Snapshot Web3

October 18, 2023

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Regulatory and Legal News

South Korean regulator outlines steps to enhance digital asset legislation

South Korea's Financial Supervisory Service (FSS) is working on additional regulations to complement the Virtual Asset Users Protection Act passed earlier this year. These regulations, set to be ready by January, will cover listing procedures, internal controls, issuance, and distribution of virtual assets. The FSS is also developing a "virtual asset market supervision and inspection system." The head of FSS, Lee Bok-hyeon, mentioned that the law passed in June lacked specific regulatory details and did not grant the agency sufficient authority, especially in cases involving manipulation of distribution volume. The FSS is in discussions with the Digital Asset eXchange Association (DAXA) regarding these regulations.

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Innovation and Launches

Swiss Bank Offers Clients Crypto Lending Product

Swiss online bank Dukascopy has launched a crypto lending product, allowing customers to borrow against their cryptocurrency holdings. Users can receive a loan for 50% of the value of their crypto assets in fiat currency while retaining their original crypto investments. To access this feature, customers need to open a multi-currency bank account, transfer their chosen crypto, and select the "Crypto lending/borrowing" option. This move comes at a time of increased regulatory pressures and high-profile incidents in the crypto lending sector. Dukascopy Bank is regulated by the Swiss Financial Market Supervisory Authority.

Ethereum L2 Scroll Mainnet Launch Marks Milestone in Ethereum Scalability

Scroll, a network leveraging zero-knowledge proofs to enhance Ethereum's scalability, has officially launched its mainnet. The goal is to provide a similar experience to Ethereum while reducing fees, increasing speed, and achieving unlimited scalability. Scroll has collaborated with the Ethereum Foundation and the open-source community to develop zkEVM technology, which is compatible with Ethereum's EVM. The mainnet launch is a significant milestone, expanding possibilities for decentralized applications and value transfer. Initial efforts will focus on onboarding infrastructure providers. Scroll also plans to develop a decentralized proof network and sequencer for future airdrops and coin issuance.

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Funding

Vitalik Buterin-linked biotech charity Kanro transfers $15M to fund grant

Ethereum co-founder Vitalik Buterin's recent $15 million transfer to Gemini was actually a transfer from a charity multisig wallet to fund a grant, according to an Ethereum Foundation spokesperson. The funds never left Buterin's wallet. The charity, Kanro, focuses on biotech solutions for COVID-19 and related issues. While blockchain analytics initially flagged the transaction, it was clarified that Buterin was a signer on a separate multisig wallet transfer and did not directly send funds to Gemini. Buterin's wallet has seen several transactions in recent months, including a $600,000 transfer to Coinbase and a $1 million transaction in August.

Bitcoin Metaverse Token Pre-Sale From ‘Life Beyond’ Team Raises $3.5M

Darewise Entertainment, the developer of "Life Beyond," an NFT-focused sci-fi game, has raised $3.5 million in token pre-sales. The project aims to build a metaverse around Bitcoin Ordinals, allowing digital assets to be recorded on the Bitcoin blockchain. The Darewise token, developed with Horizon Labs, is set to launch early next year and will serve as the native currency for the metaverse. Investors include Gamefi Ventures, London Real Ventures, and Animoca Ventures. The metaverse will feature gaming, brand integrations, real-world experiences, and more.

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NFT, Gaming and Metaverse

Reddit to wind down blockchain-based rewards service ‘Community Points’

Reddit has announced the shutdown of its blockchain-based rewards service, "Community Points," due to scalability concerns. The feature, which rewarded users with points for positive engagement in specific subreddits, aimed to incentivize higher-quality content. These points were initially based on Ethereum's ERC-20 tokens, later migrating to the Arbitrum layer-2 scaling solution for improved scalability. Each subreddit had its unique token, like Moons (MOON) for r/CryptoCurrency and Bricks (BRICK) for r/FortNiteBR. The shutdown, scheduled for Nov. 8, has sparked disappointment and frustration among users and crypto enthusiasts, with token values dropping significantly after the news.

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Scams and Hacks

Fantom Foundation hot wallet hacked for $550K

The Fantom Foundation, the entity behind the Fantom network, has reported a hack resulting in the loss of over $550,000 worth of cryptocurrency. Initially, blockchain researchers estimated the losses at around $7 million. However, the foundation clarified that not all the stolen funds were theirs, as some of the wallets had been reassigned to an employee and no longer held company funds. The team is currently investigating the incident to determine how the wallets were compromised. The attack targeted both the foundation and other Fantom wallet users, not the Fantom network itself.

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Interesting Reads

Tokenized Real-World Asset Market to Hit $10 Trillion By 2030, 21.co Projects – Can RWAs Power Ethereum (ETH) to Multi-Trillion Market Cap?

Digital asset management company 21.co projects that the market capitalization of tokenized real-world assets (RWAs) could potentially reach $10 trillion by the end of the decade in a bullish scenario. Even in a bearish scenario, it's estimated to reach $3.5 trillion before 2030. Presently, the market cap of tokenized RWAs stands at approximately $116 billion, with stablecoins accounting for the majority. Around 60% of these RWAs are issued on the Ethereum blockchain, highlighting Ethereum's pivotal role in decentralized finance, non-fungible tokens, and web3 applications. This trend, if sustained, could significantly boost the demand for Ether (ETH) in the coming years, potentially leading to a multi-trillion-dollar market cap.

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Quick Links

Coinbase lobbying efforts face setback from Hamas’ crypto use

Reports of Hamas using crypto to fund recent attacks in Israel could make Coinbase’s lobbying efforts more difficult, says Berenberg lead analyst Mark Palmer.

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Miscellaneous

Ripple job posting hints at possible IPO, XRP community says

Ripple's job posting for a shareholder communications senior manager has sparked speculation of a potential IPO. The role's responsibilities, including direct communication with shareholders and strategies for investors, are typical of publicly traded companies. The emphasis on creating investor-focused materials aligns with steps taken before an IPO. Ripple executives have mentioned the possibility of going public, although no specific timeline was provided. The company is currently facing a lawsuit from the U.S. SEC regarding XRP's classification.

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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.