Crypto Guides, Knowledge & Insights

Anchoring the worlds with flexible and high-performance on-chain governance

With adoption accelerating, blockchains potential to transform life in every way — from how business is conducted to labor division, operating systems and methods of collaboration — comes closer to fruition every day. If blockchain is the foundation to a truly digital model, then governance is the key to linking together the on and off-chain worlds. Governance itself encompasses and dictates the functionality of blockchain, from its organization structure to workflow execution, voting and incentives.　　Conceptually, governance can be understood as on and off-chain; the former being divided into protocol and contract levels. With the blockchain space rapidly diversifying, governance is also rapidly evolving to drive new and novel forms of collaboration, interaction, profit distribution and risk structure, based on each chains unique profit value.　　Todays on- and off-chain governance paradigms　　Moving forward, I believe there are several premises that must be accounted for when building governance frameworks.　　First, the digital world cannot be separated from reality. Like the off-chain world, on-chain governance also includes a two-tier structure, under which governing units serve as capital for users to engage in various democratic processes. Moreover, external on-chain governance components such as, server clusters, nodes and other infrastructures, dictate how capital rights and interests are addressed.

2021-04-12Deep Dive

Volatility Is Crypto’s Best Friend

Volatility is good for crypto. It serves multiple purposes as the whole crypto ecosystem matures, which we have to remember is an industry and technology that is still only just over a decade old. New and emerging industries are by their nature volatile as they move towards mainstream adoption. But the volatility attracts people, investors, and technologists, who drive the pace of adoption forward and as it grows, volatility naturally decreases. In the case of bitcoin (BTC), its volatility has steadily been decreasing over time and even the recent sharp moves have not seen such a big rise in volatility compared to earlier swings.　　Bitcoin price and volatility chart　　　　Source: www.buybitcoinworldwide.com　　Volatility continues to attract participants as it is unquestionably in our human nature to be drawn to assets that are subject to rapid price appreciation. Throughout history, there have been numerous asset bubbles that have burst, with Dutch tulips of the 1600s being the one that most referenced in relation to crypto-assets. But do tulips really provide any utility apart from looking and smelling good？ Many crypto-assets actually provide a purpose, a utility, and serve as the backbone to new technology protocols upon which useful apps are being built. This is why

2021-04-12Deep Dive

With Banks Turning to Bitcoin, Is It Finally Time to Long the Bankers?

The banks are coming. After years of derision and suspicion, major banks are gradually warming to Bitcoin (BTC), with many major financial institutions beginning to roll out crypto-related services.　　In the past, much of the Bitcoin community was taken to declaring, “Long bitcoin, short the bankers.” But now that the likes of Goldman Sachs, Morgan Stanley, BNY Mellon, State Street, Deutsche Bank and others are entering the crypto space, is it now to long banks as well as BTC？　　According to industry players speaking with Cryptonews.com, involving themselves in crypto will be a large net positive for banks with few risks (assuming that they dont hold crypto themselves). Likewise, while certain commentators suggest that a large bank-based custodial layer could create systemic risk for crypto, others claim that the involvement of banks will largely make crypto more secure and stable.　　Banks jump on the bandwagon = the bandwagon speeds up　　It seems that barely a fortnight is going by without some major bank or financial institution announcing that its dipping its toes in crypto in one way or another.　　Back in February, Americas oldest bank BNY Mellon revealed that it was rolling out services for its wealth management clients, who could buy, hold and sell

2021-04-12Deep Dive

Next Cryptocurrency to Explode in 2021? 8 Tokens on Watch Thanks to the Coinbase IPO

The upcoming Coinbase IPO has investors clamoring to find the next big cryptocurrency　　Crypto-watch 2021 is becoming more and more interesting by the day. As industry leader Bitcoin (CCC:BTC) slows its roll, investments in altcoins are ramping up. Especially ahead of the Coinbase IPO, it seems Wall Street is seeking out the next cryptocurrency to explode in 2021.　　The Coinbase IPO happening next week has been allowing smaller crypto tokens to shine. Four new coins are launching on the Coinbase Pro platform today, and as such, are seeing plenty of growth. An additional four exchange tokens are getting big and quietly building steam into Q2.　　Let‘s take a look at these eight crypto plays and evaluate how they’re doing so far.　　Could a Newly Listed Coin be the Next Cryptocurrency to Explode in 2021？　　Coinbase is listing four new tokens on its platform today ahead of its IPO. Recently, they have all seen rapid growth, and the new offering could lead to more upward swings.　　In fact, one crypto analysis firm said that Coinbase listings have a particular impact on the market. Because it is the largest cryptocurrency exchange in the United States, tokens tend to see high returns in the days following their listings. During

2021-04-11Deep Dive

10 Largest Venture Rounds In Crypto And Blockchain

The cryptocurrency industry is steaming hot. The total market value of cryptocurrencies is approaching $2 trillion - thats bigger than the market caps of Amazon, Google and Microsoft. Bitcoin has been trading above $50,000 since March 8 and has a market value of $1.12 trillion, almost as much as all the silver in the world. FOMO-ed institutions keep pouring into the space. Tesla will start accepting payments for its electric vehicles in bitcoin, adding the cryptocurrency to its $2.5 billion bitcoin trove. One of the oldest banks in America, BNY Mellon, has launched a digital assets unit, Goldman Sachs has relaunched its crypto trading operations, JPMorgan has introduced a structured note offering tied to a basket of stocks with exposure to bitcoin, Morgan Stanley and Goldman Sachs have become the first major U.S. banks to offer their wealthy clients direct access to bitcoin.　　But institutions and venture firms rushing to cash in on the surge don‘t come empty-handed. Hoards of capital are pouring on crypto startups, minting new unicorns at a break-neck pace. Just in March, three crypto firms raised some of the largest capital raises in the industry’s short but rich history. There are now at least 18 crypto-native companies

2021-04-09Deep Dive

Crypto Wallet Maker Ledger Faces Lawsuit Over Data Breach 'Cover Up'

Customers of the cryptocurrency wallet provider Ledger are suing over a massive data breach.　　The initial complaint, filed with the US District Court for the Northern District of California, alleges that Ledger and Shopify (an e-commerce platform thats partnered with Ledger) “negligently allowed, recklessly ignored, and then intentionally sought to cover up” the breach. Any damages awarded to the plaintiffs would be determined at trial, should the lawsuit get that far.　　Ledger sells hardware wallets, which are physical storage devices that let you hold crypto offline; the idea is that theyre less vulnerable to attacks than crypto stored on the internet.　　Last July, the company announced that hackers had acquired 1 million customer emails from its servers, along with a list of associated email addresses. No funds were stolen, but users say that the exposed list of customer identities is potentially just as bad.　　“To the world of hackers, Ledger‘s customer list is gold,” explains the complaint. “It is a list of people who have converted substantial wealth into anonymized crypto-assets that are transferable without a trace. Using that list, hackers can manipulate or compel those owners to make untraceable and irreversible transfers of the crypto-assets into the hackers’ accounts. The stakes of security

2021-04-09Deep Dive

Bank of Russia Plans Prototype for Its Digital Ruble Design in December

The Bank of Russia presented a new concept for the digital ruble, a central bank digital currency the regulator has been contemplating since late last year, at a press conference on Thursday.　　A prototype of the digital ruble will be created by this December, said Bank of Russia First Deputy Governor Olga Skorobogatova. The regulator also published a fresh report on the current state and future plans for the project.　　The digital ruble will live in a hybrid technological platform combining distributed ledger technology (DLT) and centralized control by the Bank of Russia. The regulator hasnt picked any particular DLT platform yet, Skorobogatova said, adding that the Bank of Russia will likely use open-source code to build its own proprietary product.　　In 2022, the Bank of Russia will draft the necessary regulatory norms for integrating its version of a central bank digital currency (CBDC) into Russias financial system, as well as pilot the prototype with banks and other financial institutions, according to the report.　　“We‘ve been looking at many projects, and many would like to say they have a ready-to-use product, but [they don’t] work for the digital ruble,” Skorobogatova said.　　One thing is clear: The Bank of Russia wants smart contracts on its platform

2021-04-09Deep Dive

Investor or Creator? How to Pay Taxes on NFTs

Key Takeaways　　NFTs are property, just like Bitcoin and Ethereum.　　NFT creators will pay ordinary income tax as they would when producing and selling a physical product.　　NFT investors could have their property taxed as collectibles, bringing a higher long-term capital gains rate.　　The NFT market is booming, but many participants are still in the dark when it comes to their tax liability. Crypto Briefing spoke with Gilded CFO Joey Ryan to clear things up.　　Paying Taxes on NFTs: Creators and Investors　　Gilded is a non-custodial solution for businesses that transact with cryptocurrency. Founder and CFO Joey Ryan became interested in crypto and blockchain because it has proved transformative for the accounting industry.　　While there are finally a growing number of tax education resources available for DeFi taxes and crypto taxes, tax information for the non-fungible token (NFTs) industry is still sparse.　　“NFTs are taxed as property, just like other cryptocurrencies (BTC, ETH, etc.) Their tax treatment depends on whether you are a creator or an investor in NFTs,” said Ryan.　　According to Gildeds founder, “NFT creators are taxed at the time they sell NFTs.”　　This means that creators who mint and sell these non-fungible digital assets should be reporting income as ordinary income, just as the producers of a

2021-04-09Deep Dive

NFT Tracking Metaverse Index (MVI) Launched by Index Coop

The new Metaverse Index will follow the leading tokens and projects in the NFT and virtual metaverse space. It has been launched by Index Coop, a DAO specializing in creating crypto-economy index tokens.　　In the early years, cryptocurrency indexes like C20 gave investors broad exposure to the top-performing assets in the industry. Then came the DeFi indexes such as the DeFi Pulse DPI which did the same for DeFi-related tokens.　　Now the first NFT-focused index has been launched. It aims to provide exposure to the top assets in the burgeoning digital art, collectibles, and virtual metaverse scene.　　 MVI launches on TokenSets　　The MVI launched on the Tokensets platform. It uses Set Protocol smart contracts with 15 metaverse and NFT tokens listed. These include Enjin Coin, Decentraland, SAND, Axie Infinity, RedFOX Labs, and a number of others.　　Each month, it analyzes factors like liquidity, market cap, and a number of other determinants, before rebalancing. ENJ currently has almost 20% exposure while MANA is second with just under 12%.　　It also launched with liquidity mining incentives. It offers stakers of the new MVI/ETH pool LP tokens that receive INDEX rewards during a 90-day program. These tokens are from the Index Cooperative and different from the MVI tokens

2021-04-09Deep Dive

Ledger faces class action from phishing scam victims

Ledger and Shopify have been hit by a class action lawsuit over a major data breach that saw the personal data of 270,000 hard wallet customers stolen between April and June 2020,　　Phishing scam victims John Chu and Edward Baton filed the lawsuit in California against the crypto wallet provider and its e-commerce partner Shopify on April 6.　　The Plaintiffs alleged that the firms “negligently allowed, recklessly ignored, and then intentionally sought to cover up” the data breach. The data was stolen when rogue employees of Shopify accessed the companys e-commerce and marketing database for Ledger, with the hackers then selling the data on the dark web.　　“Had Ledger acted responsibly during this period, much of that loss could have been avoided,” they claim.　　The pair are seeking redress for the damages caused by the breach, requesting “all relief allowed by law, including injunctive relief.” Chu lost $267,000 worth of BTC and ETH, and Baton lost $75,000 worth of XLM in phishing scams that impersonated correspondence from the firms.　　The data, spanning full names, email, phone numbers, and shipping addresses, was eventually posted on the website RaidForums in late December. The lawsuit accuses Ledger in particular of failing to “individually notify every affected customer or

2021-04-09Deep Dive

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