16/01/23
2022: The Events That Shaped Web3
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The year of 2022 was a year of great highs and new lows for the Web3 industry. We rode into 2022 on the back of 2021’s NFT craze, only for the collapses of major players and a looming global recession to drive the industry’s total market cap from 2.4 trillion down to an all-time-low of roughly 0.8 trillion.
Web3edge’s 0xPhillan ventured through hundreds of news articles across all of 2022 to summarize the key major events that brought together – or pushed apart – the Web3 community in 2022, summarized in one long timeline.
If I missed any key events, message me on Twitter! – 0xPhillan
Each item in the timeline is color-coded by its impact on the Web3 community:
- Green: positive impact
- Red: negative impact
- Gray: neutral impact
Enjoy!
Qubit Finance’s Qbridge Protocol hacked for $80m
Hackers stole over $80m from Qubit Finance, a DeFi protocol on Binance Smart Chain. In total, the address linked to the hack stole 206,809 Binance Coin (BNB).
The hacker exploited the QBridge smart contract’s deposit functionality to mint 77,162 qXETH (Ether bridged via Qubit). The protocol was made to believe that the hacker had deposited funds, when in fact they hadn’t.
Sources: cointelegraph.com
Dune Analytics raises $69.420m (nice) at a $1bn valuation
Dune Analytics, a platform that enables users to create data charts and dashboards on cryptocurrency metrics, has raised $69.4 million in a Series B funding round led by hedge fund Coatue, valuing the company at $1 billion.
Dune plans to use the funding to build a community of up to one million analysts, expand its team, build an API, and support more blockchains. The platform, which currently has 10,000 analysts and 100,000 pieces of analysis, charges $390 per month per user for its paid data product. Dune’s Series B round brings its total funding to date to $80 million.
Sources: tokeninsight.com
Wormhole Bridge haacked for over $320m through smart contract exploit
The Wormhole bridge, a token bridge between networks, experienced a security breach resulting in the loss of 120,000 Wrapped Ether (wETH) tokens (~$325 million).
The exploit was due to Wormhole’s failure to validate “guardian” accounts, which resulted in the hacker minting 120,000 wETH with no ETH backing it on the Solana side of the bridge. The bridge’s Ether supply was later replenished by Jump Crypto ensuring wETH was backed 1:1, making users whole again.
Sources: cointelegraph.com, decrypt.co, tokeninsight.com, twitter.com
AssangeDAO raise
The AssangeDAO, a DAO that raises funds for the defense of WikiLeaks founder Julian Assange, raised over 17,442 ETH (~$56 million) since launch on February 3, surpassing the previous record of 11,613 ETH (~$45 million) raised by the ConstitutionDAO.
Funds raised by the AssangeDAO will be used to purchase an NFT produced by digital artist Pak in collaboration with Julian Assange, with proceeds going to Assange’s defense fund to cover legal fees and a publicity campaign.
Sources: coindesk.com, juicebox.money, tokeninsight.com
Bitfinex Hackers arrested
The US Department of Justice seized $3.6bn in bitcoin in the largest financial seizure in its history. The funds were stolen in a major hack of cryptocurrency exchange Bitfinex in 2016, when 119,754 bitcoin – then worth $72m – were transferred from users’ accounts into a single wallet. The bitcoin appreciated in value over time to a value of $3.6bn.
When small amounts began to be transferred to exchanges on the dark web in 2017, investigators began to trace transactions to people in the real world. In June 2021 a married couple from New York, were arrested and charged with money laundering and conspiracy to defraud the US.
Sources: justice.gov, time.com
Coinbase Superbowl ad so popular the app crashed
Coinbase’s 60-second Superbowl ad which consisted almost entirely of a colorful bouncing QR code was so popular, that it crashed the Coinbase app. When scanned, the QR code brought users to a promotional website, offering a limited time promotion for new users.
Sources: theverge.com
Binance Smart Chain (BSC) renames to BNB Chain
In a move that appears to confuse users well into the end of 2022, Binance decides to rename Binance Smart Chain (BSC) to BNB (“Build and Build”) Chain. Binance also has an asset “BNB” (Binance Coin) which is the gas token that fuels transactions on BNB Chain.
BNB Chain is comprised of:
– BNB Beacon Chain (previously Binance Chain) – BNB Chain Governance (Staking, voting)
– BNB Smart Chain (BSC) (Previously Binance Smart Chain) – EVM compatible, consensus layers, and with hubs to multi-chains.
Sources: binance.com, tokeninsight.com
Opensea smart contract exploit
Attackers stole hundreds of NFTs from users on OpenSea through a phishing scam, with an estimated loss valued at over $1.7 million. The attack exploited a weakness in the Wyvern Protocol, the standard underlying Opensea’s NFT smart contracts.
Victims of the attack signed a partial contract with a general authorization and large portions left blank. The attackers then completed the contract with a call to their own contract in which they transferred ownership of the NFTs without payment.
Sources: theverge.com, medium.com
Stargate (Layer0) launch
LayerZero is a new protocol for cross-chain messaging that aims to offer the security of on-chain light nodes with the cost-effectiveness of middle chains. This is achieved through the use of ultra light nodes (ULN), which perform the same validation as on-chain light nodes but use decentralized oracles to stream block headers on demand. The protocol also has a user application (UA) configurable on-chain endpoint, which is made up of two parties: the Oracle and the Relayer.
While cross-chain messaging isn’t a new concept, the way that LayerZero implements it and the flexibility of the protocol led to a surge in interest in the project throughout the crypto industry. The protocol aims to offer a range of use cases, including state sharing, bridging, lending and borrowing, swaps, governance, and more.
Sources: tokeninsight.com, medium.com, medium.com
EU parliament votes against PoW ban
Sources: tokeninsight.com
Metamask surpasses 30 million users
Sources: tokeninsight.com
TIME releases first NFT-based issue of TIME magazine featuring Vitalik Buterin
Sources: time.com
TIME magazine to accept Apecoin for digital subscription
Sources: twitter.com
Thailand bans crypto as means of payment
Sources: tokeninsight.com
Kenya’s Central Bank reiterates stance opposing crypto
Sources: theeastafrican.co.ke
MetaMask discovers vulnerability in Chrome wallet, users urged to update ASAP to avoid crypto losses
Users of MetaMask were in for a scare when the MetaMask team announced they had found a vulnerability in Chrome that affects the Metamask Chrome plugin. Users were advised to update to the latest version of Chrome ASAP to avoid potential losses of funds.
While there were no reports of losses from this vulnerability, the news quickly spread to every corner of Web3.
Sources: cointelegraph.com, twitter.com
Russia-Ukraine war & $100m donated
War is awful. While war brings out the worst in people, it also brings out the best in others.
Thanks to Web3 technologies, people affected by the war have been able to protect their wealth and receive financial aid through donations from people across the globe. Not only have the number of Bitcoin addresses holding non-insignificant amounts of bitcoin risen dramatically since the war broke out, Uniswap set up a dedicated donation page for the Ukrainian government and the Ukrainian government auctioned an NFT to raise funds.
Ghana CBDC Development: New Central Bank Document Outlines Key Motivations for Issuing the Digital Currency
Sources: news.bitcoin.com
Axie Infinity Sidechain “Ronin Network” Hacked For $625m
The Ronin Network suffered a major crypto hack, with losses estimated at more than $625m in USDC and ether.
The gaming-focused network was hacked through a “backdoor” in its gas-free RPC node. The attacker was able to forge fake withdrawals and then transfer 173,600 ether and 25.5 million USDC to a fresh Ethereum address.
Sources: coindesk.com
Disappearing NFTs (metadata removal)
In early 2022, riding off the NFT craze from late 2021, users on NFT marketplaces noticed the content of their NFTs disappearing – or in some cases, their NFTs disappearing entirely.
After a large wave of confusion swept through Web3 newbie circles, they were eventually educated on how NFTs work. The NFT, a container which houses a reference to an artwork, lives on the blockchain. The artwork that is referenced, however, does not. This led to references that were stored on centralized servers to be deleted off the internet. In other cases, when artwork violated the terms of service of a marketplace, the marketplace ommitted the NFT from showing up in the users’ profiles.
Sources: vice.com
AZUKI Airdrops “Something Special” to holders, turns out to be new “BEANZ” collection
Sources: collective.xyz, nftevening.com, dappradar.com
Robinhood launches Web3 wallet
Sources: gfinityesports.com
Beanstalk Farms
The Beanstalk stablecoin protocol suffered a hack with $182 million losses across ETH, the BEAN stablecoin, and other assets being taken by a hacker. The hacker used a flash loan, which allows for the borrowing and repaying of an asset within a single complex transaction.
Beanstalk Farms, the team behind the Beanstalk protocol, has asked the DeFi community and centralized exchanges to help limit the hacker’s ability to withdraw funds.
Sources: decrypt.co, halborn.com
FEI Protocol Attack
On April 30, 2022, the Fei Protocol experienced a hack that resulted in the loss of approximately $80 million in Ethereum and other assets. The hacker exploited a reentrancy security loophole in the Rari Fuse pools, which allowed them to borrow assets and withdraw all the deposited collateral.
The attack occurred through a series of complex transactions involving multiple protocols, including flash loans, decentralized exchanges and custom smart contracts.
Sources: certik.medium.com, halborn.com
Otherdeed for Otherside Causes Massive Gas Fees on Ethereum
The sale of Otherdeed non-fungible tokens (NFTs) caused Ethereum gas prices to rise to unprecedented levels.
Bored Ape Yacht Club creator Yuga Labs launched the sale of Otherdeed NFTs, representing digital land deeds on their new venture, the Otherside metaverse. 55,000 NFTs sold out almost instantly, with Yuga Labs raking in $319m in NFT sales revenue. The minting of the NFTs required ETH for gas fees, leading to numerous users paying between $6,500 and $14,000 in gas fees due to the networks dynamic scaling of gas prices in relation to network congestion.
Sources: cointelegraph.com, medium.com
Major Solana Outage Plagues the Network
Solana, a smart contract platform launched in 2020, has experienced a number of network outages. According to co-founder Anatoly Yakovenko, outages were the result of both congestion and spam events.
The blockchain network, which produces blocks every 400 milliseconds, has since experienced many more outages, bringing into question Solana’s security model.
Sources: cointelegraph.com, status.solana.com
HOP Protocol Airdrop
Hop DAO is a decentralized autonomous organization that will govern the ongoing growth and direction of Hop Protocol, a cross-chain bridge solution for decentralized networks.
Sources: hop.mirror.xyz, coindesk.com, tokeninsight.com
The Collapse of Terra/LUNA and UST, and Do Kwon on the Run
The downfall of Terra was attributed to a number of factors, including concerns over UST’s ability to maintain its $1 peg, the use of non-transparent methods to support the peg, and questionable actions by Terra’s founder, Do Kwon. The collapse of Terra resulted in significant losses for investors, a global manhunt for Terra founder Do Kwon and increased regulatory scrutiny for the entire Web3 space.
The LUNA token would later be renamed to LUNC (LUNA Classic), while the name LUNA would be given to the new Luna 2.0 token that was built to ensure continuity of the Luna ecosystem without Do Kwon’s involvement. The launch of Luna 2.0 also led to controversy as the token lost 70% of its value and the UST stablecoin was depegged.
Bitcoin recognized as legal virtual property in Shanghai
Sources: watcher.guru
Goblintown NFT Launch
The Goblintown NFT collection is arguably characterized by its unattractive art style, irreverent nature and lack of utility. Nonetheless, when Goblintown launched in May 2022 it quickly sold out, with the floor price rapidly climbing to over $2,500.
Sources: nftnow.com
eBay launches NFT collection
Sources: prnewswire.com
Uniswap’s cumulative trading volume surpasses $1tn
Uniswap’s cumulative trading volume breaks past US$1 trillion in only 3 years of operation.
Sources: twitter.com
Hacker cashes in $800k in Luna 2.0 Oracle Exploit
A bug on Anchor Protocol’s lending and borrowing platform allowed some users to profit significantly from the launch of Luna 2.0.
The bug caused the price oracle of LUNC (Luna Classic) to go to $5 despite the actual value being significantly lower. One user was able to deposit around $100 million worth of Lido Bonded Luna tokens, which were only worth around $200,000, and withdraw a loan of 40 million UST for a profit of $800,000.
Sources: coinlive.me
Optimism (OP) token launches, followed by airdrop
Optimism launched the OP token, a governance token for the Optimism Layer2 network. The airdrop rewards early adopters and active users of projects in the Optimism ecosystem, and also welcomes active users of the Ethereum network who can help scale Ethereum’s innovations, culture, and values to Optimism’s Layer 2 network.
Sources: community.optimism.io, tokeninsight.com
Singapore Partners with Institutions to start Digital Assets Pilot
Sources: tokeninsight.com
South Korea to Launch ‘Digital Assets Committee’ to Oversee Crypto Exchanges
Sources: tokeninsight.com
Number of Addresses Holding Coins Above 1 BTC Reached an ATH
Glassnode reports that addresses holding 1 BTC have reached an all-time-high on June 2nd. Shortly thereafter on June 6th, the number of addresses holding 0.1 BTC also reached an all-time-high. The figures from Glassnode show that BTC addresses continue to grow steadily throughout the year, indicating increased adoption of Bitcoin.
Sources: tokeninsight.com, tokeninsight.com
Japan Passes Stablecoin Bill That Enshrines Investor Protection
Sources: bloomberg.com
PayPal Lets Users Transfer Cryptocurrencies to External Wallets
Sources: theblock.co
Elrond network hacked for $113m, network reset with fix
An hacker attacked the EGLD-ESDT swap contract, which controls the creation and exchange of Wrapped EGLD (WEGLD) for EGLD tokens. The attacker deployed a malicious smart contracts on the network. Using the contracts, the attacker transferred 1.65 million EGLD worth roughly $113m. The attacker managed to sell roughly 800k EGLD, which was sold on centralized exchanges and bridged to ETH and USDC. While figures differ between sources, the total losses are reported to be anywhere between $10m and $54m.
The attack caused the Maiar Exchange to be halted by the team, and later the Elrond network was reset with fixes put in place by the Elrond team.
Sources: elrond.com, bitdegree.org, tokeninsight.com, tokeninsight.com
Yuga Labs Has Destroyed Private Key with Unlimited Minting BAYC Permissions
After pseudonomyous dev “foobar” revealed that a single private key had the authority to mint an unlimited number of Bored Ape Yacht Club (BAYC) NFTs, essentially reisking the market to be flooded with BAYC NFTs and crashing the price, Yuga Labs announced that they have burned the contract owner. There will not only ever be 10,000 BAYC NFTs.
Sources: twitter.com, twitter.com
Japan’s Government Approves New Policy to Increase Crypto Adoption
Sources: tokeninsight.com
Bloomberg Terminal Has Increased Its Coverage to 50 Crypto Assets
Sources: cointelegraph.com
Mastercard Brings Its Payments Network to Web3 and NFTs
Sources: mastercard.com
Fidelity Investments CEO Reaffirms Crypto Commitment
Sources: coindesk.com
Founder of NFT Project mfers Announces Retirement and Transfers the Smart Contract to the Community
Sartoshi, the pseudonymous founder of the mfers NFT collection announced his retirement from the project, passing the reigns on to the community. The NFT project is categorized by simple stick-figure artwork reminiscent of early 2000s MS Paint artwork.
The mfers NFT project led to many spin-off projects, including Azuki mfers amongst others.
Sources: mirror.xyz
Crypto lender Celsius files for Chapter 11 bankruptcy.
The company had $1.2bn in debt, with $4.7bn in customer holdings among its $5.5bn in liabilities. The majority of Celsius’ liabilities represent customer holdings, and the company had only $167m in cash left to support “certain operations” during its restructuring process.
The bankruptcy follows those of Voyager and BlockFi, which both suffered losses after lending to crypto hedge fund Three Arrows Capital, which defaulted on its loans.
Sources: coindesk.com, tokeninsight.com, nytimes.com, forbes.com
Boxing Superstar Manny Pacquiao Will Launch Pacman NFT Collection
Sources: forkast.news
El Salvador Finance Minister: Bitcoin Crash Poses Extremely Minimal Fiscal Risk
Sources: decrypt.co, tokeninsight.com, tokeninsight.com
Voyager Files for Chapter 11 Bankruptcy
Voyager Digital, a New Jersey-based cryptocurrency brokerage, filed for bankruptcy in New York in July 2022 after defaulting on unsecured loans to Three Arrows Capital, a Singapore-based hedge fund that went insolvent earlier in the year.
Voyager CEO Steve Ehrlich said in bankruptcy papers that the company’s financial woes began with the collapse of the Terra blockchain ecosystem in May 2022 and the resulting contagion. Voyager was also reportedly underwater on positions in Lido staked ether and the Grayscale Bitcoin Trust. Voyager had lent Three Arrows $650 million, which was “one of the largest unsecured loans in the history of the digital asset industry,” according to Ehrlich.
Sources: coindesk.com, tokeninsight.com, tokeninsight.com, tokeninsight.com
Kazakhstan to let crypto exchanges open bank accounts
Sources: cointelegraph.com
Bank of Kyrgyzstan Issues Warning About Cryptocurrencies and Crypto Payments
Sources: news.bitcoin.com
Iran cuts off energy to authorized miners
Sources: tokeninsight.com
Horizon Bridge exploit causes $100m in losses
The Horizon Bridge, which connects the Harmony layer-1 blockchain to the Ethereum network, Binance Chain, and Bitcoin, was exploited for around $100 million in altcoins.
The attack was made possible by the bridge’s multisig wallet on Ethereum, which only required two out of four signees to drain the funds. The attack resulted in the theft of various tokens and eventually the Horizon Bridge was halted to prevent further losses.
Sources: medium.com
Circle launches EUROC, a fully-reserved stablescoin pegged to the EURO.
EUROC, the Euro equivalent of USDC, is a fully collateralized stablecoin pegged to the value of the Euro launched on the Ethereum network. EUROC uses the same exchange model as USDC, meaning it is always redeemable 1:1 to its pegged currency.
Sources: twitter.com
Casual Brand TOMMY HILFIGER Has Filed Trademark Applications Related to NFT
Sources: tokeninsight.com
Crypto Traceability and Market Rules Agreed by EU Lawmakers
Sources: techcrunch.com
EU Agrees on Landmark Crypto Authorization Law, MiCA
Sources: coindesk.com
Crypto Hedge Fund Three Arrows Files For Chapter 15 Bankruptcy
Crypto hedge fund Three Arrows Capital (3AC) has filed for Chapter 15 bankruptcy. Chapter 15 bankruptcy filings stop creditors from seizing a company’s assets in the US, essentially protecting the firs US assets while a liquidation is carried out in the British Virgin Islands.
The hedge fund collapsed after suffering significant losses from the failure of LUNA and Terra, which it had a large position in. The founders of 3AC, Zhu Su and Kyle Davies, defaulted on loans and are now facing legal proceedings. The company owes over $3bn, with its largest creditor being Genesis with a $2.3bn loan. 3AC’s default on debts also contributed to the insolvency of Celsius Network and Voyager Digital.
Sources: bloomberg.com, tokeninsight.com, capital.com, capital.com
Visa Launches Black Card bitcoinblack in the UAE
Sources: tokeninsight.com
ENS Domain Name 24 Hours Trading Volume Up 281.02%
Sources: tokeninsight.com, nftgo.io
Bank of England Committee Calls for Enhanced Crypto Regulation
Sources: coindesk.com
Brazil Creates Crypto-Dedicated Investigation Unit
Sources: news.bitcoin.com
Reddit is launching a new NFT avatar marketplace
Sources: techcrunch.com
GameStop NFT Launch
GameStop, a troubled US brick-and-morter video game retailer, announced the launch of their NFT marketplace aptly named “GameStop NFT”.
After the first month of operation, the platform recorded over $22m in trading volume.
Sources: news.gamestop.com, tokeninsight.com
Brazilian Users Can Now Pay Bills with Bitcoin from Within the PicPay App
Sources: tokeninsight.com
The Financial Planning Association of Australia Supports Crypto Rule Book and Regulation of Exchanges
Sources: cointelegraph.com
Central African Republic Begins Public Sale of Sango Coin
Sources: theblock.co
Chainalysis Is Spinning Up Government Solutions for Agencies
Sources: tokeninsight.com
Nomad Bridge hack and “decentralized crowd looting” leads to $190m of assets removed from bridge
Cryptocurrency bridge, Nomad, has suffered a hack that resulted in almost $200m of its funds being drained. The hack was a result of a misconfiguration of the project’s main smart contract that enabled anyone with basic knowledge of the code to authorize withdrawals to themselves. As a result, people who saw funds being stolen using this method were able to substitute their own addresses and replicate the attack.
This incident described as “the first decentralized crowd-looting of a 9-figure bridge in history”. Given the repicability of the hack, many whitehat hackers pre-emptively withdrew funds from the platform to prevent malicious actors from seizing the funds and signalled their intent to return the funds on-chain. Roughly $9m of the $190m drained have been returned to Nomad.
Sources: theverge.com, coindesk.com, coinbase.com
Solana Sybil Attack Artificially Inflates TVL
Two brothers, Ian and Dylan Macalinao, have been accused of engaging in a Sybil attack on the Solana blockchain. The attack involves creating multiple fake accounts or nodes to manipulate a system and is alleged to have been used to inflate the Total Value Locked (TVL) on Solana. The brothers are said to have used various anonymous identities to build a network of protocols that would utilise double-counted assets to boost the TVL of the Solana ecosystem artificially. Ian Macalinao is alleged to have written a blog post in March in which he described how he aimed to “maximize Solana’s TVL” by building protocols that stacked on top of one another.
Sources: cryptoslate.com
Crypto Mixer Tornado Cash Sanctioned by US Government
On August 8, the US Treasury Department’s Office of Foreign Asset Control (OFAC) designated the cryptocurrency mixer, Tornado Cash, as a sanctioned entity. OFAC alleges that North Korea, specifically the North Korean hacker group “Lazerus”, has used the privacy tool to launder over $100 million worth of cryptocurrency in order to support the government’s weapons of mass destruction program.
The OFAC designation led to the removal of Tornado Cash’s website, Github account, and IPFS gateway, as well as Circle’s blacklisting of seven addresses associated with Tornado Cash. OFAC’s action prompted a range of DeFi protocols to block transactions with addresses associated with Tornado Cash, even if those addresses had not directly transacted with the sanctioned addresses.
The action also raised questions about the decentralization of Web3 and the vulnerability of its infrastructure to centralized points of failure. Some in the cryptocurrency community have questioned OFAC’s designation of Tornado Cash as an entity, arguing that it is simply a tool and not an organization.
Coca-Cola Launches International Friendship Day NFT on Polygon
Sources: tokeninsight.com, tokeninsight.com, tokeninsight.com
Starkware Launches Recursive Proofs to Boost Layer 2 Scaling
Starkware has launched recursive proving, a new technology for its starkEx and Starknet scaling solutions that aims to increase the speed and reduce transaction fees by improving scalability. Recursive proofs are a new concept in the race to scale blockchains through rollups, which execute transactions separately from the Ethereum network, but post transaction data to the network. Rollups aim to increase scalability by solving the problem of data availability, which is one of the largest scalability bottlenecks.
Recursive proving allows Starkware to take hundreds of single proofs, each attesting to thousands of transactions, and roll them into another single proof. This is the fourth major milestone for Starkware’s scaling efforts, following STARK scaling, Cairo, and SHARP.
Sources: theblock.co
South African Reserve Bank Encourages Friendly Behavior with Crypto
Sources: cointelegraph.com
Grease Monkey Games Has Received Financial Support from Epic Games to Develop a New Blockchain Motorsport Game
Sources: cointelegraph.com
The Central Bank of the Philippines: Don’t Engage with Unregistered Virtual Asset Service Providers
Sources: news.bitcoin.com
Hodlnaut Reports $193 Million Financial Shortfall as It Seeks Court Protection
Singapore-based cryptocurrency lender Hodlnaut has suffered a financial shortfall of nearly $200m and is facing police proceedings in Singapore. The company filed for creditor protection on 16 August, seeking time to resolve its financial issues. In an affidavit filed on 12 August and obtained by The Block, Hodlnaut said it had an outstanding liability of SGD 391m ($281m) compared with assets of SGD 122m ($88m). The company, which had managed $750m at its peak in March, is exploring the option of allowing “limited exits” at 25 cents on the dollar
Sources: theblock.co
Australian Treasurer: Government Will Improve the Way System Manages Crypto Assets
Sources: cointelegraph.com
Reddit Starts Airdrop of Polygon-Based “Collectible Avatars”
Sources: coindesk.com
Nvidia CFO: Falling Crypto Prices and Changes in Consensus Mechanisms Impacted Demand for Its Products
Nvidia has reported Q2 financial results for the three months ending July 31, which showed a 19% drop in revenue to $6.5bn and a 59% drop in net income to $656m. The company’s gaming division saw a 44% drop in revenue from the previous quarter to $2.04bn, which Nvidia attributed to “challenging market conditions”. Nvidea GPUs were popular for use in Ethereum mining rigs.
Nvidia’s CFO, Colette Kress, said the company has “limited visibility” on how the crypto market affects demand for its gaming products, adding that “volatility in the cryptocurrency market” has in the past impacted demand and the company’s ability to accurately estimate it. The Ethereum Merge is expected to further drive down demand for GPUs and crypto mining hardware.
Sources: cointelegraph.com
Over 20 Crypto-Related Businesses Shut Down in Herat, Afghanistan
Sources: bloomberg.com
Founder of Turkish Crypto Exchange Thodex Arrested in Albania
Faruk Fatih Özer, the founder of Turkish crypto exchange Thodex, has been arrested in Albania. Faruk Fatih Özer disappeared in 2021, taking with him funds from 400,000 users (about $2.7 billion). Albanian Interior Minister Bledar Çuçi revealed that the process of Özer’s extradition has already begun.
Sources: tokeninsight.com
Iran Starts Licensing Crypto Miners Under New Regulatory Framework
Sources: news.bitcoin.com
Sony Music Files NFT and Metaverse Trademark Applications for Columbia Records Logo
Sources: tokeninsight.com
KPMG Report: The Crypto Market is Maturing
Sources: theblock.co
Switzerland’s SEBA Bank Launches Institutional Ethereum Staking
Sources: decrypt.co
Fortnite Creator’s Epic Games Store Launches First NFT Game
Sources: decrypt.co
The Ethereum Merge is Successful, Ethereum is now PoS
In “The Merge” the original proof-of-work (PoW) consensus mechanism for the Ethereum mainnet was replaced with a proof-of-stake (PoS) mechanism using the Beacon Chain.
While forks are not out of the ordinary, the Merge was special in that such a seismic shift in consensus was achieved without affecting Ethereum users or holders and no action was required on the part of users or holders to upgrade their wallets or funds in light of The Merge.
As a result of the merge, the Ethereum network’s hashrate is now 0 and energy consumption of the network is estimated to have reduced by 99.95%.
Sources: twitter.com, ethereum.org
HSBC’s CEO: HSBC Will Not Be Offering Crypto Services
Sources: news.bitcoin.com
Wintermute hacked for $160m
Cryptocurrency market maker Wintermute has lost $160 million in a hack of its decentralized finance (DeFi) operation.
The hack was the result of a compromised Ethereum vanity address owned by Wintermute. The attacker used the smart contract admin privileges of the address to move out funds from Wintermute’s DeFi operations.
Sources: web3edge.io, tokeninsight.com, coindesk.com
US Treasury Official Says Crypto Mixers Are Concern in Enforcing Sanctions
Sources: cointelegraph.com
ETHW, the proof-of-work hardfork of Ethereum, launches alongside The Merge
“The Merge” marked Ethereum’s shift from proof-of-work (PoW) to proof-of-stake (PoS). However, with the shift in conesnsus mechanisms, a large community of Ethereum miners were left behind with now (mostly) useless mining hardware. Chandler Guo believes that there is still value in an Ethereum network secured by proof-of-work, and hard-forked the network creating Ethereum PoW (ETHW).
The challenge in forking Ethereum comes from the dApp layer built on Ethereum, and the various providers that support the ecosystem: a token such as USDC could exist, technologically speaking, on the new chain, however there would not be any collateral backing the token. These are one of many challenges faced by the network, but only time will tell if there is truly a need for a proof-of-work Ethereum.
Sources: cointelegraph.com, cointelegraph.com, tokeninsight.com
Christie’s Launches NFT Marketplace Christie’s 3.0
Sources: nftnow.com
Chief Fintech Officer at Monetary Authority of Singapore: Resolute Crackdown on Crypto Speculation
Sources: bloomberg.com
Elon Must Takes Over Twitter
Sources: nbcnews.com
Namibia’s Central Bank: Bitcoin Can Be Accepted as Payment
Sources: tokeninsight.com
Binance Suffers $100m Blockchain Bridge hack
Hackers stole at least $110m in cryptocurrency from Binance, the world’s largest exchange, by exploiting a vulnerability in the BSC Token Hub cross-chain bridge. The vulnerability enabled the attackers to forge messages, minting new BNB tokens, but the majority of the 2 million BNB stolen, worth around $430m, could not be transferred following the suspension of BNB Chain. Hackers were only able to bridge out about $110m.
Sources: techcrunch.com, zellic.io
Mango Markets Loses $116m in Market Manipulation Attack
An attacker stole $116 million worth of tokens from the Solana-based DeFi platform Mango Markets. The attacker took advantage of limited market liquidity to artificially inflate the price of Mango Markets’ native token, MNGO, by purchasing large quantities of perpetual contracts and using new investors as exit liquidity to cash out. The hacker then used the increased value of their MNGO holdings to acquire a loan for $116 million using various tokens on the platform, including Bitcoin, Solana, and Serum. This drained all of the liquidity from Mango Markets and caused the price of MNGO to drop significantly. The development team for Mango Markets halted deposits and initiated an investigation into the incident.
On December 27th, 2022, the attacker is eventually apprehended in Puerto Rico and charged with commidities fraud and commodities manipulation.
Walmart CTO: Crypto Will Play Very Important Role in Payments Disruption
Sources: decrypt.co
Optimism Introduces Modular Components OP Stack
The Optimism Collective has developed the OP Stack, an open-source blueprint for highly scalable and interoperable blockchains, which they believe will form an emergent structure called the Superchain, which will power the collective. The aim is to make it easy to build your own blockchain, and the Optimism Collective believes that the future will arise in the form of a group of highly integrated chains, rather than a multi-chain or mono-chain system. The OP Stack is designed to be simple and modular, with the goal of becoming an open source standard across the Ethereum ecosystem.
Sources: optimism.mirror.xyz
Aptos Launches Mainnet, Closes Comments on Aptos’s Discord and Telegram Channels
Layer-1 blockchain Aptos launched its mainnet, with claims it can process 160,000 transactions per second (TPS). However, some community members report the mainnet fell short of the TPS expectations, with Aptos’ blockchain explorer showing around 4 TPS at launch. Users have also reported difficulty in sending transactions, while others have accused the Aptos team of closing its Discord and Telegram channels to prevent discussion of launch issues. Despite the reported issues, Aptos said the network is “performing as expected” and that comments on its Discord and Telegram channels were closed to “protect the community from scams”.
Along with the launch, Aptos airdropped roughly 20 Million $APT tokens to 110,235 early network participants
Sources: cointelegraph.com, tokeninsight.com, twitter.com
Warner Bros Releases Ethereum-Compatible ‘Lord of the Rings’ NFTs
Sources: decrypt.co
Google Introduces Cloud-Based Blockchain Node Service for Ethereum
Sources: coindesk.com
National Bank of Kazakhstan to Integrate CBDC on BNB Chain, Says CZ
Sources: twitter.com
Blockchain.com Partners with Visa to Offer Crypto Debit Card
Sources: cointelegraph.com
Gucci Creates Metaverse Hub Gucci Vault Land in The Sandbox
Sources: nftgators.com
Vitalik Buterin Shares Thoughts on Regulatory Policy Goals
Sources: twitter.com
Hong Kong Government Issues Policy Statement on Development of Virtual Assets
Sources: tokeninsight.com
Elon Musk Asks to Introduce Paid Verification on Twitter to Solve Bots Account Problem
Twitter is the primary news source for everything related to Web3, which is why it is lovingly referred to as “Crypto Twitter” or “CT”. The news of paid verification was quickly picked up by Crypto Twitter with mixed reactions.
Sources: theverge.com
India introduces crypto capital gains tax
Sources: tokeninsight.com
Meta to Support Minting and Selling Polygon NFTs on Instagram
Sources: tokeninsight.com
Vitalik Buterin Releases Updated Ethereum Roadmap
Vitalik Buterin, the co-founder of Ethereum, has announced a new roadmap for the Ethereum network with the aim of increasing decentralization and trust in the network. Following the successful Merge, there are now five further phases remaining in the network’s roadmap:
1. The Surge: focuses on improving scalability and decentralization.
2. The Scourge: aims to improve Ethereum’s security through the implementation of new technologies.
3. The Verge: focuses on improving the usability and adoption of Ethereum.
4. The Purge: improves the sustainability of Ethereum by reducing its environmental impact.
5. The Splurge: enabling new capabilities and innovations on the Ethereum platform.
Sources: twitter.com, academy.bit2me.com
EU Commission Set to Propose Legislation for Digital Euro
Sources: theblock.co
CZ: Binance Topped up the SAFU Insurance Fund to $1 billion USD Equivalent Again
Binance has increased its Secure Asset Fund for Users (SAFU) to $1 billion worth of various cryptocurrencies, according to a tweet from Binance founder Changpeng Zhao.
Binance SAFU (Secure Asset Fund for Users) is a cryptocurrency emergency insurance fund established by Binance. The fund is designed to provide financial protection to Binance users in the event of a hack or other security breach that results in the loss of user funds. In the event that a security breach results in the loss of user funds, the SAFU will be used to compensate affected users. The fund includes Binance’s ecosystem token BNB and stablecoin BUSD, as well as bitcoin.
The move to top up the fund comes amid speculation about liquidity issues at rival exchange FTX, which later filed for bankrupcty on November 11th, 2022.
Sources: tokeninsight.com, coindesk.com, academy.binance.com
Centralized Exchange FTX Collapses and files for Chapter 11 Bankruptcy, Sam Bankman-Fried flees to the Bahamas
FTX, a major cryptocurrency exchange, filed for Chapter 11 bankruptcy on November 11, 2022, following a lack of liquidity and gross mismanagement of funds.
The CEO of FTX, Sam Bankman-Fried, who resigned amidst bankrupcty proceedings, was arrested on December 12 in the Bahamas and faces eight criminal charges including wire fraud and conspiracy to defraud investors. The Securities and Exchange Commission (SEC) accuses Bankman-Fried of using customer funds as a “personal piggy bank” for private investments, including real estate and political campaign donations. The value of FTX’s native token, FTT, plummeted, leading to declines in other cryptocurrencies and affecting other exchanges such as BlockFi, which also filed for bankruptcy.
This is still a developing story, with contagion spreading far and wide across the industry.
Nike to Launch Web3 Platform .Swoosh
Sources: voguebusiness.com
Blockfi bankruptcy
BlockFi, a cryptocurrency lender, has filed for Chapter 11 bankruptcy in New Jersey due to “crypto market volatility” and a broader market downturn, as well as losing $80m when crypto hedge fund Three Arrows Capital collapsed and a $50m fine from the Securities and Exchange Commission. California’s Department of Financial Protection and Innovation has also temporarily suspended BlockFi’s license to make and broker loans for 30 days. BlockFi had significant exposure to FTX, which filed for bankruptcy two weeks ago, and was also hurt when another crypto lending platform, Celsius, filed for bankruptcy in June.
Sources: npr.org, tokeninsight.com, blockfi.com
J.P. Morgan Chase’s Crypto Wallet Trademark Submission Approved by the U.S. Patent and Trademark Office
Sources: tokeninsight.com
Genesis’s Fundraising Target Reduced from $1 Billion to $500 Million
Cryptocurrency brokerage firm Genesis struggles to raise $1 billion and may have to file for bankruptcy if it cannot do so. To avoid bankrupcty, Genesis proactively calls in a restructuring expert.
Genesis has faced a liquidity crunch since FTX’s bankruptcy filing and has been trying to raise at least $1 billion, including from Binance. The lending business of Genesis Trading, Genesis Global Capital, temporarily suspended redemptions and new loan originations in the wake of FTX’s collapse and the earlier Three Arrows Capital implosion. Parent company Digital Currency Group gave Genesis Trading a $140 million equity infusion after it said its derivatives business had $175 million locked up on the FTX platform.
Sources: theblock.co, cointelegraph.com, coindesk.com, investopedia.com
Game Maker Rockstar Games Bans NFTs on Third-Party Servers
Sources: theblock.co
StarkWare Open Sources Cairo 1.0, StarkNet to Support Cairo 1.0 in Q1 2023
StarkWare announced that its programming language Cairo 1.0 is open source, which is the first step towards open-sourcing the StarkNet stack.
Sources: tokeninsight.com
Ethereum Core Developers Signal Support for ‘Proto-Danksharding’
Ethereum developers are planning to implement EIP-4844, a scaling proposal known as “proto-danksharding,” in a future mainnet upgrade. This feature, which will introduce a new type of transaction called “shard blob transactions” to the Ethereum network, aims to improve scalability and allow for off-chain data to be temporarily stored and accessed by Ethereum nodes. It is expected to be deployed on the mainnet in the coming year and could potentially be rolled out with or after the Shanghai upgrade. EIP-4844 is intended to make Ethereum even cheaper when used in conjunction with Layer 2 solutions like Optimism and Arbitrum, which can already reduce transaction costs by up to ten times compared to the Ethereum base layer.
Sources: theblock.co
Japanese Social Giant LINE’s Crypto Exchange Bitfront to Close
Sources: tokeninsight.com
Proof-of-Reserves Becomes Hot Topic Following FTX Collapse
Centralized exchanges (CEXs) are known for being intransparent in regards to their customer holdings as well as information regarding their solvency. Some believe that further transparency could have prevented the FTX collapse earlier in the year. Following the collapse of FTX, proof of reserves (PoR) has become a popular area of discussion as a means to improve transparency by verifying asset backing.
Proof of reserves (PoR) is a method of verifying that a trading platform or crypto firm has 1:1 backing across the digital assets it holds in custody on behalf of its customers. A third-party organization may be enlisted to conduct the attestation, which is published to help investors understand the financial state of the firm and whether it has sufficient funds to cover customer deposits. PoR protocols using a Merkle Tree proof can verify the validity of user balances and transactions through cryptographic proofs, and may be published on a regular basis or provided in real-time, without revealing sensitive customer information.
Sources: decrypt.co, tokeninsight.com, cointelegraph.com
Former President Trump releases Trump Digital Trading Cards NFT Collection
Former President Donald Trump has released a collection of 45,000 fantasy NFTs called “Trump Digital Trading Cards,” which feature images of him in various costumes. The tokens, which are minted on Polygon, cost $99 and can be purchased with ether (ETH) or in fiat currency. Customers who purchased one of the digital trading cards were entered into a “sweepstakes” to receive experiences with Trump, including a zoom call, a dinner in Miami or a cocktail hour at Mar-a-Lago.
Sources: coindesk.com, tokeninsight.com
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