Ethereum Merge Might Happen in August as Testing Enters Final Round

Speaking at the Permissionless 2022 Conference in Florida, the U.S., Ethereum Researcher Justin Drake disclosed that the merge of Ethereum (ETH) might happen in August.

Market insight provider Bankless pointed out. He noted:

“Strong desire to make this happen before difficulty bomb in August. Stars are aligned.”

Meanwhile, Ethereum core developer Preston Van Loon shared similar sentiments that testing was in the final stages and said:

“As far as we know, if everything goes to plan, August—it just makes sense. If we don’t have to move, let’s do it as soon as we can.”

The merge, which will transition the current proof-of-work (PoS) consensus mechanism to a proof-of-stake (PoS), has been elusive because it was slated for June.

Previously, Ethereum lead developer Tim Beiko revealed that the shift would not happen in June as planned. He pointed out:

“It won’t be June, but likely in the few months after. No firm date yet, but we’re definitely in the final chapter of PoW on Ethereum.”

The merge is estimated to be the biggest software upgrade in the Ethereum ecosystem because the PoS algorithm will allow the confirmation of blocks in a more energy-efficient way. After all, it requires validators to stake Ether instead of solving a cryptographic puzzle. 

Validators will take up the role of miners when it comes to the confirmation of blocks based on the amount of ETH staked, acting as collateral against dishonest behaviour. 

The merge is usually regarded as a game-changer that will give the Ethereum network a new face because it is expected to enhance scalability through upgrades like sharding.

Furthermore, it is anticipated to strengthen Ethereum’s quest as a deflationary asset because the second-largest cryptocurrency’s value is speculated to increase based on slashed supply. 

Market analyst Lark Davis had previously opined that he expected the merge to trigger a supply growth rate of -2.8% in the Ethereum network. Moreover, a LuckyHash study noted that the shift would prompt a 1% annual deflation rate. 

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Prosecutors Investigate Do Kwon with Ponzi Fraud Charges amid Terraform Labs Dissolvement

Do Kwon’s scandal seem to be deepening. Prosecutors are investigating whether they will file Ponzi fraud charges against him following the Terra crash, according to The Korea Times. 

This comes a day after LUNA and UST investors filed a legal complaint against Do Kwon and Daniel Shin, the co-founders of Terraform Labs. LUNA and UST are the native tokens of the Terra network developed by South Korean fintech company Terraform Labs.

Having wiped out at least $38 billion of investors’ money in a week, prosecutors in South Korea are delving deeper into the Terra crash. For instance, the Seoul Southern District Prosecutors Office that is leading the case intends to seek the services of an investigation team based on lodged complaints and various factual backgrounds.

Per the announcement:

“Prosecutors in charge of the case are looking into whether they can make a Ponzi scheme case against “Anchor Protocol,” under which depositors of TerraUSD are guaranteed a 20 percent annual return.”

Financial authorities believe 280,000 South Korean investors hold approximately 70 billion LUNA coins, even though the exact amount remains unknown. 

Earlier this week, relevant governmental agencies beefed up crypto exchange inspections to try and unravel what transpired during the crash.

Did Do Kwon dissolve Terraform Labs just days before the crash?

Reportedly, Kwon dissolved Terraform Labs on April 30, just days before the Terra tokens came down with a thud. 

According to Digital Today, based on official documents in the custody of South Korea’s supreme court registry office, the decision to terminate the firm was reached at a general shareholders meeting held on April 30.

Similar sentiments were shared by a Reddit user, who noted:

“KWON-DO-HYUNG is listed in this Korean document as dissolving his company Terraform Labs on April 30th, registered May 4th. The act of dissolving just days before the collapse of UST suggests the intent to eliminate responsibility for the aftermath, which serves as evidence that he knew something was going to happen.”

Moreover, Kwon was recently slapped with a tax evasion fine of $78 million, Blockchain.News reported. 

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Terraform Labs, Luna Foundation Guard Bought 3.06m AVAX in total: Avalanche Foundation

The Avalanche Foundation announced via Twitter on Friday that Terraform Labs and the Luna Foundation Guard (LFG) have purchased 3.06m AVAX in total. - 2022-05-20T145503.939.jpg

The announcement came following an inquiry from members of the Avalanche Community about the details around the AVAX reserves held by Terraform Labs and the LFG.

The Terraform Labs’ AVAX purchase comes with a one-year lockup and the amount represents around 0.5% of last week’s AVAX volume.

While the LFG plans to use the AVAX for the Terra reserve pool and the purchased allocation represents around 0.9% of last week’s AVAX volume.

The Twitter announcement also added that the LFG has not shared any plans on using the AVAX as it is working on a Terra chain fork.

“Given the proposed Terra chain fork, LFG has disclosed no plans to use the AVAX.”

The Avalanche Foundation also added that should any sales be contemplated for the LFG reserves; it is ready to work with LFG “on a sensible trading strategy.”

According to Bloomberg, LFG, which supports public blockchain Terra, chose Avalanche Foundation in April to diversify and expand its stablecoin reserve by acquiring  $100 million worth of AVAX from the Avalanche Foundation.

In the latest figure, the total reserve balance of the LFG remains over $232.7 million, and over 66% of the reserves are TerraUSD (UST), whereas AVAX takes nearly a quarter of its reserve, which takes around $58.83 million, trading at around $29.81.

Avalanche and Terra both are layer one blockchains, similar to Ethereum, where users can write codes and build different projects from non-fungible tokens to decentralized finance applications.

The Avalanche received $230 million in funding last September, pushing the price of AVAX to a record high of $68.89. However, subject to negative impacts from LUNA crashes, its price has dropped significantly.

Currently, AVAX was trading at $29.9 during the intraday, slightly up 1.53% on Friday in the Asia trading section.

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Australias Commonwealth Bank Halts Crypto Rollout

Commonwealth Bank of Australia (CBA) announced on Thursday that it has paused the rollout of cryptocurrency trading through its banking app amid uncertainty in the market.

In November, the largest bank in Australia announced plans to allow its customers to purchase and sell crypto through its banking app.

The Commonwealth Bank had been working on the initial pilot project, with plans to progressively launch more features to more customers in 2022.

Sources show that the lender has paused the pilot project, with no timeline set for when the second pilot would resume. Individuals who participated in the initial pilot have not been able to continue trading cryptocurrency through the app.

Matt Comyn, the CEO of the Commonwealth Bank, commented that the firm was working on the feedback obtained from customers, but disclosed that more regulation would be required before moving on to the next stage.

“As events of the last week have reinforced, it is clearly a very volatile sector that remains an enormous amount of interest. But alongside volatility, awareness, and the scale, certainly globally, there is a lot of interest from regulators and people thinking about the best way to regulate that,” the executive stated in a tech briefing this week.

The federal Treasury is holding consultations on crypto regulations, with submissions open until 27 May. Comyn mentioned that the government formed after the election would be focused on how to regulate the sector most appropriately. Australia’s election is due to take place to decide who serves as the country’s next prime minister and which political group to be in power.

“We want to continue to play a leading role in providing input into that and shaping the most appropriate regulatory outcome. Our intention still, at this stage, is to restart the pilot, but there is still a couple of things that we want to work through on a regulatory front to make sure that that is most appropriate,” Comyn elaborated further.

Sources familiar with the matter indicate that the Commonwealth Bank’s pilot program has been slowed down by legal wrangling with the country’s financial service regulator, the Australian Securities and Investments Commission, over the target market for the product, the product disclosure statement, and consumer protection.

Keeping Pace with Competition

In November last year, Commonwealth Bank announced that it would start offering cryptocurrency services to its retail investors, making it the first bank in Australia to offer clients such access.

The bank partnered with US-based crypto exchange Gemini and Chainalysis intelligence firm to offer a custody service and crypto exchange, meaning that customer funds will be held offshore.

The 6.5 million users of the bank would have access to 10 digital assets, including Bitcoin and Ethereum.

CBA is making attempts to appeal to young consumers and keep pace with rivals like PayPal and Square, which already allow customers to trade and spend Bitcoin.

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Bahamas’ Sand Dollar CBDC Begins Facial-Recognition Rollout to Authorize Mobile Payments

Sand Dollar CBDC has continued to advance its usage and started addressing the issue of user authentication.

SunCash, a financial institution authorized to provide Sand Dollars in the Bahamas, announced on Thursday that it has partnered with PopID Inc software company to allow holders of the Bahamian Sand Dollar to use PopID’s PopPay platform to authenticate themselves.

It is the first time in history that consumers can now use the PopPay face verification platform to buy goods and services with a CBDC (central bank digital currency).

Bahamian citizens can now link their SunCash wallets to PopPay to enable face pay transactions using their Sand Dollars, a central bank digital currency in the Bahamas.

This will allow consumers to spend Sand Dollars at merchants (businesses) accepting SunCash payments using their faces for authentication.

Likewise, various local and global brands accepting digital Sand Dollars through the SunCash platform will be authenticated by PopPay.

PopPay’s technology allows merchants to verify customers’ identities with a facial scan. The technology links any payment method, including digital currencies, direct bank transfers, and debit/card cards, to the user’s unique facial characteristics.

Reports show that SunCash has over 55,000 active wallet holders, one-seventh of the population of the Bahamas, and more than 1,000 merchants accept the wallet.

Desmond Pyfrom, CEO of SunCash, talked about the development and said: “PopPay’s cutting edge technology provides a more consumer-friendly, seamless, and secure experience for SunCash’s users. With the integration of the PopPay platform into the SunCash App, Bahamian consumers can now quickly, efficiently, and safely use the digital Sand Dollar to purchase food and other products even if the consumer does not have a functional smartphone or an internet connection.”

Digitizing Retail Payments

Private digital currencies are storming financial markets, and as a result have prompted central banks globally to create their own, legally-backed digital tokens.

The Central Bank of The Bahamas issued the Sand Dollar– a digital iteration of the Bahamian Dollar, in October 2020.

With Sand Dollar, local consumers can receive and make payments electronically from a digital wallet using either their smartphones or a physical payment card they can manage via merchants across the nation.

Residents can open digital currency accounts, store the CBDC in an e-wallet approved by the central bank and use it for payments. The records collected during daily operations, like income and spending information, can support applications for micro-loans.

An IMF FinTech report showed that in late 2021, the number of active Sand Dollar wallets was about 20,000 in a population of about 400,000. 

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Brazilian Digital Bank Neon Triples Annual Revenue in 2021 as Demands Stays Strong

Brazilian digital bank Neon announced on Thursday that its revenues grew 3x in 2021.

Neon stated that it expects to see its revenue rise more than double this year. The digital bank further disclosed that it doubled its headcount from 800 to 1,600 employees in 2021 and expects to hire an additional 700 talents by the first half of 2022 to support its growth goals.

Neon made the revelation when it announced an overview of the firm’s growth and momentum that led up to its recent US$300 million Series D funding round, which resulted in its achievement of Unicorn status with a valuation of US$1.6 billion.

In February, Neon raised $300 million in a Series D funding round led by European bank BBVA. Counting the new fundraising, the digital bank has already received more than $726 million in investments from companies such as BlackRock, General Atlantic, Monashees, PayPal, Quona Capital, Vulcan Capital, and others.

The increased demand for digital services amidst the pandemic assisted in accelerating Neon’s rapid growth trajectory as its platform provides an alternative to traditional banking solutions. As a result, Neon reached 15 million customers in 2021.

While Brazil is the largest economy in Latin America, 80% of the population in the country is low-income. Neon’s focus is on serving the needs of this group, which includes microentrepreneurs and people with informal employment. Today 88% of Neon’s customers belong to the C, D, and E classes in Brazil. Currently, Neon handles an average of more than US$1.2 billion US monthly in transactions.

Pedro Conrade, founder and CEO of Neon, commented about the development and said: “Neon has grown tremendously and is increasingly solid, but one thing has never changed, our purpose – to improve the finances of Brazilian workers – is what drives us. Our expectation for this year is to more than double our revenue.”

Booming Digital Banking

The importance of neobanks across Brazil has continued to increase. In 2021, digital banks like Neon, Nubank, Ame Digital, Mercado Pago, Banco Pan, and PagBank had more than 95 million monthly active users. They surpassed what traditional Brazilian banks, such as Santander, Caixa, Bradesco, and Itaú, had by more than 15 million active users a month.

However, traditional banks through their digital divisions are also engaging in such a new approach to banking and finance. 

Besides Neon, Nubank is another good example of how digital banks are changing the banking industry in the country.

After its initial public offer on NASDAQ in December last year, Nubank’s valuation hit US$41.5 billion. It is considered the most valuable bank in Latin America, overtaking even Banco Itaú, with its massive annual profit and huge market share.

Early this month, Nubank announced plans to start offering cryptocurrency trading services to its 50 million customers.

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Legalizing Crypto Payments Will Happen “Sooner or Later”: Russia Trade Minister

Within months, the sentiments to ban cryptocurrencies in Russia have changed dramatically, and at present, key government officials are the ones advocating for ways to incorporate the nascent asset class into the system. (11).jpg

In a recent revelation, Russia’s Minister of Industry and Trade Denis Manturov said the move to legalize cryptocurrencies as a means of payment in the country is bound to happen “sooner or later.” The claims were made at a forum Wednesday when the minister was asked whether crypto will become a legal payment method in the country.

“The question is, when this happens, how it will be regulated, now that the central bank and government are actively working on it,” he replied. “But everyone tends to understand that … sooner or later this will be implemented, in some format or other.”

The Russian government and the Central Bank of Russia (CBR) have divergent views when it comes to how cryptocurrencies should be handled. While the government submitted a counter-proposal that will prevent a blanket ban and harsh fines on cryptocurrencies back in February before the ongoing war with Ukraine kickstarted, the stance of the Industry and Trade minister suggests both parties are beginning to shift grounds.

What Bitcoin Can do for Russia

Similar to countries such as El Salvador, Ukraine, and the Central African Republic, where making payments with Bitcoin and crypto is legal, Russians will be able to experience the ultra-fast payment provisions that Bitcoin affords all users generally.

Besides this, Russia has been reaping a lot of indirect benefits from its embrace of Bitcoin in the wake of the broad-based economic and financial sanctions being levied on it by the United States and Europe for invading Ukraine.

With the permissionless feature of the digital currency, key Russian entities are exploring a number of divergent use cases for the nascent asset class.

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Andreessen Horowitz Floats $600M Gaming Fund

After more than a decade of actively investing in the gaming industry, Andreessen Horowitz (a16z) wants to further exert its influence in that space.


In order to do this, the investment giant has floated a $600 million fund which it believes will help position it aright to tap enough market share in the more than $300 billion industry.

The company said it floated the fund which it named Games Fund One with the backing of key players in the gaming industry including David Baszucki, founder of Roblox; Jason Citron, founder of Discord; Marc Merrill, co-founder of Riot Games; Mike Morhaime, co-founder of Blizzard; Aleks Larsen and Jeffrey Zirlin, co-founders of Sky Mavis; Kevin Lin, co-founder of Twitch, Mark Pincus, founder of Zynga; and Riccardo Zacconi, founder of King.

The enormous funds will be used to support startups building a wide range of solutions in the space. These solutions border on infrastructure, supporting ecosystems for developers, and outfits developing games directly.

“GAMES FUND ONE is founded on the belief that games will play a pivotal role in defining how we socialize, play, and work over the next century. Over the past decade, games have undergone a radical transformation, from simply being packaged entertainment to becoming online services that more closely resemble social networks and scale-like consumer technology companies,” the firm said in a blog post written by the trio of Andrew Chen, Jonathan Lai, and James Gwertzman, General Managers at a16z who will be in charge of the fund.

As it has gone all out with gaming, Andreessen Horowitz is also bullish on the role blockchain technology and Web3.0 has to play in the long-term future of the gaming industry. 

The firm detailed in a report earlier how Web3.0, powered by blockchain is a better offshoot for creators when compared to traditional solutions, and as such, the investment from Games Fund One will be extended to the emerging ecosystem to complement earlier investments in CryptoKitties and Axie Infinity and other notable startups in the space.

Andreessen has also been an active proponent of the blockchain gaming space. The company’s general partner Arianna Simpson has led investments in several high-profile pay-to-earn and crypto-related gaming companies like Axie Infinity maker Sky Mavis.

According to Protocol, the fund will also collaborate with Andreessen’s crypto fund to co-invest in blockchain gaming deals.

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Multiple Hosting Site Power Cuts Plunges Bit Digital Mining Hashrate by 46.8%

Bit Digital Inc, one of the publicly listed cryptocurrency mining companies in the United States has announced a major halt in its operations at some of its third-party hosting sites. (12).jpg

According to the company, its hosting partner Blockfusion USA Inc said the substation at its Niagara Falls, NY facility was damaged by an explosion and subsequent fire, resulting in a forced halt in operation.

While Blockfusion said the fire did not damage any of Bit Digital’s miners, the halt in operation has notably cut off approximately 2,515 of our bitcoin miners and approximately 710 ETH miners off the mining network. 

Bit Digital said claims for the losses that will be incurred for the more than two weeks it will be offline will be filed from both the insurer and the national grid. In another unusual turn of events, Bit Digital’s other hosting service provider, Digihost Technology Inc also reported a halt in operations on the grounds of a regulatory impasse.

The firm said the Digihost halt “has resulted in approximately 1,580 of our miners going offline, citing the need for additional approvals from the power authorities. Digihost has made the applications and expects initial feedback this month,” adding that “Digihost also continues to await approval from the New York Public Service Commission in order to complete its acquisition of the site’s 60MW power plant; at this time there can be no assurances as to timing. Bit Digital management continues to monitor the situation.”

The unprecedented events are bound to impact the overall productivity of the firm with the 46.8% plunge in its hashrate. Mining difficulty has continued to rise significantly in recent times. By going offline, Bit Digital will put itself in a less competitive position to join the race to mine the remaining 2 million BTC units.

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Bitcoin (BTC) $ 26,564.12 0.02%
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Bitcoin Cash (BCH) $ 208.79 0.57%