ADDX Introduces Cash Management Tool ADDX Earn

ADDX has introduced a cash management tool for investors, which consists of a solution that aims to withstand short-term volatility while preserving capital.

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The new ADDX Earn will provide one more option to investors with excess funds in their wallets to make interest, instead of their funds sitting idle, according to the statement.

Per the private market exchange company, ADDX Earn has been built to boost investors’ returns deposited in their ADDX wallets and has not yet decided on which private market product to take part in. It added that some of the idle capital may also have come from previous investment earnings on ADDX.

The plan of the new management tool is also to beat short-term bank deposit rates by providing higher target returns for products under ADDX Earn. Many investors usually store undeployed capital in short-term bank deposit rates.

“The first two funds to be launched under the ADDX Earn umbrella are by Lion Global Investors, a fund manager that is a part of the OCBC Group,” ADDX said.

The two funds named the LionGlobaI SGD Enhanced Liquidity Fund and LionGlobaI USD Enhanced Liquidity Fund, are diversified over a range of issuers and tenors through investments in high-quality portfolios of debt instruments.

‘The two funds have weighted average portfolio durations of less than a year, which gives Lion Global the flexibility to adjust portfolio allocations in response to changing interest rates and market conditions,” ADDX said.

According to ADDX, investments can be redeemed on a weekly basis.

The funds are also targeting low-volatility assets. These are being done as they are “well-suited” for the current market environment that has seen increased volatility in other asset classes, ADDX announced.

Interest is accrued daily for both funds. As of July 31, the LionGlobaI SGD Enhanced Liquidity Fund had a weighted average yield to maturity of 2.22% p.a., while that of the LionGlobaI USD Enhanced Liquidity Fund was 2.38% p.a. These rates change monthly depending on the prevailing interest rate environment and the underlying assets held by the funds.

Gerard Lee, Chief Executive Officer of Lion Global Investors, said, “our liquidity funds are typically used by financial advisers and digital players. We are therefore delighted to have a private market exchange use our liquidity funds to provide a solution for their investors’ excess cash.”

The SGX-backed ADDX was founded in 2017. It is currently serving individual investors from 39 countries across the Asia Pacific, Europe and the Americas – except the US.

The company has started using blockchain and smart contract technology to reduce manual interventions in issuing, custody and distributing private market products.

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Singapore Considers Enhancing Crypto Consumer Protection via Suitability Tests & Leverage Cuts

The Monetary Authority of Singapore (MAS) is weighing the option of propelling ways of protecting consumers trading cryptocurrencies through new measures like suitability tests.

Speaking at an event on Monday, Ravi Menon, the managing director at the MAS, hinted:

“The MAS’ new rules may include customer suitability tests and cutting the use of leverage and credit facilities by retail investors for trading these digital assets.”

As the Republic of Singapore’s central bank and financial regulatory authority, the MAS carries out various statutes about securities, insurance, banking, and money. 

During the event attended by crypto industry players, Menon emphasized the need to boost regulations in the sector. He pointed out:

“Banning retail access to cryptocurrencies is not likely to work. The cryptocurrency world is borderless. There is greater impetus now among global regulators to enhance regulations in this space. MAS will also do so.” 

The absence of global oversight has become a challenging  issue amid the pitfalls experienced by various crypto companies, which triggered a $2 trillion market downturn. 

For instance, an embattled cryptocurrency hedge fund, Three Arrows Capital (3AC), filed for Chapter 15 bankruptcy in the United States of America in July. The company’s woes were ignited by the collapse of LUNA-UST, given that it had a significant amount of exposure.

Nevertheless, Menon had earlier reiterated that Terraform Labs, Three Arrows Capital, and the Luna Foundation Guard were unlicensed to operate in Singapore, Blockchain.News reported. 

The MAS started tightening digital asset rules earlier this year, with crypto companies being required to be licensed locally, even those operating overseas.

Menon also reiterated that the volatility linked to cryptocurrencies made them unsuitable for use as money. 

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Mysten Labs of Sui Blockchain Hacked on Discord

Sui blockchain designers Mysten Labs is the latest blockchain firm to face a crypto hack. The firm has announced that its Discord server has been hacked.

The blockchain company has warned people not to click any links posted on the server in the eight hours prior to its Twitter announcement and said that the team is working to fix the mess.

An unverified screenshot shared on Twitter stated that hackers had put a link of a rumoured crypto airdrop on the announcement channel in the server. Mysten Labs made such an announcement on Saturday, and so far, no other further updates have been published.

Sui blockchain, a permissionless proof-stake blockchain, is the first product offered by Mysten Labs, launched in March this year. 

Mysten Labs, a web3 infrastructure firm, was established by Evan Cheng, Sam Blackshear, Adeniyi Abiodun, and George Danezis, four former developers from Meta’s once-ambitious cryptocurrency project Novi. In the past, the four specialists were involved in the development of the Diem blockchain and its Move programming language.

Last December, Mysten Labs raised a $36 million funding round participated by high-profile investors, including Andreessen Horowitz and Coinbase Ventures. Last month, Mysten Labs announced that it was targeting a $2 billion valuation.

 $1.4 Billion Stolen This Year Through Breaches

This year, hacks and scams have hit crypto investors hard. Cybercriminals have so far found a particularly useful avenue – blockchain bridges – to siphon customers’ funds.

Blockchain bridges, which normally connect networks to enable the fast swaps of tokens, are getting increasing popularity as a way for crypto users to do transactions. Thanks to blockchain bridge technology, crypto users are bypassing centralized exchanges.

However, since the beginning of this year, a total of about $1.4 billion has been lost through breaches on such cross-chain bridges. According to blockchain analytics firm Chainalysis, the bridge exploits are happening at a striking rate as they are a new phenomenon.

In February, Wormhole, one of the most popular bridges linking the Ethereum and Solana blockchains, was hit by a hack that stole around $320 million.

In June, hackers stole $100 million in cryptocurrency from Horizon, a so-called blockchain bridge developed by crypto start-up Harmony.

Early this month, hackers stole almost $200 million from Nomad, a bridge protocol for transferring crypto tokens across different blockchains.

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Opinion: Why Ethereum’s ‘Merge’ Won’t Lower Gas Fees?

There’s an idea that Ethereum’s upcoming protocol upgrade — known as The Merge — will reduce transaction fees on the bluechip blockchain, but that’s not quite the case. Here’s why.

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Transaction fees on Ethereum are known as “gas fees.” There was a time during late 2021 when interest and investment in crypto entered a frenzied peak, and paying a gas fee worth $30 was considered cheap. 

When there’s a lot of on-chain activity, gas fees can spike for brief periods of time. For example, when Bored Ape Yacht Club creators Yuga Labs launched a new land title collection called Otherdeed for its Otherside Metaverse earlier this year, Ethereum gas spiked to an equivalent of $200 per transaction, according to BitInfoCharts.

Now the bear market has started to bite, activities on the Ethereum blockchain have dropped to lows not seen since the summer of 2020, and transaction fees now only cost a dollar or two’s worth of ETH. However, if activities pick up again, gas fees could rise — but wait — won’t The Merge change all that? 

Unfortunately, no.

The Merge (which is tentatively scheduled between Sept. 10 and 20) changes Ethereum’s consensus mechanism from “proof-of-work” (PoW) to “proof-of-stake” (PoS), which means it changes the way it processes transactions on its blockchain. According to Ethereum developers, the new system will increase the network’s security, making it almost impossible to attack the network. It will also be more energy-efficient, reducing energy consumption by roughly 10,000%.

However, The Merge won’t make the network much faster or be able to process more transactions per second, which means gas fees won’t change much. After the upgrade, Ethereum will produce blocks 10% more frequently, which “is a fairly insignificant change and is unlikely to be noticed by users,” according to Ethereum’s website. Also, The Merge doesn’t increase block size or any other parameters affecting network capacity.

So, if users once again flock to Ethereum’s array of decentralized finance apps and NFT marketplaces, they may again find themselves paying high gas fees even after The Merge. But wait, all is not lost because there is still a plan to tackle the gas fee problem.

Layer 2s are protocols that are built on top of the mainnet. Essentially, they process transactions off-chain, collect them in batches, and send them to the mainnet for final confirmation.

This process means that Ethereum’s mainnet is only used for security. The main bulk of the processing is done by third parties: Layer 2 solutions such as Arbitrum, Optimism, and Loopring. Right now, Ethereum can process 15 transactions per second, but if everyone moves their activities to Layer 2 chains, that number could go as high as 3000.

Users who currently transact on Layer 2 chains enjoy the security of Ethereum while paying a fraction of Ethereum’s gas fees. However, the main issue is that these are quite new technologies — even by crypto standards — and you need a nontrivial amount of expertise to access and use them.

Even so, the success of Layer 2s has allowed Ethereum’s developers to focus on the tricky task of moving from PoW to PoS by completing the Merge. However, once this is complete, they will be able to roll out “sharding” on the mainnet, which is a scaling solution that will “support many thousands of transactions per second, and allow large portions of the world to regularly use the platform at an affordable cost,” according to Ethereum co-founder Vitalik Buterin.

Sharding is a scaling technique and part of another massive upgrade called Serenity, expected sometime in 2023 (those who are interested in the technicals can read Buterin’s article via the link above). Simply you can imagine that sharding increases the surface area of the blockchain allowing it to “absorb” and process more transactions at once.

While it won’t make your NFT purchases, or token swaps any cheaper, The Merge is still a key part of Ethereum’s roadmap for the future. If successful, it will pave the way for upgrades planned to reduce fees and turn the blockchain into the base layer of the new internet. 

About Author:

Nathan Thompson, lead tech writer at Bybit

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Mt. Gox Creditor Refutes Fake Report about Upcoming 140K BTC Release

Eric Wall, one of the creditors of the now-defunct Mt. Gox cryptocurrency exchange, has refuted claims that the exchange plans to distribute 140,000 Bitcoins soon to the affected investors.

Mt. Gox, the world’s largest Bitcoin exchange at the time, collapsed in 2014 after it was hacked. Half a billion dollars worth of the cryptocurrency was stolen from the firm, thus leaving affected customers empty-handed.  

Last Saturday, Wall clarified that “the payout system has not yet been developed, and not even a list of exchanges where affected investors can choose to get their rewards is complete. There are currently no set final dates.”

He also shared details that Bitcoin and Bitcoin Cash payments will be made in instalments. Wall further said that some of the creditors have already sold their claims to Fortress Investment Group LLC, a New York-based private equity firm, which issued a “premium” offer to buy out creditor claims from Mt. Gox in February 2020.

Over the weekend, claims emerged that Mt. Gox will begin compensating customers for Bitcoin the following day (on Sunday August 28 2022). Many people were concerned by the announcement, viewing the rumour as a “black swan” for the crypto market.

The panic is reported to have created additional pressure on Bitcoin and the rest of the market, which already suppressed significantly on Friday after Federal Reserve Chair Jerome Powell delivered hawkish remarks on an economic policy designed to bring down inflation. At that time, the Bitcoin price dropped below $20,000.

According to Wall, those responsible for the fake news about Mt. Gox’s payouts could have decided to play ahead of the curve based on the July news about the exchange’s plans for compensation payments.

Mt. Gox Hack

On July 7, the Mt. Gox rehabilitation trustee (the trustee holding what is left after the collapse of Mt. Gox) announced plans to fast-track payouts, asking creditors to choose between Bitcoin, cash, or Bitcoin Cash to receive repayment.

The Mt. Gox trustee noted that claims for compensation from victims would be accepted until August, and then a period of review and payout would start. However, a specific date or any other specific information with regard to payouts was not given.

Mt. Gox was one of the first Bitcoin exchanges in the world and began automated trading on July 18, 2010.  The exchange once represented over 80% of the global Bitcoin trading volume.

On February 28, 2014, the exchange filed for bankruptcy after finding out it was hacked and losing most of its funds.

Mt. Gox went bankrupt after 850,000 Bitcoins were reported missing. Later, the firm managed to recover 200,000 Bitcoin. And these have since increased in value significantly. This means creditors may be able to get more value from the disaster than they lost during the bankruptcy.

While a few years back, the trustee sold roughly 50,000 Bitcoins for some US$600 million, the remaining Bitcoins are due to be distributed anytime currently.

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Australian Scammers Prefer Crypto than Credit Cards: Report

Scammers in Australia notably prefer payments in digital currencies more than credit cards, as the anonymity in offers gives them some level of protection.

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According to a report from The Sydney Morning Herald, a total loss of $84 million was reported to the ScamWatch website in 2021, a figure that is reasonably higher than the $27 million reported in 2020 and $19 million in 2019.

Per the report, the tilt towards crypto payments by scammers targeting Australian residents is growing by the day, and the losses may be significantly higher than the figure quoted. This is likely because victims of this cybercrime do not report the events, and those who do often report it to other government-backed websites other than ScamWatch.

Considering the year-on-year growth in crypto scams in Australia, the government has been making targeted efforts to tighten its scrutiny on cryptocurrency exchanges operating in the country. To license exchanges, there will be a requirement to get a good system to prevent Anti-Money Laundering (AML) activities.

“In March 2022, the Australian government began consultation on approaches for licensing digital currency exchanges and custody requirements for crypto assets,” said Delia Rickard, ACCC deputy chair “While ongoing, I am hopeful that this and other regulatory measures will slow the growth of cryptocurrency scams.”

Globally, experts have advocated for the digital currency ecosystem players to accept thoughtful regulations. In the case of Australia, the payments industry association, AusPayNet, wants every player in the financial services industry to be regulated in the same way.

Andy White, the Chief Executive Officer of AusPayNet, says reputable exchanges want to be regulated and that a uniform regulation “will help every player in the ecosystem – the consumer can have more trust of dealing with a reputable exchange, as it is licensed, and banks will be able to better assess the exchanges.”

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Grayscale Contacts with SEC over the Securities Status of Three Trusts

Grayscale Investments, a subsidiary of the Digital Currency Group (DCG), has been in contact with the United States Securities and Exchange Commission (SEC) over the definition of the status of three of its established Trusts.

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According to the reviewed filings first sighted by Coindesk, the contact between the regulator and the company is about its Horizen (ZEN), ZCash (ZEC), and Stellar Lumens (XLM) Trusts, respectively.

The alleged correspondence between both parties happened in both June and August. On one of the occasions, Grayscale acknowledged that the tokens under review “may currently be a security,” or they may be deemed as one by the relevant body in short to long term.

“The sponsor has been contacted by staff from the SEC’s Divisions of Corporation Finance and Enforcement concerning the sponsor’s securities law analysis of ZEC,” Grayscale said in its June and August filings regarding its ZEC trust. “The sponsor is in the process of responding to the SEC staff.” This exact position or language is also reflected in the company’s filings for its XLM and ZEN trusts, with the asset names changed to match each trust. 

The communication between the SEC and Grayscale is yet another known instance of interaction or inquiry with digital currency platforms as the regulator seeks to deepen its regulatory oversight of the broader industry.

The SEC recently named nine tokens that trade on the Coinbase Global Inc exchange platform as securities. This changed the narrative of the cryptocurrency trading outfit and maintained the claim that it has always abided by the necessary asset listing rules that conform to appropriate laws.

Getting in the crosshairs of the SEC might not speak well for a business venture, as any regulatory push that may ensue can be very costly. While not praying for a Ripple-related situation, Grayscale said in its June filing that the regulator has not disclosed the securities status for the tokens. This condition might have impacted its decision at the end of the day.

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75% Investors Joins Crypto Space due to GameFi, Survey Shows

ChainPlay, a one-stop platform for all-things blockchain gaming, released a survey on Sunday showing that a set of investors are joining the cryptocurrency landscape because of gaming activities.

The ChainPlay survey indicated that out of the 2428 GameFi investors who participated in the study, 75% of the respondents joined the crypto space solely because of GameFi. This Asian cryptocurrency firm brings gaming to the blockchain. GameFi offers blockchain-based games that enable users to gain real-world financial benefits.

While about half of the investors joined the GameFi platform initially because of profit-making, the recent crypto crash affected 89% of GameFi investors, with 62% losing over 50% of their profits, the ChainPlay study revealed.

The losses relatively discouraged investors from participating in the crypto game economy. The research showed that investors globally spent an average of 2.5 hours per day participating in GameFi, which is down 43% to 4.4 hours from the previous year.

The study identified that the fear of crypto rug pulls and Ponzi schemes are some of the major drivers preventing investors from investing in new GameFi projects. As a result, the survey disclosed that 44% of investors believe that the involvement of traditional gaming firms could be a key factor contributing to GameFi’s growth.

However, regarding future GameFi projects, the ChainPlay research shows that 81% of GameFi investors are shifting away from the traditional mindset and prioritizing the fun factor over profit-making as they seek exciting, positive in-game experiences.

Crypto Gaming Maintains Steady Demands

Blockchain-based gaming is proving to be resistant to the crypto market turndown. Since May this year, most cryptocurrencies have experienced heavy losses triggered by the collapse of TerraUSD stablecoin and its sister cryptocurrency Terra (LUNA).

Despite the crypto market crash, the gaming sector has not witnessed any sign of slowing down. And this indicates that there is no direct link between the crypto market and gamers’ activities.

The number of daily unique active wallets of game decentralized apps (dapps) and those of game transactions has remained at all-time highs since April, according to digital assets data provider DappRadar.

Games such as Axie Infinity, Splinterlands, and Alien Worlds have attracted millions of users each month, each showing its own economies as players trade large volumes.

This demonstrates that gaming has become a key vehicle for bringing use cases of blockchain, Metaverse, and NFTs to consumers who’ve never used cryptocurrency before.

Blockchain games like the so-called play-to-earn game Axie Infinity have attracted hundreds of thousands of players in markets like the Philippines.

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Metaverse Gaming Features Already Exist in Web2, Says Microsoft Gaming Boss

The entire concept of the Metaverse and Web3.0 might be new to outsiders, but gamers it has been living in this reality for years. 

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Phil Spencer, the Chief Executive Officer of Microsoft Gaming, revealed this position in an interview with Bloomberg Studio 1.0, highlighting that gamers nowadays do not really understand the thrill of the metaverse “because the technologies proponents claim as novel are ones they have experienced in games for years.”

“It’s not at all surprising to me that gamers might look at metaverse and think… I already have an avatar of myself, I can already go into a shared world, and I can already have voice conversations,” he said.

Spencer reiterated how Microsoft has been very cautious when it comes to certain offshoots of the blockchain gaming ecosystem, such as Play-to-Earn (P2E). The tech giant is cautious as it does not want its platforms to be unduly monetized, although Spencer noted that some forms of monetization are already commonplace in the Web2.0 ecosystem.

“There have been gold farmers, people who literally just spend their time doing some menial task in a game to accrue some currency that they can then sell to some other rich player for real money, so that person doesn’t have to spend their time… But now you find games that are starting to build that into the economy of the game itself,” 

Microsoft’s reservations regarding monetizing NFTs and their underlying innovations have pushed its Mojang Studios, the startup behind the Minecraft game platform, to ban all forms of NFT and monetization-related activities, as announced back in July. 

The limitations Minecraft announced have pushed platforms like NFT Worlds to pull out from Minecraft as its primary gaming platform. In all, Microsoft still remains one of the major tech giants pursuing metaverse-related advancement as Web3.0 evolves.

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