Snapshot Web3

October 5, 2023

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Regulatory and Legal News

Bank of Korea to start CBDC infrastructure pilot

The Bank of Korea (BOK) plans a pilot for a central bank digital currency (CBDC), involving private and public institutions, with technical support from the Bank for International Settlements. This project aims to assess the viability of a future monetary system based on "wholesale CBDCs." It will include testing both retail and wholesale CBDCs, with retail CBDC live testing expected in Q4 2024. The BOK emphasizes that this pilot does not guarantee eventual implementation, but it marks a significant step toward the future monetary system.

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Innovation and Launches

Hong Kong Stock Exchange launches settlement platform powered by smart contracts

The Hong Kong Stock Exchange (HKEX) has unveiled "Synapse," a pioneering equities settlement platform powered by smart contracts written in DAML. This system aims to expedite trades made by international investors for Mainland Chinese stocks. It will operate on Stock Connect, a channel enabling access to over 1,000 mainland Chinese stocks. The platform will link HKEX with Hong Kong’s Depository Trust and Clearing Corporation for centralized matching of cross-border transactions, streamlining trade confirmation workflows. This development comes amid Hong Kong's emergence as a hub for Web3 firms, alongside recent challenges such as the JPEX crypto exchange Ponzi scheme.

Stellar, PwC publish ‘framework’ to judge emerging market blockchain projects

The Stellar Development Foundation, with PwC, unveils a framework for assessing blockchain projects in emerging markets like Colombia, Argentina, Kenya, and the Philippines. Their findings indicate that blockchain-based payments greatly enhance accessibility, lowering fees to 1% or less. The framework evaluates projects based on parameters like access, quality, trust, and usage, offering a structured approach to measure effectiveness in promoting financial inclusion. This approach aims to provide a clear evaluation of what is needed for success in these projects.

El Salvador launches first Bitcoin mining pool as Volcano Energy partners with Luxor

El Salvador's Volcano Energy partners with Luxor to launch the country's first local Bitcoin mining pool, Lava Pool. This renewable energy project, backed by Tether, aims to power Bitcoin mining with green energy. The collaboration with Luxor enhances its mining capabilities. Volcano Energy plans to contribute to Bitcoin's decentralization and boost economic viability through renewable energy. The project will reinvest mining profits into energy infrastructure, starting with a 241 MW renewable energy park. This initiative underscores El Salvador's pioneering role in Bitcoin adoption and green energy.

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NFT, Gaming and Metaverse

Chain Letters: MoMA Launches 'Postcard' NFT Art Project

MoMA launches "MoMA Postcard," an interactive NFT project where users create collaborative art on the blockchain. Participants send digital chain letters with customizable "stamps" to build themed art pieces. This initiative aims to explore NFTs and blockchain in an accessible way, minting NFTs on Tezos. It reflects MoMA's commitment to blockchain and digital art, mirroring a trend among major art institutions.

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Scams and Hacks

Hong Kong police, regulator form crypto task force as JPEX saga unfolds

The Hong Kong Police Force and the Securities and Futures Commission have established a task force to address illicit activities on crypto exchanges, prompted by the JPEX scandal. This group will focus on monitoring and investigating Virtual Asset Trading Platforms (VATPs), sharing information on suspicious activities, assessing risks, and collaborating on investigations. The move follows recent detentions related to the unlicensed operation of JPEX. This effort underscores Hong Kong's determination to tighten crypto market regulations in the wake of these events.

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Interesting Reads

Time to ‘pull the brakes’ on Ethereum and rotate back to Bitcoin: K33 report

K33 Research advises shifting focus back to Bitcoin due to lackluster performance of new Ethereum futures ETFs. Initial trading volume for Ether futures was only 0.2% of Bitcoin's ETF debut in 2021. The report predicts a sideways trend for most of the crypto market. Bitcoin stands out with potential ETF approval and an upcoming halving event. However, Ben Laidler at eToro warns of potential downward pressure on crypto prices due to factors like rising oil prices and Federal Reserve policies.

BIS, EU central banks building data platform to track crypto, DeFi flows

The Bank for International Settlements (BIS) and several European central banks, including Deutsche Bundesbank and the European Central Bank, have developed a proof-of-concept called Project Atlas. This system aims to track both on-chain and off-chain transactions from cryptocurrency exchanges and public blockchains. Project Atlas provides insights into the macroeconomic relevance of cryptocurrency markets and decentralized finance (DeFi) protocols. The project aims to offer a transparent overview of cross-border flows in the cryptocurrency ecosystem. The next phase will involve incorporating more data sources and analyzing Ethereum network nodes and DeFi protocols.

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Quick Links

New book reveals Binance CEO CZ rejected SBF’s $40M request for futures exchange

Michael Lewis’s new book “Going Infinite” reveals that CZ and SBF had different goals when the first collaborative business opportunity arose in 2019.

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Miscellaneous

Polygon co-founder steps down, will contribute ‘from the sidelines’

Jaynti Kanani, co-founder of Polygon, has announced his step back from day-to-day involvement in the project after six years. He intends to focus on new ventures while contributing to Polygon in a more advisory capacity. Kanani, along with other software engineers, played a pivotal role in founding the Matic network, which later became Polygon. The move comes as Polygon Labs works on the transition to Polygon 2.0, utilizing zero-knowledge proofs across four protocol layers. Several co-founders are still involved in side projects on the platform.

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Funding

TON raises 8-figure sum from MEXC to make Telegram a Web3 super-app

MEXC Ventures, the venture arm of the cryptocurrency exchange MEXC, has invested an eight-figure sum in the Open Network (TON), originally conceived by Telegram. This funding is part of a strategic partnership to promote global Web3 accessibility. MEXC will offer marketing and promotional services for TON-based projects, introduce a TON collateral lending service, and eliminate trading fees for the TON token. The TON Foundation aims to boost Web3 adoption within the Telegram messenger, making cryptocurrency use as simple as messaging. Telegram founder Pavel Durov has highlighted TON's role in Telegram's potential Web3 journey.

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Resource of the Day

What is the CryptoNight mining algorithm, and how does it work?

The CryptoNight algorithm is a Proof-of-Work (PoW) protocol designed for CPU and GPU mining, with a focus on privacy and resistance to ASIC dominance. It combines various hashing functions, including CryptoNight and Keccak, to create a secure and efficient mining process. Originally adopted by cryptocurrencies like Bytecoin and Monero, it later faced challenges in maintaining ASIC resistance. Despite this, it remains a valuable tool for privacy-conscious users and emphasizes fair mining opportunities for individuals.

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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.