DOJ wants SBF’s bail revoked over tampering, diary leak allegations

July 30, 2023 Coin Telegraph

The filing revealed that on Jan. 15, 2023, SBF contacted the current general counsel of FTX US, who could potentially serve as a witness in the trial.

According to a July 28 court filing, the United States Department of Justice (DOJ) is seeking the revocation of Sam Bankman-Fried’s (SBF) bail, accusing him of attempting to tamper with witnesses and leaking Caroline Ellison’s diary to The New York Times.

The DOJ notes in the filing that SBF was released on a bond on Dec. 22, 2022, but later requested multiple bail modifications. According to the filing, on Jan. 15, 2023, the defendant reached out to the current general counsel of FTX US, who could potentially serve as a witness in the trial.

According to allegations, SBF purportedly reached out to the FTX U.S. lawyer through the encrypted messaging application Signal and email. In the communication, SBF expressed a desire to reconnect and explore the possibility of establishing a constructive relationship. He inquired about the potential of using each other as resources or providing mutual input on various matters.

Screenshot of the DOJ’s filing. Source: CourtListener.

As per the DOJ's findings, SBF allegedly employed Signal for obstructive purposes and the auto-deletion feature of messages from communication channels has complicated the investigation. The court expressed concerns regarding the potential risk of witness tampering in light of the defendant's behavior.

According to John Reed Stark, Former Chief of the SEC Office of Internet Enforcement, Judge Kaplan has several options. He could view SBF's actions as an effort to improperly influence witnesses and choose to either make further modifications to his bail conditions or even revoke his bail entirely.

He argued that Judge Kaplan will face a tough decision in this case. If SBF is permitted to stay free, the judge will undoubtedly reiterate his previous warnings.

The written submission comes after a Wednesday hearing in a Manhattan federal court, during which prosecutor Danielle Sassoon stated that no set of release conditions can guarantee the safety of the community.

One week prior, the DoJ leveled accusations against Bankman-Friend for leaking Ellison's personal diary. During the court session, Sassoon informed the judge that Bankman-Friend attempted to "intimidate" Ellison and made around 100 calls to the NYT reporter.

Magazine: Can you trust crypto exchanges after the collapse of FTX?

Lawmakers probe Apple’s App Store policies on blockchain, NFTs

July 29, 2023 Coin Telegraph

Apple

Their letter aimed to explore whether these guidelines might inadvertently hinder the progress and growth of cutting-edge innovations.

United States Representatives Gus Bilirakis and Jan Schakowsky penned a formal letter to Apple CEO Tim Cook about concerns related to the California-based company’s App Store, and the potential effect of its guidelines on emerging technologies like blockchain and nonfungible tokens (NFTs).

The letter requests information about whether the App Store’s guidelines might inadvertently hinder the progress and growth of cutting-edge innovations.

*Screenshot of the letter from the lawmakers addressed to Apple's CEO. Source: Bilirakis blog.*

The lawmakers observed a pattern in Apple’s approach to its App Store guidelines, where the company seemingly capitalized on and simultaneously limited the functionality of crypto apps. They pointed out that Apple achieved this by mandating the release of “lite” versions, which both generated profits for Apple and diminished the overall utility of the applications. As evidence, they specifically mentioned the case of Axie Infinity’s App Store experience.

By dispatching the letter, the lawmakers expressed apprehensions regarding the potential negative consequences of Apple's policies on the United States' standing in the realm of emerging technologies. The Chairman and Ranking Member of the Innovation, Data, and Commerce Subcommittee conveyed their viewpoint, noting that while Apple has justified these limitations as a means to enhance security through a "walled garden" approach, there is widespread concern that the company might be wielding the App Store as a tool to suppress competition.

They emphasized the utmost importance for Congress to gain a comprehensive understanding of the App Store Guidelines and to assess to what extent these guidelines may impede innovation and have an impact on American technological leadership. They added:

"Our subcommittee remains committed to promoting full transparency and ensuring that Big Tech is held accountable for monopolistic behavior,"

They stated that they intend to create a level playing field within the industry so that American ingenuity can continue to thrive. The lawmakers previously penned a similar letter to Apple regarding App Store policies relating to TikTok and other apps originating from China.

Magazine: GOP crypto maxis almost as bad as Dems’ ‘anti-crypto army’

SEC, Binance unite against Eeon’s lawsuit intervention

July 29, 2023 Coin Telegraph

Binance

The US SEC contends that Eeon has a history of repeatedly representing themselves in court cases, but their claims have consistently been unsuccessful in federal courts.

The response from the United States Securities and Exchange Commission (SEC) and crypto exchange Binance has been submitted regarding the entity "Eeon," which has sought to intervene on behalf of customers in the case. Both the SEC and Binance are against Eeon's petition to intervene, citing that it does not meet the necessary legal requirements for intervention and consent.

According to the District Court for the District of Columbia, both Defendant Binance and Plaintiff U.S. SEC objected to Eeon's request to intervene in the lawsuit.

The US SEC contends that Eeon has a history of repeatedly representing themselves in court cases, but their claims have consistently been unsuccessful in federal courts. The SEC has urged the court to reject Eeon's petition for several reasons.

*Screenshot of SEC's response to the intervention petition. Source: Court Listener*

Firstly, the Exchange Act prohibits private litigants from intervening, making Eeon's request impermissible. Secondly, the SEC argues that Eeon's participation in the lawsuit would have no significant impact as their claims align with those of the defendants. Lastly, Eeon's petition fails to meet the necessary requirements for intervention. Additionally, Eeon's counterclaims, seeking relief against both the SEC and Binance, are contradictory in nature.

Binance provided three grounds for dismissing Eeon's petition. Firstly, the lack of consent from the SEC; secondly, Eeon's failure to establish itself as a legitimate party of interest; and thirdly, the failure to meet the necessary legal requirements for intervention. Furthermore, Eeon's counter-claim was deemed vague and unrelated to the current lawsuit.

*Screenshot of Binance's response to the intervention petition. Source: Court Listener*

Therefore, both the plaintiff (SEC) and the defendants (Binance and CEO Changpeng "CZ" Zhao) are united in their opposition to any intervention by Eeon in the SEC's lawsuit against Binance and its CEO.

In the meantime, Binance has filed a motion to dismiss the lawsuit brought by the US CFTC, arguing that the global crypto exchange is not under the jurisdiction of the CFTC and that the CFTC lacks the right to sue its CEO, CZ. However, due to the court's extended deadlines for the submission of responses by both the CFTC and Binance, the dismissal process is expected to extend into the following year.

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

Here’s how big food and beverage brands are using NFTs: Report

July 28, 2023 Coin Telegraph

Coin Telegraph

The key supporting factors for the market are the adoption of blockchain technology and the demand for NFTs for transparency and traceability in the food industry.

Nonfungible tokens (NFT) adoption is picking up steam across the food and beverage industry, with many fast-food chains displaying interest in this new asset class.

A report by ResearchAndMarkets.com states that the global food & beverage NFT market size is expected to reach USD 2,134.04 Million by 2032. These statistics have been evident as recently, Global fast-food brands, including Pizza Hut and Papa John’s, are discovering new ways to integrate NFTs into their marketing strategies.

The report states that the key supporting factors for the market are the adoption of blockchain technology and the demand for NFTs for transparency and traceability in the food industry. Unique ownership opportunities, using NFTs in virtual reality and video games, promotions and advertising from food companies and restaurants are other factors expected to drive the market in the forecast period.

*Graphic representation of predicted growth for the Food & Beverage NFT market. Source: Research and Markets*

NFTs are unique digital assets verified on a blockchain network. These are created using blockchain technology, a decentralized digital ledger that records transactions transparently and securely.

The value of an NFT can vary greatly depending on the rarity and popularity of the item it represents, with some NFTs selling for millions of dollars. In the food industry, the NFT market gains traction due to the demand for transparency and traceability. Tracking and verifying food origin, quality and safety is crucial for consumers, retailers and regulators.

In March 2021, Pizza Hut Canada joined the NFT trend with "1 Byte Favorites," a digital pizza collection. The NFTs represented pizza slices with unique recipes on Rarible, featuring popular choices like Hawaiian, Pepperoni, Canadian and Margherita. The NFTs gained popularity and sold out, being used as a marketing campaign to promote their pan pizzas and engage customers.

Papa John's International, Inc., a pizza take-out chain, entered the NFT market with its "Hot Bags" collection. These NFTs showcased handbag designs to promote their new business line, Papa John's X Cheddar, which offers merchandise. The NFTs were minted on the Tezos blockchain, with the numbers symbolizing the company's founding year (1984).

However, the report mentions that NFT adoption in the food & beverage industry is hindered by technical complexities, especially for smaller producers. Limited awareness among consumers and industry stakeholders about NFT benefits also poses a challenge.

Magazine: Tokenizing music royalties as NFTs could help the next Taylor Swift

Securitize issues tokenized assets in Spain, plans September trading start

July 27, 2023 Coin Telegraph

Coin Telegraph

The U.S.-based trading platform is set to become the first to issue and trade tokenized assets in both the U.S. and the EU, and will operate under the new DLT pilot regime.

Digital asset trading platform Securitize has begun tokenizing equity in the Spanish real estate investment trust Mancipi Partners, it announced on June 27. The firm expects to launch secondary trading on the Avalanche blockchain in September.

Securitize plans to carry out the first natively tokenized equity issuance under the European Union’s pilot regime for distributed ledger technology supervised by the European Securities Market Authority. The pilot regime was introduced in March.

The company will undergo a six-month sandbox period under the supervision of Spain’s National Securities Market Commission, known by its Spanish acronym CNMV. In addition, it must receive regulatory approval under the pilot regime to allow it to issue, manage and trade tokenized securities in Spain and throughout the EU.

Securitize is already registered with the United States Securities and Exchange Commission as a stock transfer agent and alternative trading system, and is a member of the Financial Industry Regulatory Authority. Securitize CEO Carlos Domingo said in a statement:

“Securitize is now the first firm to be able to issue and trade tokenized securities in both the U.S. and Europe.”

Securitize partnered with asset manager KKR to tokenize an interest in its Health Care Strategic Growth Fund II in September 2022. It announced a partnership with SBI Digital Markets, a Singapore-based subsidiary of Japan’s SBI Digital Asset Holdings, in October 2022, shortly after SBI Digital Markets was granted a license by the Monetary Authority of Singapore.

Though most value is created in private capital markets, they remain notoriously impenetrable, illiquid and inefficient. At Securitize, we’re making #privatemarkets more accessible, and securities more productive.

Listen to @carlosdomingo's full interview with @fintechfrank for… pic.twitter.com/DquglSYFuw
— Securitize (@Securitize) July 21, 2023

Tokenization makes private equity investment more accessible to retail investors and improves liquidity by making the tokenized assets tradable on secondary markets. It also benefits businesses.

“European businesses will be a major beneficiary of this innovation, giving businesses a new way to raise capital through primary capital raises, and obtain potential tax benefits and liquidity through secondary trading,” Domingo said.

Collect this article as an NFT to preserve this moment in history and show your support for independent journalism in the crypto space.

Magazine: Block by block: Blockchain technology is transforming the real estate market

Hong Kong and Saudi Arabia collaborate on tokens and payments

July 27, 2023 Coin Telegraph

Coin Telegraph

The Saudi Central Bank warned in 2019 that Bitcoin is “not recognized by legal entities” but hasn’t made many statements on crypto since.

Hong Kong is expanding its financial collaboration with the Kingdom of Saudi Arabia, targeting tokenization and payments infrastructure agreements.

On July 26, the Saudi Central Bank (SAMA) and the Hong Kong Monetary Authority (HKMA) held a bilateral meeting to strengthen the integration of financial services between the two countries.

As part of the meeting agenda, the HKMA and the SAMA discussed initiatives such as financial infrastructure development, open market operations, market connectivity and sustainable development. The central banks also signed a memorandum of understanding (MoU) to promote joint discussions on financial innovation.

*HKMA chief executive Eddie Yue (left) and SAMA governor Ayman Alsayari (right). Source: HKMA*

According to an official joint announcement, Hong Kong and Saudi Arabia’s authorities also took the opportunity to share their expertise in areas like tokenization, payment infrastructure and supervision technologies.

“There is a lot of room for cooperation between the Kingdom of Saudi Arabia and Hong Kong in the fields of economy and trade, sustainable development, finance and fintech,” HKMA chief executive Eddie Yue said.

SAMA governor Ayman Alsayari noted that the MoU will not only promote the continued development of the relationship between Hong Kong and Saudi Arabia, but also help them “in the future.”

The announcement doesn’t specify whether the development would include any joint efforts related to cryptocurrencies like Bitcoin (BTC), despite the HKMA recently allowing retail investors to trade crypto. On the other hand, the government of Saudi Arabia hasn’t been vocal on any plans to promote crypto in recent years, only warning that Bitcoin is “not recognized by legal entities” in the country in 2019.

The HKMA didn’t immediately respond to Cointelegraph’s request for comment.

Hong Kong is already participating in several inter-jurisdictional tokenization initiatives. In mid-June, the Bank of China’s investment bank subsidiary BOCI issued a $28 million tokenized security in Hong Kong, minted on the Ethereum blockchain. The project deployed Goldman Sachs’ tokenization protocol GS DAP and cash tokens representing claims on the Hong Kong dollar.

Magazine: Asia Express: China expands CBDC’s tentacles, Malaysia is HK’s new crypto rival

Bank of Italy innovation hub supports research into security tokens on secondary markets

July 26, 2023 Coin Telegraph

Coin Telegraph

The Italian central bank’s Milano Hub has selected a project headed by Cetif Advisory and Polygon Labs in its second round of proposals.

The Bank of Italy’s Milano Hub innovation center will provide support for a project developed by Cetif Advisory to research a security token ecosystem for institutional decentralized finance (DeFi).

The project has no “commercialisation purpose,” but will extend “the scope of analysis” of security tokens on secondary markets. Security tokens are digitized representations of the ownership of real-world assets. Cetif Advisory general manager Imanuel Baharier said in a statement:

“We believe it is vitally important to create the conditions for DeFi to become a safe and open operating environment for supervised entities.”

The project will strive to allow institutional market participants to operate in a DeFi environment while complying with regulatory guidelines. It will further develop Cetif Advisory’s Lionity platform, which it describes as an “institutional grade automated market maker.”

Cetif Advisory is a spinoff of the Cetif Research Centre at the Università Cattolica del Sacro Cuore in Milan. The project is a collaboration with Polygon Labs, Fireblocks and other organizations. Italian banks, asset management companies and ten other financial institutions will take part in it.

Credem Euromobiliare Private Banking scelta da Banca d'Italia per l'innovazione - MilanoFinanza News https://t.co/Cs9rmH8hpP pic.twitter.com/0pQio87b4k
— MilanoFinanza (@MilanoFinanza) June 16, 2023

The Cetif Advisory project was chosen during the hub’s second call for proposals. The project was one of seven projects given the green light in the fintech category. It will receive support from the Milano Hub for six months, beginning this month, in the form of expert advice and in-depth regulatory research.

Securities tokenization is an emerging field in blockchain technology. Citi GPS recently predicted that the tokenized securities market may be worth $4 trillion to $5 trillion by 2030, with private equity and venture capital becoming the most tokenized, followed by real estate.

Magazine: Block by block: Blockchain technology is transforming the real estate market

Avalanche Foundation allocates $50M investment to on-chain asset token purchases

July 25, 2023 Coin Telegraph

Avalanche

Called "Avalanche Vista," the initiative will consider investing in any asset that can be tokenized.

The Avalanche Foundation announced the launch of “Avalanche Vista,” a $50 million initiative to spur tokenization on the Avalanche blockchain, on July 25.

Today, the Avalanche Foundation introduces Avalanche Vista, a $50M initiative to pioneer tokenization on #Avalanche

Tokenization is poised to be one of the most impactful blockchain innovations of the next decade, and Avalanche is uniquely equipped to power these systems. pic.twitter.com/ZWy109CMCi
— Avalanche (@avax) July 25, 2023

Avalanche Vista comes amid a groundswell trend towards tokenization throughout the blockchain community. Essentially, tokenization allows anyone to convert an off-chain asset into a digital, on-chain token.

One of the most popular early use cases for tokenization is in the real estate sector. Investment property purchases are typically the domain of large investors or investment corporations. When real estate is considered valuable, it’s usually difficult for small investors to approach the market.

Tokenization not only facilitates digital asset transactions such as buying and selling properties, but it also facilitates the democratization of asset allocation. Unlike traditional asset markets, buying and selling digital tokens allows multiple investors to pool funds in the purchasing of a single asset. This makes it possible for smaller investors to enter a market that otherwise might be prohibitively expensive.

Aside from real estate and collectibles, the Avalanche Foundation envisions a wide array of use cases for tokenization on its blockchain. Per a blog post, these include company equity, venture capital, debt instruments, intellectual property, and portfolio diversification.

According to the announcement, the Avalanche Vista fund will be used to purchase various tokenized assets on the Avalanche Blockchain:

“Avalanche Vista will consider assets across the full liquidity spectrum, including equity, credit, real estate, commodities, as well as those that are blockchain-native.”

As Cointelegraph recently reported, financial services and investment bank corporation Citi recently described the tokenization market as the next “killer use case” in crypto.

The company also predicts the sector will reach a global market cap of $4-$5 trillion by 2030. In comparison, the tokenization market was reportedly worth approximately $2.3 billion in 2021.

Collect this article as an NFT to preserve this moment in history and show your support for independent journalism in the crypto space.

Solana’s Parrot Protocol submits proposal to go tokenless, investors risk face -89% returns

July 22, 2023 Coin Telegraph

Coin Telegraph

The proposal calls for the redemption of PRT tokens for liquid treasury value, and the transition to a no-token protocol. Community members referred to the move as a "financial crime".

A recent proposal from Parrot Protocol's team, a Solana-based liquidity network, has sparked controversy among its community members. The proposal, up for vote until July 27, calls for the redemption of its PRT tokens for liquid treasury value, and the transition to a no-token protocol.

Based on the proposal, the PRT redemption price was established at $0.0045 per token. According to data from CryptoRank, the protocol raised over $89 million since its inception in 2021, with a current return on investment (ROI) of -89% for investors in its Initial DEX Offering (IDO) and initial exchange offering (IEO). Having a negative ROI indicates that investors have lost money on their investment.

Today in governance was a mistake news: @gopartyparrot team takes their $72m remaining in ICO funds and attempts to split it $12m to the token holders, $60m to the team.

Oh they also early unlocked their tokens and will be voting it through regardless of what anybody else says pic.twitter.com/vmhDXJochQ
— Spreek (@spreekaway) July 21, 2023

The protocol's plan does not explain the reasons behind the move, only mentioning that "many PRT holders would like to redeem their PRT tokens for their treasury value." The proposal also follows changes in Parrot's tokenomics from November 2022, when the protocol shortened its token locking period from 12 months to 7 days, claiming it would "create more flexibility for stakeholders to enter or exit their positions."

Comments from community members indicate that 81% of tokens are controlled by the team. However, Parrot's team has refuted these claims by stating on Twitter that treasury tokens are never touched or used for governance purposes. A breakdown provided by CryptoRank indicates that 35% of tokens were distributed as Protocol Incentives, 20% as Team & Angels, 10% as public sales, 20% as Seed rounds, and 15% as Others.

*Parrot Protocol Token Sale. Source: CryptoRank.*

Additionally, the proposal does not clarify what would be the fate of unclaimed funds after the 8-week redemption period, with community members suggesting the funds could be cashed out by insiders.

"The community has already explained in painstaking detail why we're not interested in this. The pro-rata value is an extreme lowball and fails to account for many of the team's misuses of the treasury without the community's consent. The team also prematurely unlocked the team and VCs' vesting tokens, so they are the majority token holders, making this vote meaningless and a total farce," wrote one community member on the proposal discussion.

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Manta Network developer raises $25M in Series A, launches layer 2 for ZK apps

July 19, 2023 Coin Telegraph

Manta Network developer raises M in Series A, launches layer 2 for ZK apps

Coin Telegraph

The funds will be utilized to expand the network, attract more users and explore diverse use cases for Manta Pacific.

P0x Labs, the cryptographic development team behind Manta Network, has announced that it raised $25 million in a Series A funding round, with leading contributions from Polychain Capital and Qiming Venture Partners. The funding gives the company a $500 million valuation.

Additionally, Manta Network has introduced the testnet of its layer-2 infrastructure, Manta Pacific, within its ecosystem for zero-knowledge (ZK) applications, according to a company statement. The raised funds will be utilized to expand the network, attract more users and explore diverse use cases for Manta Pacific.

In an interview with Cointelegraph, Manta Network CEO Kenny Li highlighted the primary goal of Manta Pacific, which is to streamline the development of features and applications, ensuring user-friendliness. Li said that while ZK has garnered attention as a valuable proposition, it primarily serves as a feature set that facilitates various use cases for applications.

However, the challenge arises from the fact that developers specializing in decentralized app development may lack expertise in cryptography or prefer to avoid a steep learning curve. In Li’s words:

“The hurdle is overcome by Manta Pacific’s ZK application layer, which utilizes pre-compiled circuits which can be seamlessly integrated into applications with minimal code.“

According to Li, implementing ZK applications for patient data is an ultimate goal, which includes achieving self-sovereignty and ownership of one’s medical information. However, Li said this goal is still years away due to the challenges associated with accessing and aggregating fragmented data from hospitals, which are not motivated to manage it effectively or adopt blockchain technology.

According to Li, Manta Network identified a use case in finance where staked tokens are issued to users based on their holdings on platforms like Binance. He stated that privacy concerns arise when users are reluctant to verify their identity due to the exposure of their entire wallet.

To address this, Li mentioned that a privacy layer through ZK-enhanced staked tokens was introduced, similar to the Binance account-bound token, resulting in approximately 58,000 verified user mints. This enhances the usability of staked tokens for identity purposes while prioritizing user privacy.

Manta Pacific’s testnet currently features various ZK applications for users to start accessing, including zkHoldEm, a fully on-chain and private Texas Hold’em game; zkMe, a protocol for private and verified credentials; and zkPass, a privacy-preserving protocol for data verification.

Manta Atlantic’s flagship nonfungible token private offering platform launched in April 2023 and has since minted over 300,000 zero-knowledge soulbond tokens across key ecosystem partners, including Arbitrum, Galxe, Linea and CyberConnect.

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