Michael Saylor to pitch Microsoft board on Bitcoin buying strategy

November 20, 2024 Coin Telegraph

Microsoft shareholder proposes firm look into investing in Bitcoin

October 25, 2024 Coin Telegraph

XRP’s ETF hopes after SEC appeal depend on US election: Analysts

October 4, 2024 Coin Telegraph

Arbitrum Proposal to Fund Tornado Cash Developers Defense Withdrawn

March 11, 2024 Bitcoin.com

Solana wind down ‘deemed a necessity’ after low fees, says Lido Finance

October 17, 2023 Coin Telegraph

Coin Telegraph

Unsustainable financials and low fees generated by Lido on Solana were two of the main reasons for the sunsetting.

Decentralized liquid staking protocol Lido Finance has announced a decision to cease operations on the Solana blockchain following a community vote in Lido’s decentralized autonomous organization.

The proposal to sunset Lido on Solana was first put forward by Lido’s peer-to-peer team on Sept. 5, citing unsustainable financials and low fees generated by Lido on Solana. Voting commenced on Sept. 29 and finished a week later on Oct. 6.

“After extensive DAO forum discussion followed by community vote, the sunsetting of the Lido on Solana protocol was approved by Lido token holders and the process will begin shortly,” Lido explained in an Oct. 16 post.

Lido will not be accepting staking requests as of Oct. 16. Voluntary node operator off-boarding will begin on Nov. 17 and Lido users will need to unstake on Solana’s frontend by Feb. 4.

“After this date, unstaking will need to be done using the CLI,” Lido added.

After extensive DAO discussion followed by community vote, the sunsetting of Lido on Solana was approved by LDO holders and will begin shortly.

More information here: https://t.co/MyImL1qpap
— Lido (@LidoFinance) October 16, 2023

The earlier proposal saw Lido seeking $20,000 per month from Lido DAO to support technical maintenance efforts involved with sunsetting operations on Solana over the next five months.

*Lido’s statement on terminating services on Solana. Source: Lido.fi*

Lido’s P2P team has been working on the Lido on Solana project since acquiring it in March 2022 from Chorus One.

Since the takeover, the P2P team has invested about $700,000 into Lido on Solana and made $220,000 in revenue, resulting in a net loss of $484,000, according to the mediakov, the author of the proposal.

The alternative in the Sept. 5 proposal was to provide more funding to Solana from Lido DAO — however 65 million (92.7%) of the 70.1 million LDO tokens (voted by token holders) were in favor of sunsetting operations on Solana instead, according to open-source voting platform Snapshot.

Lido explained the decision was a difficult but necessary one to make:

“Whilst this decision was difficult in the face of numerous strong relationships across the Solana ecosystem, it was deemed a necessity for the continued success of the broader Lido protocol ecosystem.”

Lido confirmed that staked-Solana (stSOL) token holders will continue to receive network rewards throughout the sunsetting process.

Lido’s staking services are now only supported on Ethereum and Polygon, where $14 billion and $80 million are staked, respectively, according to Lido’s website.

Lido launched on Solana on Sept. 8, 2021, when SOL was priced at $189 — an 87% fall from its current price of $24, according to CoinGecko.

Despite the news, SOL is up 8.6% over the last 24 hours.

SOL’s price movements over the last seven days. Source: CoinGecko

Magazine: DeFi Dad, Hall of Flame: Ethereum is ‘woefully undervalued’ but growing more powerful

Ethereum staking services agree to 22% limit of all validators

September 1, 2023 Coin Telegraph

Centralization

The 22% self-limit rule ensures at least four major staking entities would need to collude in order for the chain to reach finalization.

At least five Ethereum liquid staking providers have either imposed or are working to impose a self-limit rule in which they promise not to own more than 22% of the Ethereum staking market — seen as a move to ensure the Ethereum network remains decentralized.

Among the Ethereum staking providers either already committed or are working to commit to the self-limit rule include Rocket Pool, StakeWise, Stader Labs and Diva Staking, according to Ethereum core developer Superphiz.

Puffer Finance, another liquid staking service, also announced its commitment to the self-limit.

These providers are committed (or are in the process of committing) to self-limit to @Rocket_Pool @stakewise_io @staderlabs @divastaking
— superphiz.eth ️ (@superphiz) August 30, 2023

The proposal presumably aims to address concerns of Ethereum staking becoming increasingly centralized.

As to why the self-limit was proposed at 22%, Superphiz explained that because 66% of validators need to agree on the state of Ethereum, setting the limit below 22% means at least four major entities must collude in order for the chain to reach finalization.

Finality is the point where transactions on a blockchain are considered immutable, supposedly ensuring that transactions within a block cannot be altered.

The idea was proposed by Superphiz in May 2022 when he questioned whether a staking pool would be willing to put the health of the chain before its own profits.

Interestingly, the largest Ethereum liquid staking provider, Lido Finance, voted by a 99.81% majority not to self-limit back in June.

“They have expressed an intention to control the majority of validators on the beacon chain,” Superphiz said in an Aug. 31 post.

Votes casted from Lido (LDO) token holders on the self-limiting proposal. Source: Snapshot

Lido currently dominates the Ethereum staking market, accounting 32.4% of all staked Ether, while the next entity, Coinbase, accounts for only 8.7% of the market, according to data from Dune Analytics.

*Ethereum stakers by staking amount and market share, showing that Lido is the only one above the 22% threshold. Source: Dune Analytics*

Who’s in the right? Mixed reactions from the Ethereum community

One industry pundit, “Mippo,” explained on Aug. 31 that the self-limit proposal has nothing to do with “Ethereum alignment” — a principle understood to enable credible neutrality and permissionless innovation on Ethereum.

Mippo claimed those trying to push the proposal wouldn’t make way if they were in Lido’s position.

“Everyone is doing the economically selfish and rational thing here,” Mippo concluded.

Yeah because they have way less market share than that now… easy to chirp from the cheap seats.

This has nothing to do with “Ethereum alignment.” None of these teams would self limit were they in Lido’s place.

Everyone is doing the economically selfish and rational thing…
— Mippo (@MikeIppolito_) August 31, 2023

“Folks in the ETH community should not shame more user-friendly solutions as greedy products,” said another observer.

However, others were more wary of the potential centralization issues at hand, describing Lido’s market share dominance as “disgusting and selfish.”

Magazine: DeFi Dad, Hall of Flame: Ethereum is ‘woefully undervalued’ but growing more powerful

Crypto memes can be considered financial promotions, says UK watchdog

July 18, 2023 Coin Telegraph

britain

Memes found to be non-compliant with financial promotion rules could carry up to two years in jail under a proposal from the FCA.

Crypto firms and influencers may need to start slapping disclaimers on crypto memes to stay compliant with advertising laws in the United Kingdom, according to a new proposed guidance from the country's financial regulator.

On July 17, the Financial Conduct Authority (FCA) released a proposed guidance on social media financial promotions which targets promotional memes and financial influencers — “finfluencers.”

Too many people across the UK are being shown financial promotions from unsuitable sources.

We’ll be ramping up our work to stamp out illegal financial promotions, particularly those found on social media. #financialpromotions #financialservices https://t.co/sK8r5ExxVm
— Financial Conduct Authority (@TheFCA) July 17, 2023

The FCA said it’s seen memes from crypto firms circulated online which many don’t realize are subject to its promotional rules.

It said promotional memes are particularly prevalent in the crypto sector and added any type of communication could be considered a financial promotion.

*Example of a crypto investing-related meme the FCA considers a financial promotion. Source: FCA*

The FCA considers crypto a high-risk investment. It can be advertised to retail investors at large but there are requirements such as including risk warnings and a ban on investment incentives.

It said in Q4 2022, 69% of financial promotions on websites or social media from authorized firms were amended or withdrawn following FCA intervention.

It launched the consultation to update its guidance from 2015 and make clear its expectations on how marketers are to implement its regulations around promotions.

Finfluencers in the crosshairs

The FCA stated it’s seen an increase in the number of finance-oriented influencers promoting financial products they have little knowledge of, which typically target a younger audience.

It warned influencers their promotions could be an offense punishable by up to two years in jail, an unlimited fine or both. The law applies even to promotions from outside the U.K. which could have an effect in the country.

In its reasoning for the reminder, it cited a report that claimed over 60% of 18-to 29-year-olds follow social media influencers, with three-quarters saying they trust their advice.

A 2021 FCA survey found 58% of respondents under 40 years old cited hype from social media and the news as reasons for their investment in what the watchdog considers a high-risk product.

Public comments on the proposed guidance are open until Sep. 11.

Magazine: Cryptocurrency trading addiction — What to look out for and how it is treated

ETH DeFi ‘circuit breaker’ could cut hack losses by 70% — Developer

July 7, 2023 Coin Telegraph

circuit breaker

Diyahir Campos, a smart contract developer behind the new ERC proposal, sought action after falling victim to the Euler Finance hack in March.

A decentralized finance (DeFi) “circuit breaker” could have prevented billions of dollars worth of crypto from being stolen from DeFi protocols in 2022, according to the developer of the newly published ERC-7265 proposal.

A new Ethereum request for comment (ERC) was published on GitHub on July 3. In it, the lead developer Diyahir Campos proposed a standard for a DeFi “circuit breaker.” It essentially aims to set a standard for a smart contract that can halt suspiciously large token outflows from a DeFi protocol.

1/ Announcing ERC 7265: Circuit Breaker

We are fixing the biggest problem with DeFi Security - lack of response time to mitigate hacks.

Built by @Diyahir @tcb_00 @real_philogy https://t.co/4KQDYEK2H7
— Meir Bank (@MeirBank) July 3, 2023

Last year was the single biggest year for crypto hacks, with at least $3.1 billion stolen from DeFi protocols — and cross-chain bridges accounted for 65% of that.

Speaking to Cointelegraph, Campos said circuit breakers could have prevented billions in losses.

“The ones that weren’t rugs, you could probably save 70% of the money [...] with minimal impact to users.”

Campos revealed he was one of the many that lost funds in the $195 million Euler Finance attack in March, which led to contagion impacting 11 other protocols.

“Actually, I was one of the depositors in the Euler hack,” he said.

3/ Our data analysis shows that DeFi Guardian could have saved more than 50% of losses from the recent @eulerfinance hack.

Instead of draining the entire TVL of Euler within moments, the Euler hacker would have been rate limited, saving tens of millions of dollars for users. pic.twitter.com/Nuck06iQIo
— Meir Bank (@MeirBank) June 1, 2023

“From that experience, I’m looking at the TVL [total value locked] charts and the transactions that happened, and really it begged the question:”

“Why would you ever let 100% of your TVL leave in 10 seconds or five blocks?”

A typical DeFi protocol would see around 20% of total value locked entering or leaving a project in a day.

“Once you start talking 30% or 40%, that's when you really start separating exploits versus daily usage,” said Campos.

The proposed standard has not been without controversy. DeFi researcher Chris Blec was among the skeptics on Twitter concerned the circuit breaker could be used for potentially nefarious purposes.

Oh dear Lord. What is this nonsense?

Giving DeFi devs a protocol-level method that allows them to freeze your money forever?

WHAT COULD POSSIBLY GO WRONG???

(h/t @DefiantNews) pic.twitter.com/RofYYv9Nud
— Chris Blec (@ChrisBlec) July 6, 2023

Campos said the circuit breaker isn’t suitable for every DeFi protocol and doesn’t guarantee a protocol is safe. He noted the circuit breaker would be an “opt-in thing” for DeFi projects.

He also believes that a well-designed circuit breaker must strike a balance between protecting users and preventing “false positives,” as it would be extremely disruptive whenever the breaker trips.

However, a circuit breaker would be useless in cases of internal rug pulls, as it could simply be deactivated by the team controlling the protocol.

A quick exploration of the power of circuit breakers in DeFi and their limitations in preventing costly hacks https://t.co/bZKeWJyUkI
— Diyahir (@Diyahir) June 27, 2023

Campos is a smart contract developer at Hydrogen Labs. He said work began on the proposed standard during an April hackathon in Tokyo alongside Meir Banks, the co-founder of Hydrogen Labs.

The idea for the DeFi circuit breaker was inspired by similar circuit breakers that have been used by global stock exchanges for decades.

“In DeFi, we aren’t trying to calm the markets, which is the intention of the [New York Stock Exchange’s circuit breaker] rather we want to prevent hack losses,” wrote Campos in a June 27 blog post.

Other developers working on the standard include Philippe Dumonet, founder and CEO of DeReg and Blagoj Dimovski, co-founder and former chief technology officer of Diagonal Fiance.

Campos said the standard is still being shaped at this stage, but is confident it will be ready “within months,” which would put it in “a really good stage” to be integrated into protocols.

Magazine: Should you ‘orange pill’ children? The case for Bitcoin kids books

BarnBridge DAO calls halt to ‘all work’ on DeFi protocol amid SEC probe

July 7, 2023 Coin Telegraph

BarnBridge

Some DAO members joked about the situation while others believed there may be an ulterior motive at play.

BarnBridge DAO members have been told to pause “all work” related to the project after a reported probe by the United States Securities and Exchange Commission (SEC).

In a July 6 post to the platform’s Discord channel, Douglas Park, a lawyer for the decentralized autonomous organization revealed the news to members.

“I am letting you know that the Securities and Exchange Commission is investigating BarnBridge DAO and individuals associated with the DAO,” Park said.

pic.twitter.com/ChsjBuGEzM
— BarnBridge (@Barn_Bridge) July 7, 2023

In order to “reduce potential further legal liability,” Park suggested “all work” on BarnBridge-related products should stop — including the closure of liquidity pools — and that individuals should not receive compensation for work flowing from the investment efforts of the DAO.

Co-founder Tyler Ward, presumably dubbed “Lord Tyler” on Discord, confirmed Park’s message was true on BarnBridge’s Discord shortly after.

Park and Ward didn’t explain why the SEC launched a probe into BarnBridge DAO. Park however explained that because the investigation is “ongoing” and “non-public,” only limited information can be shared.

Between June 30 and July 3, 100% of BarnBridge (BOND) token holders — voted on a proposal to retain the law firm Park & Dibadj LLP — of which Park is the managing partner — as legal counsel for the DAO “for various legal work.”

213,000 votes were cast and 201,000, or 94.3%, of them came from the wallet “barnbridge.eth.”

*100% of the 213,000 BOND tokens were placed in favor of the proposal. Source: Snapshot*

The timing and subject of the proposal may suggest the SEC launched an investigation into BarnBridge DAO before June 30.

Some DAO members have raised suspicions over the announcement, however.

One member of the Discord asked for supporting evidence of the SEC’s investigation and implied BarnBridge’s founders may be using it as an excuse to facilitate an “exit strategy” to potentially defraud investors.

Ward refuted the claim stating it would be the “worst thought-out rug attempt in history.”

Other members took the news more lightheartedly with one saying it’s “time to move to Europe” — suggesting DAO members could hide from the SEC.

Another jokingly stated that anyone who interacted with BarnBridge would be “shot” by SEC chair Gary Gensler “on live TV” — alluding to his tough stance on crypto.

*Mixed reactions were recieved from BarnBridge DAO members on Discord. Source: Discord*

BarnBridge is a cross-platform risk management DeFi protocol that attempts to tackle inflation risk and interest rate volatility.

Since the news emerged, the price of its native token BOND has fallen 1.9% to $3.12, according to CoinGecko. The token is down 98.3% since its all-time high price of $185.7 on Oct. 27, 2020, and currently has a market cap of $29 million.

Early last month, the SEC filed lawsuits against two of the industry’s largest exchanges Binance and Coinbase, alleging they offered unregistered securities.

The reported investigation into BarnBridge, a small to mid-sized DAO, could suggest the securities regulator isn’t just looking to target the crypto space's largest organizations.

Cointelegraph contacted the SEC for comment but did not receive an immediate response.

Magazine: AI Eye: ‘Biggest ever’ leap in AI, cool new tools, AIs are the real DAOs

‘War on crypto’ — Newly filed letters lambast proposed SEC custody rules

May 9, 2023 Coin Telegraph

A16Z

Industry representatives have cast doubt on the legality and impact of the United States securities regulator’s proposal to expand custody rules.

A proposal by the United States securities regulator to tighten rules around crypto custody has been met with opposition from at least two proponents of the industry, according to recently filed letters.

On May 8 — the deadline for comments on the proposal — crypto industry advocacy body Blockchain Association filed its letter to the Securities and Exchange Commission (SEC) criticizing its proposal to amend its custody rule.

Three days earlier, a similar letter was sent by Web3 venture capital fund Andreessen Horowitz (a16z).

Marisa Tashman Coppel, a policy lawyer at the association, tweeted on May 8 that the rule would “drastically curtail investment in digital assets” and claimed that in its current form, the rule is “unlawful.”

1/ Today, @BlockchainAssn filed a comment letter to the SEC’s proposed custody rule. With recommendations, we explain how the rule would drastically curtail investment in digital assets and why finalizing the rule in its current form would be unlawful.https://t.co/zRrPkdiWn9
— Marisa Tashman Coppel (@MTCoppel) May 8, 2023

The same day, a16z general counsel Miles Jennings tweeted its letter, saying the firm “did not mince words” and called the SEC proposal a “misguided and transparent attempt to wage war on crypto.”

In its letter, the Blockchain Association provided over a dozen separate arguments to rebuff the SEC. Among other claims, it said the rule exceeds the SEC’s authority, would inhibit advisers from transacting with crypto exchanges and would leave investors’ assets at more risk.

A16z detailed similar arguments in its letter but focused more on its effects on registered investment advisers, namely that advisors would be prevented from using crypto and the rules could violate the duty of care the SEC requires of such firms.

On Friday, we filed a comment letter to the SEC's safeguarding custody rule. We did not mince words.

The proposal is another misguided and transparent attempt to wage war on crypto, and if passed it will result in investor harm, market inefficiencies and poor capital formation. pic.twitter.com/Z7S01Z8SOw
— miles jennings | milesjennings.eth (@milesjennings) May 8, 2023

It called the prohibition against advisors being able to trade crypto on centralized exchanges “illegal, unworkable and dangerous.”

Yet to be approved by the SEC, the February proposal would apply more stringent rules on investment advisers in the custody of assets, inclusive of crypto.

Firms would need to properly segregate assets and custodians will be required to have annual audits from public accountants among a raft of other transparency measures.

Gensler has specifically taken aim at crypto exchanges with the rule, and said some crypto trading platforms offering custody services are not actual “qualified custodians.”

The proposal even saw pushback from within the SEC. Commissioner Hester Pierce questioned the rule’s “workability and breadth” and its seeming targeting of crypto and crypto-related companies.

Magazine: Crypto regulation — Does SEC Chair Gary Gensler have the final say?

proposal

Who’s in the right? Mixed reactions from the Ethereum community

Finfluencers in the crosshairs

Share this video