit from the narrative,” he added.
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📣 Pfizer-backed DAO launches community-funded biotech firm
VitaDAO, a decentralized autonomous organization dedicated to funding and advancing early-stage longevity research, has launched its first biotech firm Matrix Biosciences. The launch follows a near-unanimous community vote earlier this year approving a collaboration with the University of Rochester’s Aging Research Center co-chair Dr. Vera Gorbunova. An initial tranche of $300,000 from VitaDAO will be made available to Matrix Bio, followed by additional funding through IP-NFT fractionalization in early 2024.
IP-NFT fractionalization relies on technology from the VitaDAO-associated platform Molecule, allowing researchers to list NFT projects on its marketplace. The additional funding target from IP-NFTs will be determined based on Matrix Bio's needs, VitaDAO told The Block via email. VitaDAO's last fractionalization project was 1,700% oversubscribed, it said. VitaDAO is part of a nascent movement known as decentralized science or DeSci. In contrast to the current system, which relies on centralized bodies for research and funding, DeSci aims to source research investment through crowdfunding initiatives and decentralized ownership. The funds will be used for preclinical studies testing novel hyaluronic acid-based compounds found in long-living cancer-resistant naked mole rats.
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📣 Yuga Labs Lays Off Staff And Focus On “Otherside” Strategy In 2024
Yuga Labs lays off employees and restructures to focus on web3 platform and Otherside strategy. The company is now fully embracing its “Otherside” strategy. A recent email from CEO Daniel Alegre revealed that the leadership team gathered in New York to redefine Yuga Labs’ core competencies. These core focuses include their unwavering commitment to their communities, strengthening the Otherside strategy, and fostering long-term partnerships. The company will actively support the expansion of “Made by Apes” and similar projects, as well as launch exciting gaming experiences planned for 2024 and beyond.
The Otherside team is gearing up to unveil thrilling gaming experiences in 2024 with third parties. Yuga Labs also emphasized its ongoing commitment to partnerships, including successful collaborations with renowned brands such as Gucci and A Bathing Ape. Amidst these changes, the company remains dedicated to supporting employees affected by the restructuring. The affected employees will receive generous severance packages and assistance in finding new job opportunities. Resources will be dedicated to preserving the crypto art legacy, enhancing the Punks app, and creating captivating experiences. Both teams will join forces with Otherside to explore new opportunities within the metaverse.
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🔵 Circle CCTP Is Now Live On Layer 2 Base Testnet
Circle’s Cross-Chain Transfer Protocol (CCTP) has been successfully deployed on the Base testnet, marking a crucial milestone in the project’s development. Circle CCTP introduces a groundbreaking method for securely transferring USDC between different blockchain networks through a native destruction and minting process. While the protocol is currently in its testing phase, it holds immense promise for the crypto community. In the coming weeks, the network will expand to include Base and Noble, increasing the available routes to a total of 30.
Once Circle CCTP goes live on the Base mainnet, it will allow developers and users to transfer USDC from Ethereum to various supported blockchains without requiring permission. As of now, Circle CCTP supports secure USDC transfers through 12 distinct routes, including Ethereum, Avalanche, Arbitrum, and Optimism. This innovative protocol serves as a permissionless on-chain utility that burns native USDC tokens on the source chain and mints an equivalent amount on the destination chain. Developers can integrate CCTP into their applications, offering users a highly secure and capital-efficient means of transferring USDC across different blockchain ecosystems. This development is a significant step towards a unified and mainstream Web3.
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📣 Ethereum Layer 2 StarkWare delays first token unlocks to April 2024
Ethereum Layer 2 developer StarkWare has delayed the first unlocks of its native StarkNet (STRK) token by over five months. The new unlock date has been pushed to Apr. 15, 2024, from the previously scheduled date of Nov. 29, 2023, according to a transaction in one of the StarkWare token locking mechanism contracts carried out on Sunday, Etherscan shows. Commenting on the delay, a StarkWare spokesperson told The Block: "We are focussing on building the technology.
Starkware deployed the STRK token on Ethereum in November 2022 after confirming in July 2022 that it would release its own token. At the time, the project said the STRK tokens allocated to shareholders, employees, and independent software developers are locked for four years, with a gradual release schedule starting after one year, meaning November 2023. Last November, the Starknet Foundation also launched, with 50.1% of the total STRK token supply in order to fulfil the vision of StarkNet’s decentralization proposal. The STRK token will be used for paying transaction fees, governance, and staking on the StarkNet network.
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🇺🇸 DOJ's Proposed Jury Questions 'Risks Tainting' Bankman-Fried's Panel, Defense Says
Some of the U.S. Department of Justice's proposed juror questions could bias either miss juror biases or prejudice potential jurors into thinking Sam Bankman-Fried was guilty before the trial begins, the FTX founder's defense team charged in a late Friday filing. "As a general matter, the Government’s proposed voir dire discourages full disclosure from potential jurors, fails to elicit sufficient information to allow the defense to ascertain potential juror bias, and risks tainting the jury by presenting the allegations in a prejudicial manner," attorney Mark Cohen wrote.
Specifically, the defense team believes that omitting the word "allegedly" when describing the crimes Bankman-Fried is accused of "improperly suggests that fraud by Mr. Bankman-Fried is an established fact," Cohen wrote. Other questions are too limited and may not reveal if the potential jurors might be predisposed to agreeing with prosecutors just because they're part of the federal government or if they lost money in crypto "that they believe was the result of wrongdoing.". This question appears designed to elicit information concerning potential jurors’ encounters with law enforcement and law enforcement practices that disproportionately affect people of color. Neither race nor police misconduct are relevant to the instant case, and this question risks improperly excluding potential jurors on the basis of race."
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🇺🇸 SEC Chair Gary Gensler Is Firm With His Stance On The Crypto Industry Is A Scam
In preparation for his appearance before the U.S. House of Representatives Committee on Financial Services on September 27, 2023, Gary Gensler, the Chair of the U.S. Securities and Exchange Commission (SEC), is poised to uphold the same stance he recently presented to the Senate Committee on Banking, Housing, and Urban Affairs. The forthcoming hearing, titled ‘Oversight of the Securities and Exchange Commission,’ will be live-streamed on September 27, 2023, at 10 AM Eastern Standard Time.
SEC Chair Gary Gensler has been vocal about the prevalence of fraud, abuse, and misconduct within the crypto industry, and he continues to stress this point in his latest testimony submitted to the House Committee on Financial Services. He also referenced the SEC’s rulemaking efforts in his testimony, specifically highlighting a release from April that classified crypto platforms, including DeFi platforms, as part of the exchange definition. The Chair of the House Financial Services Committee, Patrick McHenry, is expected to scrutinize SEC Chair Gary Gensler’s approach to crypto regulation during the hearing. McHenry previously accused Gensler of failing to provide clear guidelines on how firms can adhere to federal securities laws.
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📣 Cream Finance Soars Over 80% Amidst Release of 3-Year Staking Contract
Cream Finance, a decentralized lending protocol, has witnessed remarkable growth today, with its token, CREAM, surging by an impressive 82%. This surge coincides with the release of Cream Finance’s 3-Year Staking contract, which has sent shockwaves through the crypto community. Notably, prominent figure Huang Licheng (known as Machi Big Brother) received the lion’s share, obtaining 215,236 CREAM tokens worth $3.8 million, and subsequently staked them.
Apart from Huang’s involvement, 13 other addresses have sold 5,409 CREAM tokens, valued at $99,200, through various platforms such as Binance, Gate, or decentralized exchanges (DEX). However, caution is advised, as short-term price fluctuations may not signify sustainable growth. Additionally, Huang Licheng recently withdrew from a lawsuit involving on-chain detective ZachXBT, which brought to light allegations of embezzlement related to Huang’s previous involvement in crypto projects. Huang has vehemently denied these accusations. As Cream Finance continues to make waves in the crypto space, investors are advised to exercise prudence in response to volatile price movements and ongoing controversies surrounding key figures like Huang Licheng.
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🇭🇰 Hong Kong’s JPEX Sees Significant Increase In Victims In HK$1.37 Billion Fraud
The cryptocurrency trading platform Hong Kong’s JPEX is under increasing scrutiny as reports suggest a rising number of victims falling prey to suspected fraud cases, according to reports from aastocks and other media. Amidst the controversy, Lin Zuo, released on bail earlier, announced an upcoming emergency press conference to address the latest developments. Meanwhile, Hong Kong artist Zhuang Simin, previously suspected of fleeing to Singapore, returned to Hong Kong for questioning by the Commercial Crimes Bureau.
JPEX had canceled the registration of its subsidiary, “JP-EX CRYPTO ASSET PLATFORM UAB,” in Lithuania on July 14 of this year. Last year, JPEX publicly announced its acquisition of Lithuanian cryptocurrency exchanges and wallet operations. The removal of the “Professor Registration Permit” notice from the website has raised further questions about the platform’s operations. Expressing grave concern, Chief Executive Mr. Lee Ka-chiu reiterated the importance of investing in licensed and regulated virtual asset platforms during a recent speech. He emphasized the urgent need for an effective regulatory framework and transparent information dissemination. Investor education, he stressed, should also take priority.
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🏦 Coinbase takes precautions as mining pool captures half of Zcash hash rate
Crypto exchange Coinbase has implemented precautionary measures in response to a single mining pool taking control of 53.8% of the hash rate on the proof-of-work blockchain powering the privacy coin Zcash. From now on, the exchange will require 110 block confirmations before it confirms a deposit of ZEC, according to a blog post. This increases the deposit time from roughly 40 minutes to around 2.5 hours. The goal is to reduce the risk of double spending that emerges when a single entity controls at least 51% of the hash rate on a proof-of-work blockchain.
It has also moved its Zcash trading pairs into “limit only” mode, meaning traders can’t place market bids. The exchange stated this would minimize the impact of any volatility — likely in the event of large sales made as part of a double-spend attack. Coinbase further reached out to Electric Coin Company, the creator of Zcash, and the relevant mining pool, ViaBTC, with its concerns. "We shared our concerns around the risks of mining centralization and provided recommendations for various options that either party could implement to reduce the risk of a 51% attack," the exchange said. adding that its proposal to introduce a step named the “Trailing Finality Layer,” could address the issue.
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🟠 Binance CEO Wealth Dips Amidst Regulatory Challenges
The Bloomberg Billionaires Index has made a significant adjustment, reducing its revenue estimate for cryptocurrency exchange Binance by 38% due to a noticeable decline in the firm’s trading volumes this year. This year, Changpeng Zhao, commonly known as CZ, played a part in events that led to Sam Bankman-Fried’s legal troubles. In November, CZ announced the liquidation of a token connected to FTX, following a report that revealed Bankman-Fried’s hedge fund, Alameda Research, held a significant position in it.
The announcement prompted a rush by some FTX customers to withdraw their funds, overwhelming the exchange, which subsequently declared bankruptcy, wiping out Bankman-Fried’s fortune that had peaked at $26 billion in March last year. Binance had a substantial market share earlier this year, reaching 62% of total on-exchange crypto trades in the first quarter, partly due to a zero-fee promotion for popular trading pairs. However, this share dropped to 51% by the end of the third quarter, according to research firm CCData, as the promotional offer concluded. In recent months, Binance has faced increasing isolation from the traditional financial system, with regulatory challenges looming large. The Securities and Exchange Commission and the Commodity Futures Trading Commission have both taken legal action against the exchange.
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🪙 Tether Aims to Publish Reserve Data in Real-Time in Coming Years: Report
Stablecoin issuer Tether is working towards publishing real-time data on the reserves backing USDT in coming years, the industry's largest dollar-pegged stablecoin, according to a Bloomberg report. The firm told Bloomberg that it doesn't have any hard-and-fast deadline to achieve its real-time data reporting goal. In its latest quarterly attestation, Tether had $3.3 billion in excess reserves as it converted its pile of controversial commercial paper for U.S. Treasuries, of which it held $72.5 billion worth.
The firm received a $42.5 million fine from The Commodity Futures Trading Commission (CFTC) in 2021 on allegations that USDT was not fully backed for the majority of a 26-month period between 2016 and 2018. Tether has since ballooned in size, commanding a market capitalization of $83.9 billion that regularly surpasses $30 billion in daily trade volume, according to CoinMarketCap. The company promoted Paolo Ardoino, previously CTO, to CEO last week with previous executive Jean-Louis van der Velde transitioning into and advisory role. Ardoino said that he views Tether as a "tech powerhouse" that will "reshape the future of finance."
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🔵 Circle launches gas abstraction and smart contract beta tools amid push into web3 services
Circle has launched two new beta tools for developers: Gas Station and Smart Contract Platform. Gas Station removes transaction "gas" fees when integrated with Circle's programmable wallets. Smart Contract Platform simplifies smart contract importing, deployment and management and supports Ethereum, Polygon and Avalanche via APIs. Both products aim to streamline development for web3 services.
"We are actively exploring the expansion of Smart Contract Platform support across a number of additional blockchains," Gagan Mac, Head of Product for Web3 Services at Circle, told The Block. "We plan to add support for more blockchains starting early next year." The move follows Circle's attempt to take blockchain-based technology mainstream through deployment of web3 services. Circle launched a programmable wallet, which gave developers a user-friendly system to embed web3 wallets into their apps, in July, The Block previously reported. "Gas Station and Smart Contract Platform have been tailor-made to tackle the key challenges faced by businesses and app developers seeking to integrate blockchain-enabled experiences.
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📊 Social finance apps Tomo and New Bitcoin City break above $1 million in TVL
Social finance protocols Tomo and New Bitcoin City now have more than $1 million locked in each of their smart contracts, a figure known as total value locked, per DefiLlama. Both protocols are similar projects to Base-based FriendTech, the first mover in an emerging space that's leveraging a specific blend of social media with a financial twist. FriendTech popularized the idea of having gated communities where users need to pay for so-called keys to access group chats, with the price of the keys getting more expensive each time one is bought.
Running on the Linea platform, Tomo offers a few different things compared to FriendTech, such as the ability to message someone directly. But the main aspect that makes Tomo different is that it lets users bet on the value of people's keys, if they were they to join the platform. Tesla CEO Elon Musk's keys, for instance, are currently valued at 0.478 ETH ($743), and that's the price they would start trading at if he were to join the platform. New Bitcoin City has added a few levels of customization, including the ability to set the fee that a group chat owner charges for the purchase of their keys (between 0-8%) and the number of keys needed to access their group chat. It also lets users agree to buy each other's keys for a period of 30 days, a process referred to as (3,3).
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🇨🇳 Chinese bitcoin mines in US spark national security concerns: NYT
Chinese bitcoin mines in the U.S. have sparked national security concerns, The New York Times reported, with one such operation located next to a Microsoft data center supporting the Pentagon and near an Air Force nuclear missile base in Cheyenne, Wyoming. Anonymous U.S. government officials told the NYT they had been tracking the Wyoming facility for months, adding that measures had been taken to mitigate any potential intelligence threat.
A company linked to the Cheyenne mine, Bit Origin, told the NYT it had responded to queries from the U.S. federal committee. Li Jiaming, president of the pork processor turned bitcoin miner, said the site was chosen after securing an agreement from the local utility company to provide it with power, not due to the proximity of the Microsoft data center or the missile base. Many of these mines were set up after China banned bitcoin mining in 2021. Several reportedly have ties to the Chinese Communist Party or state-owned entities concealed behind layers of shell companies, according to the NYT. The NYT identified Chinese-owned or operated bitcoin mines in at least 12 states, including Arkansas, Ohio, Oklahoma, Tennessee, Texas and Wyoming.
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⚪️ WorldCoin State Bridge Has New Update With Improved Gas Fees
WorldCoin has unveiled an update to its state bridge architecture, designed to foster seamless interoperability between various blockchains. This enhanced state bridge system boasts a modular, license-free, and gas-efficient design, offering a range of benefits to developers and teams.The updated WorldCoin state bridge now empowers developers and teams to create and manage their own state bridges without the need for licenses. This pivotal change allows them to seamlessly integrate World ID with their preferred blockchain and application, further enhancing the adaptability of this innovative platform.
Moreover, the WorldCoin state bridge update introduces a novel method for sending messages from Layer 1 (L1) to Layer 2 (L2), effectively bridging World ID to any Ethereum Virtual Machine (EVM)-compatible chain. This opens up new possibilities for applications while strengthening security against potential attacks. WorldCoin state bridge has been a key element in enabling the sharing of the current state of World ID contracts with other chains. This facilitates the utilization of proof of personhood on Layer 2 solutions, sidechains, and more. World ID, represented as a Merkle tree on the Ethereum blockchain, delivers unique identities, with the Merkle tree’s root enabling the creation and validation of Zero-Knowledge (ZK) proofs, ensuring privacy-preserving identity primitives applicable across a wide spectrum of use cases.
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🇭🇰 Hong Kong Increases Crypto Exchange Scrutiny Following JPEX Fiasco
Hong Kong’s securities regulator and police have set up a joint task force to monitor and investigate suspicious activity at cryptocurrency exchanges. The move follows the imbroglio at the JPEX crypto exchange last month, which resulted in multiple arrests and the platform shuttering services. The unlicensed exchange is alleged to have defrauded investors out of $204 million. According to the announcement, it will “enhance collaboration in monitoring and investigating illegal activities related to virtual-asset trading platforms,”
Moreover, the JPEX saga threatens to complicate Hong Kong’s push to become a regional crypto and fintech hub. Hong Kong rolled out a new regulatory framework for crypto assets earlier this year and granted the first mandatory licenses for digital asset trading platforms in August. Hong Kong officials are striving to learn more about the 2022 crypto contagion and multiple collapses of high-profile platforms. In mid-September, the SFC contacted relevant influencers, opinion leaders, and OTC outlets, requesting they stop promoting JPEX and its services. A further crackdown on influencers linked with the defunct crypto exchange followed. The firm claims the move will raise cash flow and retain investors. Users will get dividends in various forms in two years based on their stake, according to reports.
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🟠 Binance Spot Market Share Continues To Decline Seriously
According to Bloomberg, Binance, the world’s largest cryptocurrency exchange, has witnessed a persistent decline in its spot market share for the seventh consecutive month. Binance spot market share dipped to 34.3% in September, down from 38.5% the previous month and significantly lower than its 55.2% share in January, according to data from CCData. In the derivatives market, Binance also faced a decline, with its market share falling to 51.5% from 53.5% in August.
The Wall Street Journal noted that Binance seemed to automatically assume the position of the largest cryptocurrency exchange following the collapse of FTX, which saw its founder, Sam Bankman-Fried, facing legal troubles. However, less than a year later, Binance, led by CEO Changpeng Zhao, is now confronting similar crisis risks. The pressure from the ongoing US investigation into the digital currency exchange has prompted several senior directors to leave the company over the past three months. Additionally, Binance has announced the layoffs of 1,500 employees in an effort to cut costs. Its recent decision to halt a zero-fee promotion also contributed to the decline of Binance spot market share. Meanwhile, rival exchanges like OKX, Bybit, and Bitget have managed to gain market share in the derivatives sector.
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💰 Solana-based Convergence RFQ raises token round at valuation of $30 million
Convergence RFQ, a Solana-based trading platform under development, has raised $2.5 million in a pre-seed funding round. The round was led by C² Ventures, with participation from Big Brain Holdings, Israel Blockchain Association, Auros Global and others, Convergence RFQ said Wednesday. The startup started raising for the pre-seed round mid-last year and closed it in June this year, co-founder Uwe Cerron told The Block. It was a simple agreement for future token round at a fully diluted valuation of $30 million, Cerron said.
RFQ, short for request for quote, is a method where buyers request price quotes from sellers. This method differs from the central limit order book approach used by centralized exchanges and the automated market maker method used by decentralized exchanges. In CLOB, buyers and sellers place orders at specific prices, and trades are executed when matching orders meet. AMM, on the other hand, is an algorithmic system that facilitates peer-to-peer trading by automatically adjusting asset prices in response to fluctuations in supply and demand. RFQ "can provide a much more robust crossover between centralized exchange liquidity and decentralized pricing mechanisms to create a hybrid model that gets best execution for traders, via API," Deribit wrote in an article last year. "Simply put, RFQs are really freaking quality."
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🇭🇰 Latest JPEX Arrestee Found with Shredded and Bleached Documents in Hong Kong Flat: Report
There appears to be no end to the JPEX saga. In the latest development, Hong Kong and Macau authorities have made fresh arrests of 18 suspects in the JPEX crypto exchange case. A total of $2.8 million has been seized in both cash and gold. A report from local media revealed that charges against two individuals were filed in Hong Kong for utilizing Macau casinos as a means to launder illicit funds. This led to the seizure of casino assets as well as $1.7 million in cash. The Hong Kong Police Force disclosed its efforts to locate additional suspects linked to fraud and money laundering charges.
Hong Kong’s financial regulator warned JPEX for allegedly promoting its services in the city-state without proper licenses. Following the warning, the exchange substantially increased its withdrawal fees to nearly $1,000. In a twist, its employees deserted their booths at the recent Token 2049 event held in Singapore. Several arrests were made by the police in the city-state for alleged money laundering shortly thereafter after reportedly receiving more than 2,300 complaints from victims and losses of nearly $178 million. This included two popular influencers as well. However, Hong Kong’s authorities have maintained that the ringleaders of the operation behind JPEX are still at large. Subsequently, reports about JPEX being a potential rug pull also surfaced as social media channels and its official website remained inaccessible.
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🪙 VanEck prepares to launch Ethereum Futures ETF
VanEck announced the upcoming launch of the VanEck Ethereum Strategy ETF (EFUT). The actively managed ETF is tailored to capture capital appreciation by investing in ether (ETH) futures contracts, according to a statement. EFUT won't be investing directly in ETH or other digital assets. Instead, it will invest in standardized, cash-settled ETH futures contracts sourced from exchanges that have the Commodity Futures Trading Commission's stamp of approval. As it stands, the only ETH futures the fund intends to invest in are those traded on the Chicago Mercantile Exchange.
The ETF will be listed on the CBOE, actively managed by VanEck head of active trading Greg Krenzer. Krenzer joined the firm in 1994, with over two decades of experience in trading various asset classes, including futures products. The ether ETF product follows in the footsteps of VanEck's bitcoin futures fund, the VanEck Bitcoin Strategy ETF (XBTF), launched in Nov. 2021. Both funds are structured as a C-Corp — providing a more tax-efficient experience for long-term investors, the firm said. Bloomberg ETF Analyst Eric Balchunas said he was hearing the SEC wanted to accelerate the launch of ether futures ETFs ahead of a potential government shutdown — asking the filers to update their documents by Friday to trade on Tuesday.
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🟠 Binance Will Assist HTX In Tracking Funds After The Hack
In response to Justin Sun’s recent statement that HTX has fully assumed responsibility for the 5000 ETH security loss stemming from a hacker attack on X (formerly Twitter), Binance founder CZ has pledged support to track the hacker’s funds under all possible scenarios. Unlike most cryptocurrency hacks that linger in obscurity, the HTX hack was promptly confirmed by Tron CEO Justin Sun. Despite an estimated loss of $8 million, HTX swiftly identified and resolved the issue, fully compensating for the losses incurred during the attack.
CZ also playfully remarked on the recent name change of Huobi to HTX, noting its similarity to FTX. Justin Sun reassured users that all assets remained secure, and the platform operated normally, without any trading suspension or deposit/withdrawal limitations similar to those seen after the recent CoinEx exchange hack. In a move to recover the stolen funds, Justin Sun listed two wallet addresses linked to the hack, which hold a total of 5,000 ETH. Binance founder CZ has pledged support to track the hacker’s funds under all possible scenarios. He pledged to reward the hacker with 5% of the stolen funds and even offered the possibility of hiring them as a security consultant should they choose to return the stolen assets.
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⚪️ Google Cloud adds 11 new blockchains to BigQuery data analytics service
The cloud division at Google has added support for 11 additional blockchains into its BigQuery data analytics service. These networks are Avalanche, Arbitrum, Cronos, Fantom, Near, Optimism, Polkadot, Polygon, Tron and the test networks Polygon Mumbai and Ethereum Goerli. Google Cloud notes that users can now make intricate on-chain queries, such as assessing the number of NFTs minted or contrasting transaction fees across these chains. Integration with end-user applications like Looker and Google Sheets is also available.
BigQuery, provided by Google Cloud, is a managed data warehouse service enabling users to conduct SQL-like queries on vast datasets. In 2018, Google Cloud launched its blockchain data services in BigQuery — aiming to grant developers access to on-chain data from Bitcoin and Ethereum. The following year, it added support for six more chains: Bitcoin Cash, Dash, Dogecoin, Ethereum Classic, Litecoin, and Zcash. With the recent addition of another 11 chains, the total number of supported networks stands at 19. Besides BigQuery, Google Cloud provides web3 infrastructure services, such as node hosting and the management of validator operations, for various blockchains on its platform — notably Ethereum, Solana, and Aptos.
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🪙 Tether increased stablecoin loans to $5.5 billion after saying it planned to stop: WSJ
Tether has reportedly continued lending stablecoin USDT to clients less than a year after stating it would discontinue the practice. The company's latest quarterly financial update showed the stablecoin issuer has increased its issuing of USDT-denominated loans. The report showed assets that included $5.5 billion of loans as of June 30. This is an increase from $5.3 billion a quarter earlier.
According to the Wall Street Journal, a spokeswoman for Tether confirmed the company has made new loans. “During the second quarter of 2023, we received a few short-term loan requests from clients with whom we have cultivated longstanding relationships, and we made the decision to accommodate these requests,” Tether Holdings Spokeswoman Alex Welch told The Wall Street Journal. Welch said the reasons for issuing the loans were either to prevent any depletion of customer liquidity or to assist clients so they did not have to sell their collateral at potentially unfavorable prices. However, she reportedly added that loans would be reduced to zero by 2024.
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📣 Layer 2 Scroll’s zkEVM Will Be Launched In Weeks
In an exclusive interview with Cointelegraph at Token2049, Ye Zhang, co-founder of Ethereum’s zkEVM Layer 2 solution, Scroll, shared exciting updates about the project’s progress. Zhang revealed that the highly anticipated zkEVM is on track for launch in just a few weeks after undergoing rigorous testing for 2 years and thorough code review. The mainnet is poised to follow suit shortly after the final testing phase. Notably, major DeFi projects like Uniswap and Aave are poised to make their debut on Scroll once the mainnet is live, adding a significant boost to the platform’s adoption.
Zhang emphasized the layer 2’s commitment to providing “complete proof” for all “opcodes” and transaction components of Ethereum, setting it apart from systems with unproven elements like Linea. As outlined in Scroll’s roadmap, the upcoming launch represents the fourth stage, known as the “zkEVM main network stage.” This deployment follows extensive code audits and performance enhancements, culminating in the introduction of a decentralized sequencer. Last year, Zhang Ye presented the network’s design and architecture at the 8th Global Blockchain Summit, highlighting the project’s focus on security, efficiency, EVM equivalence, and decentralization. Its structure includes Scroll nodes, on-chain smart contracts, and a decentralized prover network.
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