Crypto Guides, Knowledge & Insights

Bitcoin ETF battle heats up as BlackRock closes in on Grayscale

It has been three months since spot bitcoin ETFs began trading and BlackRocks fund appears to be on pace to usurp Grayscales as the biggest of the crypto-based investment vehicles on offer.　　According to Trackinsight data compiled by The Block Data Dashboard, BlackRocks IBIT fund had $18.2 billion in assets under management compared to Grayscales $23.2 billion.　　As Grayscales GBTC fund, which charges a higher fee than BlackRocks, has consistently shed capital since it began trading, BlackRocks ETF has been slowly narrowing the gap in terms of assets under management, or AUM. Grayscales fund had about $23.4 billion in AUM two months ago compared to BlackRocks $4.4 billion, according to The Block Data Dashboard.　　Grayscales ETF started with nearly $30 billion in AUM as the firms exchange-traded fund is a conversion of its flagship fund. The funds declining AUM is likely due, in part, to Genesis selling GBTC shares, said Eric Balchunas, senior ETF analyst at Bloomberg.　　In terms of trading volume, Grayscales fund has also been gradually losing market share, down from about 50% when the spot bitcoin ETFs launched on Jan. 11 to 23.5% as of Tuesday.　　Grayscale‘s fund shed $154.9 million in outflows on Tuesday, while BlackRock’s took in $128.7 million in

2024-04-11Deep Dive

MarginFi sees $155 million outflow amid leadership shakeup

Edgar Pavlovsky, the creator of Solana-based crypto lending and borrowing platform MarginFi, announced his departure from the protocol on Wednesday due to internal disagreements. This has largely caused major outflows from one of the most used DeFi protocols on Solana.　　According to DefiLlama, MarginFi saw net outflows worth $155 million from around Pavlovskys resignation announcement. Its total value locked also dropped to $524 million, compared to$738 million on Tuesday and $811 million on April 1.　　“I don‘t agree with the way things have been done internally or externally,” Pavlovsky wrote on X. “I’ve told everyone involved I dont really care about tokens, or money, or any of that.”　　Pavlovsky added that the departure is ultimately his failure as founder of MRGN Inc., the company behind the DeFi project.　　MarginFi also confirmed Pavlovskys exit, noting that its products and operations are unaffected. “His departure is a function of internal operational disagreements and of his own personal reasons, and we respect his privacy,” MarginFi said in its X post.　　Pavlovsky‘s resignation came just hours after Solana liquid staking protocol SolBlaze posted its accusations against MarginFi, claiming that it acted in bad faith by not distributing tokens allocated to users per SolBlaze’s depositor reward guidelines. SolBlaze rewards BlazeStake

2024-04-11Deep Dive

Policy Analysis: Uniswap Receives Wells Notice from SEC

Uniswap founder Hayden Adams announced on social media that Uniswap has officially received a Wells Notice from the SEC. In response to this news, the price of UNI dropped by over 5%, falling from 11.2 U to a low of 9 U, and is currently trading at around 9.4 U.What is Wells Notice？　　The Wells Notice is a letter sent by the SEC after concluding an investigation into an individual or company, informing them that the SEC intends to take enforcement action against them. The notice informs the investigated party that the SEC has concluded they violated securities laws. It indicates that the SEC has identified potential litigation and provides the notified party with an opportunity to explain why enforcement action should not be taken.　　Key elements include: the SEC has preliminarily characterized the investigated company and its operations, but its not a formal, final complaint, and the investigated company still has the opportunity to respond. In essence, receiving a Wells Notice means there will be a definite impact and theres a possibility of the situation worsening, but the ultimate outcome cannot be predicted at present.Uniswaps Response　　Hayden Adams stated, “I believe our product offerings are lawful and prepared to fight.” Uniswap issued

2024-04-11Deep Dive

Ex-Ethereum Advisor Steven Nerayoff Sues U.S. Government for $9.6 Billion Over 'Fabricated' Charges

An early Ethereum network adviser is suing the U.S. government for $9.6 billion, alleging federal agents “maliciously” investigated and prosecuted him.　　In a legal complaint filed on TK, Steven Nerayoffs lawyers allege government agents fabricated federal charges against their client in 2019.　　According to the lawsuit, as part of their “collective and concerted fishing expedition,” federal agents subpoenaed, surveilled and even arrested Nearyoff, despite knowing the charges against him were “factually and legally baseless.”　　“Federal agents and officers… launched an unhinged and unlawful, four-year campaign against Mr. Nerayoff,” lawyers said in the complaint.　　Nerayoff was arrested in 2019 for allegedly extorting 10,000 ether from a crypto startup. The legal battle that ensued lasted roughly four years, ending when the US government dismissed the lawsuit in May 2023.　　Nerayoffs lawyers allege that federal agents actions have caused their client “significant damages and injuries.”　　

2024-04-10Deep Dive

Etherfi maintains lead in liquid restaking niche with over $3.8 billion in deposits

Etherfi continues to lead the liquid restaking market, managing over 1.07 million ETH, which translates to roughly $3.8 billion in user deposits.　　Etherfi enables users to access restaking yields via EigenLayer, highlighting its role in the growing niche.　　Liquid restaking has experienced notable growth this year, driven largely by increased deposits on EigenLayer, which intends to utilize ETH deposits to strengthen third-party protocols. This, in turn, boosts the total value locked in LRTs, with Etherfi holding a considerable portion of this value.　　While Etherfi leads liquid restaking, other protocols also contribute hugely to the market. These include Renzo at $2.9 billion, Puffer at $1.4 billion, Kelp with over $840 million, Swell with $345 million, and Eigen at $340 million, according to The Blocks data dashboard.　　Restaking allows users to employ their staked ETH — or a corresponding liquid staking token — on platforms like EigenLayer for restaking purposes. EigenLayer then allocates this ETH to support other Ethereum-based applications, termed “actively validated services”, thereby broadening Ethereums security framework.　　Liquid restaking offers the benefit of engaging with EigenLayer‘s services while maintaining liquidity and accessibility of users’ ETH capital. These protocols continue to accept ether deposits, restake them, and issue derivative tokens, offering users additional incentives to participate

2024-04-10Deep Dive

Rise of New Token Standards: Overview of Popular Token Standards and Their Solutions

Recently, the cryptocurrency industry seems to have experienced a “New Token Standard Trend.” These new token standards implement specific functionalities by embedding new rules into the underlying blockchain. Tokens issued using these new standards also appear to be gaining popularity.　　WikiBit has organized a review of the recent popular token paradigms, hoping to help users discover value while being alert to scams.Difference Between Coin and Token　　Bitcoin, the first blockchain network, was designed to enable people to make global peer-to-peer payments using its native currency, also known as Bitcoin or BTC. Subsequently, similar blockchains emerged, such as Litecoin (LTC) and Dogecoin (DOGE), which serve similar purposes.　　All cryptocurrencies that rely on their own blockchain networks are referred to as coins.　　Later, Ethereum was introduced, introducing the concept of blockchain-based decentralized applications and protocols. Although Ethereum also has its own “coin,” named ETH, and functions similarly to BTC, its primary purpose is to facilitate transactions and operations for applications and protocols built on the network.　　Developers of these applications can create in-app currencies, which do not have their own dedicated blockchains but are stored on Ethereum. With Ethereum, users can also create other forms of independent digital assets, which can be stored on Ethereum in an

2024-04-10Deep Dive

Interpreting the Saga Project: High-frequency, Light-asset Project Solutions

Since its launch on Binance Launchpool, SAGA has attracted over 13 billion US dollars in funding, making it the project with the highest participation in Binance Launchpool history. What is the allure of SAGA that can attract such a large amount of funding？Introduction　　SAGA is a Layer 1 protocol that allows developers to automatically launch specialized chains, called “Chainlets,” which are compatible with different virtual machines, can run in parallel, and are interoperable, providing applications with unlimited scalability. Saga enables developers to start Chainlets with just a click of a button through shared security, cutting-edge validator orchestration, and standardized automated CI/CD deployment pipelines across any type of blockchain virtual machine.　　Developers using SAGA can effortlessly launch dedicated blockchains or mini-blockchains similar to deploying smart contracts. SAGAs network is best suited as a scalable layer for web3 infrastructure. SAGA offers the following features:　　Launch chains without upfront costs　　Provide predictable block space pricing for developers　　Automatically deploy single-tenant applications to their own chain　　Offer developers applications a dedicated shared security chain, ensuring high throughput without relying on other applications using Saga, and making upgrades and congestion mitigation easy.　　SAGA uses shared security to automatically instantiate fully decentralized proof-of-stake chains. Each Saga Chainlet is protected by shared security from

2024-04-09Deep Dive

New York Jury Finds Do Kwon, Terraform Labs Liable for Fraud in SEC Case

NEW YORK – A Manhattan jury has found Terraform Labs and its co-founder, Do Kwon, liable on civil fraud charges brought by the U.S. Securities and Exchange Commission (SEC) in connection with the $40 billion implosion of the Terra ecosystem in May 2022, according to a Friday statement from the SEC.　　The SEC accused Terraform Labs and Kwon of misleading investors about the stability of its so-called “algorithmic” native stablecoin, Terra USD (UST), and the use cases for the Terra blockchain.　　The jury delivered the verdict on Friday, just two hours after lawyers for both the SEC and the defendants gave their closing arguments at the end of the nine-day trial in New York.　　Jurors agreed with the SEC that Kwon and, under his direction, Terraform Labs deceived everyday investors about the nature of the supposed algorithm that kept UST pegged to the U.S. dollar. Though Kwon insinuated that it could “automatically self-heal” in the event of a de-peg, it actually relied on continuous trading activity, including large-scale trading done by institutional investors.　　“We are pleased with todays jury verdict holding Terraform Labs and Do Kwon liable for a massive crypto fraud,” Gurbir Grewal, SEC Division of Enforcement director, wrote in a statement.　　“The defendants

2024-04-08Deep Dive

dYdX experiences chain halt during upgrade, engineers are investigating

The decentralized derivatives exchange protocol dYdX has experienced a chain halt during a scheduled upgrade.　　The outage has been ongoing since 6:50 a.m. UTC, according to an incident report. On-chain data shows block production appearing to stop shortly after, with dYdX engineers currently debugging the issue.　　The incident represents the first major outage for the protocol since dYdX version 4 and its standalone Cosmos blockchain launched on mainnet in October, according to its status page.　　The dYdX Chain was scheduled to undergo its v4.0.0 protocol upgrade today which could potentially disrupt functionalities. Scheduled maintenance was completed at 6:30 a.m. UTC. However, the chain halt issue began 20 minutes later.　　In a status update at 9:21 a.m. UTC, dYdX said the issue continues to be investigated and it has been agreed for network validators to reconvene at 3 p.m. UTC.　　“This means that the devs wont suggest a workaround or a fix until then so that the validators wont get jailed for not being online when the chain restarts,” the team said. When a validator is “jailed,” it means its been temporarily suspended from participating in the network activities.　　The incident does not appear to have impacted the price of dYdXs token, which is up over 4%

2024-04-08Deep Dive

This Week Noteworthy Events(April 8, 2024 - April 14, 2024)

Anticipated Network Delays or Outages on April 8th Due to dYdX Chain v4.0 Software Upgrade　　The dYdX Ops SubDAO announced that due to the deployment of the dYdX Chain v4.0 software upgrade, network delays and potential outages are expected between 16:00 - 17:00 on April 8th (time subject to change).　　Additionally, they reminded that dYdX Chain validators using tmkms or Horcrux need to update to the latest versions of these tools before the upgrade block height.　　Previously, the dYdX community voted in favor of a proposal to upgrade the dYdX Chain protocol software to version v4.0. It is reported that this version upgrade will affect the protocol and network in various ways, including: adding the x/authz module, IBC withdrawal restrictions, conditional order improvements, and upgrading to Cosmos SDK v0.5.Mina to Conduct Devnet Upgrade on April 9th　　The lightweight blockchain protocol, Mina, announced on the X platform that it plans to conduct a Devnet upgrade on April 9th. They state that this upgrade serves as the final milestone before the significant Berkeley upgrade and will introduce easier ZK programmability and other key features to the mainnet. The complete schedule is as follows:　　April 2nd: The release of the archive node migration tool, allowing archive node operators

2024-04-08Deep Dive

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