Snapshot Web3

October 23, 2023

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Regulatory and Legal News

Sam Bankman-Fried trial moves to final stages

The trial of Sam Bankman-Fried, the founder of FTX, is entering its final stages, with the prosecution set to conclude its case on October 26. Over the past three weeks, the prosecution has presented a series of witnesses, including former FTX employees, investors, and government officials. The central argument is that Bankman-Fried intentionally deceived them, resulting in an $8 billion gap between FTX and Alameda Research in November 2022. Bankman-Fried's defense team has not confirmed whether they will present a case. If they do, it will begin on October 26. Bankman-Fried could face up to 115 years in prison if convicted.

Hong Kong securities regulator updates crypto policies, citing market developments

The Securities and Futures Commission (SFC) of Hong Kong has announced updates to its policies on virtual currency sales and requirements, citing recent market developments and industry inquiries. Under the revised guidelines, certain virtual currency products will only be accessible to professional investors, and intermediaries in the crypto space must assess their clients' knowledge of virtual asset investing before handling transactions. The SFC considers virtual assets as "complex products," subject to the same regulations as similar financial products. This move comes after over 1,000 users reported losses from the JPEX crypto exchange, which led to six arrests for operating an unlicensed crypto exchange.

Pro-Bitcoin Javier Milei trails as Argentina’s presidential election goes to run-off

In the first round of the Argentine presidential election, pro-Bitcoin candidate Javier Milei did not secure victory. Economy minister Sergio Massa led with over 36% support, while Milei trailed with just over 30% of the vote. Since no candidate received the required 45% of votes or 40% with a lead of 10 percentage points, a run-off vote is scheduled for Nov. 19. Milei, an anarcho-capitalist, advocates for reducing government size, abolishing the central bank, and adopting the U.S. dollar. He sees Bitcoin as a reaction against central bank practices. Massa, in contrast, proposes launching a central bank digital currency to combat inflation.

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Innovation and Launches

Runtime Verification launches universal ZK rollup PI Squared on MultiversX

Illinois-based security audit firm, Runtime Verification, has unveiled a universal zero-knowledge (ZK) rollup called 'PI Squared' on the MultiversX blockchain. PI Squared utilizes a custom parallel ZK circuit as a universal proof checker, revolutionizing how computational claims are verified. This innovation aims to enhance security and reliability, particularly in the context of smart contracts. PI Squared is designed to be accessible and user-friendly for developers, users, and enterprises on the MultiversX blockchain, offering a more secure blockchain ecosystem.

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NFT, Gaming and Metaverse

Web3 Watch: Austrian tourism providers want to mint your vacation

Austria is embracing Web3 tourism, where tourists can attend museums and verify their visits with NFTs, which can then be used for discounts at various establishments. This initiative is part of a collaboration between Web3 firms and Austrian regional groups, aiming to provide a novel tourist experience. Meanwhile, in Palau, a Pacific island nation, officials are implementing an NFT identification card system as part of a digital residency program to attract tourists and digital nomads, aligning with their goal to become cashless. Additionally, Austin-based company Blackdot has released an automated tattoo device, hinting at plans to enable clients to own tattoos as NFTs in the future, introducing the concept of "tradable tattoos."

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Scams and Hacks

EtherHiding: Why hackers may prefer Binance’s BNB Smart Chain

The new attack vector called "EtherHiding" concealing malicious code in blockchain smart contracts is being favored by threat actors who prefer using Binance's BNB Smart Chain due to its lower costs compared to Ethereum. This tactic involves compromising WordPress websites to pull partial payloads from Binance smart contracts, distributing malware to users disguised as browser updates. Additionally, the increased security scrutiny on Ethereum, including IP address tracking for MetaMask transactions, might be prompting hackers to opt for BNB Smart Chain for lower risk of discovery. The complex and constantly updated nature of EtherHiding makes it challenging to detect and counter.

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Interesting Reads

Layer 2 and DeFi Shine in 2023 as NFTs Lose Their Luster: Nansen

In 2023, Ethereum's landscape has witnessed a significant shift. There's been a surge in daily active addresses, surpassing 300,000. Among these, DeFi entities have emerged as dominant players, outnumbering NFT and layer 2 users. Layer 2 activities have seen a notable rise, indicating a move towards scalability solutions, with users increasingly adopting layer 2 platforms. The 'Layer 2, Bridging, and Infrastructure' sector has experienced a remarkable 149.28% increase in incoming transaction counts. In contrast, the NFT sector has experienced a decline, with daily user count dropping by over 50% since the beginning of the year.

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Quick Links

Bitcoin core developer steps back from Lightning Network over “hard dilemma”

Antoine Riard believes the Bitcoin community faces a “hard dilemma” as a new class of replacement cycling attacks threatens the Lightning Network.

Binance shutting down European Visa debit card in December

Mastercard ended its partnership in Latin America and Bahrain with Binance in September, possibly due to the regulatory environment.

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Miscellaneous

Uniswap founder burns $650B HayCoin against speculation

Uniswap founder Hayden Adams made a significant move by burning 99% of the HayCoin (HAY) supply on October 20th. This decision was driven by concerns over recent price speculation. The HAY token, initially deployed for testing five years ago, saw unusual trading behavior, with people treating it like a memecoin. Adams, uncomfortable with the speculation, opted to burn almost the entire supply, which was valued at an estimated $650 billion. This action permanently removes the tokens from circulation and can lead to inflationary effects on their price. Currently, the HAY token is traded at $2,392,640, showing over a 235% increase in the past 24 hours.

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Resource of the Day

How to improve your Web2 business with blockchain

Blockchain technology has the potential to bring transformative changes to traditional businesses operating in the Web2 environment. As Web3 emerges, companies should consider integrating blockchain features that enhance customer relations, security, and trust between stakeholders. To effectively leverage blockchain, businesses should focus on simplicity and accessibility for end users. This includes exploring specialized blockchain solutions, implementing account abstraction for a seamless user experience, and streamlining internal processes. Additionally, Web3 offers opportunities for personalized customer experiences, loyalty rewards, and enhanced data security. Embracing Web3 technology can lead to increased transparency, improved efficiency, and a competitive edge in the evolving digital landscape.

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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.