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- Nigeria’s central bank greenlights cNGN stablecoin to launch in February 🇳🇬🪙
Nigeria’s central bank greenlights cNGN stablecoin to launch in February 🇳🇬🪙
PLUS: Ready Player One-style metaverse launches with Warner Bros support. SEC reissues crypto ‘FOMO’ warning amid hope for spot Bitcoin ETFs.
Manan Vora
January 08, 2024
Snapshot Web3
January 8, 2024
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Regulatory and Legal News
Próspera, a special economic zone in Honduras, has officially recognized Bitcoin as a unit of account, allowing it to measure the market value of goods and services. The move, less than two years after adopting Bitcoin as legal tender, aims to boost financial freedom in the area. However, the implementation of the "Final BTC Tax Payment Procedure" is currently delayed due to technological and regulatory issues. Businesses opting for Bitcoin as their unit of account will report tax liabilities in BTC once these issues are resolved. Próspera ZEDE has become one of the most competitive special regimes in Latin America, attracting over $100 million in three years and creating 3,000 jobs.
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Innovation and Launches
The Central Bank of Nigeria has approved the Africa Stablecoin Consortium to launch the cNGN stablecoin in its regulatory sandbox on February 27, 2024. The stablecoin, compliant with CBN and SEC standards, is not a substitute for the eNaira but complements it. Pegged 1:1 to the Nigerian naira, the cNGN aims to facilitate cost-effective international transactions, including remittances, through blockchain technology. The CBN, acknowledging the global demand for crypto, recently lifted restrictions on Nigerian banks facilitating cryptocurrency transactions in a circular on December 22, 2023.
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NFT, Gaming and Metaverse
Readyverse Studios, inspired by "Ready Player One," launches as a metaverse project with support from Warner Bros. Discovery. The RP1-inspired metaverse is expected to debut this year. Visa is testing a Web3 customer loyalty program, allowing brands to create digital wallets for points and experiences. OpenSea falls to the fourth-most used NFT marketplace in weekly trading volume, trailing Blur, OKX, and Magic Eden. Influencer Logan Paul plans to refund $2.3 million to those who bought NFTs for his never-launched game, CryptoZoo, addressing the project's derailment by bad actors.
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Scams and Hacks
Crypto payment gateway CoinsPaid experienced its second security breach in six months, resulting in unauthorized transactions totaling over $7.5 million, according to Web3 security firm Cyvers. Detected on January 6, the breach allowed the withdrawal of $6.1 million in various digital assets. The attacker exchanged 97 million CPD tokens for ETH before moving funds to external accounts and crypto exchanges. This marks the second security incident for CoinsPaid, following a $37 million theft in July 2023, attributed to the North Korean state-backed Lazarus Group. CoinsPaid, an Estonian payment processor, claims to have processed over 19 billion euros in crypto transactions but has not commented on the recent breach.
Solana farming protocol MangoFarmSOL is suspected of an exit scam as it deactivated its social media and website after reports of missing funds. The project, promising high yields, had a scheduled MANGO token airdrop on January 10. Security auditor "Foobar" warned of a compromised front-end, hinting at a potential rug pull. The project's online presence disappeared, and estimated losses are around $2 million. Users circulated messages from the alleged scam developer, admitting involvement in Ponzi schemes and mentioning another Solana-based yield protocol, BananaMiner. Representatives from BananaMiner denied any connections with MangoFarmSOL. Solana has seen increased scams, including the sale of Solana drainer kits.
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Funding, Acquisitions and Partnerships
Coinbase plans to expand its European Union derivatives offerings by acquiring a MiFID II-licensed entity in Cyprus. This move enables Coinbase to offer regulated derivatives like futures and options in the EU. Derivatives constitute 75% of Coinbase's total crypto trading volumes. The acquisition aligns with Coinbase's "Five-point Global Compliance Standard" covering AML, KYC, global sanctions enforcement, governance best practices, and ongoing monitoring. Despite facing competition from major players like Binance and Deribit, Coinbase aims for global growth, recently securing a virtual asset service provider license in France and selecting Ireland as its central regulatory hub in the EU.
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Price Action
A potential Bitcoin ETF approval should lift all boats including Ethereum as ETH price eyes 75% upside in the months ahead.
Solana’s native token SOL dropped under $100 due to reduced demand for the network’s DApps and negative SPL token performances.
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Interesting Reads
The final steps for the introduction of a spot Bitcoin exchange-traded fund (ETF) involve asset managers submitting final revisions by January 8, including remaining fees and tickers. Exchanges have already submitted required forms, and a decision from the SEC is anticipated, possibly through a vote or delegated authority. Analysts expect most applicants to be approved by January 11 for a potential debut. A letter opposing ETF approval was dismissed, and despite historical denials, the SEC is under increasing pressure to approve a spot Bitcoin ETF.
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Resource of the Day
A mainnet is the primary operational blockchain network where real transactions occur using the native cryptocurrency. Different from testnets, it represents the final product of development activities and supports features like governance, staking, and transaction fees. Mainnets undergo test phases before the actual launch, utilizing specific consensus mechanisms like proof-of-work or proof-of-stake. They enable the operation of decentralized apps (DApps) and smart contracts. Mainnet deployment for developers involves addressing challenges like security, scalability, interoperability, compliance, and governance through careful auditing and planning.
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Miscellaneous
Social media users have pointed out that the regulator’s “no go to FOMO” warning comes amid heightened anticipation over spot Bitcoin ETF approvals.
BlackRock is reportedly set to break the news to 600 employees in the coming days amid hopes for the approval of its spot Bitcoin ETF application.
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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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