MiCA Regulations Bring Clarity, UK as a Hub for Web3, Coinbase Sues SEC & Michael Saylor's New Lightning Network Email Process

??Hey everyone! In our latest newsletter we've taken a closer look at exciting developments in Europe including the potential for the United Kingdom to become a hub for Web3 innovation, and the introduction of MiCA regulations firming up regulatory clarity for EU based crypto companies. A far cry from the US, where popular exchange Coinbase has sued the SEC over failure to provide guidance for crypto regulation. For the more technical amongst us, we’ve got a new method for creating and sending Bitcoin lightning network transactions via Email and website domains, popularized by BTC permabull and MicroStrategy CEO Michael Saylor. We even dive into how you can do this yourself as we are huge supporters of advancements that make mass adoption easier. Finally Crypto lending DeFi project FilDA Finance has been hacked for $700,000 and the mystery still remains surrounding $10M in ETH that has been stolen in a sophisticated attack with no clear indication of how. Let's dive in.

EU Leads The Way In Comprehensive Regulation

Starting with some positive news,?we are excited to see the recent approval of the world's first comprehensive crypto regulation by the European Union. This development is a significant step towards the mainstream adoption of cryptocurrencies and aims to promote innovation while safeguarding consumers and investors from fraud and hacking.

The new regulations apply to all 27 EU member states and mandate that crypto exchanges and custodian wallet providers comply with strict anti-money laundering (AML) and counter-terrorism financing (CTF) requirements. The regulation also includes provisions for the issuance and trading of stablecoins, as well as clear guidelines for initial coin offerings (ICOs).?

We expect these new regulations to become effective within the next year and believe that they could serve as a blueprint for similar legislation in other jurisdictions.

More bullish news as the recent decision by the Financial Conduct Authority (FCA) to grant Coinbase an e-money license is a clear sign of the UK's positive attitude towards the sector. This license will allow Coinbase to offer an expanded range of financial services to UK customers, including faster payments and additional fiat currency support.

But it's not just about regulation - the UK also has a highly skilled workforce and a strong position in the fintech industry. We see this as a great advantage for Web3 companies looking to establish a presence in Europe.

In addition, the UK government has shown a commitment to supporting innovation in emerging technologies. Recently, it announced a ￡10 million fund to explore the use of blockchain in public services.?

The UK is well-positioned to become a leading hub for Web3 innovation. Its supportive regulatory environment and strong tech ecosystem make it an attractive destination for startups in the sector.

Make your email and website domain into a BTC lighting wallet-

Last week, Michael Saylor, the CEO of MicroStrategy and a prominent Bitcoin advocate, created a Bitcoin Lightning email address. This innovation allows him to send and receive Bitcoin payments via email and to domains such as https://www.microstrategy.com/ and he believes that it could help to further mainstream adoption. At TrustWare we are always interested in the Web2.5 approach, as a way to bridge the gap between Web2 and Web3 audiences. Utilizing trusted and well known standards such as email is a step in the right direction, even if the process is somewhat complex currently.?

For those interested, the article details the technical process behind creating a Lightning email address, which involves setting up a Lightning node and configuring it to work with email protocols. Eventually Saylor believes that Lightning email addresses could become as ubiquitous as traditional email addresses, making it easy for anyone to transact in Bitcoin without needing to know how to use a crypto wallet. Definitely interesting!

Give it a try yourself, here are the steps to add Lightning support to your personal domain:

1. Install the Alby browser extension on Chrome or Firefox and create an account with Alby.
2. Create a new Lightning Address with Alby at the bottom of the account creation page.
3. Go to https://getalby.com/.well-known/lnurlp/<USERNAME> (replace <USERNAME> with your own username).
4. Download the file by clicking "save" and remove the ".json" at the end of the file name.
5. Upload the file to the same location on your website server:
6. https://yourdomain.com/.well-known/lnurlp/<USERNAME>
7. Test it out by attempting to send a Lightning payment to an email at your domain. Protip, always start by sending a few Sats.
8. For more information on alby. Please visit.

https://blog.getalby.com/introducing-the-alby-wallet-api/

Unsolved Hacks And Malicious Attacks

Unsurprisingly and sadly we are reporting yet more malicious behavior in the world of crypto, as users have fallen victim to a sophisticated attack resulting in the loss of 5,000 ETH, worth over $10.4 million since December. The former CEO and founder of MyCrypto wallet manager, Taylor Monahan, took to Twitter to pinpoint that the attack is likely beyond a simple phishing scam.

Further investigations revealed that the malicious actors may have targeted improperly secured secret recovery phrases, which give the hacker access to the victims' private keys, enabling them to execute transactions from the compromised crypto wallets.

MetaMask, a popular crypto wallet, advised users to create new wallets in the event they cannot recall if they have been 100% secure with their keys. In light of the attack, Monahan suggested against keeping all assets in a wallet protected by a singular key or secret phrase, and urged users not to keep their private keys on any online/Internet-enabled device.

The TrustWare team recommends additional security measures such as a multisig or a MPC wallet, single private key solutions are just plain unsafe. Stay extra vigilant with your? private keys and ensure they are adequately secured to prevent similar incidents from occurring to you.?

And finally, Crypto lending DeFi project FilDA Finance has suspended operations on the Elastos Smart Chain (ESC) and REI Network following an exploit that resulted in a loss of around $700,000. The project has identified the vulnerability and isolated the attack vector, and is currently investigating the incident. All digital assets on FilDA's ESC Chain, including Elastos token, Bitcoin, and BUSD, were affected by the hack. However, assets on other chains remain unaffected. This is the second time that FilDA's ESC chain has been exploited, the first being in April 2022, when the project lost around $2 million. FilDA has a total deposit and loan amount of $21.3 million and 145,574 current addresses on the network.

We hope you found this update informative. As always, TrustWare is committed to keeping you safe and up-to-date regarding the latest developments in the crypto world. Stay tuned for more updates!

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