Day: March 5, 2023

UK’s Bank Regulator to Propose Rules for Digital Asset Issuance

by Blockchain News

The United Kingdom’s Prudential Regulatory Authority (PRA) has announced plans to propose a set of rules for the issuance and holding of digital assets. The decision comes as the use of digital assets continues to grow and evolve globally, and the PRA aims to ensure that banks and other financial institutions operating in the UK can do so safely and securely.

The proposal will be developed in accordance with the Basel III rules, a global regulatory framework for banking institutions, as well as the Financial Services and Markets (FSM) bill currently under consideration by the UK Parliament. This ensures that the UK’s regulatory framework is aligned with international standards and is comprehensive in its approach to managing digital assets.

Vicky Saporta, executive director of the Prudential Policy Directorate at the Bank of England, made the announcement in a speech delivered at the bank on February 27. Saporta emphasized that the PRA’s goal is to develop a regulatory framework that is proportionate to the risks associated with digital assets while remaining flexible enough to adapt to the rapidly changing market.

The proposed rules are expected to address a range of issues related to digital assets, including custody, governance, risk management, and disclosure requirements. The PRA’s approach will be informed by ongoing discussions with industry stakeholders and other regulatory bodies, as well as by best practices observed in other jurisdictions.

This move by the PRA represents a significant step forward in the regulation of digital assets in the UK. While digital assets have been gaining popularity in recent years, there has been little regulatory oversight, leading to concerns about investor protection and financial stability. The proposed rules will help to address these concerns and provide greater clarity and certainty for financial institutions operating in the UK.

In addition to the proposed rules from the PRA, the UK government has been taking steps to enhance its regulatory framework for digital assets. The Financial Conduct Authority (FCA), the UK’s financial regulator, has implemented a registration scheme for cryptocurrency firms operating in the country, and is considering additional measures to enhance investor protection and market integrity.

Overall, the UK’s approach to regulating digital assets is reflective of a broader global trend towards greater regulatory oversight. As digital assets continue to evolve and become more mainstream, it is likely that regulatory frameworks will continue to evolve as well, with the aim of promoting investor protection and financial stability while supporting innovation and growth in the sector.

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Binance Launches Joint Anti-Scam Campaign

by Blockchain News

 Binance, one of the world’s largest cryptocurrency exchanges, has launched a new campaign aimed at preventing scams in cooperation with local law enforcement agencies. The initiative, called the “Joint Anti-Scam Campaign,” was first rolled out in Hong Kong and aims to help potential victims of scams avoid falling prey to fraudulent activity.

As part of the campaign, Binance collaborated with the Hong Kong Police Force’s Cyber Security and Technology Crime Bureau to create an “alert and crime prevention message” for Hong Kong residents. When users attempted to make withdrawals, they were subjected to warning messages that provided information about common scams and tips on how to avoid them.

Binance investigated users’ responses to the messages over a four-week period and found that approximately 20.4% of users either decided not to make the withdrawal or investigated further to determine whether the transaction might be a scam. The success of the pilot program has led Binance to plan collaborations with police in other jurisdictions to create tailor-made warning messages for customers outside of Hong Kong.

Phishing and social engineering scams have been a recurring problem for cryptocurrency users. In February, scammers allegedly created a fake version of the ETHDenver convention website, which they used to trick users into giving away their cryptocurrency by calling a function on a malicious contract. In another example, an influential non-fungible token promoter had over $300,000 worth of CryptoPunks removed from his wallet when he was apparently fooled into interacting with a phishing site.

Binance’s Joint Anti-Scam Campaign aims to help users avoid these types of scams by providing them with targeted alerts and resources to educate them about common scams and how to avoid them. The company’s collaboration with law enforcement agencies is an important step in the fight against fraudulent activity in the cryptocurrency space. With the success of the pilot program in Hong Kong, it is hoped that this initiative will be expanded to other jurisdictions and help prevent more users from falling victim to scams.

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Bitcoin NFTs to Hit $4.5B Market Cap

by Blockchain News

 Galaxy Digital’s research unit has predicted that the Bitcoin nonfungible token (NFT) market could reach a $4.5 billion market cap by March 2025 based on the current growth rate and infrastructure of Ethereum’s NFT market. This is due to the emergence of a native on-chain ecosystem for NFTs on Bitcoin, which was not possible before the launch of the Ordinals protocol in late January.

Bitcoin NFTs, also known as Ordinals, allow users to inscribe data such as images, PDFs, video, and audio onto individual satoshis, each representing 0.00000001 Bitcoin (BTC). The market for Bitcoin NFTs has attracted significant attention since the launch of the Ordinals protocol, with NFT giants such as Yuga Labs jumping in on the hype. On February 28, the $4 billion firm behind the Bored Ape Yacht Club announced a Bitcoin-based NFT project dubbed “TwelveFold” in recognition of the Ordinals movement.

Galaxy researchers analyzed the potential growth of Bitcoin NFTs in a new report published on March 3. The report provided three market cap predictions based on the firm’s analysis, covering bear, base, and bull case scenarios. The baseline analysis predicted that if Bitcoin NFTs can expand to mainstream NFT culture like profile pictures, memes, and utility projects, the market capitalization should increase to $4.5 billion.

The researchers also noted that the projection of $4.5 billion is based on the rapid development in inscription awareness coupled with the marketplace/wallet infrastructure already out today. In a bear case scenario, Galaxy estimated that Bitcoin NFTs can still reach a market cap of $1.5 billion based on the current level of interest and supporting infrastructure. On the bullish side of things, Galaxy researchers estimate that the Bitcoin NFT market could reach around $10 billion if it provides strong competition to Ethereum NFTs while providing unique use cases.

The report highlighted the significance and utility of Bitcoin NFTs, noting that the addition of sizable data storage with strong availability assurances opens up a variety of use cases, including new types of decentralized software or Bitcoin scaling techniques. Even the NFT use case alone has the potential to dramatically widen the scope of Bitcoin’s cultural impact.

As of the report’s publication, more than 250,000 Ordinals have hit the market, indicating the growing interest and adoption of Bitcoin NFTs. With the emergence of a native on-chain ecosystem for NFTs on Bitcoin, it will be interesting to see how the market evolves and whether it can compete with Ethereum’s NFT market.

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Fox Renews Dan Harmon Krapopolis for Third Season Amid NFT Tie-Up

by Blockchain News

Fox has announced that it has renewed Dan Harmon’s animated comedy series, Krapopolis, for a third season, despite the first season not even airing yet. The show is produced by Fox Corp’s NFT firm, Blockchain Creative Labs, and features NFTs called “Krap Chickens.” These NFTs depict cartoon chicken avatars in the same art style as the show and offer holders exclusive access to experiences, content, rewards, and voting rights on certain aspects of the show. Fox’s president of scripted programming, Michael Thorn, expressed his faith in Harmon and his work, saying, “We’re so bullish about the work that we want to support and its ability to find an audience and succeed. While [a third season order] is atypical, it was a no-brainer for us with Krapopolis.” The show is set in ancient Greece and follows a “flawed family of humans, gods and monsters that try to run one of the world’s first cities without killing each other.” The cast includes Richard Ayode, Matt Berry, Pam Murphy, Duncan Trussell, and Hannah Waddingham.

In other NFT-related news, Baobab Studios sold out its first collection of 8,888 NFTs just nine hours after launch. The collection is called “Momoguro” and is tied to an upcoming role-playing game on layer 2 Ethereum scaling solution, ImmutableX. The game has breeding elements and quests in a world named “Uno Plane,” with NFTs being a key part of the gaming experience. According to data from CryptoSlam, the NFTs have generated $8.1 million worth of secondary sales to date, with $7.6 million coming on the day of launch.

Flare, a Layer 1 Ethereum Virtual Machine blockchain, welcomed its first NFT platform after Sparkles went live. The platform is set to hone in on the interoperability of native Flare protocols to increase use cases for NFT utility.

Additionally, Square Enix’s NFT-friendly CEO, Yosuke Matsuda, is stepping down after nearly 10 years at the helm. The move won’t be finalized until an annual shareholders meeting in May, but Takashi Kiryu has been named as his successor. While Web3 and NFTs weren’t explicitly mentioned in the notification from Square Enix, the firm did indicate that it is still looking to push on with new tech integrations, suggesting its blockchain-related plans may remain unhindered. Matsuda had previously taken a bullish position on Web3 gaming and emphasized Square Enix’s devotion to “aggressive investment and business development efforts” in the space in 2022 and beyond.

Finally, Magic Eden has launched a “Mint Madness” campaign that offers free access or “free mints” to 13 Web3 games in March. The campaign went live on March 3 and is spread across Polygon, Ethereum, and Solana, with nine, three, and one games on each platform, respectively. Magic Eden is also offering a 20,000 Polygon (MATIC) prize pool worth roughly $23,200. The prizes will go to the top 10 traders of the NFTs related to nine of the new games based on Polygon, with the top prize fetching 4,500 MATIC ($5,220). The full list of available games during the promotion includes Planet Mojo, Meta Star Strikers, Alaska Gold Rush, Shrapnel, Petobots, Blast Royale, Rogue Nation, Tearing Spaces, Freckle Trivia, Realm Hunter, Legendary: Heroes Unchained, Shrapnel, and Papu Superstars.

The NFT market continues to grow and expand, with more companies and industries embracing the technology. From animated comedy series to role-playing games, NFTs are being used to provide exclusive access and rewards to holders. Fox’s renewal of Krapopolis for a third season before the first season even airs is a testament to the potential success of NFT tie-ins with media and entertainment. Baobab Studios’ successful sale of its Momoguro NFT collection further highlights the growing interest in NFTs in the gaming industry. With the launch of the Mint Madness campaign by Magic Eden, NFT holders can now get access to a range of Web3 games and potentially win prizes. As the NFT market continues to mature, we can expect to see more creative and innovative use cases for the technology.

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India tests offline functionality of digital rupee

by Blockchain News

The Reserve Bank of India (RBI) is testing the offline functionality of its newly-launched central bank digital currency (CBDC), the digital rupee, according to Ajay Kumar Choudhary, the executive director of the RBI. The move comes after the RBI launched the wholesale segment pilot for the digital rupee on November 1, 2022, onboarding 50,000 users and 5,000 merchants for real-world testing.

Since the launch of the wholesale CBDCs, around $134 million worth of transactions have been completed as of February 25, with 800,000 transactions taking place. These figures indicate the growing popularity and potential use cases of CBDCs in India.

The digital rupee is expected to provide numerous benefits, such as reduced transaction costs, increased financial inclusion, and enhanced security features. The RBI aims to provide a digital alternative to the traditional physical currency, making transactions faster, cheaper, and more efficient.

With the offline functionality of the digital rupee being tested, users can continue to make transactions even in areas with poor or no internet connectivity. This is an important feature for a country like India, where internet penetration is still low in certain regions.

The pilot for the digital rupee has been launched in the wholesale segment, which caters to financial institutions and large businesses. However, the RBI plans to roll out the digital currency to the general public in the future.

India is not alone in its efforts to launch a CBDC. Several countries, including China, Sweden, and the United States, are exploring the possibility of introducing their own digital currencies. The rise of CBDCs is expected to have a significant impact on the traditional banking system, as they have the potential to change the way people store, transfer, and access money.

In conclusion, the testing of the offline functionality of the digital rupee is an important step towards the wider adoption of the CBDC in India. The wholesale segment pilot has already shown promising results, and the RBI’s plan to introduce the digital rupee to the general public could revolutionize the country’s financial sector.

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TBD’s Block Launches c= to Enhance Bitcoin Lightning Network

by Blockchain News

TBD, a subsidiary of Block, has announced the launch of c=, a new initiative that aims to improve the Bitcoin Lightning Network. c= is a new endeavor that aims to improve the Bitcoin Lightning Network. The Lightning Network is a layer 2 payment network that aims to make Bitcoin transactions quicker, cheaper, and more reliable. Its primary function is to reduce the fees associated with Bitcoin transactions. From its inception, the network has been subject to unplanned expansion, with the acceptance of its services in the real world being the primary driver of its liquidity and capacity.

TBD wants to further extend the scope of the Lightning Network by offering more liquidity and routing services, and with the introduction of c=, they hope to accomplish this goal. The objective of the c= project is to enhance the architecture of the network in order to better facilitate the use of Bitcoin as a payment mechanism by the general public.

The Lightning Network is a crucial breakthrough for Bitcoin since it overcomes some of the difficulties associated with the original blockchain, such as sluggish transaction times and excessive fees. This makes the Lightning Network a vital addition to the Bitcoin ecosystem. Lightning Network transactions are peer-to-peer transactions that are more trustworthy, cheaper, and quicker than typical blockchain transactions. This is made possible by the addition of a second layer to the network, which is what the Lightning Network does.

Nevertheless, there are several difficulties associated with using the Lightning Network. Lack of liquidity is one of the primary problems, which might make it challenging to route transactions over the network. This is one of the fundamental challenges. Services such as c= come into play at this point. c=’s goal is to enhance the user experience by providing more liquidity and routing services. This will make it simpler for more individuals to use Bitcoin as a payment method and should encourage more people to do so.

Since it displays a dedication to developing the Lightning Network and making Bitcoin more accessible to a larger audience, the introduction of c= is an exciting step for the Bitcoin community. Services like as c= are vital for guaranteeing that the Bitcoin network is able to continue to satisfy the demands of users all around the globe as it continues its rapid expansion and widespread acceptance.

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US proposes new bail conditions for former FTX CEO

by Blockchain News

The former CEO of cryptocurrency exchange FTX, Sam Bankman-Fried (SBF), is facing new bail conditions proposed by the United States Department of Justice. The proposal was submitted to District Judge Lewis Kaplan of the Southern District of New York, and includes a prohibition on using smartphones, tablets, computers, or any video game platforms or devices that allow chat and voice communication. Instead, Bankman-Fried’s communication would be restricted to a “flip phone or other non-smartphone with either no internet capabilities or internet capabilities disabled.”

The proposal was reportedly negotiated with Bankman-Fried’s defense team, who requested to submit a proposal by March 3. It also requests that the temporary bail conditions recently imposed should be made permanent. These temporary conditions include a ban on contact or communication with current or former employees of FTX or Alameda Research, except in the presence of counsel, and a prohibition on using any encrypted or ephemeral call or messaging application, as well as a VPN.

In addition, the proposal notes that Bankman-Fried’s laptop would be monitored by security software that will log his online activity. The proposal also states that Bankman-Fried will not object to the installation of court-authorized pen registers on his phone number, Gmail account, and internet service, which will be sought by the government and maintained by the Federal Bureau of Investigation.

Bankman-Fried’s $250 million bail has been under scrutiny since February 9, after he was found to have contacted potential witnesses on his case. He was also temporarily banned from using a VPN after prosecutors accused him of using it on two occasions, on January 29 and February 12.

The court unsealed a superseding indictment against Bankman-Fried on February 22, which contains 12 criminal counts, including eight conspiracy charges related to fraud as well as four charges of wire fraud and securities fraud. Bankman-Fried has not yet entered a plea in the case.

The proposed bail conditions are likely an attempt to prevent Bankman-Fried from potentially tampering with witnesses or committing further crimes while awaiting trial. The case against him is still ongoing, and it remains to be seen how the court will ultimately rule on the proposed conditions.

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Bybit suspends USD bank transfers amid service outages

by Blockchain News

Bybit, a Dubai-based cryptocurrency exchange, has announced that it is temporarily suspending United States dollar (USD) deposits via bank transfers in response to “service outages from a partner.” According to a blog post from March 4, USD deposits via wire transfer are no longer available, but users can still make USD deposits through the Advcash Wallet or with a credit card. Withdrawals through the Advcash Wallet are scheduled to be available soon, according to the exchange.

Bybit has reassured users that their funds are safe and secure, but is urging clients planning to withdraw USD to do so “as soon as possible to avoid potential disruptions.” The halt comes just a day after Silvergate Bank announced plans to discontinue its digital assets’ payment network, which was one of the major on- and off-ramps for USD in the American crypto industry.

Bybit is one of the companies with exposure to the crypto lender Genesis Global Trading, which filed for Chapter 11 bankruptcy on Jan. 20. According to Bybit CEO Ben Zhou, the exposure amounts to $150 million via its investment arm Mirana Asset Management. A total of $120 million of the funds were collateralized and had already been liquidated, according to Zhou. He also assured that all client funds go into separate accounts and that Bybit’s earn products do not use Mirana.

The regulatory pressure and market outflows following the dramatic collapse of the cryptocurrency exchange FTX in November 2022 are driving US banks to reduce their exposure to cryptocurrency assets. Last month, Binance announced that it would temporarily suspend bank transfers of US dollars. In January, the exchange also said that its SWIFT transfer partner, Signature Bank, would only process trades by users with USD bank accounts over $100,000. Signature Bank previously announced that it was drastically decreasing crypto deposits.

While Bybit has suspended USD deposits via bank transfer, users can still make deposits through the Advcash Wallet or with a credit card. Bybit has assured users that their funds are safe and secure, but is urging clients to withdraw USD as soon as possible to avoid potential disruptions. The halt comes amid regulatory pressure and market outflows in the wake of the collapse of FTX and the bankruptcy of Genesis Global Trading.

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Binance CEO denies FBI “shot” rumor

by Blockchain News

Binance CEO Changpeng “CZ” Zhao has denied rumors that he was “shot” by the U.S. Federal Bureau of Investigation (FBI), which were spread widely on a Chinese messaging platform. In a tweet on March 4, CZ addressed the false speculations, and reiterated the close working relationship that exists between Binance and the FBI. He also emphasized the importance of ignoring fake news, distractions, and attacks, which he listed as his fourth goal for 2023.

The rumor was quickly debunked by CZ, who took the opportunity to remind Binance users to remain vigilant against fake news and distractions. He also retweeted a tweet by a user asking him about the rumor, and suggested that CZ should provide a “proof of life” with the latest Binance Smart Chain (BSC) block hash.

This event is similar to a false rumor spread about Ethereum co-founder Vitalik Buterin in 2017, when he was rumored to have died in a car crash. Security analyst Harry Denley called the rumor about CZ the “2023 adaptation of attempted market manipulation.”

In recent news, CZ and Binance.US CEO Brian Shroder were sent a letter on March 1 from three United States senators, Elizabeth Warren, Chris Van Hollen, and Roger Marshall, demanding more information regarding the financials of Binance. The senators claimed that the “little information” available in regards to Binance’s financials suggests that the exchange is a “hotbed of illegal financial activity.”

It is worth noting that Binance.US hired former FBI special agent BJ Kang in October 2022 to head up its investigation unit, aimed at combating illegal activity on the platform. Kang was once dubbed “the most feared man on Wall Street” by Reuters after being photographed arresting Bernie Madoff, who was found guilty of running the largest Ponzi scheme to date.

Overall, CZ’s swift response to the false rumor demonstrates his commitment to transparency and accountability at Binance. Despite the senators’ demands for more information, Binance has remained steadfast in its mission to provide a secure and compliant platform for its users.

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Ripple CEO Warns SEC’s “Enforcement” Approach May Hurt US Crypto Industry

by Blockchain News

The CEO of Ripple, Brad Garlinghouse, has warned that the US Securities and Exchange Commission’s (SEC) approach to regulation is putting the US at risk of missing out on being a global hub for the next evolution of blockchain and crypto innovation. In a recent Bloomberg interview, Garlinghouse suggested that the SEC’s enforcement-focused approach, as opposed to working collaboratively with the industry, is not a healthy way to regulate an industry.

Garlinghouse noted that the SEC’s case against Ripple is an example of the regulator simply playing “offense” and “attacking” the industry as a whole, rather than taking a constructive approach to regulation. He added that if the SEC is “able to prevail,” there will be “a lot of other cases.” 

Garlinghouse argued that the crypto industry has “already started moving outside” of the US given its crypto regulation process is “behind” other countries such as Australia, UK, Japan, Singapore, and Switzerland. He commended these countries for taking “the time and thoughtfulness” to create “clear rules of the road,” and suggested that the US should follow suit in order to remain competitive. 

Garlinghouse believes that the framework process should begin with outlining clear protections for consumers. He added that consumers are suffering from the “lag,” as they don’t have the “same protection” that the regulatory frameworks can provide. 

Meanwhile, John Deaton, founder of legal news outlet Crypto Law Lawyer, recently put a call-to-action to his 245,000 Twitter followers, stating that all companies in “active litigation” with the SEC should collaborate and develop “coordinated strategies,” adding that it is “war.” This comes after Blockchain Association CEO, Kristin Smith, told Bloomberg in a Feb. 22 interview that the crypto regulation process in the US is happening “behind closed doors,” and that more industry involvement is vital in an “open process.” 

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Bitcoin (BTC) $ 26,576.12 0.03%
Ethereum (ETH) $ 1,593.18 0.14%
Litecoin (LTC) $ 64.97 0.60%
Bitcoin Cash (BCH) $ 208.29 0.16%