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 its monthly attestations are suspect because they are issued by … Continue reading 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 Customers – were responsible for banking most crypto firms. After … Continue reading 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 these business activities? The company’s financials are a black box. … Continue reading 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 from authorities allays investor fears about BUSD’s reserves – deposits … Continue reading 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 laws by offering unregistered tokens for sale. It also charges … Continue reading 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 invasion of Ukraine. International payment networks like SWIFT reacted swiftly … Continue reading 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 crypto are decrying the sanctions as an assault on “free … Continue reading 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 investing configurations to provide exposure to the asset class. The … Continue reading 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 chances it might be Tether, the world’s biggest stablecoin, are … Continue reading Will Tether, Crypto’s Biggest Stablecoin, Be Its Next Casualty?