The biggest crypto news and ideas of the day |
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The European Union passed new tax rules impacting crypto, granting authorities the ability to share users’ personal data in a bid to block assets from being stashed overseas. The updated rules, proposed last year, received unanimous support from EU member states but also drew public controversy for being crafted in discussions behind closed doors. The so-called Eighth Directive on Administrative Cooperation, aka DAC8, covers stablecoins, NFTs, DeFi tokens and proceeds from staking. |
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SBF's defense scored a few points in their cross-examination of former FTX higher-up Nishad Singh on his second day on the stand by showing discrepencies between Singh's testimony and closed door conversations he had with Department of Justice prosecutors in January. Singh has said he had a "surprising amount of haziness" about events in June 2022, including discovering a bug that over-counted Alameda's debt position, but was seemingly about to recount details in court. - Singh, who took a plea deal with the DOJ, also said during the cross-examination he knowingly bought a multi-million dollar penthouse at the luxury complex Orchid, in the Bahamas, using customer funds.
- University of Notre Dame accounting professor Peter Easton, who took the stand in SBF's ongoing trial Wednesday morning, said "Oh, yes" when asked whether FTX ever spent user deposits. Easton was hired by the DOJ to trace billions of dollars of Alameda and FTX funds. By June 2022, when FTX deposits were at their peak, the exchange only had around $2 billion on hand to back more than $11 billion in user deposits, he testified.
Easton's investigation found customer funds were behind a number of FTX investments, including into Anthony Scaramucci's SkyBridge Capital, bitcoin mining firm Genesis Digital Assets and the hedge fund Modulo Capital (run by another SBF ex). SBF also allegedly set up a shell company called Paper Bird that funneled $100 million of FTX users funds into Dave, Inc., a mobile banking platform. - SBF met pro-crypto New York City Mayor Eric Adams at his favorite Italian restaurant, according to a detail from FBI Special Agent Richard Busick's testimony on Tuesday, thought to be presented to establish DOJ's jurisdiction over the internationally-based SBF. SBF also met with Saudi Arabia’s finance minister, Khalid A. Al-Falih, and sovereign wealth fund lead, Yasir Al-Rumayyan. FTX employee Natalie Tien served as SBF's personal assistant.
Looking for more in-depth reporting on the SBF trial? Subscribe to "The SBF Trial" newsletter pop-up, written by CoinDesk reporters and editors on the ground in court. |
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A message from Chainalysis |
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Reddit is sunsetting its “Community Points” reward token, which launched three years ago and is often cited as an example of crypto tech being adopted by a mainstream company. “The resourcing needed was unfortunately too high to justify,” Reddit Director Tim Rathschmidt told TechCrunch. The Arbitrum-based rewards tokens, which rewarded users for making “high-quality” contributions, will be fully phased out by Nov. 8. Redditors had mixed reactions, with some citing the recent and successful Collectible Avatar NFT launch, reportedly minted by millions of users, while others complained about how the system incentivized low-effort posting. Tokens for subreddits like r/CryptoCurrency and r/Fortnite tanked on the news. |
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Stellar, the nine-year-old payments-focused blockchain, is making smart contracts a priority in a bid to take on app-friendly chains like Ethereum. The so-called Soroban integration is expected later this year, and will be led by the Stellar Development Foundation. “We see DeFi as a big part of the future, and we want to enable that for the users of Stellar," Foundation VP Tomer Weller said. The foundation, a massive bagholder of about $2 billion worth of XLM, recently inked a deal with smart contract security company Certora. Developers of FLOKI, the “dog token” project fashioned after SHIB and DOGE, are building a staking system and utility token, chief developer “B” told CoinDesk, calling it a bid to “ensure long-term development sustainability for this project.” The yet-unnamed item can only be acquired by staking FLOKI. |
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Digital asset management firm 21.co said the market for tokenized assets could reach $10 trillion in a "bull case" and $3.5 trillion in the "bear case," in a new report. "The convergence between crypto and traditional asset classes, including fiat currencies, equities, government bonds, and real estate, is experiencing an unprecedented growth," it read. The current “real world asset” market is valued at $116 billion, with smart contract network Ethereum hosting nearly $60 billion of these assets, followed by Tron and Solana. Meanwhile, Coinbase trading volumes in the U.S. appear to have weakened more than expected in Q3, investment bank Berenberg reported Tuesday. The exchange’s trading volume fell 52% year-on-year, a bellwether sign of the bear market. |
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The Takeaway: Crypto Ain't Traditional |
Rob Krugman, today's guest columnist, is the chief digital officer at Broadridge. The crypto market participants increasingly find themselves in the cross hairs of elected officials and regulators who are concerned that investors do not understand the assets they are investing in. Regulators and market participants can address these risks and help restore confidence in crypto assets by coming together to create a standardized disclosure framework that better inform crypto investors about opportunities and risks. Experienced crypto traders rely on a series of dedicated metrics to assess the viability and attractiveness of crypto assets. For example, “network performance” measures how the platform supporting an individual crypto asset works and how fast the platform processes transactions. “Tokenomics” measures things like the initial supply of a cryptocurrency, details on how that supply can change, and other variables that help determine a token’s value. Without looking at these and other factors unique to crypto, it’s difficult or even impossible to understand and place a valuation on a crypto asset. However, a new survey from Broadridge surveyed 2,000 crypto market participants in the United States, U.K. and Canada and found the majority use conventional financial metrics when determining what to invest in. This means trying to apply things like cash flows to assess a cryptocurrency. Nearly half of respondents said they look at the holdings of a crypto project’s management team — like the breakdown of how many tokens go to a project’s founding team versus its treasury — when making financial decisions. But still, only about 28% of investors consider network performance and only 16% look at tokenomics. The findings suggest that many investors don’t fully appreciate the importance of crypto-native factors critical to understanding crypto assets. The results also point to the more troubling possibility that some current investors may be making decisions based on an incomplete assessment of the risk-return profiles of particular crypto assets. Read the full article on the web. – Rob Krugman @RobKrugman |
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Cryptocurrency Payment Solutions are (Finally) Emerging, Thanks to Payment Gateways Like Alchemy Pay* If cryptocurrency-as-payment were truly easy and ubiquitous, there wouldn’t be playful articles about how hard it is. And that gets to the crux of the issue. The idea of “buying coffee with bitcoin” was quirky and fun but not mainstream. Not only Bitcoin, other cryptocurrency like Ethereum, Litecoin, Dogecoin, XRP have been used to make payments, but failed to take off as a widespread payment solution. None have truly caught fire in a mainstream way. The reason for this lack of adoption? Let’s look at it from the perspective of users, merchants, and enterprises. Continue reading **This is sponsored content by Alchemy Pay |
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