Global Crypto Adoption Leader? India! 🏆😎

PLUS: Binance cuts third of staff in US. Franklin Templeton files for spot Bitcoin ETF.

Author

Manan Vora
September 13, 2023

Snapshot Web3

September 13, 2023

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Regulatory and Legal News

Fifty U.S. lawmakers, led by Congressman Tom Emmer, have reintroduced the CBDC Anti-Surveillance State Act to prevent the Federal Reserve from issuing a retail central bank digital currency (CBDC) that could infringe on Americans' financial privacy rights. Emmer emphasized the need for a CBDC designed to emulate cash, ensuring privacy, individual sovereignty, and free-market competitiveness. The bill aims to uphold these American values while safeguarding against potential surveillance-style CBDC implementation. The House Financial Services Committee will review the bill later this month.

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Innovation and Launches

Central banks of Hong Kong and Israel, along with the Bank for International Settlements, have unveiled Project Sela's findings. This initiative focused on creating a retail central bank digital currency (rCBDC) that combines cash-like attributes with digital advantages. Private partners like FIS and M10 Networks were involved. In the Sela ecosystem, central banks manage the rCBDC ledger, funding institutions oversee conversions, and access enablers handle customer services. The project aims to increase competition and accessibility in financial services. The report also addresses potential solutions for enhancing real-time gross settlement systems.

21.co, the parent company of crypto exchange-traded products provider 21shares, has introduced a suite of wrapped tokens pegged to top crypto assets across multiple blockchains. These wrapped tokens aim to enhance liquidity and interoperability between various crypto networks. They represent a 1:1 backing by the underlying native asset from a different blockchain. 21.co's approach focuses on security and institutional-grade cold storage custody. The suite includes tokens for BTC, BNB, XRP, ADA, SOL, LTC, DOT, and BCH. The Index Coop will be the first to utilize this technology for launching an index fund spanning different blockchains.

At the "Avalon Bitcoin & Crypto Day" conference in Singapore, Canaan, a bitcoin mining ASIC manufacturer, unveiled its latest Avalon 14 series mining rigs. Among them, the A1466I stands out with impressive energy efficiency of 19.5 J/T and a production capacity of up to 170 TH/s. This miner utilizes liquid cooling, a notable advancement in bitcoin mining efficiency. Canaan, a pioneer in ASIC bitcoin miners, marked its 10th anniversary with this presentation, emphasizing their ongoing commitment to innovation in the field.

Solflare, a Solana wallet provider, has integrated MetaMask Snaps, enabling MetaMask users to directly manage their Solana portfolio. This integration aims to streamline access to the Solana blockchain, making it more user-friendly. The co-founder of Solflare, Filip Dragoslavic, believes that this integration will encourage more users to explore Solana's ecosystem. Through MetaMask Snaps, users can interact with various decentralized applications within Solana. This development is seen as a significant step towards a more seamless user experience, as stated by Christian Montoya, the product lead at MetaMask Snaps.

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NFT and Metaverse

Diesel is partnering with Web3 platform Public Pressure for "Metamorph," a limited edition run of 300 NFTs minted on Polkadot and Polygon networks. These NFTs grant exclusive access to Diesel's Milan Fashion Week show and the chance to buy a limited edition Metamorph watch. Priced at $60 each, they also offer access to music events, an exclusive soundtrack, and a virtual experience. This collaboration underscores Diesel's commitment to merging fashion with technology for enhanced community interaction.

Meta, the parent company of Facebook and Instagram, is launching an educational program in the US aimed at inspiring students to explore the potential of the metaverse. This initiative will leverage virtual reality (VR) to facilitate learning. Meta has partnered with 15 US universities, including Stanford and Arizona State, to conduct classroom sessions and exercises in virtual reality, exploring how immersive technologies can shape the future of education. The company is also working on ways to highlight educational apps available in the Meta Quest store. While costly, Meta remains committed to developing the metaverse and VR technology.

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Scams and Hacks

Reports suggest that Coinex, a global cryptocurrency exchange, may have suffered a potential hot wallet hack, resulting in a loss estimated at nearly $28 million. Blockchain security firm Peckshield noticed unusual outflows of significant assets from Coinex-affiliated addresses, including ETH, MATIC, and TRX. The incident has raised concerns about the security of hot wallets on the exchange. Coinex has responded by forming a special investigative team to address the issue and has assured users that their assets are secure, promising 100% compensation for any losses incurred. Deposit and withdrawal services are temporarily suspended for added security.

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Interesting Reads

India, Nigeria, and Thailand lead in Chainalysis' "2023 Global Crypto Adoption Index," signaling strong grassroots cryptocurrency adoption, especially in lower middle-income (LMI) countries. The report notes that LMI nations have demonstrated the most robust recovery in grassroots crypto adoption over the past year. Despite an overall dip in grassroots crypto worldwide after the 2022 FTX incident, LMI countries have maintained or exceeded adoption levels from Q3 2020. This trend suggests that crypto is poised to play a significant role in the future of these economies, given their growing industries and large populations.

Recent price swings in cryptocurrencies caused $256 million in liquidation losses over two days, reports Coinglass. On Monday, fears about FTX selling its crypto holdings led to a market drop, resulting in $167 million in liquidations, with 90% being leveraged long positions. This marked the largest single-day leverage flush-out since the panic on August 17. Traders then piled into short positions, but a sudden short squeeze reversed the trend, wiping out another $89 million in positions, predominantly shorts. Open interest in BTC and ETH derivatives has notably decreased, potentially reducing their impact on spot prices.

Solana, recovering from last year's FTX collapse, aims to level block production through a unique roadmap. Co-founder Anatoly Yakovenko envisions multiple leaders per slot, offering more fairness in transaction processing. This approach could open block production to validators with as little as 0.001% staked Solana tokens, fostering competition and decentralization. Solana's wallet, Solflare, is also integrating with MetaMask Snaps for enhanced functionality and wider customization. Despite past setbacks, including FTX's collapse, Solana is gaining traction, with Visa allowing USDC settlement payments on its blockchain to speed up merchant settlements.

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Quick Links

Franklin Templeton has submitted an application to the U.S. SEC for a spot Bitcoin exchange-traded fund (ETF). The fund, structured as a trust, would have Coinbase as the BTC custodian and Bank of New York Mellon as the cash custodian and administrator. Shares would trade on the Cboe BZX Exchange. The SEC's decision deadline is Oct. 16. The application acknowledges regulatory uncertainties in the digital asset market. Franklin Templeton manages $1.5 trillion in assets.

Zodia Custody, a subsidiary of Standard Chartered, is teaming up with Parity Technologies to offer institutional support for the Polkadot blockchain. This partnership will provide custody services for the Polkadot ecosystem, with a focus on financial institutions. They also plan to enable staking of DOT, the native token of Polkadot, aiming to increase its adoption among institutions. This collaboration holds significance in the context of institutional adoption of digital assets.

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Miscellaneous

Binance.US, the U.S. arm of the crypto exchange, has laid off around a third of its staff (approximately 100 positions) and its CEO, Brian Shroder, has left the company. This move is aimed at providing the exchange with a more secure financial runway as it transitions to being a crypto-only platform. A spokesperson for Binance.US cited regulatory pressure from the U.S. Securities and Exchange Commission (SEC) as a significant factor in these decisions. Norman Reed, the Chief Legal Officer, has taken on the role of interim CEO. Shroder's departure follows a series of regulatory challenges faced by the exchange.

Ethereum co-founder Vitalik Buterin and a group of privacy experts have proposed a solution to enhance privacy in blockchain transactions. They suggest combining technologies like zero-knowledge proofs and "Privacy Pools" to create a unique approach. This allows users to join a cryptocurrency washing pool to hide their blockchain history while still being able to dissociate from any illicit use. However, there is debate within the crypto community about the balance between compliance and privacy, with critics arguing it may contradict the decentralized ethos of blockchain technology.

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The information provided in this newsletter is for informational purposes only and should not be interpreted as investment advice, endorsement, or recommendation. Cryptocurrency investments carry significant risk due to their volatility. You should consider your financial situation, investment goals, and risk tolerance before making any investments. We strongly recommend consulting a qualified financial advisor before making any investment decisions. Past performance is not indicative of future results.

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