Liz Coyne

On this episode of Blockworks&#8217; podcast &#8220;<a href="https://www.youtube.com/watch?v=N4j2op6uIo4" target="_blank" rel="noreferrer noopener">On the Margin</a>,&#8221; Michael Ippolito, co-founder, sits down with former presidential advisor and economist Dr. Pippa Malmgren. Dr. Malmgren shares insights on the effects of decentralization, creative destruction, debt restructuring, and how crypto fits into her outlook.



They covered: 



<ul><li>Decentralized Finance (DeFi)</li><li>Centralization vs. Decentralization</li><li>Innovation&#8217;s effect on the Future</li></ul>



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<iframe loading="lazy" title="Globalization, Decentralization &amp; Innovation post COVID | Pippa Malmgren" width="1024" height="576" src="https://www.youtube.com/embed/N4j2op6uIo4?start=182&#038;feature=oembed" frameborder="0" allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture" allowfullscreen></iframe>
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&#8220;On the Margin&#8221; is a two-part show.&nbsp;Once a week, Mike interviews industry experts, and then at the end of the week he is joined by co-host <a href="https://cms.blockworks.co/newsletter/" target="_blank" rel="noreferrer noopener">Tyler Neville</a> where they break down the top crypto and macro stories. Episodes go live every Wednesday and Saturday morning.



Subscribe to &#8220;On the Margin&#8221; today on <a href="https://podcasts.apple.com/us/podcast/lyn-alden-explains-connection-between-inflation-bitcoin/id1558223079?i=1000513411286" target="_blank" rel="noreferrer noopener">Apple</a> or <a href="https://spoti.fi/3bTa9uw" target="_blank" rel="noreferrer noopener">Spotify</a>, or watch episodes on <a href="https://youtube.com/playlist?list=PLvER9nHSRN3xVs_p-dl7L7K_ZgL6lSudu" target="_blank" rel="noreferrer noopener">YouTube</a>.

Podcast: The Next Big Economic Disruption

Shalini Nagarajan

Remember Multichain, the bridging network that <a href="https://blockworks.co/news/multichain-anyswap-exploit">suffered unauthorized withdrawals</a> of over $130 million, allegedly involving its CEO?



It suspended operations in July after disclosing that CEO Zhaojun and his sister were behind transferring a large amount of tokens from its bridging networks to externally owned addresses.



Now, some of the platform&#8217;s developers are getting back in the game with a new project, ValueRouter, that looks quite a bit like Multichain.



And it&#8217;s safe to say people don’t like it.



Multichain, previously known as Anyswap, enabled users to bridge their cryptoassets across different blockchain networks.&nbsp;



ValueRouter looks similar, as its <a href="https://www.valuerouter.com/">website</a> explains: “Swap any asset for your desired asset across multiple chains in just one transaction.”



The new venture, <a href="https://twitter.com/MultichainOrg/status/1707604474452177006">announced</a> Friday, seems to enable users to transfer or exchange assets between Ethereum, Avalanche, Optimism and Arbitrum blockchains.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">👏 A salute to the former engineers of Multichain! Even after the team&#39;s disbandment, they continue to forge ahead in Web3, bringing forth <a href="https://twitter.com/ValueRouter?ref_src=twsrc%5Etfw">@ValueRouter</a> . 🌟 Explore <a href="https://t.co/zzp2i9nwGd">https://t.co/zzp2i9nwGd</a> for seamless bridging or cross-chain swaps among <a href="https://twitter.com/ethereum?ref_src=twsrc%5Etfw">@ethereum</a> <a href="https://twitter.com/avax?ref_src=twsrc%5Etfw">@avax</a> <a href="https://twitter.com/optimismFND?ref_src=twsrc%5Etfw">@optimismFND</a> <a href="https://twitter.com/arbitrum?ref_src=twsrc%5Etfw">@arbitrum</a>.…&mdash; Multichain (Previously Anyswap) (@MultichainOrg) <a href="https://twitter.com/MultichainOrg/status/1707604474452177006?ref_src=twsrc%5Etfw">September 29, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
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“ValueRouter is a unified protocol that simplifies multi-chain asset swaps by integrating Circle CCTP and DEXes, empowering developers to build cross-chain dApps and enabling users to effortlessly route assets to any major DeFi platform,” the team said.



It utilizes a multi-party computation system, similar to a multi-signature wallet, which is much like how Multichain operated.



The news sparked surprise among some, with crypto sleuth ZachXBT <a href="https://twitter.com/zachxbt/status/1707611733441815010">suggesting</a> the team should address the $125 million that&#8217;s unaccounted for before embarking on a new project.&nbsp;



Nick SR, who manages social media for the Fantom Foundation, <a href="https://twitter.com/Nick_SR5/status/1707604945816465860">remarked</a>, “Too soon.”



In July, Multichain urged users to halt bridge activities due to unauthorized withdrawals.



The Fantom ecosystem was hit particularly hard by Multichain’s failure; its already suffering total value locked (TVL) cratered following the unauthorized withdrawals, which ultimately <a href="https://blockworks.co/news/multichain-bridge-fantom-dex">forced the Fantom-based SpiritSwap DEX to shut down</a>.


<div class="wp-block-image">
<figure class="aligncenter size-large"><img decoding="async" loading="lazy" width="1432" height="628" src="https://blockworks-co.imgix.net/wp-content/uploads/2023/09/multichain-tvl-defillama.jpg?w=1024&amp;h=1024" alt="" class="wp-image-69481" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2023/09/multichain-tvl-defillama.jpg?w=1432 1432w, https://blockworks-co.imgix.net/wp-content/uploads/2023/09/multichain-tvl-defillama.jpg?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2023/09/multichain-tvl-defillama.jpg?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2023/09/multichain-tvl-defillama.jpg?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2023/09/multichain-tvl-defillama.jpg?w=428 428w, https://blockworks-co.imgix.net/wp-content/uploads/2023/09/multichain-tvl-defillama.jpg?w=470 470w, https://blockworks-co.imgix.net/wp-content/uploads/2023/09/multichain-tvl-defillama.jpg?w=389 389w, https://blockworks-co.imgix.net/wp-content/uploads/2023/09/multichain-tvl-defillama.jpg?w=80 80w" sizes="(max-width: 1432px) 100vw, 1432px" /><figcaption class="wp-element-caption">Fantom TVL; Source: <a href="https://defillama.com/chain/Fantom">DeFiLlama</a></figcaption></figure></div>


Multichain later <a href="https://blockworks.co/news/multichain-founder-family-arrested">revealed</a> that its CEO Zhaojun had been detained by Chinese authorities since late May, and his devices and recovery phrases were confiscated.



Zhaojun&#8217;s family allegedly gained access to the cloud server platform using information from his home computer, and granted only limited access to the team just to address some tech issues.



A Multichain team member earlier <a href="https://blockworks.co/news/multichain-bridge-fantom-dex">told</a> Blockworks that tokens affected by the large withdrawals lacked collateral, leaving users without a quick solution. They added that Zhaojun couldn&#8217;t perform the withdrawals independently as the police controlled the server access.&nbsp;



As of last month, the team had no plans to reimburse users for the unauthorized withdrawals.



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Follow Sam Bankman-Fried’s trial with the <a href="https://blockworks.co/tag/sbf-trial">latest news from the courtroom</a>.

Multichain team pivots after security debacle

Replicating designer merch isn’t a far-fetched idea. A bold few may indeed attempt it, proudly displaying what appears to be genuine accessories.



Web3 startup IYK, which stands for &#8220;If You Know,&#8221; emerged with the concept of ensuring the legitimacy of fashion items and other merchandise, while offering fans unique consumer interactions.



On Thursday, IYK, co-founded by Ryan Ouyang and Christopher Lee, <a href="https://mirror.xyz/iyk.eth/mw-PQ5THEea4NLjLpICEAblFVfgmTJBv7hoffvc6RIA">revealed</a> that it raised $16.8 million in seed round funding.&nbsp;



This round was spearheaded by A16z crypto and included participation from Collab Currency, Lattice Capital, 1kx, Synergis Capital, among others.



IYK — serving clients such as Adidas, 9dcc and VÉRITÉ — is founded on the idea of embedding NFC (near-field communication) chips within merchandise or apparel.&nbsp;



This technology enables consumers to effortlessly tap their smartphones on items like T-shirts to confirm their authenticity.&nbsp;



In exchange, customers receive NFTs and the possibility of exclusive offerings from brands.&nbsp;



Meanwhile, businesses gain insights into their merchandise ownership and maintain direct communication with customers.



Ouyang, one of the co-founders, shared IYK&#8217;s journey in a recent <a href="https://twitter.com/RyanOuyang_/status/1707429724606157269">X thread</a>.&nbsp;



He recounted how he crossed paths with his partner, Lee, in the summer of 2021 on Discord. Together, they ventured into the world of Web3 projects, ranging from NFT sniping bots to online scavenger hunts.



One day, Ouyang found himself frustrated while waiting in a Ticketmaster queue to purchase tickets for a John Mayer concert. Despite being a frequent concertgoer for Mayer’s shows and a top 0.01% streamer, he had to compete against ticket-snatching bots for seats.



This experience made him realize that artists lacked the tools needed to maintain a strong connection with their real-world audience and devoted fans.



The realization sparked the idea that eventually evolved into IYK. After acquiring NFC chips, they set out to create a prototype of their concept.



IYK recently partnered with Adidas for an exclusive limited shirt release tied to NFT NYC 2023. In this collaboration, they created a total of just 152 shirts.&nbsp;



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<blockquote class="twitter-tweet" data-width="550" data-dnt="true">new drip ⛓️<a href="https://twitter.com/adidas?ref_src=twsrc%5Etfw">@adidas</a> + <a href="https://twitter.com/indigo_herz?ref_src=twsrc%5Etfw">@indigo_herz</a>, powered by iyk <a href="https://t.co/sLCadJSfEb">pic.twitter.com/sLCadJSfEb</a>&mdash; IYK (@iyk_app) <a href="https://twitter.com/iyk_app/status/1646705948327567362?ref_src=twsrc%5Etfw">April 14, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
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The company defines its platform as a user-friendly gateway accessible to brands, musicians, artists and creators of all kinds to help them create “digi-physical” products without requiring technical expertise.



IYK&#8217;s recent fundraising is noteworthy in light of the tough funding environment for blockchain startups prevailing today.



The company secured this round after participating in the A16z Crypto Startup School, a twelve-week accelerator program hosted by the venture capital firm, focused on supporting emerging startups within the sector.



Blockchain fundraising has been challenging due to a prolonged slowdown in funding, heightened scrutiny and concerns about the macroeconomic environment.



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A16z gets ‘digi-physical’ with $17M funding for IYK

Katherine Ross

The Securities and Exchange Commission has delayed decisions on several other bitcoin ETF proposals just days after delayed <a href="https://blockworks.co/news/sec-decision-date-bitcoin-etf">decisions for Ark 21Shares and GlobalX</a> until January.



The anticipated <a href="https://www.sec.gov/files/rules/sro/nasdaq/2023/34-98606.pdf">delays</a> filed Thursday focused on BlackRock, Valkyrie, and <a href="https://www.sec.gov/files/rules/sro/nysearca/2023/34-98607.pdf">Bitwise’s</a> bitcoin ETF applications. The SEC initially delayed its decision on the fund on Aug. 31.



On Wednesday, the SEC moved to delay Hashdex’s bitcoin ETF which was expected on or around Oct. 6.



Bloomberg’s James Seyffart <a href="https://twitter.com/JSeyff/status/1707488041663697200">said</a> the delays are trickling in now to get ahead of an expected government shutdown. In a hearing in DC earlier this week, SEC Chair Gary Gensler said a shutdown would leave the regulator with a “skeletal” staff.&nbsp;



BlackRock is the <a href="https://blockworks.co/news/blackrock-clout-bitcoin-etf-approval">most highly anticipated of the bitcoin ETF</a> applications, with the $9 trillion asset manager having an impressive record of approvals from the SEC. Bloomberg’s Eric Balchunas and Seyffart have said that the record stands at roughly 575-1.



Read more: <a href="https://blockworks.co/news/sec-bitcoin-etf-grayscale">Is another SEC bitcoin ETF denial politically untenable?</a>



Prior to the second delay, many of the fund hopefuls had deadlines in mid-October, though — as Blockworks previously reported — industry experts have stressed that the SEC can delay its rulings until the end of the 240-day deadlines.



The delays have left some questioning whether the SEC plans to appeal the Grayscale decision, in which a <a href="https://blockworks.co/news/grayscale-sec-spot-bitcoin-etf">panel of judges sided with Grayscale</a> and asked the SEC to re-examine its application to convert its Bitcoin Trust (GBTC) to an ETF.



As Blockworks noted, there is a 45-day window from the Aug. 29 decision for the SEC to appeal. That would mark Oct. 13 as its final day.&nbsp;



However, as the bitcoin ETFs face further — though expected — delays, the SEC is pushing forward with Ethereum futures ETFs.



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SEC delays BlackRock, Valkyrie spot bitcoin ETFs decision

Ben Strack

While the fate and timeline around US spot bitcoin ETFs remains opaque, the Securities and Exchange Commission appears to have given its blessing to ether futures funds.&nbsp;&nbsp;



Crypto-focused investment firm Valkyrie had filed with the SEC in August <a href="https://blockworks.co/news/valkyrie-eth-futures-etf">to change its Bitcoin Strategy ETF</a> — which holds bitcoin futures contracts — to one that also invests in ether futures. 



The attempt was successful.



The Valkyrie Bitcoin Strategy ETF began adding exposure to ether futures contracts Thursday, a Valkyrie spokesperson told Blockworks in an email. The fund’s new investment strategy is set to become formally effective on Oct. 3, the representative added — at which point its name will change to the Valkyrie Bitcoin and Ether Strategy ETF (BTF).&nbsp;&nbsp;



<a href="https://blockworks.co/news/volatility-shares-eth-futures-etf">Volatility Shares kicked off the latest wave of ether futures ETF proposals</a> with a July 31 filing. Others, including Grayscale Investments, Bitwise Asset Management, ProShares, VanEck, Direxion, and Roundhill Investments <a href="https://blockworks.co/news/eth-related-etf-proposals">quickly followed suit with similar proposals</a> the following week. 



Read more: <a href="https://blockworks.co/news/sec-consider-ether-futures-etfs">SEC now ready to consider ETH futures ETFs, sources say — but what’s changed?</a>



Valkyrie’s different approach — by amending the investment strategy of an existing fund — had put its potential effective date ahead of other proposed issuers.&nbsp;



Industry watchers expect other ether futures ETFs to launch in short order.



Volatility Shares said last month it planned to launch its Ether Strategy ETF (ETHU) on Oct. 12. VanEck posted a video on its X page Thursday — in tandem with a press release — teasing the “upcoming launch” of the VanEck Ethereum Strategy ETF.&nbsp;



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">When you’re ready, ENTER THE ETHER. The VanEck Ethereum Strategy ETF ($EFUT) is coming soon. Read our press release: <a href="https://t.co/4QPOVd5nB2">https://t.co/4QPOVd5nB2</a> <a href="https://t.co/vSF3HzMuvC">pic.twitter.com/vSF3HzMuvC</a>&mdash; VanEck (@vaneck_us) <a href="https://twitter.com/vaneck_us/status/1707419473337033075?ref_src=twsrc%5Etfw">September 28, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
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A VanEck spokesperson did not return a request for comment on the exact timing of that launch.&nbsp;



Eric Balchunas, senior analyst at Bloomberg Intelligence, said in a Thursday X <a href="https://twitter.com/EricBalchunas/status/1707394842827882826">post</a> that the SEC could look to speed up the launch of ether futures ETFs before a potential government shutdown.



The SEC had submitted a range of filings this week delaying its decisions on a number of planned ETFs, including <a href="https://blockworks.co/news/sec-decision-date-bitcoin-etf">a spot bitcoin ETF proposal by Ark Invest and 21Shares</a>. The regulator was not expected to weigh in on that proposal next until Nov. 11.



Segment observers speculated the earlier-than-expected disclosures were also due to the looming shutdown, which Gary Gensler said during a Wednesday hearing would leave the commission with a “skeletal” staff.&nbsp;&nbsp;



Valkyrie’s success in modifying its existing fund to hold ether futures contracts comes nearly two years after the first bitcoin futures ETFs hit the US market.&nbsp;



ProShares launched its bitcoin futures product just days before similar funds by Valkyrie and VanEck went live — a first-mover advantage that <a href="https://blockworks.co/news/bito-on-track-to-be-first-fund-in-history-to-hit-1b-in-aum-in-two-days">helped it quickly amass $1 billion in assets under management</a>.&nbsp;



Several issuers, including Grayscale Investments, filed for ether futures ETFs in May before halting such plans. Sources told Blockworks at the time that the SEC signaled it was <a href="https://blockworks.co/news/sec-ether-futures-etfs">not ready to approve such products</a>.



The SEC did not return a request for comment.



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Valkyrie is the first to provide ether futures exposure in an ETF

As a range of firms chase a spot bitcoin ETF, Ark Invest expects to differentiate by ultimately bringing more exposures than rivals to market, the company’s chief operating officer said.&nbsp;



The Securities and Exchange Commission approving a spot bitcoin ETF would be “just the beginning” for the US crypto ETF space — spurring a “metamorphosis” for digital asset access for TradFi users, <a href="https://blockworks.co/tag/ark-invest">Ark Invest</a> Chief Operating Officer Tom Staudt told Blockworks in an interview.



“We believe firmly that we will have the most encompassing, most complete, most diverse and deepest crypto suite of products in the ETF wrapper in the United States,” he added. “We want to be the crypto solution for the ETF market.”



Like a handful of other fund groups, Ark Invest — in tandem with Europe-based crypto ETP issuer 21Shares — has a proposed spot bitcoin <a href="https://blockworks.co/tag/etfs">ETF</a> in front of the SEC. The Cathie Wood-led firm is <a href="https://blockworks.co/news/sec-decision-date-bitcoin-etf">set to receive a ruling on that product</a> from the securities regulator by Jan. 10.



The firms have also, similarly to competitors, <a href="https://blockworks.co/news/ark-21shares-ethereum-etf">filed for an ETF that would invest in ether futures contracts</a> — a type of fund <a href="https://blockworks.co/news/bitcoin-etf-race-news">expected to launch next month.</a>&nbsp;



But Ark Invest and 21Shares have planned other crypto offerings, such as a fund that would invest in both bitcoin futures and ether futures contracts. Another would blend bitcoin futures exposure with crypto- and blockchain-related equities.&nbsp;



Read more: <a href="https://blockworks.co/news/ark-21shares-spot-bitcoin-etf">Amid spot BTC ETF effort, Ark and 21Shares seek to launch other crypto funds</a>



The two companies then made headlines earlier this month by <a href="https://blockworks.co/news/21shares-ark-filing-for-spot-ether-etf">filing for a spot ether ETF</a>.&nbsp;



“Right now we have seven filings; we don’t think that’s where this will end,” Staudt said. “We think that the regulators and the market are both going to approve and demand more solutions for deeper exposures and more specific exposures.



“Obviously the obstacles and the big opportunities are still ahead of us,” he added.



Though Ark intends to ultimately have the most comprehensive crypto suite, it is not the only one chasing multiple crypto products.&nbsp;



ProShares was <a href="https://blockworks.co/news/first-bitcoin-futures-etf-nears-1b-on-first-day-of-trading">the first to launch a bitcoin futures ETF</a> in October 2021 and also filed for various ether futures-related strategies last month. VanEck, Valkyrie and Bitwise also have live bitcoin futures offerings and intend to broaden their ETF lineups with exposure to ether futures, spot bitcoin and, in VanEck’s case, a spot ether product.



It’s not a stretch for Ark Invest to believe they can become a US leader in the segment given 21Shares is the world’s largest provider of ETPs, according to Nate Geraci, president of The ETF Store. The challenge, he added, will be navigating the “absolutely brutal competitive environment,” particularly when it comes to fees.&nbsp;



“Ark isn’t exactly known as a low-cost leader with their existing product lineup, so the question is how committed will they be to fighting for crypto ETF assets based on fees?” Geraci told Blockworks.



The company has a competitive advantage when it comes to marketing, however, he argued — an asset industry watchers have said will be crucial given the crowd of fund issuers seeking to launch similar funds.



“Nobody in asset management markets their firm and products the way Cathie Wood does,” Geraci said. “That could be a game changer if their crypto ETFs are competitively priced.”



Ark’s focus on the pending US crypto ETFs comes as the firm’s other main priority is bringing its existing, non-crypto innovation strategies to Europe. Last week, the company acquired thematic fund specialist Rize ETF Limited, giving the firm an entry point into that market.&nbsp;



Though Europe already has its share of crypto ETPs trading, Ark could seek to bring some differentiated crypto-related offerings to Europe — and other global markets — down the line, Staudt said.



But the executive noted that right now, getting its crypto ETFs approved in the US is more pressing.



“We’re really intending to not take our eye off the ball at what we think is a critical juncture,” Staudt added. “It’s pretty fair to say the US crypto ETF market is on the precipice of the inflection point.”



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Ark anticipates win in US crypto ETF battle with ‘deepest’ suite, COO says

Darren Kleine

It was only a year after the launch of the Ethereum mainnet that Nick Johnson began building the Ethereum Name Service, or ENS — a tool for assigning human-readable names to otherwise-complicated sequences of letters and numbers that describe Ethereum addresses.&nbsp;



“It was one of the first projects I started working on at the Ethereum Foundation and then spun out to its own organization,” he says, “and we&#8217;ve been building it ever since.”



“I&#8217;m incredibly impressed with what we&#8217;ve achieved,” he says, “but, you know, it&#8217;s only the beginning of what we&#8217;re working on.”



On the 0xResearch podcast (<a href="https://open.spotify.com/episode/6lpKK9idoD1T45FKeuBGYF?si=e89d054e65534682">Spotify</a>/<a href="https://podcasts.apple.com/us/podcast/ens-funding-public-goods-dao-governance-l2-scaling/id1651683074?i=1000629542109">Apple</a>), Johnson details his vision for the future of the service, with plans to make the service “even more useful” with <a href="https://blockworks.co/tag/layer-2-2">layer-2</a> support, an improved user interface and greater functionality.



One priority, Johnson says, is that a user should expect to be able to enter an <a href="https://blockworks.co/tag/ens">ENS</a> name anywhere that an ether (<a href="https://blockworks.co/tag/eth">ETH</a>) address can be entered. A user should “be surprised when it isn’t supported rather than having to check that it is,” he says. “I think we&#8217;re close, but not there yet for that.”



Another crucial element of the vision involves increasing transparency and lowering costs. “That’s our big focus at the moment.”



This work involves rolling out layer-2s for low-cost registrations, Johnson explains, as well as adding enhancements that make it easier for users to issue subnames. These improvements would enable organizations like <a href="https://blockworks.co/tag/coinbase">Coinbase</a> to use either a layer-2 or “host names entirely off-chain.”



With these improvements, name owners would have greater control over the “trust model” of how their names and subdomains are managed, Johnson says. “We&#8217;re focusing on that mostly at the moment by building tooling that makes it easier for people to work on [layer-2],” he says.



<h2 class="wp-block-heading">Do you know Google’s IP address?</h2>



Johnson adds that while it’s been possible to host names on layer-2 for more than a year, it needs to be easier to set up. “What&#8217;s been missing is the easy plug and play tooling that makes it trivial for someone to do that,” he says.



“At the moment, the integration overhead is a bit higher,” he admits. “So that&#8217;s our main focus on the back end. And then on the front end, it&#8217;s all corresponding work to make the usability meet the feature set on the back end.”



Johnson says the company has been speaking to wallet providers to enable the naming of wallets, “which has always been a long term vision of mine.”&nbsp;



“The wallet sign-up flow should include naming the wallet,” he says. “You shouldn&#8217;t have to even know or care what your Ethereum address is any more than you do what your IP address is.”



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“If I asked you what Google&#8217;s IP address was, you couldn&#8217;t tell me because there&#8217;s no reason you would know that — and there&#8217;s no reason you would want to know that,” he says. “And IP addresses are a lot shorter than Ethereum addresses. They&#8217;re a lot easier to memorize.”



“The same degree of usability ought to apply to <a href="https://blockworks.co/tag/ethereum">Ethereum</a>, to crypto in general.”



Setting up a wallet should involve picking a name, Johnson says, that can be pseudonymous and disconnected from other wallets to ensure privacy. “Ultimately, we create accounts because we want to transact with them,” he says.&nbsp;



“At some point, that involves giving that address to someone else or some third party or site or whatever, and this just makes that an order of magnitude easier.”



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Ethereum Name Service is getting easier and cheaper to use, says founder

Bessie Liu

The DAO that governs Ethereum layer-2 network Arbitrum is currently voting to determine whether or not it should invest 50 million ARB ($41 million) into active projects in its ecosystem.



An initial <a href="https://snapshot.org/#/arbitrumfoundation.eth/proposal/0x5e0057920df9a278918e4de4ee1e6de7e2415d2af985e40a6c7a1a4b47a4ce01">snapshot</a> temperature check saw over 65% of participating ARB token holders voting in favor of allocating 50 million ARB to ecosystem participants. 35% of ARB token holders voted to allocate 25 million ARB, and no ARB holders voted against a short-term incentive program.



According to <a href="https://defillama.com/chains">information</a> available on DeFiLama, Arbitrum currently has a market cap of $1.7 billion and a market cap to total value locked (TVL) ratio of 0.64.



The proposal was drafted following community calls and active workshops between Arbitrum stakeholders and will span between two voting rounds where projects applying for grants will be reviewed.



Four different types of grants will be available to <a href="https://blockworks.co/tag/arbitrum">Arbitrum</a> ecosystem contributors. The smallest grant, Beacon, will distribute 200,000 ARB per grant and will require the project to have been on Arbitrum for at least 2 months and have an estimated trading volume of at least $1.5 million. Siren Grants, which will give out up to 750,000 ARB, expect the project to have been live on Arbitrum for at least 4 months and have a $4 million TVL.



Lighthouse Grants will hand out less than 2 million ARB tokens, and eligible projects must have been live on Arbitrum for at least 6 months and either have a $15 million TVL or a $100 million 30-day trading volume.&nbsp;



The largest category of grants, Pinnacle Grants, will hand over 2 million ARB tokens to projects that have been live on the network for at least one year and have either a $30 million Arbitrum network TVL or a $200 million 30-day cumulative trading volume.&nbsp;



The voting period for the <a href="https://www.tally.xyz/gov/arbitrum/proposal/92535731414466076465748260699234569033779695239254902723866669906112586724812">proposal</a> will end on Oct. 9. During this time, ecosystem participants can submit grant proposals for their projects. DAO participants will have until Oct. 3 to review all the proposals, and a voting period to determine which projects should receive funding will begin on Oct. 4 and end on Oct. 11.&nbsp;



So far, a total of <a href="https://docs.google.com/spreadsheets/d/1cXSWgnmpv2LEbDSTzkkGVr-zqV4q4Pti59cgZlx_Jqg/edit#gid=326656725">105 different projects</a> have applied for grant funding, information compiled by Blockworks Research shows. This means Arbitrum DAO members must independently review all proposals within the week and determine which projects should be funded.&nbsp;



The short-term incentive program will be a one-time distribution. Recipients will be required to keep ARB distributions and will not be able to convert the tokens to other assets or participate in any governance activities.



A 5/9 <a href="https://blockworks.co/news/what-are-multisig-wallets">multi-signature wallet</a> will be established and will have the capability to retrieve funds from projects that violate the agreement and stream funds to selected projects on a bi-weekly basis.&nbsp;



Grant recipients will be held accountable by reporting data and dashboards and providing performance insights on a regular basis. Each project that receives funding must create Dune dashboards that show daily TVL, transaction volumes, unique addresses and transaction fees, unless otherwise specified in the application.



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Arbitrum DAO looking to bet $40M on network protocols

Ripple is abandoning its planned acquisition of Fortress Trust, according to CEO Brad Garlinghouse.&nbsp;



The acquisition was announced in early September, with <a href="https://blockworks.co/tag/ripple">Ripple</a> saying at the time that it would buy the company in a cash-and-equity deal. Further details of the deal were not disclosed.



“The Fortress team is incredibly talented, and has built products solving real customer problems. While this outcome is different from what was originally planned, we’ll continue to support them and hope to work together in the future!” Garlinghouse <a href="https://twitter.com/bgarlinghouse/status/1707455045942292954">said</a> in a post on X, formerly Twitter.



When it announced the potential <a href="https://blockworks.co/tag/M&amp;A">acquisition</a>, Ripple called Fortress Trust a “financial institution that provides licensed Web3 financial, regulatory and technology infrastructure for blockchain innovators.”



Ripple was an early investor in Fortress, and <a href="https://blockworks.co/tag/brad-garlinghouse">Garlinghouse</a>’s social media post on Thursday said that, while the acquisition had fallen through, it would retain its stake in the company.&nbsp;



“We’ve had a chance to get to know the team, its vision and technology,” Garlinghouse said when Ripple announced its plans to acquire the company on Sept. 8. “They’ve built an impressive business with recurring revenue and a strong roster of both crypto-native and new-to-crypto customers.”&nbsp;



A few days after the acquisition announcement, Fortress Trust CEO Scott Purcell told <a href="https://fortune.com/crypto/2023/09/12/fortress-trust-12-to-15-million-hack-bitcoin-usdc-usdt-ripple/">Fortune</a> that the firm had lost around $12 million to $15 million worth of bitcoin, USDC and USDT in a hack. However, Purcell said the company “covered it right away.”



Fortress Trust did not immediately return a request for comment.



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Ripple ditches plan to buy Fortress Trust

James Cirrone

Blockchain validation. Payments between different network layers. Digital asset recommendations in the metaverse.&nbsp;



These are some of the areas <a href="https://blockworks.co/tag/paypal">PayPal</a>’s research and development efforts appear focused on, according to a slate of recently published patent applications.



The most recent application, published Thursday and originally filed in March 2022, delves into the details of how validators or miners should be selected during the process of adding transactions to the blockchain. The <a href="https://image-ppubs.uspto.gov/dirsearch-public/print/downloadPdf/20230306418">document</a> states that the company’s disclosed techniques could “advantageously allow steering of blockchain requests to a desired subset of miners/validators.”



Three other patent applications, released on Sept. 21, were also filed in March 2022.



<a href="https://image-ppubs.uspto.gov/dirsearch-public/print/downloadPdf/20230298001">One</a> offered up supposedly new “methods and systems” to enable off-chain transactions through NFT marketplaces.&nbsp;



<a href="https://image-ppubs.uspto.gov/dirsearch-public/print/downloadPdf/20230298008">Another</a> mentions the concept of a so-called omniverse, which in this context suggests a product that deals in multiple metaverses. PayPal says it developed an “online transaction processor” that would provide recommendations for which digital assets a user should buy based on the user’s blockchain preferences and which metaverses they interact with most.&nbsp;



<a href="https://image-ppubs.uspto.gov/dirsearch-public/print/downloadPdf/20230298005">A third</a> describes another conceptual online transaction processor. This processor’s goal is to facilitate payments between users and merchants operating on different network layers (layer-1s and layer-2s) in a more efficient manner.&nbsp;



The applications, in sum, offer a window into PayPal’s thinking as it builds out its suite of crypto products and services.&nbsp;



For instance, with <a href="https://blockworks.co/news/paypal-launches-stablecoin">PayPal releasing a stablecoin</a> in August, these proposed provide a window into the direction of PayPal’s use of the technology for payments. Venmo, the firm’s popular payment app that <a href="https://blockworks.co/news/venmo-crypto-transfers-coming">enabled crypto transfers in May</a>.



PayPal did not immediately respond to Blockworks’ request for comment.



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PayPal patent apps signal an interest in layer-2s, NFTs

Molly Jane Zuckerman

<figure class="wp-block-image size-large"><img decoding="async" loading="lazy" width="1024" height="256" src="https://blockworks-co.imgix.net/wp-content/uploads/2023/06/Off-Topic-with-Molly-Jane_20230616a-1.png?w=1024&amp;h=1024" alt="" class="wp-image-60166" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2023/06/Off-Topic-with-Molly-Jane_20230616a-1.png?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2023/06/Off-Topic-with-Molly-Jane_20230616a-1.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2023/06/Off-Topic-with-Molly-Jane_20230616a-1.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2023/06/Off-Topic-with-Molly-Jane_20230616a-1.png?w=428 428w, https://blockworks-co.imgix.net/wp-content/uploads/2023/06/Off-Topic-with-Molly-Jane_20230616a-1.png?w=470 470w, https://blockworks-co.imgix.net/wp-content/uploads/2023/06/Off-Topic-with-Molly-Jane_20230616a-1.png?w=389 389w, https://blockworks-co.imgix.net/wp-content/uploads/2023/06/Off-Topic-with-Molly-Jane_20230616a-1.png?w=80 80w" sizes="(max-width: 1024px) 100vw, 1024px" /></figure>



Everybody loves a delicious story.&nbsp;



The delicious story of the week for Crypto Twitter was Ben Armstrong (formerly BitBoy Crypto) and his firing, flameout and livestreamed arrest.&nbsp;



Crypto media treated the story with as much interest and enthusiasm as if it was FTX 2.0. At least, it felt especially so, because Armstrong — long a controversial figure before his unceremonious exit from the successful BitBoy Crypto channel on YouTube — had taken such pleasure in saying he (allegedly) <a href="https://twitter.com/YahooFinance/status/1594369981705240582">knew</a> ex-FTX boss Sam Bankman-Fried was a “scammer” since day one.



I’m not here to opine on what Ben Armstrong and his now-former business associates allegedly did or didn’t do, both recently and in the past &nbsp;— there’s plenty of Crypto Twitter fodder to churn through if you’re interested.&nbsp;



Instead, I want to dig into why this story captured the hearts and minds of crypto, and crypto alone, this week.&nbsp;



The phrase “there’s no press like bad press” seems apt here. Could it be that we are all secretly hoping for Armstrong’s public meltdown to catapult crypto again into the wider media universe?



Crypto-only media outlets tend to focus on the real meat of the crypto space. New innovations, launches, partnerships, regulation (and also sometimes, inexplicably <a href="https://blockworks.co/news/ai-cryptocurrency-connection">AI</a>) — in other worse, up-close coverage of straight news that’s really only important to the crypto circle. And we don’t expect anyone else to care.



The big exception, as I’m sure you are all waiting with baited breath for me to say, is the case of FTX and Sam Bankman-Fried. This was a story that made it beyond crypto media to the mainstream, and also a story that went beyond covering a run-of-the-mill crypto scam to tabloid-esque coverage of polycules.&nbsp;



The BitBoy story, salacious as it may be, has remained siloed within crypto media. Scrolling back through every single article covering the Armstrong/BitBoy this week, you can only find one non-crypto media outlet who took the bait, and their piece spells crypto as “crytpo.”



I’m not begrudging crypto media outlets a chance to pounce on a sensational story. The market has been exceptionally boring for the past few months — and there are only so many articles you can write about the supposed “end of the bear market.”



Read more from our opinion section: <a href="https://blockworks.co/news/crypto-must-advertise-airports" target="_blank" rel="noreferrer noopener">Crypto must advertise</a>



But seeing the crypto world’s interest in the situation around Armstrong and BitBoy Crypto feels a bit like the masses grasping at straws of relevancy. It was definitely a terrible time for crypto when Bankman-Fried was the center of worldwide media attention, and the spotlight on FTX’s collapse did nothing to help crypto’s perception — but at least it was a hot topic that brought crypto an insane amount of mindshare.&nbsp;



If the plan is to repeat this situation, it’s not working. It doesn’t seem like Ben Armstrong and his antics have left a strong enough mark —&nbsp;nobody involved allegedly misappropriated billions of dollars, for example — to inspire books and TV documentaries, like someone else we know.



The Armstrong drama — and the attention paid especially — instead seems symptomatic of what I see as crypto’s often misguided superiority complex. The sheer audacity of the FTX tale took the world by storm last year. But we’re still nowhere near capturing that mindshare high again, especially not with smaller <a href="https://twitter.com/HashBastardsNFT/status/1707045975057903763?s=20">dramas</a> of crypto YouTubers and their Lamborghinis.



<hr class="wp-block-separator has-alpha-channel-opacity"/>



I don’t care much about tech, I don’t care a whole lot about finance, either. I care about writing stories and watching weird things unfold. And that’s why I’ve ended up in crypto. But because I’m missing that passion for what crypto and blockchain are all about — finance, tech, privacy, yadda yadda — I’m going to write instead about what I am actually interested in. Everything about crypto that has very little to do with crypto. That’s what this column will be about. All the tangential stories that come out of the blockchain and crypto space, what I think about them, and how I navigate it all as a skeptical former Russian literature major. It’s precisely my perch as an outsider that lets me do what I do: Opine on all sides of any crypto issue, no strings attached, no skin in the game. If you want to talk crypto with me, let’s go off topic.



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Crypto is boring right now, but the BitBoy drama isn’t much more exciting

Macauley Peterson

Say hello to Holešky, a new Ethereum testnet that successfully went live today after a configuration problem <a href="https://blockworks.co/news/ethereum-holesky-testnet-launch-failed">prevented the network from launching</a> two weeks ago on the 1-year anniversary of <a href="https://blockworks.co/tag/ethereum-merge">the Merge</a>.



Holešky is intended to replace Ethereum’s Goerli testnet — Ethereum’s validator and staking-focused testnet — which will be retired in 2024.



A minor bug reported on <a href="https://www.youtube.com/watch?v=CPt3f3ughFM">today’s</a> all-core-developers call, affecting some Prysm Ethereum clients, was not enough to derail the launch, according to Barnabas Busa, a software engineer at the Ethereum Foundation. Validator participation has been climbing in the hours since, Busa said, expected to reach 90% by Friday.



Goerli is still expected to be used for the <a href="https://blockworks.co/news/ethereum-update-liquid-staking">Dencun upgrade</a>, featuring <a href="https://blockworks.co/news/ethereum-cancun-upgrade-blobs">EIP-4844</a>, on its way to mainnet release.&nbsp;



But before that step, the upgrade has been running a gauntlet of developer networks — or devnets.



Core developers discussed the imminent launch of Devnet-9, which will debut “Friday or early next week” according to project coordinator Tim Beiko. That’s slightly delayed from the planned Sept. 27 start date projected on the previous developer call.



The Dencun upgrade initially aimed for a hard fork date in the fourth quarter of this year. However, due to the slower-than-expected progress of the Devnets, a 2023 hard fork now seems unlikely.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">It&#39;s now more than likely that Dencun and EIP-4844 will not be implemented by the end of this year. <a href="https://t.co/NGIMrhK7uL">https://t.co/NGIMrhK7uL</a> <a href="https://t.co/mkdAmpefTo">pic.twitter.com/mkdAmpefTo</a>&mdash; liam 📜 (@daddysether) <a href="https://twitter.com/daddysether/status/1705360324810142197?ref_src=twsrc%5Etfw">September 22, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Busa told his colleagues on the call, “we probably need a Devnet 10 too,” though it’s expected to be “a shorter-lived Devnet.”



The new goal is for the first testnet launch to occur prior to November’s Devconnect conference, taking place in Istanbul in mid-November.



If all goes smoothly, the mainnet could follow as early as January 2024.



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Devnet, testnet, mainnet: Ethereum’s next upgrade progresses — slowly

Casey Wagner

US Securities and Exchange Commission Chair Gary Gensler is facing tough questions from Washington, with both sides of the aisle joining in.&nbsp;



A bipartisan group of representatives wants Gensler to answer for his agency’s failure to approve a spot bitcoin ETF, even after courts sided with Grayscale, one of several issuers trying to launch the product.&nbsp;



Reps. Tom Emmer, R-Minn., Ritchie Torres, D-N.Y., Wiley Nickel, D-N.C., and Mike Flood, R-Neb., penned the <a href="https://flood.house.gov/sites/evo-subsites/flood.house.gov/files/evo-media-document/sec-bitcoin-spot-etf-letter-signature-check.pdf">letter</a> Tuesday, a day before Gensler appeared before the House Financial Services Committee for his oversight hearing.&nbsp;



“During your time at the SEC, you have consistently stated that digital asset firms should ‘come in and register’ with the SEC,” the Reps. wrote in the letter. “Market participants have relied on your statements and have filed applications for a regulated spot bitcoin ETP. Following the Court of Appeals’ decision, there is no reason to continue to deny such applications under inconsistent and discriminatory standards.”&nbsp;



Tuesday’s letter is not the first time congressional leaders have taken it upon themselves to question the agency.&nbsp;



Weeks before teaming up with Nickel and their Republican colleagues, Torres wrote his own open letter to Gensler, criticizing the agency’s “regulation by enforcement” tactics.&nbsp;



“In light of the SDNY’s landmark decision in the Ripple case,<a href="https://twitter.com/SECGov"> </a>[Gensler] must reassess its reckless regulatory assault on the crypto industry,” Torres wrote on X, formerly Twitter, along with the letter.&nbsp;



In June, Republican crypto advocates Reps. Warren Davidson and Tom Emmer <a href="https://blockworks.co/news/republicans-oust-gensler-bill">introduced a bill to remove Gensler as the SEC’s head</a>.&nbsp;&nbsp;



“U.S. capital markets must be protected from a tyrannical Chairman, including the current one,” Davidson <a href="https://twitter.com/WarrenDavidson/status/1668305460368121857">wrote</a> on X, formerly Twitter, after the bill was unveiled. “I’m introducing legislation to fix the ongoing abuse of power and ensure protection that is in the best interest of the market for years to come.”&nbsp;



How the SEC engages with crypto-related issues has been a topic of discussion between lawmakers, on both sides of the political spectrum, and federal agencies for years.&nbsp;



In 2021, Sen. Elizabeth Warren, D-Mass., sent a <a href="https://www.warren.senate.gov/imo/media/doc/Draft%20SEC%20Crypto%20Exchange%20Letter%2007.7.2021%20clean.pdf">letter</a> to Gensler asking if Congress needed to step in to help the SEC obtain more authority over crypto markets. In his <a href="https://www.warren.senate.gov/imo/media/doc/gensler_response_to_warren_-_cryptocurrency_exchanges.pdf">response</a>, Gensler said he was willing to work with Congress as “we need additional authorities to prevent transactions, products, and platforms from falling between regulatory cracks.”&nbsp;



Warren has maintained a predominantly anti-crypto stance, especially in her role on the Senate Banking Committee. Teaming up with Republican Roger Marshall, a junior senator from Kansas, she co-sponsored the Digital Asset Anti-Money Laundering Act of 2023. Some industry advocates say this legislation could effectively kill crypto in the US.



The <a href="https://www.warren.senate.gov/imo/media/doc/Digital%20Asset%20Anti-Money%20Laundering%20Act%20of%202023.pdf">bill</a> tasks the SEC and Treasury to create a “risk-focused examination and review process” for crypto securities.&nbsp;



<h2 class="wp-block-heading">What’s next&nbsp;</h2>



Gensler, who was President Biden’s pick to lead the <a href="https://blockworks.co/tag/sec">SEC</a>, is currently serving a five-year term set to end in June 2026, but some speculate the anti-crypto agency head could be ousted sooner.&nbsp;



If the White House goes red in 2024, Gensler will almost certainly be looking for a new gig. Former President Donald Trump, who currently leads in the Republican primary polls, already faced legal action from the agency earlier this year when his SPAC partner opted to settle with the SEC for $18 million over alleged securities violations.&nbsp;



Fellow Republican candidate Vivek Ramaswamy, currently ranking third in the polls, has expressed disdain for Gensler – and almost every other agency head in the US – <a href="https://blockworks.co/news/ramaswamy-pledges-crypto-policy">arguing that unelected officials have no place holding this much power</a>. Ramaswamy vowed to cut the federal government by 75% during an appearance at the Mainnet conference in New York earlier this month.&nbsp;



Coinbase CEO Brian Armstrong said in a recent <a href="https://finance.yahoo.com/video/coinbase-ceo-companys-next-steps-172157616.html">interview</a> that Gensler could be out in 2025 if a Republican wins the White House in 2024, and he’s keeping an eye on how current candidates engage with crypto.&nbsp;



“[Presidential candidates] see it as an opportunity to challenge — the policies of the current administration has had in downstream effects with the regulators, that they view as not in line with what the American people want,” Armstrong said at the Goldman Sachs Communacopia and Technology Conference earlier this month. “This could become a hot topic in the presidential race in 2024.”

The anti-Gensler movement is picking up steam on both sides of the aisle

The Bank of International Settlements announced the conclusion of Project Mariana, which tested cross-border trading and settlement of a central bank digital currency (CBDC).



The project, which spanned months, took place in partnership with the central banks of France, Singapore and Switzerland. The goal was to create a settlement system for a wholesale <a href="https://blockworks.co/tag/cbdc">CBDC</a>, the type of CBDC used between financial institutions. 



The experiment does not necessarily imply that any of the participating countries will adopt a CBDC.&nbsp;



“In the tested experimental setup, central banks are able to manage their wCBDC without necessarily operating or controlling the underlying infrastructure. Commercial banks can use the wCBDCs to engage in instant FX trading and settlement, avoiding credit and settlement risk and improving efficiency,” the paper said.



Throughout the experiment, Project Mariana focused on three elements: “a common technical token standard” which allowed for interoperability between various currencies and was provided by a public blockchain, bridges for the transfers of the CBDCs, and an <a href="https://blockworks.co/tag/amms">automatic market maker</a> (AMM). 



An AMM is a type of decentralized exchange that has “smart contracts that allow traders to exchange one crypto asset — or tokenized assets more generally — for another, by drawing on a common pool of liquidity. Prices are determined by a pre-specified algorithm.”



Project Mariana also discovered some challenges for banks: “For example, the 24 hours a day 7 days a week availability of wCBDC may increase operational complexities for central bank.”&nbsp;



However, it further notes, “commercial banks can use the wCBDCs to engage in instant [foreign exchange] trading and settlement, avoiding credit and settlement risk and improving efficiency.”



Read more: <a href="https://blockworks.co/news/cbdcs-tokenized-deposits-unified-ledger">Combine CBDCs, tokenized deposits on a unified ledger, BIS says</a>



Additionally, “further work is needed to understand the role of central banks and wCBDCs in a broader tokenised ecosystem potentially including stablecoins, tokenised deposits and financial instruments, such as tokenised bonds and securities.”



“Project Mariana pioneers the use of novel technology for interbank foreign exchange markets. It successfully demonstrated that it is feasible to exchange wholesale CBDC across borders using novel concepts such as automated market makers,” said Cecilia Skingsley, head of the BIS Innovation Hub



But the paper also echoes a point made by the BIS chief in a speech earlier this week, “collaboration among stakeholders will be key.”



Agustin Carstens, the general manager of the BIS, said “<a href="https://blockworks.co/news/bis-cbdc-legal-framework-monetary-system">international coordination and cooperation is critical</a>” and that it would be “unfortunate” to have digital currencies that don’t interoperate.



The BIS has been actively researching CBDCs throughout this year, with multiple studies finding that <a href="https://blockworks.co/news/banks-exploring-potential-cbdc">roughly 90%</a> of central banks are interested in exploring “some form” of CBDCs, as well as how <a href="https://blockworks.co/news/bis-cbdc-framework">central banks could properly protect “resilient” CBDC systems</a>.



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Wholesale CBDCs and automatic market makers could be the perfect pair, BIS finds

The average mobile phone user might not be into crypto, but that doesn’t mean they can’t benefit from the technology — even if they don’t know they’re using it.



<a href="https://blockworks.co/tag/helium">Helium</a> Foundation CEO Abhay Kumar details the Helium Mobile platform as an example of a crypto-based product with mass market appeal. On the Lightspeed podcast (<a href="https://open.spotify.com/episode/5dIMcSgCaclKqgkFAIdXzx?si=9bc99b39c5fb4475">Spotify</a>/<a href="https://podcasts.apple.com/us/podcast/how-helium-is-leading-cryptos-depin-revolution-abhay-kumar/id1697548240?i=1000629512236">Apple</a>), he explains that the service aims to be “a better kind of carrier.”



The carrier is building a “mass market product,” he explains, with an aim to improve privacy and provide a better customer experience at a lower cost.&nbsp;



But Kumar asserts that the developers aren’t building a “crypto product,” per se. “The crypto part is an interesting thing and it actually enables their business long-term,” he says, “but you know, they want to be able to serve regular humans.”



“They want to serve my mom,” he says, having onboarded his mother to the service a few months ago. “She doesn&#8217;t live in the country,” he explains, “so whenever she comes and visits, she pays Verizon some ludicrous amount for a prepaid plan.”



“I said, ‘No, this is ridiculous. Here’s a $5 a month plan. Just keep it.’”



Read more: <a href="https://blockworks.co/news/for-5-a-month-crypto-now-has-your-cell-plan-covered">For $5 a month, crypto now has your cell plan covered</a>



His mother didn’t need to use any sort of <a href="https://blockworks.co/tag/cryptocurrency">cryptocurrency</a>, Kumar explains, adding that she set up the account on her laptop and then installed the corresponding app on her phone. “The app is the thing that hides the wallet,” he says, “and that&#8217;s something that they&#8217;ve done, I think, really well, which is that the app is a wallet.”



“They hide the crypto bits,” he says, “unless you want to experience those crypto bits.”



One of those “crypto bits” that can be enabled, Kumar explains, is called “discovery mapping.”&nbsp;&nbsp;



Users can opt into discovery mapping to earn rewards for sharing their location. This enables Helium Mobile to gain a better understanding of where subscribers are using the network.&nbsp;



Unlike traditional carriers, Kumar says, subscribers are not automatically opted in to sharing location data by default. “Contrast this from a typical ISP that is 100 percent selling all of your usage data,” he says.



<h2 class="wp-block-heading">Building out globally</h2>



Kumar describes the launch of the $5 per month plan in Miami. He explains that the goal is to build “very dense coverage in the area to prove out this business model, so that they can then move to the next one, and the next one, and the next one.”



The concept isn’t limited to the United States, he says. Helium Mobile launched with the radio protocol, CBRS (Citizens Broadband Radio Service), which allows “regular human beings” to set up radios anywhere, Kumar explains.&nbsp;



“WiFi is the other option,” Kumar says. A network of WiFi hotspots will soon be added to the network, he says. “We&#8217;re in this really awesome time,” he says, “with eSIMs being very, very easy to install on our phones and WiFi offload actually working at scale.”



“You could build a carrier anywhere in the world. In fact, any individual or any brand could actually build their own carrier,” he says.



Kumar imagines a near future where the Helium network can serve users <a href="https://www.technologyreview.com/2022/09/21/1059682/pandemic-broadband-funding-native-communities-blackfeet-internet-access/#:~:text=Each%20of%20the%20574%20federally,for%20awards%20totaling%20%24146%20million.">in remote locations</a> that lack internet access. He cites an example of a Native American reservation in Nebraska, where the cost to bring network fiber into homes is “about $50,000 per household.”



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“That is atrocious,” he says. “This is in the age where we have Starlink and we have pretty cheap WiFi routers. Let&#8217;s build the network there.”&nbsp;



“That was my initial thought when I heard that,” he says. “How do I deploy a bunch of Starlink radios, a bunch of Helium WiFi hotspots — and give a bunch of people some eSIMs and let them have their own <a href="https://blockworks.co/news/web2-data-web3-threads">self-sovereign network</a>?”



“That&#8217;s what I want to see in the world.”



“We&#8217;re spending so much money on infrastructure to trench through desert and put fiber through desert and forests and mountains,” he says, acknowledging the expensive efforts are for a good cause. “I believe every single human on this Earth should have broadband internet.”



“But the way that we&#8217;re getting there seems incredibly inefficient,” he says. “There&#8217;s better ways to get there.”



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Follow Sam Bankman-Fried’s trial with the <a href="https://blockworks.co/tag/sbf-trial">latest news from the courtroom</a>.

Helium Mobile a ‘mass market product’ that ‘hides the crypto bits,’ CEO says

The European Union wants to figure out how crypto asset networks might be affecting climate change and reduce their impact.



On Tuesday, the bloc released a notice showing intent to engage an institution to create a methodology aimed at reducing the environmental effects, as needed.



“There is evidence that crypto-assets can cause significant harm on the climate and environment and generate negative economic and social externalities, depending on the consensus mechanism used to validate transactions,” a contract <a href="https://ted.europa.eu/udl?uri=TED:NOTICE:577973-2023:TEXT:EN:HTML&amp;tabId=1">notice</a> showed, without specifying which assets.



The note expressed concerns that growing interest in crypto and the expansion of mining activities, even within the EU, might jeopardize the EU&#8217;s efforts to meet its climate and sustainability objectives to align with the Paris Agreement.



“The action aims at enhancing the EU capacity to assess and mitigate the impact of crypto-mining and develop specific sustainability standards,” it said.



Consequently, the study&#8217;s findings may impact prospective policies aimed at establishing environmental sustainability criteria for crypto assets.



The EU will earmark about 800,000 euros (~$843,000) for commissioning this study, which is expected to last 13 months.



The deadline for submitting tenders or requests to participate is set for Nov. 10.



<h2 class="wp-block-heading">Proof-of-work vs. proof-of-stake&nbsp;</h2>



Bitcoin relies on a <a href="https://blockworks.co/news/what-is-proof-of-work">proof-of-work</a> mechanism, which necessarily expends energy to solve computational puzzles.



Cryptocurrencies, particularly Bitcoin, often face criticism for their perceived high energy consumption, leading to concerns about environmental impact and resource usage.



Most crypto assets, such as Ethereum, employ a <a href="https://blockworks.co/news/proof-of-stake-investors-guide">proof-of-stake</a> system where validators secure the network by staking assets as collateral. This alternative approach drastically lowers energy consumption compared to Bitcoin, although <a href="https://blockworks.co/news/proof-of-work-vs-proof-of-stake-whats-the-difference">there are tradeoffs</a>.



For instance, Ethereum previously relied on proof-of-work in its consensus design, but <a href="https://blockworks.co/news/ethereum-switches-to-proof-of-stake-after-7-years-of-work">following the Merge</a> in September 2022, the network instantly reduced its energy consumption by 99.95%.



But the true environmental effects of crypto networks that still use proof-of-work remain a subject of ongoing debate, and misconceptions are common.



For instance, according to climate tech investor Daniel Batten, bitcoin has managed to offset 6% of emissions through methane mitigation efforts.&nbsp;



In contrast, other industries such as banking, gold, steel, automotive, aluminum and construction have not reported any emissions offset through methane mitigation at this time, he tweeted.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Methane mitigation is according to the UN our &quot;Strongest lever to reduce climate change&quot; Here&#39;s the amount of emissions offset through methane mitigation currently across industries: Bitcoin: 6% Banking: 0% Gold: 0% Steel: 0% Automotive: 0% Aluminum: 0% Construction: 0% <a href="https://t.co/OQbRrNQrVj">pic.twitter.com/OQbRrNQrVj</a>&mdash; Daniel Batten (@DSBatten) <a href="https://twitter.com/DSBatten/status/1707329053748056225?ref_src=twsrc%5Etfw">September 28, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



New insights come from the <a href="https://blockworks.co/news/cambridge-bitcoin-electricity-consumption">recent revision</a> of the Cambridge University Bitcoin Electricity Consumption Index (CBECI), a tool that provides daily estimations of the network&#8217;s energy requirements.&nbsp;



Researchers, after revisiting this widely used index on Aug. 31, came to the realization that earlier assumptions regarding Bitcoin&#8217;s energy consumption had been overstated.

EU expensing $843k to pull back the curtain on crypto’s climate impact

Coinbase is expanding its perpetual futures service to non-US retail users after seeing substantial institutional trading of over $5.5 billion in notional volume during the second quarter.



A Bermuda regulator granted Coinbase International Exchange the authority to offer perpetual futures to eligible non-US retail clients, according to an announcement on Thursday.



Coinbase initially <a href="https://blockworks.co/news/coinbase-international-futures-institutional-traders">launched</a> perpetual futures trading in May, but it was limited to only institutional investors located outside the US.&nbsp;



Starting Sept. 28, non-US retail traders can verify their eligibility for perpetual futures trading on Coinbase Advanced, with actual trading set to commence in the following weeks, the <a href="https://www.coinbase.com/blog/coinbase-receives-regulatory-approval-to-enable-retail-perpetual-futures">announcement</a> said.



“At a time when other crypto exchanges are backing away from various regions due to increased scrutiny from local regulators, this regulatory approval highlights Coinbase’s commitment to working with local regulators to ensure its retail and institutional offerings are compliant with local frameworks and standards,” Coinbase said in an email.



The Coinbase International Exchange, which provides the service, maintains financial backing through its Insurance Fund and Liquidity Support Program, both funded in USDC, rather than relying on an exchange token, the company said.



Liquidity for the platform is sourced from compliant, independent liquidity providers, it added.



Coinbase is looking to reduce its dependency on spot trading revenues, which, in the past, have negatively impacted its stock performance following disappointing quarterly earnings.



Notably, perpetual <a href="https://blockworks.co/tag/futures">futures</a> trading makes up a substantial portion, up to 75%, of the overall global cryptocurrency trading volume, according to the exchange.



The firm is also seeking to spread risks related to regulatory uncertainties. 



This strategic shift underscores Coinbase&#8217;s efforts to evolving within the changing crypto market dynamic and achieving a balanced revenue mix.



Coinbase joins a handful of other centralized exchanges to offer such contracts including the likes of <a href="https://blockworks.co/tag/deribit">Deribit</a>, Binance, Bitfinex, among others, as well as a growing number of DeFi <a href="https://blockworks.co/tag/derivatives">derivatives</a> options, such as <a href="https://blockworks.co/tag/dydx">dYdX</a> and <a href="https://blockworks.co/tag/aevo">Aevo</a>.



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Coinbase’s international exchange opens futures to retail

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Dan Smith

Research Analyst

Why L1 Blockchains are Valuable

<h2 class="wp-block-heading">Blockworks&#8217; Digital Asset Summit (DAS) will take place March 18-20, 2024 at The Hilton London Metropole. Why London?</h2>



Momentum. 



London has become one of the world’s hottest crypto hubs.&nbsp;



Innovation is thriving, new institutional investors are flocking in, and regulators like the FCA are taking a pragmatic approach to crypto oversight. Prime Minister Rishi Sunak has welcomed crypto with open arms and a16z recently set up their first non-US office in London.&nbsp;



Across Europe, institutions are getting excited about crypto again thanks to sensible legislation like MiCA. DAS has always been at the heart of institutional crypto adoption and right now, that place is London.&nbsp;



<h2 class="wp-block-heading">What you can expect:</h2>



<ul>
<li>Insights on the impact of regulatory implications and the need for realistic policy</li>



<li>Access to institutional dinners and exclusive networking events</li>



<li>Unparalleled insights from industry leaders</li>
</ul>



And more! Don’t miss out on the opportunity to be in the room when the future of crypto is decided.



Join us and help shape the future of our industry.

Tickets

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<h2>Why Sponsor DAS 2024?</h2>
If you’re serious about the future of crypto, you have to be at Blockworks Digital Asset Summit (DAS) 2024. This year’s event will bring industry leaders, legislators, and institutional experts together to discuss the latest developments and challenges in the ever-evolving world of digital assets. DAS is the perfect opportunity to showcase your offerings in front of hedge funds, VCs, regulators, lenders, custodians and more. 
We’ll work with your team to define the perfect sponsorship opportunity that best fits your needs and budget. 
Get in touch with us today at <a href="mailto:sales@blockworks.co">sales@blockworks.co</a>