May 19, 2022

Crypto Roundup by DJKupo

UST’s Do Kwon Was Behind Earlier Failed Stablecoin, Ex-Terra Colleagues Say (CoinDesk)

“Do Kwon, the CEO of Terra creator Terraform Labs, was one of the pseudonymous co-founders behind the failed algorithmic stablecoin Basis Cash, CoinDesk has learned. Basis Cash (BAC) was a closely watched revival in decentralized finance (DeFi) circles when it launched on Ethereum in late 2020, just before the launch of terraUSD (UST), Terra’s flagship stablecoin. Like UST, BAC sought to maintain a $1 peg through code, not collateral.”


Citadel Securities, BlackRock, Gemini Slam Social Media Accusations of Involvement With UST Collapse (CoinDesk)

“Did UST collapse because of a shadowy conspiracy involving the same cast of characters from the GameStop short squeeze? Or was it because of a structural problem with the nature of stablecoins? Bad news for those who believe the former: Everyone named in this conspiracy theory has come out with swift denials. While BlackRock manages cash reserves for USDC, it said in a public statement it doesn’t trade UST. Likewise, Citadel Securities has publicly stated that it does not trade in stablecoins. Gemini said in a tweet that it has made no such loan as claimed in the conspiracy theory.”


Chainalysis Valued at $8.6 Billion in GIC-Led Investment (The Block)

“Blockchain data analytics firm Chainalysis has raised $170 million in their latest funding round at a valuation of $8.6 billion, more than doubling its $4.2 billion valuation from last June, according to The Information. According to the report, current investor GIC, which is one of three investment entities in Singapore that manage the government’s reserves, is leading the Series F round.”


FTX.US Applies for Trust Charter in New York (The Block)

“FTX.US has applied with the New York Department of Financial Services (NYDFS) for a trust charter, the firm announced Wednesday. The crypto exchange, the American affiliate of FTX, seems to be inching closer to opening up its services to New York residents. As it waits for approval from regulators, FTX.US has also started gearing up for the possible launch of a New York State limited purpose trust company.”


Luna Hits New Lows as Kwon Pursues Plan to Restore UST Peg (The Block)

“The price of LUNA, the native token of the Terra blockchain, hit new market lows Thursday morning. The cryptocurrency dipped below $0.30 for the first time early on May 12, hitting a low point of $0.21 as of press time, based on Binance data. Binance currently facilitates more trading in LUNA than any other exchange, according to CoinGecko.”


SEC’s Gensler Says Crypto Exchanges Trading Against Clients (Bloomberg)

“Gary Gensler is ratcheting up his criticism of digital-asset exchanges, arguing that some platforms are shirking rules and may be betting against their own customers. The US Securities and Exchange Commission chair reiterated Tuesday that most digital assets fall under his agency’s purview and venues trading them should register with the regulator. The SEC is also beefing up its enforcement efforts, he added.”


Crypto Exchange KuCoin Scores Funding at $10 Billion Valuation (Bloomberg)

Cryptocurrency Companies Photo Illustrations

“KuCoin, one of the world’s most popular crypto-exchanges, has raised $150 million from investors led by Jump Crypto, boosting its valuation to $10 billion. Circle Ventures, IDG Capital and Matrix Partners took part in the pre-Series B financing, the Seychelles-based startup said in a statement. It will use the proceeds to expand in decentralized finance and non-fungible tokens via its own venture investment arms.”


Yellen Cites UST Breakdown While Calling for Stablecoin Rules (Bloomberg)

Janet Yellen 

“Treasury Secretary Janet Yellen said the de-pegging of TerraUSD shows the urgency to have a regulatory framework on stablecoins, which aim to minimize the volatile price swings seen in most cryptocurrencies. ‘A stablecoin known as TerraUSD experienced a run and had declined in value,’ Yellen said during testimony before the Senate Banking, Housing and Urban Affairs Committee on Tuesday. ‘I think that simply illustrates that this is a rapidly growing product and that there are risks to financial stability and we need a framework that’s appropriate.’”


Luna Foundation Guard Seeks More Than $1 Billion to Shore up UST Stablecoin (The Block)

“The Luna Foundation Guard (LFG), a Singapore-based non-profit that supports the Terra blockchain ecosystem, is looking to raise more than $1 billion to shore up the UST algorithmic stablecoin after it lost parity with the US dollar, according to three sources familiar with the situation.”


Dapper Labs Unveils $725 Million Ecosystem Fund for Flow Blockchain (The Block)

“Dapper Labs, the company behind the NFT-focused blockchain Flow, is launching a $725 million fund to attract developers to the network. The so-called ecosystem fund drew participation from an array of venture firms, including Andreessen Horowitz,  Coinfund, Digital Currency Group (DCG), Coatue Ventures, Dapper Ventures, Fabric Ventures, Spartan Group and Union Square Ventures.”


Crypto Market Crash Leads to $1B in Liquidations, Majors Lose Pivotal Support (CoinDesk)

“Crypto futures racked up more than $1 billion in liquidations in the past 24 hours amid weak market sentiment and major assets losing pivotal support levels. Bitcoin (BTC) fell as much as 8% in the past 24 hours. Ether (ETH), BNB Chain’s BNB, and XRP saw similar losses. Terra’s LUNA fell 50% as its UST stablecoin lost its peg with U.S. dollar, while memecoin dogecoin (DOGE) fared relatively better than the market with just a 6% drop.”


Terra Stablecoin Peg Slips Below $0.70—Despite Loan From Bitcoin Reserves (Decrypt)

Crypto winter conditions are making market prices slippery. Image: Shutterstock

“Terra’s UST, the third-largest stablecoin by market cap, dropped to $0.69 in Monday trading, an all-time low according to CoinMarketCap data, even after the Terra-supporting Luna Foundation Guard rushed a $1.5 billion loan to shore up the currency. On Coinbase, the listed price got as low as $0.65.”


Bitcoin’s Testing of Lows Has Traders Wary of a Break Below $32,000 (Bloomberg)

“Bitcoin slumped for the seventh time in eight days, raising concern that the slide risks pushing the largest cryptocurrency out of the range it has traded within much of the year. Cryptocurrencies have been weighed down by the overall risk aversion that has swept though global markets as central banks battle inflation while trying to temper the stimulus added during the Covid pandemic. Bitcoin is down more than 20% so far this year.”


India Mulls a 28% Tax for Crypto Services: CNBC-TV18 (The Block)

“India’s Goods and Services Tax (GST) Council is weighing a proposal to impose a 28% tax on all cryptocurrency transactions, according to a report by CNBC-TV18 on Monday. ‘The proposal is to levy 28 percent GST on services and all activities related to cryptocurrencies soon,’ a source familiar with the issue told CNBC-TV18. The matter remains under discussion by a ‘law committee’ working for the council.”


Binance Suspends Luna and UST Withdrawals Amid Market Turbulence (The Block)

“Crypto exchange Binance has suspended withdrawals of LUNA and UST tokens as the Terra-based stablecoin struggles to recover its peg to the US dollar. Binance announced the temporary suspensions in a blog post earlier this morning, blaming ‘a high volume of pending withdrawal transactions’ caused by network congestion.”


Luna Foundation Guard Says It Will Lend Out $1.5 Billion in BTC and UST to Defend Stablecoin Peg (The Block)

“The Luna Foundation Guard (LFG) said Monday that it will lend out hundreds of millions of dollars worth of bitcoin and the stablecoin UST in order to defend the latter’s peg amid a period of market volatility. As reported Sunday by The Block, UST — the algorithmic stablecoin tied to the Terra crypto ecosystem — slipped below its intended $1 parity, though it has since recovered ground since Saturday’s low. At press time, UST is trading at $0.9955 against USDT on Binance.”


Google Is Building a WEB3-Focused Team (The Block)

“Google is reportedly putting together a web3 team that will build services for developers running blockchain applications, according to CNBC. In an email sent to employees Friday, Google Cloud vice president Amit Zavery said that while Web3 was still in its early stages, the market “is already demonstrating tremendous potential with many customers asking us to increase our support for Web3 and Crypto related technologies,” per the report.”


WisdomTree Positions Its Forthcoming Crypto Wallet to Serve ‘the Next 2 Billion’ (The Block)

“US asset manager WisdomTree hopes its forthcoming consumer-facing crypto wallet will offer an approachable experience for less tech-savvy users intimidated by the current crop. The smartphone-based wallet, known as WisdomTree Prime, was announced in January and will have a limited US launch this summer before a full roll-out across America next year, Jason Guthrie, Wisdomtree’s European head of digital asset product and head of digital assets, said in an interview with The Block.”


Meta’s Instagram to Support NFTs From Ethereum, Polygon, Solana, Flow (CoinDesk)

“NFTs from some of the most popular blockchain networks for crypto art are coming to Instagram with the announcement of a pilot as soon as Monday. The social media powerhouse owned by Meta is planning non-fungible token (NFT) integrations for Ethereum, Polygon, Solana and Flow, CoinDesk has learned. Those networks host the vast majority of trading in digital collectibles, with Ethereum and its Bored Apes leading the way by market cap.”


Amber Group Is Raising Again After Securing $200 Million in February (The Block)

“Crypto trading platform Amber Group is seeking fresh funding just a few months after topping up its coffers with $200 million. Two people with direct knowledge of the situation told The Block that the deal would likely value the Singapore-based startup at up to $8 billion. One of those sources said the final valuation is likely to be between $5 billion and $8 billion.”


Binance Commits $500M to Co-invest in Twitter With Elon Musk (Cointelegraph)

Binance commits $500M to co-invest in Twitter with Elon Musk

“Major crypto exchange Binance has participated in Elon Musk’s $44 billion acquisition of Twitter, according to data filed with the United States Securities and Exchange Commission. On May 5, Musk filed an amended general statement of the acquisition, announcing that Twitter received an aggregate of about $7.2 billion in new financing commitments in connection with the merger agreement, subject to the conditions in co-investor equity commitment letters.”


Luna Foundation Guard Acquires $1.5B in Bitcoin to Reinforce Stablecoin Reserves (CoinDesk)

“The Luna Foundation Guard (LFG) has acquired 37,863 bitcoins as it continues to move toward its target of having $10 billion of stablecoin reserves before the end of the third quarter. The purchases were made in the form of two over-the-counter deals, one a $1 billion swap of US Terra (UST) for bitcoin (BTC) with crypto prime broker Genesis Global Trading and the other a $500 million purchase of bitcoin from hedge fund Three Arrows Capital, according to a tweet on Thursday. Genesis is owned by Digital Currency Group, which is also CoinDesk’s parent company.”


Tron’s New Algorithmic Stablecoin USDD Goes Live (The Block)

“Tron’s new algorithmic stablecoin USDD has officially gone live on the blockchain, according to a spokesperson for the company. The stablecoin — similar in almost every way to Terra’s UST — is designed to incentivize arbitrageurs to keep its price closely pegged to that of the US dollar, through trading between TRX, Tron’s token, and USDD. Like Terra, Tron has also signalled its intent to establish a reserve of $10 billion in bitcoin and other cryptocurrencies to support the new stablecoin.”


Curve Finance Integrates With Near’s Aurora Network (CoinDesk)

“Curve Finance, a decentralized exchange built on the Ethereum blockchain that focuses on stablecoin swapping, has integrated with Near protocol’s Ethereum Virtual Machine (EVM) layer called Aurora. Aurora is an EVM built on the Near protocol, offering full Ethereum compatibility, low transaction costs and trustless bridging, according to its website. Aurora has $1.3 billion in total value locked (TVL) and is ranked 12th among top decentralized finance (DeFi) protocols, according to DeFi Llama.”


Former BitMex CEO Asks for Probation Over Jail Time Ahead of Court Sentencing (The Block)

“Former BitMEX CEO Arthur Hayes is seeking probation with the ability to travel and reside abroad rather than serving jail time. Hayes pleaded guilty to violating the US Bank Secrecy Act (BSA) in February after a two-year legal battle with the US government. Hayes and his co-founders were accused of ‘evading US anti-money laundering requirements’ in October 2020. The penalty carries a maximum penalty of five years in prison.”


Last Week’s Most Read Articles

Bitcoin Mining Council Rebuts House Democrats in Letter to EPA (The Block)

Bored Ape Metaverse Frenzy Raises Millions, Crashes Ethereum (Bloomberg)

VanEck Releases First NFTs, Promising Early Access to Research (CoinDesk)

Otherside NFT Mint Burned More Than $157M in Ethereum (Decrypt)

California Governor Signs Executive Order to Create a Crypto Framework (The Block)

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