Day: February 24, 2023

Former FTX CEO faces 12 criminal charges

by Blockchain News

The federal court who is presiding over the prosecution of the former chief executive officer of FTX, Sam Bankman-Fried, has given the order for a superseding indictment to be disclosed. This indictment contains 12 separate criminal offenses.

In a superseding indictment that was submitted to the United States District Court for the Southern District of New York on February 22, United States Attorney Damian Williams alleged that the actions of Bankman-Fried in the case involving FTX and Alameda warranted the filing of 12 charges against him. According to the indictment, they included eight accusations connected to conspiring to commit fraud, as well as four charges each for wire fraud and securities fraud.

The superseding indictment against Bankman-Fried mentioned an additional charge for conspiracy to commit bank fraud and broke down individual wire fraud charges related to his alleged actions at FTX and Alameda. The initial indictment against Bankman-Fried, which was announced on December 13, included eight similar charges. However, the superseding indictment included nine charges. At the time, prosecutors also listed conspiracy to commit commodities fraud in its charges, which appeared to be included in the superseding indictment related to the “purchase and sales of derivatives” at FTX. This charge was seemingly included in the indictment related to the “purchase and sales of derivatives.”

The indictment states that Bankman-Fried engaged in fraudulent activity when he opened a bank account and tried to obtain user deposits: “[Bankman-Fried and others] falsely represented to a financial institution that the account would be used for trading and market making, even though he knew that the account would be used to receive and transmit customer funds in the operation of a cryptocurrency exchange, and thereafter, in connection with using the account for the receipt and transmission of customer funds in connection with the operation of a cryptocurrency

In connection to the claims of illegal political donations, the filing said that SBF and others made more than 300 contributions worth “tens of millions of dollars” by using “straw donors” or corporate funding. According to the allegations made by the United States Attorney, Bankman-Fried was able to “evade contribution restrictions on individual contributions” that were imposed by the Federal Election Commission. These limits are typically set at $100.

According to the document, “While personnel at Alameda usually monitored loans to executives, the transfers to Bankman-Fried in the months before the 2022 midterm elections were not documented on internal Alameda monitoring spreadsheets.” “Instead, an internal Alameda spreadsheet indicated almost $100 million in political donations,” despite the fact that FEC records show that Alameda did not make any political contributions for the 2022 midterm elections to candidates or political action committees (PACs).

Since a bail hearing in December, during which his mother and father agreed to put up the equity from their property as part of Bankman-$250-million Fried’s bond, the former CEO of FTX has been primarily restricted to his parents’ home in California. The hearing took place in California. Andreas Paepcke, a research scientist, and Larry Kramer, a former dean of Stanford University’s law school, both signed on as sureties for Bankman-bail, Fried’s which was set at $200,000 and $500,000, respectively.

While the criminal trial against Bankman-Fried is set to begin in October in federal court, the matter regarding FTX’s bankruptcy is now being heard in the United States Bankruptcy Court for the District of Delaware. Caroline Ellison, the former CEO of Alameda Research, and Gary Wang, the co-founder of FTX, pleaded guilty as part of a plea agreement to allegations that were identical to those brought against SBF. Many industry analysts believe that they may provide evidence about SBF’s case.

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Interchain Foundation to Spend $40 Million on Cosmos Ecosystem Development

by Blockchain News

According to an announcement made by the Interchain Foundation (ICF) on February 20 in a Medium post, the nonprofit organization that was responsible for the creation of the Cosmos (ATOM) interblockchain communications (IBC) ecosystem has committed to spending approximately $40 million in 2023 to develop its core infrastructure and applications. Around fifty different blockchains, such as Tendermint Core (which has since been renamed CometBFT), Cosmos SDK, Cosmos Hub, and the IBC protocol, all make use of the Interchain Stack.

“Throughout the course of the year, we plan to engage additional teams to offer more manageable tasks that are more specifically defined within each area of work. These contracts will be used either to augment the work of the teams listed below or to serve the requirements of those teams as they develop over the year.

CosmWasm and Ethermint are two technologies that, according to the company, have become the “foundations of smart contract and Ethereum Virtual Machine (EVM) compatible blockchains.” The Internet Commerce Foundation (ICF) is helping to fund the development of both of these technologies.

The International Community Foundation (ICF) will provide funding for initiatives that, in addition to fundamental infrastructure, encourage the adoption and use cases of Cosmos. These include integration with other blockchain technologies such as Polkadot and Hyper Ledger, as well as initiatives such as the Interchain Developer Academy, the Cosmos Developer Portal, and the Interchain Builders Program. Other similar programs include the Cosmos Developer Portal.

A “large backlog of applications” led to the suspension of the ICF’s public Small Grants Program in 2018, however the organization has said that it has every intention of resuming operations of the program in 2023.

It intends to restart the program in due time and is inviting teams to seek out to the Builders Program for mentoring and help in areas unrelated to finances. For the time being, the ICF advises software developers to make use of its ATOM delegation program in order to get access to contribution benefits.

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POSA Publishes Two White Papers

by Blockchain News

On February 21, a collection of white papers was released by the Proof of Stake Partnership (POSA), a nonprofit industry organization. These white papers investigate the legal status of deposit tokens in regard to their respective subfields of the law, namely securities law and tax law, within the framework of the securities legislation and tax law of the United States, respectively. Contributors originating from more than ten various departments belonging to a range of industrial organizations and representatives of those departments were instrumental in facilitating the publication of these pieces.

The act of producing transferable receipt tokens on blockchains that use a proof-of-stake consensus mechanism as their method for obtaining network consensus is referred to as liquid staking. Liquid staking is also known as proof-of-stake consensus. In the context of cryptocurrencies, this activity is referred to as “staking.” The statement that inspired the term “liquid staking” also gives its name to the practice, which is referred to as “liquid staking.” In order to establish ownership of cryptographic assets that have been staked or prizes that have been received for the purpose of staking, these tokens are put into circulation and employed in the process of establishing ownership of those assets. Staking the tokens itself is one method for accomplishing this goal. The POSA is opposed to the description of “liquid staking derivatives” because, according to their argument, it paints a false picture of the qualities that are associated with the tokens. The POSA stated that the tokens should now be referred to as “liquid staking tokens,” and they advocated for this change as a direct result of the event that took place. Since the Ethereum Merge took place, there has been a perceptible increase in the number of people who are contemplating taking part in liquid staking. This boost in interest comes as a direct result of the Ethereum Merge.

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Revenue for United States-based Coinbase Exchange Beats Expectations for 4th quarter

by Blockchain News

Coinbase, a cryptocurrency exchange that operates in the United States, has disclosed that its revenue for the fourth quarter of 2022 has above projections. This comes despite the fact that the exchange’s transaction volume has been steadily declining over the last several months.

The exchange reported a net revenue for the quarter of $605 million, which was much more than the revenue prediction of $589 million that was supposedly provided by Wall Street industry professionals.

Coinbase reported a 12% decrease in transaction volumes in comparison to the preceding quarter. Despite this, the business credited its 5% improvement in total revenues for the period to a 34% increase in subscription and service fee income.

In spite of Coinbase’s repeated assertions that the business does not consider its staking products to be securities, staking revenue for the company has reduced when compared to the prior quarter. This is due to the fact that the fall in the value of cryptocurrencies has been bigger than the overall growth in the amounts of staked bitcoin.

An inquiry of the exchange’s staking products is now being carried on by the United States Securities and Exchange Commission. This inquiry is quite similar to the one that led to its rival, the cryptocurrency exchange Kraken, reaching a settlement with the regulator for the amount of $30 million. Specifically, this investigation is looking into whether or not Kraken engaged in any illegal activity.

According to Coinbase, 2022 was a “tough year for crypto markets,” with the industry facing substantial headwinds due to both macroeconomic developments and incidents such as the bankruptcy of crypto hedge fund Three Arrows Capital and exchanges Voyager and Celsius. Coinbase attributed these headwinds to the fact that the sector was operating in a highly competitive environment.

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Team behind Friendsies NFT project refutes claims

by Blockchain News

The team that is responsible for the nonfungible token collection Friendsies has refuted assertions that they are “abandoning” the NFT project in the wake of a flood of allegations that they engaged in “rug pulling.” The allegations were made in response to a flood of allegations that the team engaged in “rug pulling.” After the squad was accused of indulging in “rug pulling,” these allegations were made to defend their actions. These claims were leveled as a kind of pushback against the mountain of evidence suggesting that the team engaged in “rug tugging.”

On February 21, the people who are driving the NFT project published a message to their Twitter followers stating that they would be “putting a stop” on Friendsies and “any future digital commodities” for the time being. The statement was posted on Twitter. They said that this decision will become effective right away. They justified their choice by arguing that the market provided a variety of challenges for them to overcome, which the decision had to take into consideration.

After around forty minutes had elapsed, the Twitter account that was in question was disabled, and the account of the organization that was responsible for beginning the campaign, Friendswithyou, was made private. Both of these actions were taken immediately after. As a direct consequence of this fact, stories have surfaced stating that the designers “rugged” for remuneration to the tune of almost five million dollars.

Since then, the Twitter account that is affiliated with the project has been revived, and the people behind the campaign have strongly disputed allegations that they had “given up” on the project altogether. The internet has been replete with reports that they are giving up on the project and moving on to other things, which may be translated as “throwing in the towel.” In spite of this, the account that was initially established by the company’s founders is being kept a secret by the management that is in place at the moment.

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Solana Spaces to Close Down Stores

by Blockchain News

Solana Spaces has decided to close its two Solana (SOL)-themed, community-oriented retail shops in New York City and Miami at the end of this month. These stores are situated in both cities respectively. This decision was taken as a result of the fact that the physical shops did not bring in as many new users as was first anticipated when they were first opened.

Solana Spaces announced the news through a tweet on February 21, which also contained a message from the shop’s founder, Vibhu Norby, explaining the many factors that contributed to the decision to close the stores.

Norby, who founded Solana Spaces in the early part of 2022, explained that the company had reached a “inflection point” with the stores, which prompted them to shift their investment focus to “DRiP,” the firm’s brand-new nonfungible token artwork airdrop platform. This move was prompted by the fact that the company had reached a “inflection point.” Norby also said that he was the one responsible for establishing Solana Spaces in the first place.

“While our stores onboard between 500 and 1,000 people per week, DRiP onboards that same number EVERY DAY,” Norby noted, explaining why the firm opted to shift its investment priority. “While our shops onboard between 500 and 1,000 people per week, DRiP onboards that same number EVERY DAY.” “While our shops bring on between 500 and 1,000 customers every week, DRiP brings on that same number every single day,”

Norby stated that the decision to close the stores, which are located in the Wynwood neighborhood of Miami and the Hudson Yards neighborhood of Manhattan, was made “a few weeks ago,” and that they would “sunset” at the end of the month of February. Both of these neighborhoods are in the city of New York.

Because the two stores in New York and Miami did not open their doors to the general public until the end of July and August, respectively, the ambitious endeavor was only operating for a relatively little period of time.

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NFTs belonging to bankrupt hedge fund to be sold by liquidators

by Blockchain News

According to a recent statement, the nonfungible tokens (NFTs) that belonged to the failed hedge firm Three Arrows Capital (3AC) would be liquidated by its liquidators, Teneo.

Christopher Farmer, a joint liquidator for 3AC, made the announcement in a notice dated February 22 that the liquidators aim to start selling NFTs that are associated with the company. The value of the NFTs would be “realized for the purposes of the liquidation,” according to the notice, which stressed the fact that the sale would be conducted. The notification will be effective 28 days from the beginning of the sales, as stated in the statement.

Within the release, the liquidators made it clear that they would not be included the list of NFTs that has been unofficially called the “Starry Night Portfolio.” As part of the bankruptcy proceedings involving 3AC, on October 5, 2022, 300 NFTs belonging to 3AC subsidiary Starry Night Capital were transferred. The liquidators brought to everyone’s attention the fact that an application regarding these NFTs is presently being considered by the supreme court in the British Virgin Islands.

Although the announcement did not specify which NFTs would be sold, analyst Tom Wan pointed out on Twitter which NFTs the liquidators may or may not sell in the future. According to Wan, the NFTs have the potential to incorporate certain items of a high profile. In the middle of the process through which 3AC was filing for bankruptcy, he tweeted that community members had constantly voiced their discontent on social media over the activities of the 3AC staff. On January 3, 2019, the creator of 3AC, Su Zhu, was called out on Twitter for his accusation that the Digital Currency Group (DCG) was planning to attack Terra in conjunction with the FTX exchange. Zhu’s attempts to call out DCG and FTX failed, as community members urged him to concentrate on his own wrongdoing rather than the actions of the other two companies.

On February 10, members of the cryptocurrency community attacked the newly created exchange that was supported by 3AC and Coinflex. The launch caused outrage among the community members, and many of them vowed that they would never participate in the exchange again and would harass anyone who did.

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Galaxy Digital Invests $44 Million Into Institutional Cryptocurrency

by Blockchain News

In order to access its exclusive asset storage and management capabilities, Galaxy Digital has put $44 million into an institutional bitcoin custody platform.

The purchase of GK8, a company that has created its own patent bitcoin custody system with the intention of providing safe asset management for institutional customers, has been successfully completed by the cryptocurrency investment business owned by Mike Novogratz.

The firm specializes in the provision of cold vault technology, which enables transactions to be carried out despite the absence of a connection to the internet. It has the potential to automate transactions thanks to its in-house multi-party computation (MPC) vault, and the service also gives access to decentralized finance (DeFi) networks, tokenization, and NFT trading.

According to a statement released by Novogratz, one of the primary motivations for the purchase was the rising demand for custody services among investors. The cold storage solutions and wallet technologies developed by GK8 will be integrated into GalaxyOne, the premier brokerage platform that will soon be released by Galaxy Digital.

As a result of the business transaction, Galaxy will expand its operations to include a location in Tel Aviv, where they will bring on approximately 40 staff formerly employed by GK8. Lior Lamesh and Shahar Shamai, co-founders of GK8, will continue in their roles as leaders of Galaxy’s custodial technologies offering after the company was acquired.

At the time of its introduction, GalaxyOne is expected to provide institutional-grade consumers with access to a comprehensive variety of bitcoin financial services. Trading, lending, derivatives, cross-portfolio margining, and custodial offers are all going to be a part of this. All of these are going to be handled by GK8.

In December 2022, Galaxy announced the purchase of Argo Blockchain’s primary mining operation for the price of $65 million. This move was Galaxy’s way of doubling down on its investments in the cryptocurrency mining business. In order to avoid going bankrupt during a challenging year for the mining industry, the mining company was forced to sell up its Helios mining plant.

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Binance Australia Derivatives starts closing certain positions and accounts

by Blockchain News

Users of the Binance Australia Derivatives product have reported receiving unexpected notices on February 23 from the digital asset platform, which said that the company has begun closing some derivatives contracts and accounts.

Individuals who did not match the qualifications to be a “wholesale investor” were informed that all of their positions would be closed, and they would no longer be allowed to use the Binance Australia Derivatives Platform, according to screenshots that were uploaded on Twitter by a variety of users.

Users have been advised that in order to continue utilizing Binance Australia’s derivatives platform, they are need to provide the requisite proof to demonstrate that they satisfy the criteria for the role of “wholesale investor.”

The letter went on to explain that Binance Australia Derivatives is working on a remediation and compensation plan for customers to whom the company owes any refunds as a result of the change.

 

It was then said that the steps that followed were in accordance with the local legislation in Australia, and as a result, the users were informed quickly, and the accounts that were impacted were closed.

The company officially goes by the name Oztures Trade Pty Ltd, however its trading name is Binance Australia Derivatives. The local Australia office of Binance is a corporate approved agent for Oztures. This is the connection between the two companies.

It is made abundantly clear that derivatives items are only made available for wholesale customers located in Australia in the official overview that was issued in July of 2022.

Despite this, customers commented to Binance’s article on Twitter, with one user from Australia stating that they were unable to stake their cryptocurrency owing to complications in their location. Another user said that flexible earn was no longer accessible in Australia, which prompted the Binance support staff to react by saying that they will investigate the situation.

As part of its “multi-stage” strategy to combat frauds, Australia strengthened its watchdogs for the cryptocurrency field earlier in the month of February.

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Coinbase Announces Launch of Ethereum Layer-2 Network

by Blockchain News

The cryptocurrency exchange Coinbase made the announcement about the launch of Base, an Ethereum layer-2 network, on February 23. The business has said that the newly launched network would provide a low-cost, secure, and user-friendly environment for the development of decentralized applications (DApps) on the blockchain.

According to Coinbase, Base was developed with the intention of serving as a gateway for people into the cryptocurrency economy. It does this by providing users with access to other L1 ecosystems, such as Solana, and by ensuring that it is compatible with other chains. Additionally, it will provide consumers access to Coinbase’s products, users, and tools, in addition to providing simple on-ramps for fiat currency and strong acquisition tools. The corporation has indicated that it does not intend to provide a fresh network token at this time.

Optimism’s “OP Stack” will be the foundation upon which Base will be constructed. It will begin with a significant degree of centralization; however, Coinbase has disclosed a comprehensive blueprint outlining how the network will gradually become decentralized over time.

In the statement that Coinbase made, the company said that Base will be “completely open source and readily accessible.” The business announced that it would be joining the core development team for OP Stack in order to “ensure that it is a public benefit that is open to everyone.”

The release states that Coinbase will continue to connect itself as an exchange with other networks, and that Base itself will function as “a bridge, not an island.” Coinbase wants Base to be a network that is simple for its consumers to use so that they can get used to using cryptocurrency. However, the company will urge users to “start on Base, but travel elsewhere.”

Coinbase stated in its decentralization plan that it is collaborating with Op Labs and the Optimism Collective to decentralize the Optimism ecosystem. This will be accomplished by building a “Superchain” of connecting networks based on the OP Stack. Coinbase’s plan calls for the creation of this “Superchain.” Citing Vitalik Buterin’s paper on the decentralization of rollups, the business has come to the conclusion that the present version of Optimism is what is known as a “Stage 0 rollup.” Coinbase has said that it intends to have developed Base to “Stage 1” by the end of the year 2023.

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