9 September

A group of Tornado Cash users filed a lawsuit against the U.S. Department of Treasury, calling its sanctioning of the Ethereum mixing service an ‘unprecedented, overbroad action.’ The suit, which is being funded by Coinbase and includes several employees as plaintiffs, also names Treasury Secretary Janet Yellen and Director of the Office of Foreign Assets Control (OFAC) Andrea Gacki.

That rationale is far too broad, Coinbase CEO Brian Armstrong wrote in a blog post about the lawsuit. ‘Sanctioning open source software is like permanently shutting down a highway because robbers used it to flee a crime scene.’ Jonathan Van Loon, one of the plaintiffs and an Ethereum core developer at Prysmatic Labs, wrote:

Code is speech and free speech is a constitutional right worth protecting.”

See Also: Firm Behind Ethereum Name Service and Virgil Griffith Sue GoDaddy Over Sale of Eth.link

The White House Office of Science and Technology Policy called for the U.S. to conduct further research on the energy impact of crypto mining in order to set standards for the industry, in a new report published Thursday.

The report calls on federal agencies including the Environmental Protection Agency and the Department of Energy to work with states and local officials to develop standards for the industry’s impact on the environment; the intensity and source of energy that goes into it, noise pollution, water usage as well as how to build carbon-free energy to balance out crypto mining’s consumption.

Should these measures prove ineffective at reducing impacts, the Administration should explore executive actions, and Congress might consider legislation, to limit or eliminate the use of high energy intensity consensus mechanisms for crypto-asset mining.

The report said that crypto mining, particularly bitcoin (BTC) mining, uses a lot of electricity, which undermines U.S. sustainability goals.”

“The U.S. Treasury Department will advise the federal government to press forward on work to issue a digital dollar, though it should only take the final step if there’s sign-off that the government-created tokens are in the “national interest,” according to a person familiar with a report emerging soon.

The Treasury’s document on how to handle the question of a digital dollar – expected to be released in the coming days – is among the most eagerly awaited, because issuing such a token could upend the digital assets industry and have major implications for consumers’ relationships with traditional banks.

While the “Future of Money” report won’t explicitly provide an administration endorsement for the digital dollar, it will suggest potential ideas for how it could be designed. It will also highlight work being done on a government real-time payments system expected to begin next year, which may take some pressure off the CBDC decision.

Even if Biden, Congress and the Fed eventually decide to put out a digital dollar, it could take as much as five years to design and launch one. That would give the crypto industry a long time to establish private stablecoins as an alternative for users. Fed officials have said they believe there would be room for the private sector to operate dollar-pegged cryptos alongside a public token.”

See Also: House Republicans Want Answers From Fed on Digital Dollar
See Also: UK economic secretary commits to make country a crypto hub under new PM

“In a Wednesday report, Chainalysis explained that the upcoming Ethereum upgrade would introduce institutional investors to staking yields similar to certain instruments such as bonds and commodities while also becoming much more eco-friendly. The report said ETH staking is expected to offer a 10-15% yield annually for stakers, therefore making ETH an ‘enticing bond alternative for institutional investors.’

Ether’s price could decouple from other cryptocurrencies following The Merge, as its staking rewards will make it similar to an instrument like a bond or commodity with a carry premium.

According to Chainalysis data, the number of institutional ETH stakers — those with $1 million worth of ETH staked or more — has “been steadily increasing” from under 200 as of January 2021 to around 1,100 as of August this year. The report also tips ETH to draw in more retail and institutional traders after The Merge, as the forthcoming upgrade will make staking a much more attractive investment tool.

See Also: Bitcoin is a ‘wild card’ set to outperform —Bloomberg analyst
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“The DAO behind Aave has accepted a proposal to reward members from Aave Companies with $16.28 million in retroactive funding for their role in the development of Aave Protocol v3. The community has overwhelmingly voted in favor of the retroactive funding request, with community members suggesting ‘Aave Companies did tremendous work and should be paid for that.'”

The “retroactive public goods funding” model provides an incentive for developers to work on projects by allowing them to get paid after the project is completed and can be based on the value it provides. The core principle behind the concept is that “it’s easier to agree on what was useful than what will be useful.”

Vitalik suggests in the post that it can be difficult in the beginning phase of a project to get it off the ground, with donations and grant money being insufficient to incentivize developers.”

“At an industry conference today, Securities and Exchange Commission (SEC) chief Gary Gensler said that he supports handing the Commodity Futures Trading Commission (CFTC) the power to ‘oversee and regulate crypto nonsecurity tokens and related intermediaries.’ Gensler stressed that should Congress give the CFTC prime oversight over crypto, his own federal agency shouldn’t be overlooked.

There has been a flurry of proposals, both from the crypto industry itself and from Washington, to delegate oversight of the crypto industry to the CFTC, which presently only has the power to regulate derivatives.”

See Also: Crypto Doesn’t Need More Guidance, SEC Chair Gensler Says
See Also: International Regulators Struggle With How to Oversee DeFi

“Soulbound tokens, which in this case act as an identity passport across the BNB chain, are unique and non-transferrable. Users who would prefer their identity not be shared across the entire network can opt out of the token.

Binance’s soulbound token – named binance account bound (BAB) – will allow users to participate in “building projects” while earning rewards, according to the release.”

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