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The Cryptocurrency Times

The Cryptocurrency Times editorial team. Includes many members in many different countries.

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Coinbase’s Base could make it the NVIDIA of DeFi?

by The Cryptocurrency Times
written by The Cryptocurrency Times

Coinbase’s stock price has surged since the company’s first-quarter earnings report. Will its Base offering be enough for investors to sustain the momentum?

Coinbase’s Base has the potential to position the company as the NVIDIA of DeFi, as indicated by its recent surge in stock price following the first-quarter earnings report. With the vibrant market for Bitcoin and Ethereum driving growth, Base’s performance stands out as a significant contributor to Coinbase’s momentum.

Coinbase is a distributed company; all employees operate via remote work.

Introduced in August 2023, Base represents a secure and cost-effective Ethereum layer-2 solution designed to scale Coinbase’s user base on-chain for faster transactions. The company’s overarching goal is to decentralize Base, fostering an open and global crypto ecosystem leveraging Ethereum’s mainnet security, accessible to all.

The Q1 report reveals a remarkable surge in volume on Base, particularly after the Ethereum Dencun upgrade. Daily trading volume on DeFi crypto exchanges within Base soared past $1 billion, narrowing the gap with Coinbase’s centralized exchange trading volumes, where nearly 250 cryptocurrencies are traded.

The Dencun upgrade played a pivotal role in enhancing Base’s activity. It catalyzed a surge in daily transaction volume and revenue, outpacing competitors like Optimism and Arbitrum. The upgrade’s cost reduction for layer-2 scaling chains like Base fueled heightened user engagement and transaction volumes.

Post-upgrade, Base has consistently processed over 3 million transactions daily, substantially boosting fee revenue. If this trajectory persists, Base could emerge as a significant growth driver for Coinbase. Since the upgrade, Base’s fee earnings have outpaced those of other major Ethereum scaling networks. This surge in revenue is attributed to Base’s support for DeFi protocols, with around 250 protocols currently operational on the network.

The rapid market share increase within a short timeframe underscores Base’s immense potential. It also strengthens the case for Coinbase’s long-term dominance in the DeFi landscape, akin to NVIDIA’s position in the tech industry. As Coinbase continues to innovate and expand its offerings, Base could solidify its role as a cornerstone of the decentralized finance ecosystem.

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Messari CEO Criticizes US President’s Crypto Stance, Foresees ‘Mass Wealth Confiscation’ if Biden Gets Reelected

by The Cryptocurrency Times
written by The Cryptocurrency Times
Recently, Messari’s founder and CEO, Ryan Selkis, has expressed strong opinions about the potential impact of a Joe Biden reelection on the cryptocurrency industry in the United States. On Thursday, Selkis voiced his concerns on the social media platform X, stating that a “second Biden term will lead to mass wealth confiscation and crypto seizures.”

Crypto Industry at Risk in Biden’s America, Says Messari Founder

With approximately 187 days remaining until the U.S. presidential election on Tuesday, Nov. 5, 2024, Ryan Selkis, founder and CEO of Messari, a crypto data and analytics platform, has been increasingly outspoken about the event. Prior to establishing Messari, Selkis was involved with Coindesk and its former parent company, Digital Currency Group (DCG). More recently, he has voiced concerns about the Biden administration’s handling of crypto regulation, specifically pointing to Senator Elizabeth Warren‘s influence.

Selkis shared his views on the social media platform X last week, stating, “If you can understand that Elizabeth Warren is the President of the U.S. economy [and] financial services regulators thanks to her early endorsement of Biden in 2020; Then you should understand why crypto’s vocal [and] heavy $$$ support for Trump will swing a 2025 GOP admin libertarian.” The comments from the founder of Messari coincide with a period marked by notable regulatory actions by the U.S. government, targeting the crypto industry and non-custodial software.

Getty Images

In the past year, various U.S. regulatory and law enforcement bodies have increasingly focused on crypto firms and their leaders. Recently, the U.S. Department of Justice’s (DOJ) dealings with the developers of Tornado Cash and Samourai Wallet have sparked significant discontent within the crypto community. These developments have compelled both Wasabi Wallet and Phoenix Wallet to restrict access for U.S. users. On May 2, Selkis shared a screenshot from an X post revealing a major bitcoin company’s plans to exit the U.S.

“Wave of DOJ subpoenas inbound. Going to be a full blown war over self custody,” the picture’s text conveyed. Further agreeing with this sentiment on X, Selkis commented, “A second Biden term will lead to mass wealth confiscation and crypto seizures. They aren’t baiting and switching in an election year, they are telling you they’re coming for your property, surveilling your every move, and censoring your dissent.”

As the election draws near, the odds have tightened significantly in recent months. The main contenders include incumbent President Joe Biden, former President Donald Trump, and Independent candidate Robert Kennedy Jr. Meanwhile, Trump is scheduled to address the upcoming Libertarian National Convention, aiming to attract independent voters. While Kennedy supports cryptocurrency, Trump has recently become more favorable towards bitcoin, whereas Biden’s rigorous enforcement actions have demonstrated zero love for the crypto industry.

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CZ’s Trial Proves it Pays to Cooperate

by The Cryptocurrency Times
written by The Cryptocurrency Times

His four-month sentence was vindication for the Binance founder’s legal strategy.

A contrite Changpeng “CZ” Zhao has been sentenced to four months in federal prison, for his apparently limited role in the illegal activity at Binance, the crypto exchange he founded in 2017. U.S. District Judge Richard Jones in Seattle specifically noted CZ’s many contributions to charity, as well as willingness to accept responsibility, all while downplaying the idea CZ had any foreknowledge that Binance was intentionally committing crimes.

Photos from Smorshedi/Wikimedia

The sentence is more than CZ’s lawyers had asked for (they were bargaining for house arrest at most), but less than both the official sentencing guidelines (around one year) and what U.S. Department of Justice prosecutors sought (36 months). We don’t know exactly why CZ received the sentence he did. But it’s notable that, instead of fighting extradition, CZ willingly came to the U.S. to stand trial. The outcome is the latest signal that if caught doing a crime, cooperate, cooperate, cooperate.

This is the plain and simple understanding drawn from comparing CZ to Sam Bankman-Fried, the founder and fraudster behind rival exchange FTX, who, in March, was sentenced to 25 years in prison, and never really admitted to his multi-billion dollar theft of client funds. CZ, of course, wasn’t accused of stealing from customers, but instead of failing to implement the necessary compliance infrastructure expected of a money transmitter.
For a prehistoric, i.e. pre-crypto, comparison: 20 years ago, Martha Stewart showed no remorse after being convicted of conspiracy and obstruction of justice, maintaining her innocence and even comparing herself to Nelson Mandela. She served five months in prison – a month more than CZ will.
It’s also worth noting that in addition to Zhao’s prison sentence to be served in Washington State, he paid a $50 million fine alongside the gargantuan $4.3 billion settlement agreement Binance paid.

Dennis Kelleher, co-founder of Better Markets, a public service nonprofit, says the relatively short sentence proves that “crime pays.” Zhao will be able to keep his ownership stake in Binance, the world’s largest crypto exchange by volume and vast personal wealth. DOJ attorney Kevin Mosley echoed this point: “Breaking U.S. law was not incidental to his plan to make as much money as possible. Violating the law was integral to that endeavor.”

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BlockchainNews

Cryptojacker Charged with Defrauding Two Cloud Providers of $3.5M

by The Cryptocurrency Times
written by The Cryptocurrency Times

US prosecutors have charged a man with wire fraud and money laundering related to a significant illegal ‘cryptojacking’ operation.

United States prosecutors have filed charges against a Nebraska man accused of a cryptojacking scheme that allegedly defrauded two cloud providers – one headquartered in Seattle and the other in Redmond, Washington – of $3.5 million.

Prosecutors allege that the cryptojacking scheme yielded cryptocurrency mining valued at almost $1 million.

Cryptojacker Charged in $3.5 Million Scheme

Charles O. Parks III, also known as “CP3O,” was charged with wire fraud and money laundering offenses for allegedly orchestrating a large-scale illegal “cryptojacking” operation.

According to the Brooklyn U.S. Attorney’s Office, Parks defrauded two cloud computing providers of $3.5 million to mine approximately $970,000 worth of cryptocurrencies, including Ether, Litecoin, and Monero, using the companies’ resources without authorization.

Prosecutors claim that Parks used the ill-gotten gains for extravagant purchases, including a luxury Mercedes Benz, jewelry, and first-class hotel and travel expenses. Notably, Parks was arrested on Friday, April 13, and faces a combined maximum sentence of 50 years.

The indictment alleges that Parks created multiple accounts with a subsidiary of “Company 1,” a cloud computing and consumer electronic device company based in Seattle, Washington, and “Company 2,” a firm specializing in personal computers and related services headquartered in Redmond, Washington.

Brooklyn U.S. Attorney Breon Peace said in a statement that the office is committed to prosecuting criminal actors who use sophisticated technology for fraudulent activities.

Park’s Calculated Fraud Moves

From January to August 2021, Parks employed various aliases, corporate affiliations, and email addresses, including those associated with companies he registered – MultiMillionaire LLC and CP3O LLC – to establish accounts at the cloud computing providers. This allowed him access to heightened services and benefits, such as high cloud computing services and deferred billing accommodations.

The indictment suggests he laundered some of the illegally mined cryptocurrency through “Cryptocurrency Exchange 1,” a decentralized company with no headquarters. The other funds were laundered through a payments provider, bank accounts, and a New York City-based nonfungible token (NFT) marketplace.

Parks evaded federal law’s $10,000 minimum transaction reporting requirements by structuring payments in amounts just below the threshold. Prosecutors claim multiple instances where Parks made transactions of $9,999 and smaller sums from crypto exchanges to a bank account.

Despite having one account suspended for nonpayment and fraudulent activity, Parks allegedly created a new account with the provider within a day. He reportedly consumed over $2.5 million of services from the Seattle-based provider.

Prosecutors further alleged that Parks employed similar tactics to defraud the Redmond-based provider of more than $969,000 in cloud computing and related services.

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FTX will conduct the next round of token sales for locked SOL under auction format

by The Cryptocurrency Times
written by The Cryptocurrency Times
The upcoming token sale of Solana (SOL) by FTX will be held through an auction, possibly due to increased demand.

Instead of offering at a fixed price as in the initial round, the FTX exchange will organize an auction for the next batch of locked Solana (SOL) tokens, with details yet to be disclosed.

As of April 5th, FTX’s bankruptcy trustees successfully sold 25 – 30 million SOL (2/3 of the 41 million locked tokens) to prominent names in the industry such as Galaxy Digital and Pantera. This deal generated $2.6 billion for FTX, with a selling price of around $60 per token.

Last September, the court allowed FTX to liquidate the remaining crypto assets to raise additional cash, repay debts to investors affected by the previous collapse. At that time, the rogue character Sam Bankman-Fried’s exchange chose Galaxy Asset Management as the custodian to serve the asset sale plan, aiming to save costs and enhance deal efficiency.

Since then, the bankruptcy trustee of FTX has attracted significant attention from large institutions, especially for the locked SOL tokens as they constitute the largest portion of the remaining assets of the exchange.

Neptune Digital was the first organization to purchase 26,964 SOL at $64 per token – equivalent to $1.7 million. At that time, billionaire Mike Novogratz’s investment fund also established a new $620 million fund solely for the purpose of acquiring SOL from FTX. Additionally, Pantera Capital announced its intention to raise $250 million to participate in this deal.

SOL’s price has increased by 600% in the past year, hence the increased demand for locked tokens from FTX is understandable.

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Binance Converts Entire SAFU Fund Assets to USDC

by The Cryptocurrency Times
written by The Cryptocurrency Times

In response to market volatility, Binance has announced the conversion of 100% of assets in the user protection fund SAFU to the stablecoin USDC.

On April 18th, Binance exchange stated it would convert all BTC, BNB, USDT, and TUSD within SAFU to USDC. The exchange explained that storing assets under a transparent stablecoin like USDC would ensure the stability and reliability of the user protection fund.

According to transaction evidence provided by Binance, the exchange moved nearly $1 billion worth of Bitcoin and $722 million worth of BNB out of storage addresses, subsequently depositing only $800 million USDC back into the insurance fund address.

Therefore, it appears that Binance has gained over $900 million USD by holding BTC and BNB in the SAFU fund since February 2022. The exchange did not specify the purpose for this amount but stated it would continue to maintain the value of the SAFU fund at $1 billion USD.

SAFU (Secure Asset Fund for Users) is a user protection insurance fund established by Binance in 2018 to safeguard users in emergency situations such as technical failures impacting user assets. Since its establishment, Binance has allocated 10% of its trading fees to increase funds for SAFU in various cryptocurrencies like BTC, ETH, BNB, and several stablecoins.

Due to being held in different cryptocurrencies, the value of SAFU fluctuates with the volatility of these currencies. In February 2022, Binance announced that the fund had reached $1 billion USD and has maintained this threshold until now.

Binance’s move is understandable given the market’s sensitivity ahead of the upcoming halving event, scheduled for the evening of April 20th (Vietnam time). Numerous predictions about Bitcoin’s price during this period have been made, such as Arthur Hayes believing that the cryptocurrency will experience significant volatility around the halving, or JPMorgan predicting that BTC could even drop to $42,000 USD post-halving.

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GameFiNews

Crypto Gaming Studio Avalon Secures $10M Funding Led by Bitkraft and Hashed

by The Cryptocurrency Times
written by The Cryptocurrency Times

Avalon, a burgeoning crypto gaming studio, has successfully secured a $10 million funding round, with Bitkraft Ventures and Hashed as the primary investors. This substantial investment is earmarked for the advancement of their flagship project, the massively multiplayer online game (MMO) “Avalon.”

The development team behind Avalon comprises seasoned professionals from leading web2 gaming enterprises, harnessing their collective expertise to create an immersive gaming venture. Collaborations with industry trailblazers such as Didimo and Inworld AI further enrich the gaming experience.

Sean Pinnock, the CEO and founder of Avalon, emphasized the studio’s commitment to delivering an unparalleled gameplay experience. Pinnock highlighted the integration of cutting-edge technologies like Unreal Engine 5 and AI-driven user-generated content systems. He also mentioned the forthcoming NFT collection featuring revolutionary AI-powered avatar NFTs.

Pinnock’s extensive background includes stints at industry giants Electronic Arts and Microsoft, as detailed in his LinkedIn profile.

Carlos Pereira, a Partner at Bitkraft Ventures, expressed optimism about Avalon’s potential contribution to the Synthetic Reality (SR) landscape. Synthetic Reality encompasses the creation and simulation of digital worlds and systems, offering immersive gaming experiences with robust in-game economies.

Avalon has announced plans for a closed, early-access version of the game slated for release later in 2024. Players will have the opportunity to engage with the game firsthand and provide feedback.

In addition to Bitkraft Ventures and Hashed, other notable participants in the funding round include Coinbase Ventures, Spartan Capital, Foresight Ventures, LiquidX, and Momentum6. This diverse investor support underscores the strong confidence in Avalon’s vision and potential.

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Bitcoin Mining Stocks Slump Ahead of Halving

by The Cryptocurrency Times
written by The Cryptocurrency Times

itcoin mining stocks are witnessing a significant downturn in anticipation of the impending halving event. Marathon Digital Holdings, Riot Platforms, and CleanSpark have all seen consecutive declines in their stock values over the past three days. Marathon Digital Holdings, the leading public Bitcoin miner, has experienced a notable 25% decrease in stock value over the last month, while Riot Platforms has seen a nearly 30% drop. Moreover, the Valkyrie Bitcoin Miners exchange-traded fund has registered a decline of approximately 28% in its value this month.

This downward trend in stock prices persists amidst growing short interest in cryptocurrency mining stocks and geopolitical tensions arising from recent conflicts between Iran and Israel. These factors have prompted investors to seek refuge in safer assets. However, despite these challenges, CEOs of leading mining companies express optimism, as reported by Bloomberg. They point to the cost-efficient nature of their operations, utilization of advanced mining technology, and the escalating demand for cryptocurrencies as potential mitigating factors against the anticipated $10 billion annual revenue loss due to the upcoming Bitcoin halving.

Furthermore, these companies are banking on the surge in demand fueled by the introduction of new spot ETFs to buoy Bitcoin’s price and counteract the negative impacts of the halving. Traditional asset management firms introduced these ETFs in January, and they have since attracted a cumulative net inflow of $12.4 billion. With these factors in mind, despite the current challenges, Bitcoin mining companies remain cautiously optimistic about their future prospects.

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BlockchainNews

Hong Kong has approved a series of spot Bitcoin and Ethereum ETFs.

by The Cryptocurrency Times
written by The Cryptocurrency Times

Early afternoon on April 15, 2024, Wu Blockchain cited announcements from relevant parties stating that Hong Kong authorities had preliminarily approved applications to launch spot Bitcoin and Ethereum ETFs.

Announcements from the official WeChat accounts of China Asset Management, Bosera Capital, HashKey Capital, and Harvest Global Investments all confirmed that their ETFs had been approved.

According to preliminary calculations, there are currently four approved entities. This information aligns with the “rumors” from the previous week, indicating that Hong Kong might approve a Bitcoin spot ETF the following week.

Thanks to this positive information, the prices of Bitcoin and Ethereum are showing strong recovery after two days of steep decline over the weekend.

1h chart of ETH/USDT pair on Binance on April 15, 2024

BTC is currently fluctuating around $66,300, slightly up after a flash crash to as low as $60,600 on April 14.

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Bitcoin Miners Stare Down Potential $10 Billion Loss Ahead of Halving Event

by The Cryptocurrency Times
written by The Cryptocurrency Times

Bitcoin Miners Face Potential $10 Billion Loss Ahead of Halving Event, Amidst Rising Competition from AI Companies.

Reports from U.Today indicate that Bitcoin miners may be on the verge of encountering losses surpassing $10 billion with the looming halving event, set to unfold in less than five days. The immediate fallout entails a reduction in mining rewards from 6.25 BTC to a mere 3.125 BTC per block. This impending halving is poised to inflict severe blows, particularly on mining entities burdened with higher-than-average operational expenses.

Traditionally, miners have weathered the storm of diminished block rewards, buoyed by subsequent bullish market surges post-halving. Historical data analyzed by Chainalysis reveals a pattern of miners bolstering their cash reserves leading up to the first two halvings in 2012 and 2016. However, this trend did not manifest preceding the third halving in 2020. Drawing from past mining cycles, miners opted to delay liquidating their reserves, foreseeing an uptick in Bitcoin’s valuation.

In the current landscape, although the aggregate balance of mining pools has dipped by over 20%, the contraction is notably less pronounced compared to preceding halvings. The recent attainment of a new all-time high in Bitcoin’s price on the cusp of the halving has somewhat alleviated concerns, enabling miners to cautiously offload certain holdings in preparation for the halving’s substantial impact.

Beyond the specter of the Bitcoin halving, miners find themselves grappling with escalating competition from artificial intelligence (AI) enterprises. Adam Sullivan, CEO of Core Scientific, underscores the tightening grip on power resources in the United States, characterizing it as “extraordinarily constrained.” Notably, tech behemoths such as Amazon are poised to inject hefty investments into data center infrastructure, intensifying the struggle for miners to secure lucrative, low-cost power contracts.

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