Ripple’s Legal Chief predicts crypto landscape shifts in 2024

December 16, 2023 Coin Telegraph

Taurus starts credit tokenization as an asset class for German SMEs

December 14, 2023 Coin Telegraph

Former British Chancellor’s crypto firm Copper launches tokenized securities platform

November 29, 2023 Coin Telegraph

Copper plans to use its arm in the United Arab Emirates, Copper Securities, to capitalize on the demand of institutional investors.

London-based crypto trading firm Copper plans to start offering tokenized securities early next year, according to reports on Nov. 29. Under the leadership of former British Chancellor Phillip Hammond, the company expects to capitalize on institutional investors' demand.

The service is expected to be first rolled out in Abu Dhabi, United Arab Emirates, by its new arm in the country, Copper Securities. The company is reportedly in the process of securing regulatory approval from local authorities.

Copper plans to use blockchain technology to provide securities financing and other payment solutions to institutional clients over the coming months. More than 90 markets around the world will be accessible through the new platform, said the company.

Copper acquired its securities arm earlier this year with the goal of offering tokenized securities within the Abu Dhabi Global Market (ADGM), an international financial center and free zone on Al Maryah Island.

Hammond has long-standing ties to the region. He has been advising the government of the neighboring country Saudi Arabia since 2021, following approval by the United Kingdom's lobbying watchdog. In the same year, Hammond was appointed as a senior adviser to Copper, before taking over as the company's chair earlier 2023. Back then, Hammond shared his thoughts on how blockchain technology can benefit the financial sector:

"I remain firmly of the view that the post-Brexit U.K. Financial Services sector needs to embrace Distributed Ledger Technology as a key part of its strategy to remain a major global financial center.”

Securities tokenization involves converting financial assets like stocks or real estate into digital tokens on a blockchain. Tokenization facilitates access to expensive assets and increases market liquidity by allowing fractional ownership, thus democratizing ownership of financial assets.

Assets tokenization has been a hot topic in 2023, and its popularity is likely to continue growing in the future. In the United Kingdom, investment managers are being encouraged to use blockchain technology to tokenize investment funds, moving away from traditional record-keeping systems. A recent report published by the Investment Association argued that the tokenization of investment funds can lead to a more efficient and transparent financial industry.

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Decentralized file sharing, explained

November 25, 2023 Coin Telegraph

Blockchain

Decentralized file sharing is a peer-to-peer network system where files are distributed across multiple nodes, eliminating the need for a central server.

The importance of decentralization in file sharing

Decentralized file sharing revolutionizes data access by eliminating dependence on centralized servers and utilizing P2P technology to distribute files across a network of nodes.

Distributing and accessing data without depending on a centralized server is possible with decentralized file sharing. Rather, files are kept on a network of linked nodes, frequently through the use of peer-to-peer (P2P) technology.

To enable file sharing, each network user can provide bandwidth and storage space. BitTorrent and InterPlanetary File System (IPFS) are two well-known instances of decentralized file-sharing protocols.

The decentralization of file sharing has completely transformed the way users access and store digital content. In contrast to conventional centralized file-sharing systems, which store files on a single server, decentralized file-sharing uses a P2P mechanism. Dispersing files among a network of linked nodes promotes a more robust and secure system.

Key components of decentralized file sharing

Decentralized file sharing depends on a number of essential elements to allow for a dispersed and safe data exchange.

Firstly, P2P networks, which enable direct user contact in the absence of a centralized server, are the backbone of a decentralized file-sharing system. By doing this, a robust system where participants directly share files is fostered.

Blockchain technology is essential to maintaining integrity and trust in decentralized file-sharing networks. It improves the general security of transactions and file transfers by enabling transparent and impenetrable record-keeping. Smart contracts are self-executing contracts with pre-established rules that automate tasks like access control and file verification.

Furthermore, files are distributed throughout a network of nodes using decentralized storage systems, which often use protocols like BitTorrent or IPFS. This approach eliminates the need for a central server and enhances the availability and reliability of data due to its redundant nature.

Cryptographic methods also protect the integrity and privacy of data. User confidence in decentralized file-sharing systems is increased by end-to-end encryption, which guarantees that only authorized parties may view the content. Together, these elements essentially provide a safe and dispersed setting for easy file sharing via the decentralized web.

How does decentralized file sharing work?

Decentralized file sharing operates on P2P networks by leveraging a distributed architecture rather than relying on a central server.

Peer discovery

Participants in the network (peers) need a way to discover one another, which is accomplished by using distributed hash tables (DHTs) or decentralized protocols. Peers build a network without a central authority by keeping track of other peers with whom they are linked.

DHTs are decentralized systems that enable distributed storage and retrieval of key-value pairs across a network, while decentralized protocols enforce communication rules that enable peer-to-peer interactions without relying on a central authority or server.

File distribution

A file is split up into smaller parts where every component is dispersed among several network peers. This approach enhances file availability, as it is not stored in a single location, ensuring better accessibility and reliability.

Dispersed storage

By distributing file portions over several nodes, decentralized storage systems lessen reliance on a single server. For instance, IPFS employs a content-addressed approach, in which files are recognized by their content as opposed to their physical location.

Peer interaction

Peers request and share file portions directly with one another. The coordination of file transfers no longer requires a central server, thanks to this direct connection. Every peer participates in the file distribution process by serving as both a client and a server.

Blockchain and smart contracts

Blockchain technology is incorporated into several decentralized file-sharing systems to increase security and transparency. Smart contracts are self-executing contracts with pre-established rules that can automate tasks such as access restriction and file verification and reward participants with tokens.

Often, decentralized file-sharing systems use cryptographic techniques like end-to-end encryption to provide privacy and security for the shared files. This ensures that the content can only be accessed and deciphered by authorized users.

Working of a decentralized storage system

Advantages of decentralized file sharing

The benefits of decentralized file sharing include enhanced resilience, improved privacy, scalability and censorship resistance.

By removing a single point of failure, it improves reliability and resilience. In a peer-to-peer network, where files are dispersed among several nodes and peers, the system continues to function even in the event that some nodes go down.

Also, decentralized file sharing, by its very nature, offers enhanced security and privacy. By ensuring that only authorized users can access and decode shared content, cryptographic solutions like end-to-end encryption help lower the danger of unauthorized spying or data breaches.

Better scalability can also be attained as the network expands. In decentralized networks, more users add to the network’s capacity, allowing it to accommodate more demand and traffic without requiring modifications to the centralized infrastructure.

Additionally, decentralized file sharing encourages resistance against censorship. It is harder for any organization to censor or limit access to particular files or information because there isn’t a single entity in charge of the network.

Furthermore, decentralized file sharing frequently incorporates incentive mechanisms through token economies or other reward systems to encourage users to contribute resources like bandwidth and storage, thereby creating a cooperative and self-sufficient environment.

Challenges and limitations of decentralized file sharing

Challenges associated with decentralized file sharing involve scalability issues, consistency concerns, user adoption complexities, security risks and regulatory uncertainties.

Firstly, as the network grows, scalability issues become more pressing. A poor user experience may result from increased involvement if it causes slower file retrieval times and greater bandwidth requirements.

Moreover, in decentralized systems, problems with consistency and coordination could surface. It may be difficult to maintain consistency in file versions throughout the network in the absence of a central authority, which could result in conflicts and inconsistent data.

Complicated interfaces and user acceptance present another difficulty. When compared to centralized options, decentralized file-sharing platforms frequently have a higher learning curve, which may put off consumers who are not familiar with P2P networks or blockchain technology.

Furthermore, security vulnerabilities still exist, especially in the early phases of decentralized file-sharing deployments. As these systems grow more widely used, they are targeted by different types of attacks, which makes the continuous development of strong security measures necessary.

Regulatory uncertainty is another difficulty. The adoption and long-term viability of decentralized file-sharing platforms may be impacted by the changing legal environment surrounding cryptocurrency and decentralized technology.

The future landscape of decentralized file sharing

The future of decentralized file sharing involves blockchain technology, P2P networks and tokenization for secure, efficient and collaborative data exchange, which challenge traditional models.

Decentralized file sharing is expected to bring about a more inclusive, secure and productive environment. Distributed ledger and blockchain technology will be essential in guaranteeing tamper-proof and transparent transactions and facilitating file sharing among users without depending on centralized intermediaries.

Decentralized protocols powering peer-to-peer networks will enable direct data transmission between users, cutting down on latency and reliance on centralized servers. Strong encryption techniques will allay privacy concerns and provide consumers with more control over their data.

Furthermore, tokenization could encourage resource sharing among users, resulting in the development of a collaborative ecosystem. Innovative file-sharing services will probably proliferate as decentralization gains pace, upending established paradigms and promoting a more robust and democratic digital environment.

Fantom Foundation awards $1.7M bounty for preventing $170M drain

November 21, 2023 Coin Telegraph

Fantom Foundation awards .7M bounty for preventing 0M drain

Coin Telegraph

In the aftermath of Fantom’s $550,000 hack in October, a security researcher found that the attacker could have stolen as much as $170 million.

The Fantom Foundation, a nonprofit organization developing the Fantom blockchain platform, has eliminated a significant vulnerability after a $550,000 hack in October.

On Oct. 17, the Fantom Foundation suffered a hot wallet hack, with an unknown attacker draining 1% of Fantom Foundation’s funds. The foundation subsequently stopped using some of the affected wallets, reassigning them to a Fantom employee, making it a “targeted attack.”

Following the incident, an unnamed security researcher found an additional potential risk associated with the hack and alerted the Fantom Foundation, according to a blog post on Nov. 20. The vulnerability was associated with a dormant admin token for Fantom’s ERC-20 FTM contract, which could potentially allow the attacker the ability to mint a portion of Fantom (FTM) for themselves on Ethereum.

According to the Fantom Foundation, the discovered vulnerability could have allowed the hacker to drain $170 million using the wallet access. The organization said the value of the potential loss is based on the token price at the time of the hack, “though this estimate does not consider the market’s insufficient liquidity to absorb the tokens fully.”

The Fantom Foundation said that the vulnerability was “mitigated quickly,” and the organization awarded the unnamed researcher $1.7 million in recognition of the contribution. The announcement added:

“The Fantom Foundation is dedicated to upholding the highest security standards for our platform, and we remain grateful for the security researchers who contribute to this effort.”

The Fantom Foundation did not immediately respond to Cointelegraph’s request for comment.

Despite the Fantom Foundation losing half a million to a hack one month ago, the Fantom token has risen over the past four weeks. The token has added 82% of value since Oct. 17, trading at $0.31 at the time of writing, according to CoinGecko. The token is also up 78% over the past year, according to the data.

*Fantom (FTM) token 90-day price chart. Source: CoinGecko*

Launched in late 2019, the Fantom network is a blockchain protocol that enables users to build and deploy decentralized applications (DApps). The Fantom Foundation’s Opera is a permissionless blockchain compatible with the Ethereum Virtual Machine, which allows users to interact with the Fantom network on MetaMask, a leading self-custodial cryptocurrency wallet.

Fantom’s recent $550,000 hack isn’t the first attack on the Fantom Foundation or its users. In July 2023, Fantom suffered a massive multichain bridge hack, which resulted in the loss of $126 million worth of cryptocurrency. Fantom creator Andre Cronje subsequently claimed that the Fantom team was misled about the actual security level of Multichain, which ceased operations in mid-July 2023.

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dYdX raises margin requirements in some markets, bans “highly profitable trades”

November 19, 2023 Coin Telegraph

Coin Telegraph

The decentralized exchange increased margin requirements on several markets on Nov. 18, after an alleged targeted attack on the YFI token triggered massive liquidations.

Decentralized crypto exchange dYdX has disclosed new measures to mitigate trading-related risks after burning $9 million of its insurance fund on Nov. 17 to cover users’ losses.

According to an announcement on X (formerly Twitter), the exchange increased margin requirements on several “less liquid markets,” affecting tokens such as Eos (EOS), 0x Protocol (ZRX), Aave (AAVE), Algorand (ALGO), Internet Computer (ICP), Monero (XRM), Tezos (XTZ), Zcash (ZEC), SushiSwap (SUSHI), THORChain (RUNE), Synthetix (SNX), Enjin (ENJ), 1inch Network (1INCH), Celo (CELO), Yearn.finance (YFI), and Uma (UMA).

dYdX triggered its insurance fund to cover users’ trading losses on Nov. 17 after a profitable trade targeting long positions on the YFI token caused the liquidation of positions worth nearly $38 million.

dYdX founder Antonio Juliano dubbed the move a "targeted attack" on the exchange. According to him, YFI's open interest in dYdX spiked from $0.8 million to $67 million in a matter of days as a result of the actions of one individual. The same individual, according to Juliano, attempted to attack the SUSHI market on dYdX a few weeks earlier.

"We did take action to increase initial margin ratios for $YFI prior to the price crash, but this was ultimately not sufficient. The actor was able to withdraw a good amount of $USDC from dYdX right before the price crash," he wrote.

On X, the exchange’s team said that "highly profitable trading strategies have now been banned on dYdX,” in a reference to the language used by Mango Markets’ exploiter Avraham Eisenberg in his $116 million attack of 2022.

dYdX is now offering a bounty payment in exchange for valuable information:

dYdX will pay bounties to those most helpful in aiding the investigation

We will not pay bounties to, or negotiate with the attacker

We and others have made significant progress into identifying the attacker. We are in the process of reporting the information we have to the FBI
— Antonio | dYdX (@AntonioMJuliano) November 19, 2023

The YFI token declined by 43% in just a few hours on Nov. 17 after soaring over 170% in November. The sharp decline wiped out over $300 million in market capitalization from the recent gains, according to data from CoinMarketCap. In the past 30 days, however, the token has still gained over 90%, trading at $9,190 at the time of writing.

The Yearn.finance team hasn’t disclosed any official details about the incident. A source familiar with the matter told Cointelegraph that developers on the team do not control the majority of the token supply, strongly refuting initial concerns about a potential scam. The claim is supported by Etherscan data showing large centralized exchanges as YFI top holders.

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Former Bithumb chair faces 8-year imprisonment

November 18, 2023 Coin Telegraph

Bithumb

According to prosecutors, Lee Jeong-hoon intended to revamp Bithumb’s governance to gain from exchange coins, circumventing financial regulations.

Lee Jeong-hoon, the former chair of Bithumb, one of South Korea’s major cryptocurrency exchanges, is at the center of a legal battle and might be facing an eight-year prison sentence in the appeal whose verdict is scheduled for Jan. 18.

According to Korean local media reports, prosecutors contend that Lee intended to revamp Bithumb’s governance to gain from exchange coins, circumventing financial regulations. They claim Lee knew about challenges in the BXA Coin listing but didn’t disclose it to Kim. Despite listing issues, Lee purportedly received payments without informing Kim about the decision not to list BXA Coin.

The South Korean prosecutors requested an eight-year prison sentence for Lee Jung-hoon.

Lee’s defense challenges these assertions, pointing out discrepancies in Kim’s statements and questioning his reliability. Lee insists on Kim’s competence to lead Bithumb, maintaining that Kim was informed about the progress of BXA Coin’s listing.

Lee Jeong-hoon faces legal issues related to accusations of violating the Act on Aggravated Punishment for Specified Economic Crimes, particularly fraud. The prosecution alleges his involvement in a 110 billion won fraud scheme with BK Group Chairman Kim Byung-geon. The charges originate from a deal in which Lee purportedly presented Kim with the chance to acquire and jointly manage Bithumb, along with commitments to list BXA on the platform.

The decision on Lee’s appeal might set a precedent for legal proceedings involving cryptocurrency exchanges and governance. This development coincides with Bithumb’s preparations for an IPO on KOSDAQ by 2025.

The appeal’s result will significantly impact Bithumb’s future and the fate of BXA Coin. A guilty verdict might trigger a reassessment of governance frameworks in cryptocurrency exchanges, potentially resulting in increased regulatory scrutiny.

While the cryptocurrency community and investors anticipate the appeal outcome, the case underscores the industry’s dynamic nature and the necessity for well-defined regulatory frameworks to tackle governance issues and uphold trust among investors and stakeholders.

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Blockdaemon among founders of BSN Spartan Network governing body

November 16, 2023 Coin Telegraph

China

The BSN Foundation’s “non-cryptocurrency” approach aims to create a stable network that would not be as volatile as traditional cryptocurrencies like Bitcoin.

The Singapore-based BSN Foundation, a global blockchain infrastructure organization, officially announced its launch with five international founding members on Nov. 16.

BSN’s founding members include the institutional digital asset wallet Blockdaemon, the blockchain infrastructure automation platform Zeeve, the digital asset creation platform Toko and tech firms GFT Technologies and Red Date Technology.

The newly formed BSN Foundation will serve as the governing body of the BSN Spartan Network, a public infrastructure network based on the open-source BSN Spartan data center software. The foundation’s launch marks one of the most significant milestones on its path to global expansion and its ambitions to establish a new international standard for decentralized IT infrastructure.

“The BSN Foundation launch is a vital step in our global expansion, demonstrating the international recognition and support for the BSN Spartan Network’s concept and goals,” Red Date Technology vice president of global business, Tim Bailey, told Cointelegraph. The foundation is launched with participation from organizations across different regions across the world, including the United States, Germany and Hong Kong, Bailey noted, adding:

“These organizations bring expertise in areas like blockchain-as-a-service, asset tokenization, financial services, and consulting, highlighting the wide applicability and potential of the BSN Spartan Network.”

Bailey stressed that the BSN Spartan Network is designed to significantly shift how the public chain technology is utilized and governed.

“By focusing on non-cryptocurrency public chains and a decentralized governance model, we’re not just innovating in technology but also in how global collaborations can shape the future of IT infrastructure,” the exec said. BSN’s approach ultimately aims to create a “more stable and accessible network” for businesses worldwide, moving away from the volatility associated with traditional cryptocurrencies like Bitcoin (BTC).

Launched in September 2022, the BSN Spartan Network features a non-tradable token (NTT), a digital token issued on the default chain of the BSN Spartan Network. Each BSN Spartan data center has only one registered NTT wallet to manage and hold NTT, which can be purchased with fiat currency, designated stablecoins or acquired through incentive programs.

Despite the BSN Spartan Network launching just about a year ago, its idea originated long before. The network was started in China as the “Blockchain-based Service Network” in early 2020 and was launched with support from the Chinese government.

“BSN was indeed originally initiated in China. However, the BSN Spartan Network, governed by the Singapore-based BSN Foundation, is distinct from the BSN Networks in mainland China,” Bailey stated. He emphasized that the BSN Spartan Network is built using international standards, completely open source and operates separately from the BSN Networks in mainland China.

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Philippines to sell $179M in tokenized treasury bonds for the first time

November 16, 2023 Coin Telegraph

bonds

Real-world asset tokenization as a concept has existed for some time. However, in 2023, with the growing interest of institutions, various governments have started experimenting with the idea.

The Philippines Bureau of the Treasury announced it would offer 10 billion pesos ($179 million) of one-year tokenized treasury bonds for the first time after canceling the traditional auction scheduled for Nov. 20.

The Bureau of the Treasury will offer the tokenized bonds to institutional buyers at minimum denominations of 10 million pesos with increments of 1 million pesos. The bonds will be valid for one year and due in November 2024. The final interest rate will be disclosed on the issuance date, according to a report by Bloomberg.

The bonds will be issued by the state-owned Development Bank of the Philippines and the Land Bank of the Philippines.

When asked whether the government is exploring continuous use of tokenized real-world assets and bonds, Deputy Treasurer Erwin Sta said it will “continue to study the technology and test how far we can take it.”

The move by the Philippines to issue tokenized bonds over traditional ones comes amid a growing interest of Asian governments in the tokenized bond market. In February, Hong Kong issued $100 million in tokenized green bonds under its Green Bond Programme. The government used Goldman Sachs’ tokenization protocol to tokenize the bonds with one-year validity.

Another Asian country, Singapore, recently launched a series of pilots on tokenizing real-world assets in partnership with JPMorgan, DBS Bank, BNY Mellon and investment firm Apollo. The United Arab Emirates has also teamed up with HSBC to carry out the tokenization of bonds.

Apart from the growing popularity of blockchain-based real-world asset tokenization in Asia, Israel’s Tel Aviv stock exchange also completed out a proof-of-concept for tokenizing fiat and government bonds.

The tokenization of real-world assets using blockchain technology has gained popularity among governments recently. The trend has also gained momentum fuelled by the interest of financial giants like JPMorgan, HSBC and others.

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Solana (SOL), Avalanche (AVAX) and dYdX produce double-digit gains as Bitcoin reclaims $37K

November 15, 2023 Coin Telegraph

Solana (SOL), Avalanche (AVAX) and dYdX produce double-digit gains as Bitcoin reclaims K

Adoption

SOL, AVAX and DYDX rank among the top-performing altcoins this month. Cointelegraph investigates what is behind the move.

On Nov. 15, several altcoins continued to show strength alongside Bitcoin (BTC), which notched an intra-day high at $37,400. Leading into the week, DYDX, Solana’s SOL (SOL) and Avalanche’s AVAX (AVAX) currently reflect double-digit gains, with each chasing after new year-to-date highs.

The sustained bullish price action from altcoins has led some analysts to declare the arrival of an altcoin season , and at the time of writing, the total market capitalization of the altcoin market has hit a 2023 high at $659.5 billion.

Altcoin price rallies typically involve a slew of factors, some being sentiment-based and others based on project fundamentals. Let’s look at a few of this week’s top market performers to see what catalysts underlie their growth.

dYdX fee switch boosts price

The platform behind the DYDX token is dYdX, a decentralized exchange that offers futures contracts on Ethereum Virtual Machine blockchain tokens like Ether (ETH). On Oct. 27, dYdX launched its layer-1 blockchain with the creation of its genesis block, which operates using native DYDX tokens. The launch allowed for the on-chain distribution of all fees received to validators and stakers. The protocol update has been fantastic for DYDX’s price, sending it up over 110% in the past 30 days.

In addition to token price appreciation, the dYdX platform is posting substantial user numbers, including increased fees and revenues. Both metrics have witnessed 77.5% increases to $8.67 million in 30 days. Annualized, this could mean $105.5 million in fees for validators and stakers.

*DYDX fees and revenue. Source: TokenTerminal*

SOL price hits another 2023 high

Solana’s SOL token has had an impressive 30-day return profile, gaining over 166%. Despite reaching a 2023 high on Nov. 10, Solana’s price is still over 4x below its all-time high of $259.96.

Solana’s price growth has been powered by an uptick in users, which is led by the top-performing decentralized application on the blockchain, Jito, a liquidity staking platform. Solana’s daily active users also hit a 2023 high on Nov. 10, reaching 200,000. Coinciding with the increase in users, Solana’s revenue has eclipsed $1 million in 30 days, recording a 78.2% increase.

*Solana daily active users and revenue. Source: TokenTerminal*

Avalanche’s AVAX token picks up steam

Avalanche is a layer-1 blockchain similar to Solana, where validators process transactions and receive tokens. Compared with Solana and dYdX, Avalanche brings in less revenue, but that hasn’t stopped its token from going on a double-digit run this week.

*dYdX, Solana and Avalanche fees. Source: TokenTerminal*

Despite being relatively smaller, AVAX has been performing well. In the past seven days, AVAX reached above 59% in gains, and it hit an impressive 118% growth in 30 days. AVAX’s price is still more than 7x below its all-time high.

While these three altcoins are performing well, Bitcoin continues to dominate the overall market, with its dominance rate hovering above 50% since Oct. 16. When Bitcoin dominance decreases, those funds typically flow into altcoins, which is generally the start of an altseason.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Tokens