Blockchain Confidential - 28 January 2022
Diem, Polymarket, yet another Bitcoin ETF: goodbye to all that
The Week
The Fantom network is now the third-largest DeFi ecosystem, though Ethereum-based protocols still account for over 60% of Total Value Locked (TVL). Robinhood now allows its users to withdraw Bitcoin from their platform, and NYC-based Flushing Bank is plans to offer Bitcoin services, allowing customers to buy, sell and hold Bitcoin. American Express suggested they may allow credit card points to be used to purchase crypto in the future, though a full crypto-linked credit card is not coming anytime soon according to their CEO.
In NFT and metaverse, YouTube’s CEO hinted that their may support NFT integration in the future, though with very little detail. On the heels of Twitter’s NFT profile picture integration, Reddit is testing a feature to do the same.
In addition to the YouTube initiative, Alphabet’s Google Cloud unit is looking to expand its blockchain support, establishing a new Digital Assets Team. And finally, the biggest news at the intersection of Big Tech and Web3 was probably the wind-down of Facebook’s ill-starred Diem project after extensive pushback from global regulators against its plans to launch its own stablecoin; its foundation is selling its assets to Silvergate Bank.
The Good Read
Yifei Wang continues his exploration of the intersection of crypto data and data science on Medium, and it’s well worth following if you are interested in applying these tools to blockchain transactions and smart contract events. Read What is crypto data? A practical guide for data science practitioners.
Regulator Radar
Some proponents for a digital dollar — a U.S. CBDC — highlight geopolitical considerations. Bank of America made the case this week in a research note. The SEC pushed back on MicroStrategy’s accounting, in particular its non-GAAP reporting that excludes Bitcoin impairment charges. Once again the SEC rejected a spot Bitcoin ETF, this time one from Fidelity. And last but not least, the SEC’s probes into interest-bearing DeFi accounts from Celsius and others appears to be broadening; this follows on actions from multiple state regulators and an earlier rejection of a similar offering from Coinbase. After an enforcement action by the CFTC, the prediction platform Polymarket started geoblocking U.S. customers. Finally, Gemini Galactic became the most recent firm to register as a broker/dealer with FINRA and the SEC.
The IMF tells El Salvador to drop Bitcoin almost as often as the SEC rejects Bitcoin spot ETF’s, and they did so once again this week. On the CBDC front the Bank of Korea joins the list of successful pilots, with a second phase underway. Japan’s DeCurret is adopting a multi-issuer approach for its digital yen project, with multiple banks able to issue the CBDC; trials are about to start. The BIS Innovation Hub, which has been helping coordinate and seed many CBDC projects, announced an expansion into looking at DeFi for 2022. The hardware wallet Trezor is integrating a strict Swiss AML standard into its products. Finally, in Russia, after lots of noise about bans President Vladimir Putin expressed interest in regulating Bitcoin mining, with a view that the country has a “competitive advantage” in the space, and the Bank of Russia announced a roadmap to introduce new regulation by year-end.
At the Office
Everyone has been heads-down sprinting toward our first demo in late March. We got a basic Web front-end connected to a GraphQL-based backend with simulated ticking portfolio data and live-updating grids, and also demonstrated deploying it all in a local Kubernetes setup. We also got a local Envoy HTTP proxy working to sit in front of all of the microservices that will make up Serenity. The whole of DevSecOps and Research also moved over to a brand-new Azure DevTest Labs-based cloud development environment so everyone has identical Docker and devcontainer setups now whether on Mac or PC. Sonakshi Rohra from the National University of Singapore joined Cloudwall Capital SG as a Research intern, and Ilya has started building Serenity’s first risk models.