One of the most interesting developments in the last week has been the launch of FedNow, an instant payment settlement service for banks and financial institutions from the Federal Reserve. Up until now, settlement times between banks in the United States vary between one to three days. The promise of FedNow is instant settlement for… Read More On FedNow
In its almost fifteen year existence, crypto has produced many a tale. The latest one is that of payments app Strike. The app claims to use the Lightning Network (LN), bitcoin’s second layer, to expedite cross-border payments and make them cheaper. That network is still under construction and has myriad problems. But that hasn’t stopped… Read More The False Promises of Payments App Strike
Regulators around the world have begun taking tentative steps to regulate crypto and digital assets. Such assets are a new frontier in finance. And available evidence does not encourage much trust or confidence in their value or, for that matter, utility. How, then, should they be regulated? A panel discussion at the Bank of International… Read More How to Regulate Crypto
Slightly more than a month after Ethereum enabled withdrawals of staked ether on its platform, the landscape for staking presents a rosy picture on the surface. The numbers of staked ether and platforms offering staking services has multiplied. Ether’s staking yield, which was expected to decline after withdrawals, popped after the event. Underneath, however, the… Read More Ethereum Staking After Withdrawals
The cases brought by the Securities and Exchange Commission (SEC) against Binance and Coinbase earlier this week instigated steep price declines in crypto prices and a war of words between regulators and the industry’s biggest players. It makes for great drama and news cycles. But will it make a ‘consequential‘ difference to the ecosystem? Not… Read More Notes 6/8: Inconsequential Lawsuits
The surge in market capitalization for Tether always brings the stablecoin’s many mysteries into the spotlight. Who runs it? Who are its bankers? And, most important of all, where are its reserves? Tether claims to be a fiat-backed stablecoin. This means that its circulating supply should be bolstered by an equal amount of fiat currency… Read More The Tether Algorithmic Stablecoin
When it was launched, Ethereum had a simple vision. It was to be a smart contract platform with low fees that settled transactions occurring on other applications. That idea is now a corporate money-making entity. Investors and stakeholders use the venue to boost staking rewards and prices for worthless tokens. Examples include the recent meme… Read More Ethereum’s Latest Bad Idea: Restaking
It is yesterday once more in the bitcoin ecosystem. The recent spike in bitcoin transaction fees has surfaced memories of similar occurrences in the past. Those fee hikes were also instigated by spurious activity on bitcoin’s network and set off a debate in its community about the size of blocks on bitcoin’s network. The Importance… Read More The Future of Bitcoin and its Transaction Fees
The murky waters of cryptocurrencies consist of many worthless tokens. The Gemini dollar (GUSD), a stablecoin issued by cryptocurrency exchange Gemini, is one of them. The token serves no purpose in crypto or outside its ecosystem. It claims to be “regulated from day one” to alleviate user concerns about a run on its holdings. But… Read More Why Does GUSD Exist?
This past week threw crypto’s banking problems into sharp relief. Silvergate Bank was arguably the biggest provider of banking services to the crypto industry and its unraveling will significantly reduce options available to crypto businesses for access to the world of mainstream financial services. As I wrote last year, three banks – Silvergate, Signature, and… Read More The Future of Crypto Banking
Where does Tether get its revenues? Over the years, the stablecoin claims to have made redemptions worth billions of dollars. At the same time, it has made investments and loans worth millions of dollars to crypto ventures on the side. It has 42 employees, per LinkedIn. Where does it get the cash to manage… Read More Where Does Tether Get Its Revenues?
Binance USD (BUSD), Binance’s stablecoin, is among the few regulated parts of the exchange’s sprawling and mostly unregulated operations. It is issued by Paxos – a registered Trust company in New York that was a cryptocurrency exchange in its earlier avatar – and regulated by the New York Department of Financial Services (NYDFS). That stamp… Read More Notes 12/31: Binance’s BUSD: An Unstable Stablecoin
As a concept for collective governance, decentralized autonomous organizations (DAO) are replete with hip buzzwords and ideas. Their practical implementation, however, is clunky. The latest example is that of Ooki DAO – a margin lending platform that is being sued by the Commodities Futures Trading Commission (CFTC). The agency contends that Ooki DAO violated investment… Read More Reckoning With DAO Governance
Central bank digital currencies (CBDC) are becoming popular among countries. According to the Atlantic Council’s CBDC tracker, 105 countries, representing 95 percent of the world’s GDP, are developing digital versions of their national currency. Eighty-one countries were exploring the use of CBDCs in their economy last August. CBDC development accelerated in the aftermath of Russia’s… Read More Notes 10/4: CBDC Development, An Opening for Crypto?
The fallout from the Treasury Department’s sanctions on Tornado Cash continued this week. The department’s Office of Foreign Assets Control (OFAC) claims that the crypto-mixing service, which is a decentralized application (dApp) running off Ethereum’s blockchain, was used by hackers in North Korea to launder more than $7 billion worth of cryptocurrencies. Privacy activists in… Read More Tornado Cash Sanctions Become Rallying Cry For Crypto Privacy Activists
Bitcoin’s emergence as an asset class has been tumultuous. Amidst a raucous debate about its utility, the cryptocurrency’s price volatility has transfixed investors and traders looking for short-term profits. But they do not have much choice in terms investing avenues because the cryptocurrency remains largely outside the perimeters of regulation. Instead, players have crafted unique… Read More Delving Into MicroStrategy’s Bitcoin Bet
UST. Celsius. Three Arrows Capital. The list of crypto’s casualties in the current downturn is growing by the day. There’s more bad news ahead. Experts say that the crypto ecosystem is due another capitulation event. “Some giant player will go to zero [soon],” Shark tank personality and crypto investor Kevin O’Leary told Coindesk recently. The… Read More Will Tether, Crypto’s Biggest Stablecoin, Be Its Next Casualty?