The Disrupt Weekend

“These products may revive interest in the famed “cash and carry” arbitrage strategy, which in turn would bring more buying pressure to the spot market.

Assuming Wall Street embraces these ETFs, the futures premium, or the spread between futures prices and spot prices, would rise significantly, boosting yields from cash and carry strategy, which involves buying the asset in the spot market and simultaneously selling futures contracts. Carry trades are direction-neutral and profit from an eventual convergence of the two prices.

If the futures ETF comes out, there will be more inflows into buying futures. That would drive the futures curve further into contango [a situation where the futures contracts trade at a premium to the spot price], offering a strong incentive to carry traders. They would start the trade by buying BTC in the spot market.

A ‘risk-free’ rate [cash and carry yield] of 10-20% could be the new norm.”

See Also: Bitcoin’s First ETF: Winners and Losers

“[Ethereum] client teams met face to face last week (analogous to the Eth2 Interop from 2019) for a workshop named Amphora 🏺.

Milestone 5 required client teams to start a devnet that would not only run through the entire transition with all client combinations, but that would persist beyond the Amphora event. On the last day of the workshop, M5 was hit: a network of 10,000 validators across 100 nodes and several client implementations launched under PoW, reached the TERMINAL_TOTAL_DIFFICULTY, transitioned to PoS, and successfully finalized the chain 🎉!

Amphora’s success provides great momentum for The Merge. Client teams now have a clear list of tasks they need to work toward. Yesterday, a more stable version of the M5 Amphora devnet, Pithos, was launched. Now that this network is live, expect public calls exploring how developer tools and other core Ethereum infrastructure can best prepare for the PoW to PoS transition.”

In the past, it was necessary to switch to ZK languages in order to take advantage of the unmatched scaling, security, and UX benefits of zero knowledge proofs. But this is no longer the case: after many R&D breakthroughs, the innovations that make the zkEVM possible have elevated Solidity to a first class citizen in the ZK Rollup universe.

Developing on zkSync will feel natural and familiar, with Solidity, Web3 API, Ethers SDK, and native Ethereum signatures. And audited codebases battle tested on Ethereum will be as secure on zkSync as they are on mainnet.

We are tremendously excited today to present a fully functional dApp with Solidity smart contracts and a Web3 frontend! Try out UniSync, our port of the Uniswap V2 smart contracts and frontend.”

See Also: Argent + zkSync: A Peer-to-Peer Electronic Cash System Dream Comes to Life
See Also: PoolTogether Launches v4: More Prizes, Better Odds and Aggregated Liquidity
See Also: Futureswap V4 Mainnet Beta Launch

“While DeFi 2.0’s meaning is still congealing, a core component of DeFi’s next evolution includes alternatives to a mainstay of DeFi 1.0: liquidity mining. Projects like OlympusDAO, Fei Protocol, and Alchemix, are all experimenting with new ways of capturing users with the new challenge of getting them to stay.

The new crop of DeFi projects centers around the idea called protocol controlled liquidity (PCV). This entails projects acquiring funds to support their financial applications, rather than tapping users’ funds by enticing them with liquidity mining rewards.

The problem is that protocols are watering down their token’s supply in exchange for capital deposits, which are often temporary. So people come in, lend their assets to the protocol while milking its rewards, then leave with both the assets and rewards, leaving the protocol high and dry.

There’s a swath of projects eschewing liquidity mining and experimenting with alternatives. OlympusDAO sells its token at a discount in exchange for tokens like DAI, but also liquidity provider (LP) tokens which include OHM. This system has allowed Olympus to own its own liquidity. OlympusDAO’s stats page says the protocol owns over 99% of the OHM-DAI liquidity. And that liquidity isn’t going anywhere because Olympus itself owns it.

Protocol controlled value brings sustainability so you can maintain the growth you had without hollowing out the community. The move in DeFi 2.0 is for protocols to own their own liquidity. This contrasts to ‘DeFi 1.0’ where protocols earned TVL by providing the best user experience or rented liquidity via liquidity incentives.”

Even though, for now, speculation appears to be the biggest use case for NFTs, they offer something far bigger: the foundation for a new digital economy.

People ask, “Why on Earth would someone pay millions of dollars for a JPEG that I can simply ‘right-click/save’ to my hard drive?” The problem with that statement is it confuses possession of a digital file with rights to the artwork or information contained within it. It’s the latter that NFTs offer, creating provably scarce digital markers of value and providing a vital building block for a better system of rights enforcement.

For the longest time, you couldn’t transfer those rights to anyone else. As social media took off, as everyone became a creator of “user-generated content,” Facebook, Twitter and other platforms used that principle to their advantage. Their terms and service essentially required users to sign away their copyright, allowing their content to be shared, retweeted and repurposed within the platform without restriction.

This generated a massive network effect for the most successful platforms because they became the primary source of information for the general public. Control over market data for creative content was now in the hands of Facebook, Google, Twitter and Amazon, not the creators.

By establishing provably unique, scarce digital markers for the first time, NFTs are a game-changer. They will ultimately allow the creator – and all owners of property that can be expressed in digital form – to reassert their property rights, recovering a power that was lost, or at least severely deprecated, in the Internet 2.0 era. It’s a means to restore a direct relationship with their audience.

It means individual creators and anyone who owns any digital asset – including a digital record of their genome – can now tap the value-creating power of software, exploit the global reach of the internet, and mine the data that it produces.

This is what the platforms have been doing for decades to create their monopolies. It will now come available to individuals. This is why NFTs are so revolutionary.”

See Also: Flow integrates Filecoin storage services to make NFTs more decentralized
See Also: Major Refresh of NFT Images & Metadata for ENS Names

“Some of crypto’s rarest and largest ocean dwellers are quickly becoming endangered this year. As of today, the number of Bitcoin addresses holding 1,000 Bitcoins or more is at a record low of 82. [However], the data highlights that mid-tier Bitcoin whales have been on the rise since early September.

The number of addresses holding 100 to 1,000 BTC has increased significantly in the past five weeks.

Perhaps the colossal Bitcoin humpbacks of old are a dying breed, but recent developments suggest that smaller whales are multiplying.”

How to Earn ETH As A Liquidity Provider on Hop Protocol

“Bakkt Holdings, the digital assets management arm of Intercontinental Exchange (ICE), has announced it will soon become a publicly traded company on the New York Stock Exchange, starting Oct. 18. The public listing for Bakkt comes as a result of a merger with VPC Impact Acquisition Holdings, a Chicago-based special purpose acquisition company.

The combined company’s Class A common stock and warrants are expected to begin trading on the New York Stock Exchange (“NYSE”) under the ticker symbols “BKKT” and “BKKT WS” respectively.

Additionally, the business combination resulted in gross proceeds of approximately $448 million to Bakkt, which it plans to reinvest in growing the company’s capabilities and partnerships.”

“El Salvador’s mainstream Bitcoin (BTC) adoption is gaining momentum during the ongoing bull run as citizens are increasingly exchanging their U.S. dollar savings for BTC.

President Bukele further stated that Chivo has reported 24,076 remittance requests, ‘adding up to $3,069,761.05 in one day.'”

16 October

“After years of trial and error by would-be fund sponsors, cryptocurrency investing is finally opening up to the masses with the tacit U.S. approval of a bitcoin exchange-traded fund. The SEC greenlighted bitcoin futures ETFs in a first for the industry on Friday, after the regulator’s five commissioners met on the issue.

ProShares, which filed for its Bitcoin Strategy ETF this past summer, may be the first to launch next week. The company filed a post-effective amended prospectus on Oct. 15, stating its filing is expected to launch on Monday, Oct. 18, though the fund may not begin trading immediately.

It’s an encouraging sign for the future of crypto to see SEC Chairman Gensler get comfortable in helping mainstream investors more easily access bitcoin exposure. The availability of a bitcoin ETF will now bring more investors under the crypto tent and facilitate greater education across the space.

The SEC has rejected every previous application to date, and still has yet to weigh in on more than 30 other current applications.”

See Also: Nasdaq listing hints that the SEC may soon approve ETF application from Valkyrie
See Also: Bitcoin Climbs Above $60K After Report That SEC Won’t Block Futures ETF
See Also: Bitcoin gets green light for price discovery with ‘almost no supply’ on exchanges above $59K

“According to a CFTC press release, Tether’s stablecoin was fully backed by reserves for only one-quarter of the time over a 26-month period between 2016 and 2018. Further, Tether comingled reserve funds with the company’s corporate funds and held reserves in non-cash products.

The order also finds that, instead of holding all USDT token reserves in U.S. dollars as represented, Tether relied upon unregulated entities and certain third-parties to hold funds comprising the reserves.

In a concurring statement, CFTC Commissioner Dawn Stump said she agreed with the agency’s findings but expressed concern about the CFTC’s role in regulating stablecoins specifically. Stump questioned whether the CFTC was broadening its jurisdiction versus protecting investors.”

See Also: Crypto Finally Makes the Cut in OCC’s 2022 Bank Supervision Operating Plan

MSCI warned of “creeping” exposure to cryptocurrency in equity markets by 52 companies with some degree of crypto exposure. The companies covered by the index provider’s research have a combined market capitalization of $7.1 trillion.

This can occur when newly listed cryptocurrency companies get added to the indexes that guide their investments, or when companies in which they are already invested, directly or through indexes, announce strategies that include bitcoin or other cryptocurrencies.”

“In August, the company said it would start offering the crypto payment option via a pilot program to gauge demand for this service. It was the first mortgage lender to do so.

Due to the current combination of incremental costs and regulatory uncertainty in the crypto space, we’ve concluded we aren’t going to extend beyond a pilot at this time.”

See Also: Steam Boots Blockchain-Based Video Games From Its Platform; Epic Games Welcomes Blockchain

15 October

“A Bloomberg’s senior ETF analyst says there are “good” signs that a Bitcoin exchange-traded fund (ETF) will soon be approved, pointing to Ark Invest filing for a Bitcoin futures ETF with an assigned ticker and Valkyrie updating its own ETF prospectus with a ticker.

Cathie Wood’s Ark Investment Management LLC filed for a Bitcoin (BTC) futures ETF under the ARKA ticker, while Valkyrie has assigned its BTC futures prospectus with the BTF ticker. [Further], Ark’s latest ETF filing with the SEC does not mention the word “Canada” and the application clearly outlines that the fund is seeking to invest in “exchange-traded Bitcoin futures contracts that are cash-settled in U.S. dollars.”

The analyst stated that he looks for “these type” of updated prospectus filings when determining whether an official SEC greenlight is incoming, and said that applicants often update the final details “right before” launch.

The futures ETFs filed under the ’40 Act (which Genz loves) are very much alive and likely on schedule (we think 75% chance approved in Oct).”

Decentraland is hosting a first-of-its-kind music festival featuring more than 80 real-world artists. Big names such as Paris Hilton, Deadmau5, Alabaster dePlume and 3LAU are involved. The four-day “Metaverse Festival” also includes VIP areas, a merchandise store for non-fungible tokens (NFTs) and, oddly, portable toilets. The festival starts Oct. 21.

It is a celebration of music and culture in the virtual social world, but also a recognition that the metaverse has arrived as a viable, irresistible and profitable space for creative people, whatever their medium or background.”

See Also: Sotheby’s Takes Its NFT Experiment Into the Metaverse
See Also: Subversive Capital Files Application With SEC for a Metaverse ETF
See Also: Shatner May Have Conquered Space, but 4 South Korean ETFs Beat Him to the Metaverse

With regulatory rumblings in Washington growing louder, Uniswap has hired Hari Sevugan to help shape public perception. Sevugan, a former Washington operative who has held senior staff positions for multiple high-profile statesmen, will manage public-facing communications for Uniswap Labs, including ‘helping the company tell its story to existing users and new audiences and managing media affairs.’

Crypto is opaque and intimidating to many outside of it. I want to help more people connect to it by making it more relatable and understandable. One of the fundamental challenges, by virtue of what makes headlines, is that crypto is seen only through the lens of value, and not values.”

See Also: Coinbase Proposes US Create New Regulator to Oversee Crypto
See Also: Meet the DeFi Delegate Knocking on the Doors of Congress

“The Pay Me in Bitcoin option, introduced Thursday, allows users to deposit their salaries directly to their Strike accounts and choose the amount that is automatically swapped and credited to their bitcoin balance.

Strike began experimenting with the feature last year when National Football League player Russell Okung used Strike to split his $13 million salary 50-50 between bitcoin and fiat. Several other athletes have since followed in his footsteps. Now the service has been made widely available to Strike’s U.S. customers.

The expanded feature comes less than a month after Coinbase, the leading U.S. cryptocurrency exchange, announced that it will let users deposit all or part of their paychecks in crypto or dollars. However, unlike Coinbase, which lists a smorgasbord of digital assets for trading, Strike is a staunchly bitcoin-focused shop.”

“Bitcoin is showing signs of exhaustion after the minutes from the Federal Reserve’s September meeting, released late Wednesday, flagged inflation concerns and revealed growing support for a faster unwinding of stimulus.

The Fed minutes carried fewer references to inflation being transitory and showed policymakers are worried that price pressures might remain high for longer than previously assumed.

Bitcoin is up 30% this month, though, buoyed by increased expectations that the U.S. Securities and Exchange Commission will soon approve a futures-based bitcoin exchange-traded fund (ETF). The SEC is likely to approve at least four ETFs this month, according to Bloomberg. Long-term sentiment remains bullish.”

“Any CBDC must “do no harm” to central banks’ ability to maintain monetary and financial stability, the finance officials of the seven countries (U.K, U.S, France, Germany, Italy, Canada, Japan) said in a joint statement on Wednesday.

CBDCs should also co-exist with other conventional means of payment such as cash to promote a competitive environment and be a catalyst for digital economy innovation in conjunction with existing and future payment methods.”

See Also: Putin Says Crypto Can’t Yet Replace Dollar in Settling Oil Trades: Report

“North American addresses received $750 billion in crypto between July 2020 and June 2021, or 18.4% of global transactions. Central, Northern and Western Europe received $1 trillion during that time period, accounting for 25% of global volume. Monthly transaction volume in North America grew by over 1,000% between July 2020 and this past May, from $14.4 billion to $164 billion.

Chainalysis attributed the growth to DeFi, which represented 37% of total transactions in North America. The region’s top exchange during that time period was decentralized trading platform Uniswap, followed by centralized exchange Coinbase and decentralized dYdX.

East Asia’s share of global crypto transaction volume started dropping in April 2020, long before this year’s crackdown on the industry by Chinese authorities. Starting April 2019, East Asia accounted for the lion’s share of crypto transactions globally, until June 2020, when it was overtaken by Central, Northern and Western Europe, as well as by North America.

China has been moving towards an outright crypto ban in favor of its own solutions.”

“MintGreen, a Canadian cleantech cryptocurrency miner, is working with Lonsdale Energy Corp. to supply heat to the city of North Vancouver from bitcoin mining. The heat source will be introduced in 2022 and will prevent 20,000 metric tons of greenhouse gas per megawatt from entering the atmosphere compared with natural gas.

MintGreen’s proprietary “Digital Boilers” recover 96% of the electricity used for bitcoin mining as heat that is then used to supply communities and for industrial processes. The company uses an “immersion” technology that captures the heat generated in mining and goes to hot water utilities. The utility working with MintGreen serves about 100 buildings.”

14 October

“An under-the-radar rendezvous of core Ethereum developers took place in Greece last week, with major progress being made toward the Merge. The teams accomplished the transition of a multi-client devnet from proof-of-work to proof-of-stake. Eth1 execution clients and Eth2 consensus clients successfully merged to create a network capable of processing transactions.

As we approach the eventual transition to proof-of-stake, it is important to note what the upgrade will change and what will stay the same.

  • Energy efficiency
  • Transition away from economy of scale
  • Ether emissions fall”

See Also: Bitcoin ‘Bullish Sentiment’ Is Back Among Institutional Investors: Report

“The much-anticipated parachain auction process, where projects are allocated slots for building on the Polkadot cryptocurrency network, kicks off next month. The first of the auctions is slated to begin on Nov. 11.

The last technical steps to complete before launching parachains on Polkadot were the finalization of parachain disputes and Polkadot’s full code audit, both of which have now been completed. Each auction on Polkadot will assign a parachain slot for a total of 96 weeks. The first five projects to win an auction would be onboarded to Polkadot simultaneously on Dec. 15, 2021.

The ongoing Kusama parachain auctions have seen some 2.4 million KSM, Kasama’s native token, contributed to crowdloans by more than 49,000 unique addresses. DOT, the native asset of the Polkadot network, will be used in the upcoming auctions.

The economics of Polkadot are designed so that a target of 20% of DOT end up bonded on behalf of parachains over time.”

Swiss financial regulator FINMA-licensed SEBA says it will be the first fully regulated bank to offer investors access to yields in decentralized finance (DeFi) protocols. The Swiss regulated firm is tapping into demand from institutions for income from digital assets.

SEBA Earn will let institutions generate income from proof-of-stake protocols such as Polkadot, Tezos and Cardano, with other networks to be added over time. The platform will also enable investors to lend bitcoin and ether through SEBA Bank.”

See Also: Proposed Bank ‘Jewel’ Wants to Become a Global Stablecoin Issuer, With Bermuda’s OK

“The latest CCAF data shows the U.S accounting for 35.4% of the global hashrate as of the end of August, more than doubling from 16.8% at the end of April. Kazakhstan and Russia followed the U.S. with shares of 18.1% and 11%, respectively, up from 8.2% and 6.8% in April.

China’s share has effectively dropped to zero.

Where China’s dominance of the bitcoin mining industry peaked at over 75% in September 2019, the immediate trend suggests there will be no one clear winner. The crackdown has driven firms to see the need to spread their operations around rather than centralizing in one location.”

We are witnessing a real-time demonstration of the way a failing political order can lead to the imposition of Orwellian surveillance out of last-gasp desperation. That’s the only honest way to assess the Biden administration’s almost unspeakably bad proposal to require that all U.S. banks report data to the Internal Revenue Service about any account with more than $600 in annual deposits and withdrawals.

The only comparable power grab in living memory was the secret surveillance of U.S. citizens’ communications by the National Security Agency. It should be deeply embarrassing to all Americans that our lawmakers are even considering imposing this new financial surveillance apparatus.

As another nauseating index of political dysfunction, this rule isn’t even being considered on its own merits. Instead, much like recent half-cocked crypto reporting rules, it’s being crammed through as a pay-for in the big infrastructure bill, practically guaranteeing that it would be drafted hastily and with minimal debate.

This rule should, of course, be opposed on principle – but it’s just one index of a much deeper, scarier downward spiral as social distrust and legislative haste grease the skids for the erosion of the privacy guaranteed by the Constitution. It will take a major change to escape that trap.”

See Also: Andreessen Horowitz Plans to Meet With Washington Policymakers Over Web 3: Report

“The financial services giant is partnering with former Major League Baseball player turned NFT artist Micah Johnson to build a program that will support artists who want to use NFTs to sell their work. Visa will select a small group of creators through an application process and then help them learn about the crypto and blockchain industry.

We believe that we are at the beginning of a digital renaissance in the world of art and content creation.”

13 October

“We’re seeing more and more chatter about crypto regulations from the current U.S. presidential administration but, despite certain statements from the SEC chair, the overall approach seems to be “wait and learn” rather than immediate action.

Rumor has it President Joe Biden may issue an executive order (EO) that would direct federal agencies to study the crypto sector and develop recommendations for regulating it.

The key takeaway seems to be that the administration wants to know more about crypto, how it works and how it might fit into existing regulations or what new regulations the industry might need. The administration is taking a wait-and-see approach as opposed to immediately moving to ban or even strictly regulate crypto.”

See Also: IMF reiterates more oversight for crypto in latest report on financial stability

“The U.S. crypto exchange is launching “Coinbase NFT,” a marketplace that will allow its users to buy and sell Ethereum-based digital collectibles, the company announced Tuesday. Coinbase’s NFT platform is expected to launch by the end of the year.

Coinbase’s product will take a direct swing at juggernaut marketplace OpenSea, which is currently home to the majority of Ethereum-based NFT trading.

If you’ve tried to create or purchase an NFT, you’ve probably found the user experience lacking. Coinbase NFT will make minting, purchasing, showcasing and discovering NFTs easier than ever.”

See Also: Médecins Sans Frontières Receives $3.5 Million ETH Donation From NFT Sale

“Video games and music as industries are most likely to see positive changes from the influx of NFTs. Areas and companies that are likely to be hurt by NFTs include video game retailers with physical stores, traditional record labels and music publishers, traditional video and music streaming platforms and “walled garden” online ecosystems. All of those are intermediaries that could be bypassed if content creators had a more direct relationship with their customers.

The advent of NFTs promises significant disruption to any/all sectors with exposure to IP (intellectual property), licensing and merchandise related revenues. The key point is that its decentralized and democratized model allows content owners to disintermediate traditional gatekeepers both in terms of distribution and monetization.”

See Also: Bored Ape Yacht Club NFT Makers Eye Expansion Into Film, TV and Music

“Today we’re unveiling Arbitrum Nitro, the next iteration of Arbitrum. We’re estimating a 20–50x increase in Layer 2 execution speed, and we also expect a sizable decrease in costs.

It’s built on standard technologies like WASM and Geth, so it’s more EVM-compatible, an order-of-magnitude faster than our current tech, and adds another 0. When it’s ready we’ll be deploying it as a seamless upgrade to Arbitrum One.”

“The newly launched $1 billion Growth Fund by Binance will be dedicated to four main categories in the BSC’s ecosystem: talent development among the developer communities and crypto investors, liquidity incentive programs to encourage new users to try the smart contract blockchain, tech support including global hackathons and an incubation program for different new projects.

The announcement came after a number of other blockchain projects pushed out their own big-budget incentive programs to boost their ecosystems, including Solana, Avalanche and Fantom.

BSC has faced criticism for being less decentralized and secure than some of its competitors. There has been a growing number of “rug pulls” or exploits on DeFi projects built on BSC this year, and BSC’s security algorithm, known as Proof-Of-Staked Authority (PoSA) , is controlled by only 21 node operators.”

“The wallet, available as an extension for the Chrome web browser, will look to challenge MetaMask, the non-custodial wallet that in August said it had more than 10 million active users.

XDEFI offers access to chains such as THORChain and Terra and aims to allow users to move between protocols easily and automatically add new chains. The wallet also offers automatic detection of NFTs.”

See Also: Stripe Is Hiring a Crypto Team 3 Years After Ending Bitcoin Support

12 October

“If the American economy were in dire straits, the Fed might impose a negative interest rate on people’s savings, forcing us to spend.

The currencies would be a ‘useful policy tool’ for casually annihilating the savings of every wage-worker in the country if they don’t spend them fast enough.

CBDCs are a perversion […] of the founding principles and protocols of cryptocurrency—a cryptofascist currency, an evil twin entered into the ledgers on Opposite Day, expressly designed to deny its users the basic ownership of their money and to install the State at the mediating center of every transaction.”

“There’s a downside to SEC Chair Gary Gensler’s preference for an exchange-traded fund focused on bitcoin futures. But it’s unlikely to deter investors.

“Contango bleed” refers to fund underperformance that could theoretically occur because longer-dated futures contracts are trading at higher prices than shorter-dated contracts. In the bitcoin market, contango mainly results from bullish price expectations.

Several futures ETF proposals are due for regulatory approval in the coming weeks, of which the ProShares’ product is widely expected to receive accreditation on Oct. 18. Investors who pile into these new funds could get hit with “contango bleed,” where they might get lower returns than if they had simply bought bitcoin directly.

The dynamic shows one potential downside from the SEC’s preference for an ETF based on bitcoin futures over one that buys bitcoin directly.

The futures-based ETF, if approved, will be an inefficient product. Because bitcoin’s futures curve is typically in contango, the fund is going to suffer from a negative rollover. I am expecting the average negative yield to be at around 5%-10% on the CME bitcoin futures curve.

In plain English, if the price of bitcoin doubles in the next 12 months, the ETF would underperform by at least 5%-10%. Unhedged investors would still benefit from any underlying gains in bitcoin’s price – just not as much. According to experts, the prospect of a futures ETF underperforming bitcoin is unlikely to deter investors from pouring money into the product.

Investors simply want exposure to the asset class and will look the other way if there is a slight roll charge. In our view, the only way the roll charge will prevent investor interest in a BTC ETF is for the forward market to be in very steep contango.

If contango steepens, fund managers could change strategy and hold more than just the front-month futures contract.”

“There are many nuanced, detailed arguments for the inevitability of cryptocurrency and blockchain’s growth and adoption – advantages of efficiency, trust, privacy and autonomy that are already proving out at a global scale. But interest in cryptocurrency is driven perhaps most of all by something more elemental and emotional, a deep intuition that has been rising around the world for decades: that the people in charge cannot, and should not, be trusted.

That sense of rising distrust was validated yet again with the Oct. 3 release of the so-called Pandora Papers, a trove of almost 12 million leaked documents from law firms and other organizations around the world. The documents unmask the previously unknown owners of 29,000 offshore companies hiding billions of dollars in assets from taxation or oversight. The owners include political leaders, celebrities and underworld figures from more than 200 nations.

By one estimate, as much as $32 trillion in assets worldwide may be in offshore tax havens, and much of it amounts to theft by world leaders from their own citizens.

That certainly drives home the absurdity of global regulators’ relentless focus on cryptocurrency systems as vectors for money laundering and tax evasion. Regulators, it seems, find it easier to punch downward at an emerging technology than to challenge the legalized corruption of the legacy banking system, or the hegemony of their bosses.

It’s unclear whether cryptocurrency provides a substantive answer to this rampant elite corruption. But the Pandora Papers at least explain much of the emotional drive behind crypto adoption: the simple desire to quit a system that is rotten to its absolute core.”

“An investor deck shows Paradigm is in the process of raising what would be one of the VC world’s largest crypto-focused funds.

The revamped war chest could place Paradigm near the top of the pack as venture capital flows into the crypto sector with unprecedented velocity. VCs have placed $17 billion in crypto investments in the first half of 2021, “dwarfing” the $5.5 billion from the same period last year.

Earlier this year, VC powerhouse Andreessen Horowitz (a16z) announced it had raised $2.2 billion for its third crypto fund, making it the industry’s largest ever.”

See Also: ConsenSys Holds Funding Round Talks With $3B Valuation

“We announced our vision for StarkNet at the beginning of the year: to bring massive scalability to Ethereum while preserving L1 security, permissionless interactions, and decentralization.

StarkNet Alpha 2 now supports composable smart contracts of general computation in an Ethereum-like state, with the ability for L1 and L2 contracts to interact with each other. StarkNet Alpha is launching on Mainnet Ethereum by November.”

The current laws in China that make commercial activities involving crypto illegal cannot be applied, and so the government needs the judiciary to interpret them.

Virtually all crypto trading was outlawed in China last month, when the exchange of one crypto for another was banned. Caijing Magazine has suggested that the withdrawal of exchanges could see the criminal activities involved becoming more concealed.”

See Also: US lawmaker is most concerned about Treasury’s response to crypto
See Also: Chinese blockchain project BSN expands to Turkey and Uzbekistan

“The Gambling Commission is looking into whether Sorare should be required to have a gambling license or if its services don’t actually constitute gambling.

While the company doesn’t offer any traditional forms of sports gambling, the speculative nature of their digital trading cards – whose values are largely driven by player performance – skirt the line of categorization.

Sorare said it is ‘very confident [it] does not offer any forms of regulated gambling.'”

9 October

“While the ‘net’s inherent anonymity is definitely a good thing, it leaves users of ID-reliant tools in thrall to major centralized identity providers and their seemingly inevitable abuses. Blockchain developers have long talked about developing “decentralized” identity standards to save us from the dangers of Big Login, and at least one significant step towards that future appears imminent: Sign-in With Ethereum is coming.

It’s just what it sounds like: a standard way to use an Ethereum wallet that you own as an identifier across multiple services.

Using a cryptographic marker as an identity means the user, not the identity provider, has total control over what information is associated with it. Eventually, you’ll be able to decide, for instance, whether a particular service needs your name, proof of your age, or a glimpse of your ETH balance. You won’t have to send all that information to every service you use.

Applications for this initial iteration, according to Spruce, are more likely to include lower-security uses like gating content for non-fungible token (NFT) holders. But, eventually, by integrating secure off-chain storage, Sign-in With Ethereum (let’s just call it SIWE) could also offer “strong” options such as government ID.”

See Also: Sign-In With Ethereum

Bitcoin’s allure as an inflation hedge‘ is drawing institutional investors back to the crypto market, JPMorgan’s Nikolaos Panigirtzoglou wrote in an Oct. 6 research note to clients. The shift into bitcoin that drove late-2020 all-time highs ‘has started reemerging in recent weeks.’

There are tentative signs that the previous shift away from gold into bitcoin seen during most of Q4 2020 and the beginning of 2021 has started reemerging in recent weeks.”

See Also: Citi Exec: Clients Started With Bitcoin and Went ‘Down the Rabbit Hole’
See Also: Google Pay to Support Bakkt Debit Card

The Biden administration is considering an executive order for federal agencies, which would require them to study the crypto industry and provide recommendations on their oversight. In addition to asking agencies to study different aspects of the industry, the order “would clarify the responsibilities” different agencies have around crypto and blockchain.

According to the report, the order would include the Treasury Department, Commerce Department, National Science Foundation and national security agencies.

The President’s Working Group on Financial Markets is also set to consider a report that would recommend Congress enact legislation to create a special purpose charter for stablecoin issuers, treating these entities akin to banks. The Federal Reserve is also set to issue reports on stablecoins and central bank digital currencies (CBDCs).”

See Also: Big Tech-Issued Stablecoins Could ‘Amplify Shocks’ to Financial System, Says ECB Exec

“U.S. jobs rose by 194,000 in September, well below economists’ average estimate for a gain of 500,000 jobs. But the data was mixed, with August’s jobs number revised upward by 131,000.

The combination may give the U.S. Federal Reserve more flexibility after Chair Jerome Powell signaled recently that the central bank looked to be on track to start tapering its $120 billion-a-month in bond purchases later this year.

Overall, this looks like a ‘decent’ enough labor report to allow the Fed to proceed with the taper in November, as flagged at the last FOMC meeting.

The concern among bitcoiners is that they would no longer be able to count on the Fed bringing more liquidity to the markets through quantitative easing. The bitcoin price was holding steady after the report around $55,000.”

A rising trend in the NFT sector is for projects to include community benefits that go along with the ownership of their tokens. ReNFT is giving owners a way to monetize these benefits without selling the underlying asset.

Lenders can send the NFTs they want to rent out to a smart contract after determining the daily rental price and maximum rental period. Borrowers then input how long they want to “own” the NFT, paying for the rental cost plus a collateral amount equivalent to the price of the NFT, which they get back once the NFT is returned.

reNFT sees the future of its lending protocol extending into the metaverse, where users could rent out their play-to-earn items, intellectual property and even digital real estate.

This is a valuable new primitive in web3 and in particular within the fast-growing gamefi space.”

8 October

“Celsius Network CEO Alex Mashinsky said the company pays an interest rate of 5%-6% to Tether, Bloomberg reported Thursday as part of an investigation into the stablecoin provider’s reserves. The investigation found that Tether had loaned billions of dollars to crypto companies using bitcoin as collateral.

Bloomberg’s investigation also found that Tether’s reserves include billions of dollars of short-term loans to large Chinese firms, something that has been speculated on widely.

Last month, Celsius Network received a cease-and-desist order from Kentucky’s securities regulator over interest earned on certain crypto accounts. The regulator says the accounts violate the state’s securities laws.

In response, Tether described Bloomberg’s investigation as ‘a one-act play the industry has seen many times before.’

This article does nothing more than attempt to perpetuate a false and aging story arc about Tether based on innuendo and misinformation, shared by disgruntled individuals with no involvement with or direct knowledge of the business’s operations.”

See Also: Tether fires back against report it is using reserves for investments and making crypto-backed loans
See Also: US Wants to Regulate Stablecoins First

The SEC approved an ETF consisting of companies holding large amounts of Bitcoin on their balance sheet. Park said the Bitcoin Revolution Fund will be less volatile than pure crypto plays since a plunge in the price of Bitcoin does not have a major affect on the shares of firms like Tesla or PayPal.

Volt said 25% of the fund’s assets would be made up of stock in MicroStrategy. Park added that the fund will consist of shares in approximately 30 companies, including Tesla, Square, Coinbase, and PayPal. He also said Volt decided to include Twitter, which recently made Bitcoin tipping part of its operations, and Bitcoin mining companies like Marathon that also hold the currency in their corporate treasuries.

A year ago, an ETF like this wouldn’t have been possible. We hope this is a crack in the dam.”

See Also: Invesco Lists Two Crypto ETFs With Galaxy Digital on the CBOE

Bitcoin ran through key technical resistance levels on Wednesday, strengthening a bullish bias. The cryptocurrency jumped above $55,000 yesterday, breaching the downtrend line. Buyers also flipped the horizontal resistance at $53,000 into support.

The breakout has exposed highs near $60,000 registered in the first half of May – more so, as the recent bullish move is backed by a pickup in trading volumes and accumulation by whales.

See Also: Bitcoin’s Options Market Is Now Skewed Bullish Across All Time Frames

“In August, Chainalysis published its second-ever global cryptocurrency adoption index which reported an 880% rise in global crypto adoption, driven by P2P trading and usage in emerging markets such as Africa. The Chainalysis team tracked data across 7,000 crypto service providers and found ‘meaningful crypto activity’ in 158 countries.

Despite the big moves made by institutional investors such as MicroStrategy and Twitter founder Jack Dorsey’s Square in the U.S., Vietnam topped the Chainalysis adoption index, followed by India and Pakistan. Six out of the top 20 countries in the index are African nations.

There are a lot of extremely large institutional size transfers that really bias our data upward. And so really, all the things that we did in terms of weights and metrics introduced, were to try to capture that day-to-day grassroots activity among your everyday shop owner, or your everyday person who’s accepting a remittance payment rather than capturing those really large transfers.”

See Also: El Salvador’s State-Owned Banco Hipotecario Taps Four Crypto Startups for Blockchain Products
See Also: Brazilian Lawmaker Aims to Make Bitcoin a Legal ‘Payment Currency’
See Also: Wirex Launches Crypto Platform in Vietnam
See Also: Colombia Could Use Waterfalls to Produce Bitcoin, Not Cocaine: Senator Petro

“Christensen asserts that MakerDAO should strive to ensure that all of its collateral comprises ‘sustainable and climate-aligned assets that consider the long-term impacts of financial activity on the environment.’

Christensen also expresses the need for MakerDAO to reestablish its commitment to decentralized collateral, advocating that the protocol return to relying on the Ethereum network and Ether (ETH) token.

Today we already have everything we need to begin scaling our RWA exposure to hundreds of billions of USD and beyond, securely and in full compliance with financial regulation, by using the trustee-based model of real-world assets that the community developed over many years.”

“Chainalysis said Thursday that Dapper Labs will use Chainalysis’s KYT (Know Your Transaction) and Reactor compliance tools, which flag suspected criminal activity and enable deeper investigations into those transactions, respectively.

Dapper expects illicit activity could ramp up as NFTs hit mainstream adoption.”

See Also: Russia aims to limit crypto purchases by non-accredited investors

7 October

“Bitcoin’s latest breakout above $50,000 seems to be backed by renewed institutional buying.

Front-month bitcoin futures contracts based on the Chicago Mercantile Exchange (CME) are trading at an annualized premium of 12.8% to the spot price. That’s the highest level since mid-April and marks a significant rise from the discount of 0.36% seen a week ago.

The increase in premium suggests that there is high demand among the CME traders to build long exposure in bitcoin at the moment.

According to Bloomberg’s Intelligence senior ETF analyst, there is a 75% chance of a futures-based ETF approval this month, most likely the ProShares Bitcoin Strategy ETF on Oct. 18.

A futures-based ETF, if approved, could lead to further buying pressure on the front-month CME futures contract and a higher premium. A continued rise in premium may entice carry traders, leading to more substantial demand in the spot market.”

See Also: George Soros Fund Manager Says Bitcoin Has Gone ‘Mainstream’, Fund Owns ‘Some Coins’
See Also: Mexican Stock Exchange Is Considering Listing Crypto Futures, CEO Says

“The Federal Deposit Insurance Corp. (FDIC), a key U.S. banking regulator, is studying whether certain stablecoins might be eligible for its coverage. Such coverage would insure holders of the tokens against losses up to $250,000 if the bank holding the collateral were to fail.

This is all part of a process by which they are trying to bring stablecoins into the banking system in a responsible manner.

The FDIC has strict rules as to which institutions may call themselves FDIC-insured. Insurance of particular stablecoins and permission to use the FDIC logo would provide clarity about which stablecoins, up to the insurance limit, will not lose value.”

“It was the highest price since May 12, before a crackdown by China on its domestic cryptocurrency and other negative news helped push the price below $30,000. The latest rally has pushed bitcoin’s market capitalization back up above $1 trillion.

If the bulls are looking for a pain point, then the next stop is $60,000, and if they don’f find a pocket of shorts to force out, then confidence will only grow.

Traditional markets are struggling in the current macroeconomic environment with falling stock prices, a potential energy crisis and fears over losses in the Chinese property sector. ‘Global markets are derisking.’

That might mean that ‘bitcoin is arguably becoming more resilient against traditional market turbulence.’ Morris said that the next leg up for bitcoin could come from a further adoption push by Wall Street and traditional financial firms.”

See Also: Bitcoin Price Rally Fueled by Whales’ $1.6B Buy, Blockchain Data Shows

“Each of our four proposals is designed to stand on its own, but taken together, they represent the start to a comprehensive approach to supervision, oversight and taxation in a decentralized environment.

a16z’s consumer protections proposal recommended creating a simple disclosure-based supervision regime under the Consumer Financial Protection Act. DAOs, meanwhile, are to be given similar legal rights to those of a standard incorporated entity, including tax requirements and being allowed to open bank accounts and sign legal agreements.

The firm suggested three ways to shore up regulatory fragmentation and overlap. Those included harmonizing areas of jurisdiction among agencies, establishing an industry self-regulatory organization and setting up a nonprofit for technical oversight.”

See Also: Gensler’s Crypto Testimony: 6 Key Takeaways
See Also: DOJ to Create Crypto Enforcement Group to Fight Cybercrime, Money Laundering
See Also: BIS Outlines How Stablecoins Could Comply With International Money Standards

Republic Music gives listeners the chance to ‘invest in the music they love for as little as $100 and share in the rights to royalties.’ S-NFTs are a kind of security – something you can invest in with the expectation of profit down the line.

The songs are going to be placed in an LLC, and you will be a member of the LLC. You will have a share of ownership in that song, and a right to the royalty on the back end.

I think in the New World Order, early supporters are going to be rewarded, the artists are going to get paid and the community is going to grow stronger.

That means S-NFTs are overseen by the SEC and the Financial Industry Regulatory Authority (FINRA); investors based in the U.S. will need to comply with relevant KYC / AML regulations.”

See Also: Billion-Dollar Toy Brand L.O.L Surprise! to Build Its Own NFT Marketplace

“Strips is planning to launch in November with initial functionality that will enable interest rate swaps (IRSs) via automated market makers (AMMs). The product will be launching natively on Arbitrum. IRSs allow users to switch between more volatile floating rates and safer, but lower-upside fixed rates on deposits.

This is something we haven’t found available in DeFi so far, however, it is a huge market in traditional finance – we’re talking about over $6.5 trillion being traded in interest rate markets in a single day.”

Traditional cross-border payments giant MoneyGram is working with the Stellar blockchain network to create instant money transfers using Circle’s USDC stablecoin.

Working with MoneyGram allows end consumers to have on- and off-ramps everywhere that MoneyGram’s vast agent network supports this. So this is just transformational in terms of being able to exchange crypto for fiat and fiat for crypto.

The news will come as a slap in the face for Ripple, the cryptocurrency payments network whose longstanding relationship with MoneyGram wound down after the U.S. Securities and Exchange Commission (SEC) filed suit against Ripple in December 2020.”

6 October

“Rep. Patrick McHenry (R-N.C.), the ranking member on the House Financial Services Committee, unveiled a safe harbor bill on Tuesday ahead of a committee hearing with Securities and Exchange Commission Chair Gary Gensler.

The “Clarity for Digital Tokens Act of 2021″ would effectively codify SEC Commissioner Hester Peirce’s Token Safe Harbor proposal, a pitch the regulator made in 2020 and 2021 to create a pathway for crypto startups to launch token sales to fund their projects without fear of SEC enforcement.

Under the Peirce proposal, these businesses would have three years to either register with the securities regulator or meet a set of requirements to prove themselves fully decentralized.

Industry proponents praised the effort in statements on Tuesday. Perianne Boring, the president of the Chamber of Digital Commerce, said the bill “has the potential” to create a path for startups in the crypto industry.”

“SEC Chair Gary Gensler told Congress on Tuesday that the SEC has no plans to ban crypto.

Gensler’s assertion that the SEC does not plan to ban crypto mirrors similar remarks made by Federal Reserve Chair Jerome Powell last week, when the central bank head told the House Financial Services Committee that the Fed had “no plans to ban” the $2.2 trillion asset class.”

BTC is up about 22% over the past week and has decoupled from slumping global equities. Sentiment on bitcoin significantly improved over the past week, signaling a shift away from market panic, according to the Fear and Greed Index. Technical indicators are also showing improving short-term momentum.

We expect short-term overbought conditions to be weathered long enough for a test of minor resistance near $52.9K, a breakout above which would target the all-time high.”

See Also: 4 Factors Helping Bitcoin to Decouple From Falling Stock Market

“The three firms will support different segments of the market – from small DAOs to multibillion-dollar crypto funds.

The partnership will involve MetaMask Institutional being integrated with BitGo wallets. He says that’s significant because it ‘validates the growing appetite for institutional investors to participate in DeFi with the highest level of security possible.’

Bruzzesi said BitGo is seeing pent-up demand from institutional players to gain access and exposure to decentralized lending platforms. BitGo currently has $40 billion in assets under custody; once the integration with MetaMask Institutional is completed, over 500 firms in crypto will be able to access DeFi.”

See Also: Fifth Largest US Bank Launches Crypto Custody With NYDIG Backing
See Also: Bitpanda to Offer Its Digital Asset Investing Product to Italian Banks, Fintechs
See Also: DeFi Custodian Trustology Gets Green Light From UK’s FCA

“Circle, a key supporter of the USDC stablecoin, said in a regulatory filing that it received an “investigative subpoena” from the SEC’s Enforcement Division in July. That subpoena requests ‘documents and information regarding certain of our holdings, customer programs and operations.’

[Circle] didn’t elaborate on what the SEC’s investigation was focused on, [however] the subpoena arrived one month after Circle began onboarding corporate USDC holders into its first high-interest yield product, Circle Yield.

It’s not the firm’s first disclosed run-in with the SEC as it prepares to go public in a special purpose acquisition company deal that values the company at $4.5 billion.”

See Also: The US Inches Closer to Stablecoin Rules

Credit Suisse is taking part in the tokenization of a Swiss resort using the Ethereum blockchain. The law in Switzerland was updated in February to allow tokenized securities to trade on a blockchain with the same legal standing as traditional assets.

What’s interesting is that this project is also making a private placement, i.e. capital increase, based on tokenized securities, with the objective to provide secondary market trading.

The shares will begin to trade on the Taurus Digital Exchange (TDX) in the first quarter of next year to provide liquidity to Alaïa investors and employees. Earlier this year, Taurus received a license from the Swiss Financial Market Supervisory Authority to run a marketplace for digital assets.”

See Also: Altair Upgrade Set to Activate on Ethereum Mainnet This Month

THORSwap is the first multi-chain exchange using the THORChain protocol. This means that it allows users to swap tokens, for example, BTC for ETH, in one step without using an intermediary like a centralized exchange.

THORSwap currently only offers coins that are supported by THORChain, including BTC, LTC, ETH (and ERC-20 tokens) and BNB, but it is looking to integrate more coins outside of THORChain’s liquidity. Two networks of interest are 1inch and 0x.

Multi-chain solutions are said to be a game-changer by many people in the industry, with Arc Managing Director David Nage calling it the “actualization of free markets.”

Unlocking cross-chain liquidity will be critical to the future of decentralized finance.”

See Also: Blockstream’s Liquid Network Faces Delay in Processing as Transactions Begin to Stack Up

While very similar in look and feel to popular blogging platform Medium, Mirror shakes things up with an array of crypto-native features and capabilities. It’s a decentralized protocol that lets users log in and “sign” posts with an Ethereum wallet, plus it uses blockchain-based storage protocol Arweave to “permanently” back up posts and boost their censorship resistance.

Over the past several months, Mirror has added various crypto-centric economic elements to enable monetization for users, unlocking the ability to offer NFT collectibles, hold auctions, and even launch crowdfunding campaigns.

In April, the writer Emily Segal funded her next novel on Mirror. In July, the creators of an upcoming documentary film about Ethereum raised $1.9 million worth of ETH through a Mirror crowdfunding drive. In particular, Mirror has become a popular tool for DAOs, or decentralized autonomous organizations. DAO communities largely live within Discord servers, so Mirror provides a decentralized way to publicly share long-form information.

Mirror also shared a list of features coming to the platform in the future, including subscriptions, blog feeds and discovery elements, a richer editing platform, and support for Ethereum Name Service (ENS) domain-like names.”