News from the blockchain world | episode 24 ???
It's Friday again and you know what it means! ?? It is time for the next episode of "News from the blockchain world". ?? This week was still full of echoes after the collapse of FTX but the Web3 world hasn't slowed down. And - what's important - it has not lost its sparkle. ?? From this edition, you will learn a.o.:
? Who is under investigation in the Bahamas for possible criminal misconduct?
? Who launches NFT wearables collection?
? Who is getting sued by crypto investors?
? Whose Proof-of-Reserves were (allegedly) cooked?
? Who is 35th on list of richest ETH holders?
? Who prepares for potential bankruptcy?
Wishing you all terrific afternoon and until next week!
??? Business?
?? Ripple Partners With Africa-Focused Remittances and Payments Firm MSF Africa.
Ripple, the United States-based tech firm, has said its crypto solution known as “on-demand liquidity” is set to help MSF Africa “streamline real-time mobile payments for customers in 35 countries.”
?? Binance to Relaunch Bid for Bankrupt Crypto Lender Voyager.
Binance.US is preparing to bid for bankrupt lending platform Voyager Digital, according to a person familiar with the plans. A previous auction, which was completed around the end of last September, saw the now defunct FTX emerging as the “white knight,” winning out against rivals Wave Financial and Binance. Following FTX’s announcement last week to file for bankruptcy, Voyager said it had reopened the bidding process for the company, and is in active discussions with alternative bidders.
?? Nexo had offered BlockFi an $850 million deal to potentially acquire it.
Crypto lender Nexo earlier this year made an unsuccessful offer to acquire troubled rival BlockFi as part of a proposed deal worth about $850 million, according to an "indicative investment proposal" document obtained by The Block. The offer was made in July when BlockFi was struggling financially after losing $80 million due to its exposure to now-bankrupt crypto hedge fund Three Arrows Capital. BlockFi rejected Nexo's offer and chose to stick with a non-final deal with FTX.US.
?? Abu Dhabi issues Binance a permit to provide financial services.
Abu Dhabis Global Market (ADGM) and Financial Services Regulatory Authority have granted cryptocurrency exchange Binance clearance to offer its services in the region. News came after Binance founder and CEO Changpeng Zhao attended the Abu Dhabi Finance Week. The announcement had its detractors. Chief among those was economist and cryptocurrency critic Nouriel Roubini. Roubini argued that Binance being banned in the United Kingdom and ongoing investigations by the United States Department of Justice suggests the exchange is a “walking timebomb”.
?? Singapore’s Temasek Writes Off $275 Million FTX Investment.
Singapores state-owned investor, Temasek Holdings announced on Thursday that it would be writing off its entire $275 million investment into the collapsed cryptocurrency exchange, FTX. The Singapore investor followed Soft Bank Groups Vision Fund and Sequoia Capital in writing off their FTX investment to zero. FTX was an aggressively growing cryptocurrency exchange that was valued at $34 billion in its last funding round.
?? Genesis Trading Joins List of Lenders Freezing Withdrawals.
Crypto lender Genesis Trading has joined the ranks of centralized lenders pausing withdrawals. In a Nov. 16 Twitter thread, the company blamed a liquidity crunch that started following the fall of 3AC and rebooted with the “unprecedented market turmoil” caused by the collapse of the second largest global crypto exchange, FTX, and its sister company, trading firm Alameda Research.
?? FTX-owned Japan crypto exchange Liquid halts all withdrawals.
The FTX-owned crypto exchange Liquid took to Twitter on Nov. 15 to officially announce a suspension of fiat and crypto withdrawals on its Liquid Global platform. Liquid cited compliance with the requirements of voluntary Chapter 11 proceedings in the United States.
?? SBF is still tweeting, he wants to ‘raise liquidity’.
Sam Bankman-Fried, former CEO of crypto exchange FTX, is still tweeting. He said that "too much leverage" and a run on the bank scenario were to blame for FTX's collapse. “So what can I try to do? Raise liquidity, make customers whole, and restart,” Bankman-Fried wrote. He said he may fail, but added, “part of me thinks I might get somewhere”. The tweets will raise many an eyebrow given that FTX filed for Chapter 11 bankruptcy protection and may have more than a million creditors. Moreover, its sister company Alameda Research used FTX customer funds for risky bets.
?? FTX Crisis Has Put These Companies on the 'Contagion' List.
FTX's collapse could spell trouble for many companies in which FTX or Alameda Research had previously invested. Overall, Alameda Research was responsible for 184 investments, FTX Ventures for 48 investments, and the FTX exchange for 21 investments.
?? Fantom Announces partnership with Gitcoin.
Fantom, one of the fastest-growing layer-1 blockchain platforms, today announced the next wave of its grants program alongside Gitcoin, the leading platform for open source development in Web3. Gitcoin has long been a cornerstone in funding for open source software in Web3. To date, Gitcoin has contributed over $72M, onboarded 312,000 active developers, and supported over 2,500 development projects. Through this collaboration, Fantom will allow the ecosystem builders within the Fantom Network to participate in a test round on Gitcoin’s new grants protocol.
?? Wallet that drained FTX accounts starts swapping millions of dai for ETH.
A crypto address connected to the suspected drain of FTX accounts is swapping decentralized stablecoin dai for ether in a series of multimillion-dollar trades. The source of these funds originated from hundreds of millions of dollars of unusual outflows from collapsed crypto exchange FTX. The transfers have been mentioned in the latest court filings for its bankruptcy protection.
?? BlockFi will 'explore all options' to deal with the fallout from FTX's bankruptcy after it took a $250 million loan from the exchange.
BlockFi received a $250 million loan from FTX in June as several crypto financial institutions, including Three Arrows Capital and Voyager Digital, tumbled in the wake of the summer's market meltdown. The loan, used to help keep the firm afloat, meant that BlockFi had a credit line with Sam Bankman-Fried's FTX US. BlockFi also said it had corporate assets held with FTX. BlockFi previously announced on Friday that it had paused its customers' ability to make withdrawals from their accounts.
?? FTX to reorganize, new CEO seeks support from staff during company conference call.
FTX's new CEO John Jay Ray III called on staff to rally together during an all-hands meeting. "We need your support," Ray told staff, according to those on the call. Former billionaire Sam Bankman-Fried stepped down from the company following a series of events last week. A number of others have also left, including former Head Of Institutional Sales Zane Tackett and head of FTX Ventures Amy Wu. Despite the troubles, some lower- and senior-level employees remained at the company.
?? Binance Starts Recovery Fund for Crypto Projects Facing Liquidity Crisis.
The CEO of Binance announced a plan to create a fund to help those projects that have strong foundations, but have been hit by a "liquidity crisis" as a result of recent events. "We will we will try to collect the other industry players together to form an industry association globally, and try to deal with some of the common standards in business".
?? Visa terminates global debit card agreements with FTX.
Visa Inc, the world's largest payments processor, said on Sunday it was severing its global credit card agreements with collapsed crypto exchange FTX. FTX and Visa had announced an expanded partnership in early October, including plans to introduce account-linked Visa debit cards in 40 new countries.
?? FTX confirms holding $900 million in liquid assets.
According to a sheet made public showing FTX's holdings, the exchange has just $900M in liquid assets against $9 billion in liabilities. The sheet further revealed $5.5 billion in minor liquid assets made up of crypto tokens, and $3.2 billion in illiquid investments in private equity. There’s also a $7 million contract entitled TRUMPLOSE.
??? Products?
?? U.S. banks along with Fed launch digital dollar pilot program.
A group of banking institutions - including HBSC, Mastercard and Wells Fargo - has announced the launch of a digital money platform called Regulated Liability Network (RLN). The platform will use blockchain technology to create opportunities to improve the operation of the current financial system. The idea is both for settlements between central banks, commercial banks and "regulated non-banks".
?? Adidas Originals launches inaugural NFT wearables collection.
Adidas Originals has unveiled a limited collection of blockchain-based virtual wearables, released as NFTs. Representing the brand’s first NFT collection of wearables, a new product category adidas calls “Virtual Gear”, the launch is part of a drive towards strengthening its “community-based, member first, open metaverse strategy”.
?? Superform, the first non-custodial Yield Marketplace.
Superform is the first non-custodial yield marketplace. It offers single transaction access into any ERC-4626 yield vault on any EVM chain using any asset. Superform is an omnichain application, meaning it does not have a home or primary chain. At launch, Superform will deploy on Ethereum, Polygon, Optimism, Arbitrum, Fantom, Avalanche, and BSC. The Superform closed beta will launch on November 28th.
?? 1inch seeks to optimize gas costs with its new v5 router.
According to 1inch, users' gas costs for swaps will be at least 10% lower than its previous offerings in the DEX segment, thereby, making swapping activity on the Ethereum network more profitable for its users. In the Router v5, 1inch estimated that swaps will be approximately 5% more gas efficient than in the previous version, and 10% more gas efficient, compared to the second best performing player in the DEX segment.
?? Nike launches SWOOSH, a new digital community for Nike products.
Nike launches .SWOOSH. The new digital community and experience is a home for Nike virtual creations. SWOOSH will allow Nike Members to “learn about and collect virtual creations.” These are typically interactive digital objects featuring virtual shoes or jerseys. Interestingly, Nike community members will be able to wear their new SWOOSH-acquired digital collections in digital games. Nike’s SWOOSH offers more intriguing features; in some instances, community members can unlock access to physical products or events like intimate conversations with athletes or designers via Nike’s new platform.
?? Polygon and the airport metaverse with BLR.
Polygon announced it was taking the first airport to the metaverse. The blockchain announced that BLR Airport was entering the virtual world. BLR will benefit by showcasing its services to customers in a virtual space. On the other hand, a successful endeavour could see more metaverse projects building on Polygon and raising its token’s utility.
?? Russia’s Digital Ruble Integrated Into Banking App.
VTB Bank has become the first Russian bank to add the digital ruble to its mobile application. The integration is currently being tested with accounts set up for legal entities. Select customers will be granted access in the coming months and will be able to join the trials. The bank is also preparing to launch an exchange function which will allow conversion between digital rubles and regular electronic money.
??? Competitors?
?? Tokensoft publishes personal data of around 5,000 users who had been gaming airdrops.
Tokensoft, a project that aims to help web3 projects launch fairly, published a list of private user data. The list included full names, wallet addresses, and physical and IP addresses. The project later deleted the link from the Discord server, then tried to claim that it had never been posted at all.
?? KarmaLife offering financial services for gig workers enters partnership with Repute.
The partnership will enable KarmaLife to bring affordable financial services to the low-income workforce. Repute is a blockchain solution for secure identity and reputation management. With this collaboration, KarmaLife aims to provide access to earning-linked affordable credit to employees.
??? Legal?
?? Senator Lummis believes that the FTX exchange would not have collapsed if the law she co-authored had been in effect.
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The Wyoming senator has long been an advocate of regulating the digital asset market. She personally owns BTC and believes bitcoin is something the Federal Reserve should have on its balance sheet. She has repeatedly said that the cryptocurrency is an excellent store of value. She wrote on Twitter that "The FTX bankruptcy wouldn’t happen under the Lummis-Gillibrand bill". Lummis and Senator Kirsten Gillibrand introduced the "responsible financial innovation" bill in June.
?? FTX pitch deck projections not backed by ‘viable assumptions,’ legal expert says.
Legal expert George Morris examined one of FTX's pitch decks. A pitch deck produced by FTX in February 2020 for its Series B funding round and obtained by The Block features several projections that Morris describes as “unsubstantiated.” The deck was part of a plan to raise up to $50 million at a $1 billion valuation — although the round was ultimately far larger. While pitch decks are often only the first phase of a due diligence process, the document gives a sense of the audacious and at times farfetched vision that former FTX CEO Sam Bankman-Fried presented to investors.
?? Tom Brady, Larry David and other celebrity FTX backers sued by crypto investors.
US crypto investors sued FTX founder Sam Bankman-Fried and several celebrities who promoted his exchange including NFL quarterback Tom Brady and comedian Larry David. The proposed class action filed in Miami alleges that FTX yield-bearing accounts were unregistered securities that were unlawfully sold in the United States.
?? Congress wants SBF to come to Washington — one more time.
Members of Congress want to hear from Sam Bankman-Fried and other crypto executives about FTX’s sudden and complete collapse, including the impact it’s had on customers and the entire digital asset ecosystem. A December hearing on the matter announced by the House Financial Services Committee will also look at the role public comments made by Binance CEO Changpeng "CZ" Zhao.
?? BlockFi prepares for potential bankruptcy.
BlockFi is the latest in a series of organizations entangled in a financial web with the now-defunct FTX. According to sources familiar with the matter, BlockFi is also starting to plan layoffs and is considering filing for Chapter 11 bankruptcy (United States Bankruptcy Code). According to Twitter, Security and Exchange Commission charged BlockFi $100 million.
?? US lawmaker blames ‘billionaire crypto bros’ for delayed legislation.
U.S. congressman Brad Sherman, a known crypto skeptic, has pointed the finger at "billionaire crypto bros" for slowing down much-needed cryptocurrency regulation. Sherman announced his plans to work with his Congress colleagues to examine options for federal legislation, which he hopes can be carried out without the financial influence of members in the cryptocurrency industry.
?? FTX under investigation in the Bahamas for possible criminal misconduct.
"In light of the collapse of FTX globally and the provisional liquidations of FTX Digital Markets Ltd., a team of financial investigators from the Financial Crimes Investigation Branch are working closely with the Bahamas Securities Commission to investigate if any criminal misconduct occurred". FTX Digital Markets is a subsidiary of FTX Trading and is licensed and regulated in the Bahamas. There has been increased speculation this weekend on the whereabouts of now-former CEO Sam Bankman-Fried, who told Reuters on Saturday he was in the Bahamas. A later report said he and two former FTX associates were “under supervision” by Bahamian authorities.
??? Security?
?? Were Binance’s Proof-of-Reserves cooked?
According to an analysis from a Reddit user, Binance transferred 2.7 Billion USDT to another wallet within 20 hours after their proof of reserves was published. This wallet is not listed as a Binance wallet, is not identified as such, and is not included in Binance’s publication of “Proof of Reserves”.
?? Crypto scammers are using black market identities to avoid detection.
Crypto scammers have been accessing a “cheap and easy” black market of individuals willing to put their name and face on fraudulent projects — all for the low price of $8, blockchain security firm CertiK has uncovered. These individuals, described by CertiK as “Professional KYC actors” would, in some cases, voluntarily become the verified face of a crypto project, gaining trust in the crypto community prior to an “insider hack or exit scam".
?? Hacker who robbed FTX is 35th on list of richest ETH holders.
The hacker who robbed the FTX exchange is now the 35th richest ETH holder. Just a day after the FTX exchange began bankruptcy proceedings, someone robbed it of more than $600 million in various tokens. According to on-chain data, various tokens from the Ethereum network, as well as tokens from the Solana and Binance Smart Chain, were transferred to decentralized exchanges such as 1inch.
?? Proof of Reserves: Could it Have Prevented the FTX Meltdown?
Crypto exchanges are not the same as banks. Crypto isn’t insured by government depositary schemes. Accordingly, customers must take due diligence matters into their own hands when choosing where to park their money. Several crypto exchanges are advocating for a form of transparency called proof-of-reserves. This is a cryptographic method of proving that an exchange is liquid enough to process all customer withdrawals, and otherwise allows customers of a cryptocurrency exchange to keep tabs on where their money really is.
?? Binance Hacked by False Trading Bot Platforms.
Binance users have reported funds being drained and transferred by hackers. The accounts are those owned by users who registered for third-party trading bots such as 3Commas and Skyrex. In an elaborate ploy, hackers developed a mock-up app resembling 3Comma in order to lure in users and trick them into sharing sensitive information. Binance users who registered on these fake trading bot platforms had their exchange API identifiers stolen, which the attackers swiftly used to execute trades and steal funds from the accounts of victims.
?? Mass withdrawals from Crypto.com after "accidental" transfer.
Within hours, more than 89,000 withdrawals of varying sizes have been processed from the Crypto.com transaction account. Causing concern among investors is the revelation that the Singapore-based crypto exchange “accidentally” sent 320,000 ETH (US$400 million) to rival exchange Gate.io. This has led many critics to accuse Crypto.com and Gate.io of “sharing” funds to post stronger-looking ‘Proof of Reserve’ statements.
?? Crypto exchange Kraken freezes accounts related to FTX and Alameda.
Kraken has frozen accounts associated with "FTX Group, Alameda Research, and their executives," on its exchange. In a Twitter post on Nov. 13, Kraken said the accounts were frozen “to protect their creditors” and added it “maintains full reserves” and other users’ funds aren’t affected, likely seeking to stamp out fears from users that the exchange might face liquidity issues due to the fund freeze.
??? Investments?
?? Zulu banks $5M for its LatAm digital wallet amid shaky ground for crypto.
Zulu, a digital wallet for Latin America consumers raised $5M in new funding. Its platform enables Android and iOS users to save in secure digital dollars and send cross-border payments at no cost. The company said it has approximately 500,000 users across Colombia, Venezuela, Peru and Mexico.
?? Indian lendtech start-up Lentra raises $60m in Series B round.
India-based lendtech Lentra has raised $60 million in a Series B funding round led by existing investors Bessemer Venture Partners and Susquehanna International Group (SIG) Venture Capital. Lentra currently has 50 clients in India for its SaaS lending solution, which is “powered by artificial intelligence (AI), machine learning (ML) and blockchain technologies". Founded in 2019 and based in Pune, Lentra will use the money to expand into five countries next year, including the US, starting with Vietnam and the Philippines in spring. It will also look for acquisitions in the payment processing and data insights.
?? Former Meta Execs Raise $8M in Seed Funding for Web3 Startup Virtualness.
Former Meta execs Kirthiga Reddy and Saurabh Doshi co-founded Web3 startup, Virtualness, which announced the closing of an $8 million seed round led by Blockchange Ventures. The startup provides tools for creators to design their own digital collectibles, which can then be minted and showcased on the Virtualness mobile platform. Virtualness will use this first round of funding to make new hires and to expand platform support to additional blockchains.
?? Matter Labs raises $200M for zkSync Ethereum scaling solution.
Matter Labs, the development team behind the Ethereum scaling solution zkSync, today announced that it has raised $200 million in new funding to launch new projects and continue to grow its team. Blockchain Capital and Dragonfly Capital co-led the Series C funding round. This additional funding brings the company’s total raised to date to $458 million.
?? JUMBO exchange raised $3.5 million.
JUMBO raised $3.5 million. Leading Investors: Pantera Capital, Huobi Ventures D21 Ventures, Big Brain Holdings, Dweb3 Capital, Fundamental Labs, MetaWeb. JUMBO Exchange started its development at the end of 2021 and has already become one of the foremost DEXs on NEAR.
?? Shima Capital backs PlayEmber's $2.3 million raise.
Web3 gaming monetization platform PlayEmber has raised $2.3 million in a pre-seed round led by Shima Capital. Investors in the round also include Big Brain Holdings, Hyperithm, Warburg Serres, Lyrik Ventures and Huobi Ventures. PlayEmber aims to make it easier for gaming advertising dollars to transition from the web2 market to web3 through a Unity-based software development kit.
?? Yuga Labs acquires Beeple’s 10KTF game, hints at metaverse integration.
Yuga Labs, creators of Bored Ape Yacht Club (BAYC), have acquired 10KTF; the NFT game founded by digital artist Michael Winkelmann, also known as Beeple. 10KTF is a browser-based NFT game that allows players to outfit heroes with crafted items and loadouts in order to complete missions. Missions reward players with APE coins, badges, materials, and free airdrops.
?? SG’s ADDX raises $20m in round led by Korea’s KB Securities.
Singapore private market exchange ADDX has secured US$20 million in a pre-series B extension round led by KB Securities, a subsidiary of South Korea’s KB Financial Group. The exchange is regulated in Singapore and uses blockchain and smart contracts to automate private market investment processes. It allows investment in VC, PE, crypto, real estate and other funds.
?? Y Combinator backs payment startup Ping in $15 million seed round.
Ping, a new freelancer-focused neobank, raised $15 million in a seed round. Ping’s app-based platform focuses on digital nomads and freelancers working internationally. It aims to ease the process of getting paid in dollars and converting those funds to local currency. It allows users to create a U.S.-dollar bank account, invoice their employers and receive local currencies or crypto through bank transfers.
??? Others?
?? Metaverse ‘explosion’ will be driven by B2B, not retail consumers: KPMG partner.
The Australian arm of Big Four accounting firm KPMG could soon be holding executive meetings and closing multi-million dollar deals with clients in the Metaverse, with the firm now exploring how the revolutionary technology can transform its business model. In a recent interview, KPMG’s James Mabbott, Partner in Charge at KPMG Futures said the firm sees real potential in the technology creating new and more efficient ways for businesses and consumers to interact with each other: “I think the really interesting applications are going to be in the B2B context [...] And I think that I actually think that's where the money is going to be [even] more so than the consumer driven participation".
?? The Algorand Foundation hires new global head of ecosystem growth.
Min Wei will join the Algorand Foundation as global head of ecosystem growth. Wei formerly worked with the crypto financial services firm, Blockchain.com. She was well known for developing and fostering strategic partnerships with many crucial stakeholders in the crypto space.
?? Apple’s forthcoming AR/VR headset will launch Metaverse battle with Meta.
Apple is working on at least three augmented reality and virtual reality headsets, the first of which is likely to be launched under the name "Apple Reality Pro" and is expected to cost twice as much as the Meta Quest Pro.
?? A new leader among whales has emerged in the BTC market.
On November 14, an anonymous whale dominated the bitcoin market in terms of coin holdings. After a recent transaction in which he acquired 1,200 BTC, he now owns 144,664 bitcoins. Their total value at the current exchange rate is $2.4 billion. According to the BitInfoCharts website, the unknown whale is on the podium in terms of BTC holdings on the Bitcoin Rich list. It is only surpassed by cryptocurrency exchanges Binance and Bitfinex.
?? Pissed, pessimistic and paranoid, FTX clients face new reality: 'It’s all gone'.
Millions of people around the world have turned to cryptocurrencies either out of the desire to escape volatile local currencies, or, in many cases, simply because they were bored at home during the pandemic. There are, of course, those that are the true believers in decentralization who want nothing to do with central banks and governments. A little over a million of those chose FTX and have now likely lost everything in the exchange's spectacular collapse. The likelihood of getting their money back looks bleak. In other financial blow-ups, victims rarely get anything back.
?? Bitfinex publishes details of reserves after rival FTX files for bankruptcy protection.
Bitfinex publishes details of its reserves on Friday. The exchange's holdings include 204,338 BTC ($3.4 billion) and 1.2 million ETH ($1.5 billion) Bitfinex joins Binance, OKX, Crypto.com, Kucoin and Bybit in promising more transparency.
?? NBA legend Scottie Pippen now has his own NFT.
Basketball player Scottie Pippen, who won six NBA championships with the Chicago Bulls in the 1990s, has his NFT, which resembles graphics associated with the iconic CryptoPunks series. Scottie Pippen has received a personalized NFT that runs on Arbitrum. The athlete tweeted a photo of himself wearing a jersey with the number 33 with an NFT avatar added next to it. The token was created through the Smolverse platform.
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