Estimates suggest that over a third of the current supply of bitcoin is made up of potentially lost or dormant coins. This statistic and the horror stories of people digging through landfills for a lost seed phrase continue to keep skeptics on the sidelines. 



Industry experts have long debated how to solve this problem without losing the self-custody of the BIP-39 seed phrase standard. For example, wallet manufacturers such as ZenGo and Argent launched seedless alternatives, but their critics argue that they sacrifice a degree of autonomy and censorship resistance for convenience. 



And as the application layer of the crypto ecosystem grows, wallet manufacturers are competing to own the layer of user experience in Web3. The simple offline paper wallets of the early days in crypto can’t support this new demand for smart contract functionality and security.



Watch: The Wallet Wars: Rise of the SuperApp | Qiao Wang



But these developments also come with new risks. A recent report published by CertiK exposed malware that can steal the private keys of mobile wallets. 



Noisy debate and increased complexity makes it even more difficult for average users to navigate the different ways to safely store their assets. 



This explainer series on crypto wallets will attempt to make this journey a little less mind numbing. In this article, we will start with explaining the seed phrase debate and will follow up with a hot vs. cold wallets breakdown and then a full wallet security guide. 



What is a seed phrase?



A seed phrase is a series of words that grants access to a crypto wallet on any compatible device. It is also known as a recovery or mnemonic phrase and is best understood as a security measure for self-custodied digital assets. 



Both hot wallets and cold wallets can use a seed phrase for recovery. For example, MetaMask (hot browser extension wallet),  Exodus (hot mobile wallet), and Ledger (cold hardware) all use seed phrases for recovery. 



The

What Are Seed Phrases and Are They Needed? The New Debate

Insiders at public crypto companies have bought millions of dollars worth of their own stocks since FTX crumpled last November — an event which sent the price of bitcoin spiraling 25%.



Coinbase director Tobias Lütke, perhaps better known as the CEO of Canadian ecommerce giant Shopify, has led the charge. He’s been busy buying the Coinbase dip, spending $4.86 million on the stock over the past three months, per SEC filings.



Lütke has snapped up nearly 110,000 Coinbase shares in that time for an average price of $44.37. COIN traded for about $60 on Friday afternoon, which means he’s up 35% on his recent haul. 



As Blockworks previously reported, Lütke has been regularly buying Coinbase stock, spending upwards of $350,000 practically every single week since August.




Lütke joined Coinbase’s board of directors in January 2022, when its shares were worth more than $200 a piece.



In total, he has acquired just under 172,000 Coinbase shares for about $9.3 million, at an average price of $54.30. 



His total haul is currently worth more than $10.3 million — his dip buying has, so far, paid off.






Chart by David Canellis



Three insiders at major bitcoin miner Marathon have also recently backed their own stocks. Directors Douglas Mellinger and Kevin DeNuccio respectively spent $104,000 and $339,000 on Marathon shares throughout December. 



Marathon CEO Fred Thiel himself plonked around $19,000 on 5,000 shares; altogether those three execs bought stock at an average price of $4.40. Marathon now trades for $8.18, which means they’ve collectively gained 86% — another win for the dip buyers.



CleanSpark Chief Financial Officer Gary Vecchiarelli grabbed $34,500 or 19,400 shares at $1.78 apiece in mid-December. CLSK is now at $2.90; Vecchiarelli is up 63%, lodging more than $21,000 in paper gains.



Altogether, these insiders spent $5.35 million buying the dip on their own stocks since the start of November. That same cache is now worth

Crypto Execs Bought the Dip on Their Own Stocks — They’re Up 40%

Layer-1 Aptos has seen the price of its token, APT, soar by 460% since the start of the year.



Previously dubbed the ‘Solana Killer,’ proof-of-stake network Aptos promised to create a fast and cheap blockchain that would enable NFTs, DAOs and DeFi activity but fell short when it launched in October last year. 



Only 50 active developers are currently active on Aptos, according to data from TokenTerminal. Its number of daily active users currently sits around 31,000. 



Despite these numbers, Aptos’ fully diluted valuation (FDV) is significantly greater than that of other blockchains, including Avalanche, Solana, Polygon, and Optimism, Blockworks Research Senior Analyst Dan Smith said.



Aptos’ recent price surge correlated with the deployment of the decentralized exchange (DEX) PancakeSwap on its blockchain two weeks ago  — the DEX makes up a total of $33.26 million in TVL on Aptos — almost 60% of the entire Aptos TVL, according to DefiLama.



“The lack of development is obvious in the on-chain liquidity, which mostly resides on a non-native DEX — PancakeSwap — in the form of non-native tokens such as USDC, BUSD, WETH,” Smith said. 



By contrast, projects such as Fuel or zkSync run a series of testnets with developers who are building on their network before mainnet launches. That “creates a community of developers and users before the token launch, which is undeniably a more ethical process,” Smith added.



So why is the network with few users and developers seeing such a huge increase in its token’s price?





Nearly 400 articles about Aptos were published in the weeks leading up to its 460% rally | Chart by David Canellis



The South Korean market 



The price rally of Aptos parallels the beginning of “Xangle Blockchain Foundation Week” in South Korea, where the project has been heavily promoted.



In fact, Aptos’ focus on the South Korean market has always been intentional. A Twitter user who goes by the pseudonym

Aptos Surge Triggers Flashbacks of Ripple's 2017 Bull Run

Though more crypto firms revealed layoffs this week, several segment players added high-level executives. 



The Algorand Foundation named Jessica Tsai Chin as its new chief marketing officer.



The hire comes after Algorand brought aboard Chief Marketing Officer Michele Quintaglie, a former communications executive at Fidelity Investments and Visa. A spokesperson told Blockworks that Quintaglie will continue in that role, while Chin leads on the foundation side.  



Chin was most recently head of brand for global privacy at WhatsApp, where she also led the marketing team’s metaverse efforts. 



Prior to joining WhatsApp, she worked in global brand marketing at Nike, where she developed mobile-first membership growth initiatives for platforms like SNKRS and the Nike Run app. She also spent about four years at Apple, leading global special projects for enterprise technology products. 



Blockchain.com’s former chief compliance officer with an extensive traditional finance background has moved over to Kraken to work in the same role.



CJ Rinaldi joined Blockchain.com in October 2021, according to his LinkedIn. As its compliance leader, he helped the crypto platform build out global compliance frameworks.



Before that, Rinaldi was a head of markets compliance at Deutsche Bank Securities after heading up the investment bank’s anti-financial crimes compliance business. He also formerly worked at UBS, working as a transaction risk manager for currencies and commodities, among other roles.



Monica Long is now Ripple’s president after working at the company for roughly a decade. 



She first joined Ripple in 2013 as its first marketing and communications hire, and was most recently a senior vice president and general manager of both RippleNet and RippleX. 



RippleNet is a decentralized global network of banks and payment providers using Ripple's distributed financial technology. RippleX is the open platform enabling developers and entrepreneurs to

Latest in Crypto Hiring: Former Nike, Apple Marketing Pro Joins Segment

Solana (SOL) is eyeing a return to the top 10 cryptocurrencies by market value — now trading only 25% below its price point recorded just before FTX imploded.



SOL sank more than 70% in the months following the Sam Bankman-Fried scandal, as markets rejected crypto associated with the disgraced alleged fraudster.



The trend had inspired markets to value memecoin shiba inu (SHIB) more than SOL for most of the past few months. 



Solana’s ecosystem meanwhile hoped to distance itself from Bankman-Fried, historically one of the network’s loudest proponents and primary backers.





Click play to watch SOL and SHIB duke it out



But SOL had spent most of January well ahead of SHIB — now valued at more than $9 billion compared to SHIB’s $6.4 billion. 



SOL is currently whiskers shy of the top 10 by market cap, around $600 million short of polygon (MATIC) and $1.6 billion ahead of polkadot (DOT). The token sat ahead of both before its association with Bankman-Fried dragged it downward.



Solana has easily outperformed most top assets year to date, jumping from under $10 to nearly $24 — returning around 140%. 



Still, it’s lagging behind bellwethers bitcoin (BTC) and ether (ETH) since the end of October (FTX would file for bankruptcy two weeks later). BTC is up 11% while ETH is flat.





MATIC appears to have benefitted from the SBF scandal



MATIC, the native token of Polygon — considered a direct rival to Solana — is up nearly 19% over the same period.



SOL overtaking MATIC to regain its original position would effectively mark the end of Bankman-Fried’s influence over the network.




Get the day’s top crypto news and insights delivered to your email every evening. Subscribe to Blockworks’ free newsletter now.

Want alpha sent directly to your inbox? Get degen trade ideas, governance updates, token performance, can’t-miss tweets and more from Blockworks Research's Daily Debrief.

Can't wait? Get our news the fastest way possible.

Solana Flips Shiba to Regain Footing Post-FTX — Is MATIC Next?

A government agency in the most populous US state, California, is testing blockchain technology using a private fork of Tezos to execute some of its record keeping, including the issuance of car ownership and simplifying transfers of such ownership.



The CA Department of Motor Vehicles (DMV) is expected to develop consumer-facing applications such as digital wallets and car title NFTs later this year, according to Ajay Gupta, the agency’s chief digital transformation officer.



The state opted to team up with Tezos and crypto software provider Oxhead Alpha to embrace California’s roadmap to explore crypto adoption, according to an Oxhead statement.



Oxhead Alpha has built a set of smart contracts on a version Tezos — but not the public permissionless chain — to test e-titles, enabling the electronic exchange of title information, in a move that could lessen processing time for documentation. California had over 30 million registered vehicles as of 2020.



Gupta told Fortune that he hopes the plans to materialize the title database on blockchain come to fruition in the next three months.



This collaboration comes after California Governor Gavin Newsom last year signed an executive order directing state agencies to discern ways in which they can employ blockchain technology and digital assets. 



The use of blockchain-based projects has evolved in use cases, pushing developers to build out more decentralized applications. Several governments and business entities have been pursuing its adoption in sectors including capital markets, healthcare, insurance and digital identities.



The pilot is the latest example of attempts to find technology solutions that benefit enterprises looking for smoother compliance and efficiency in their business operations. In another instance, a Cleveland-based startup called ChampTitles looking to overhaul the car title and registration systems using blockchain raised nearly $13 million in a Series B round in

California Pilots Blockchain Car Title Management System on Tezos Fork

Documents filed Wednesday in Delaware’s US Bankruptcy Court list thousands of potential FTX creditors, though lawyers said the names within the documents are not necessarily significantly tied to the company.



One large bank in particular is looking to distance itself from the exchange. 



The 116-page filing, called “Verification of Creditor Matrix” includes the names of Goldman Sachs, JPMorgan Chase, HSBC, BNY Mellon, and other household names in financial services. 



It also comprises a number of crypto firms, airlines, some of the world’s largest tech firms — even media companies.



While industry watchers and large media outlets are anxious to find out the entities to which FTX owes money, the document filed Wednesday does not specify, lawyers said. 



A Goldman Sachs spokesperson told Blockworks in an email the bank is not an FTX creditor. 



“This type of creditor matrix is prepared by the debtors for the purpose of providing notice to interested parties in a bankruptcy proceeding and is not necessarily evidence of a creditor relationship,” the representative added.



A spokesperson for JPMorgan Chase declined to comment. 



HSBC and BNY Mellon did not immediately return requests for comment. 



Dov Kleiner, a partner at law firm Kleinberg Kaplan, said the creditor matrix is generally pulled from the debtor’s books and records and can include lots of different parties. 



A creditor matrix includes lending counterparties and account holders, as well as all other known creditors. But some of the companies and entities listed could be vendors or landlords who have already been paid, or known litigation parties.



“The idea is to include anyone who might have a claim so that the notice of the filing is as broad as possible,” Kleiner added. “Ultimately, the debtors are looking to have their claims resolved finally in the bankruptcy, so they will want to cover everyone they can.” 



A professional who represents debtors, who

Goldman Sachs: We Are Not an FTX Creditor

Amazon is launching a digital assets enterprise, according to four sources familiar with the matter, who said that an NFT initiative is expected in the spring.



Amazon has been shopping the digital collectibles effort to no shortage of power players in the industry, per multiple sources. Said to be among those entities are layer-1 blockchains, blockchain-based gaming startups and developers and digital asset exchanges. There’s a focus on blockchain-based gaming and related NFT applications, two sources said. 



One example in the works, per one source: getting Amazon customers to play crypto games and claim free NFTs in the process. 



The effort is still developing, sources said. April appears to have been penciled in for the e-commerce giant to make its bold crypto ambitions public.



Amazon “coming into the space” is “a big one” for crypto “for many different reasons, one source said. 



“We knew it was possible,” the source said. “But now it seems like it’s really happening. That’s going to affect the existing players in the space — if they execute and do this right and are smart about it.”



Amazon executives leading the push reached out to at least one family office in recent months, one of the sources said. At the time, the plan, in its earlier iteration, was to do at least one NFT drop with an artist, the same source said. Amazon’s Web3 blueprint appears to have significantly evolved since. 



It wasn’t immediately clear who in terms of personnel is leading Amazon’s NFT initiative. Details about the platform, which would include certain NFT gaming initiatives, are still unfolding, but two sources said the platform is set to run out of Amazon proper, rather than its popular web-hosting platform, Amazon Web Services (AWS).



An additional fifth source said Amazon has been exploring a number of other Web3 initiatives of late. When it comes to both the platform and Amazon’s additional crypto forays, a number of

Amazon NFT Initiative Coming Soon: Exclusive

Crypto and equities markets whipsawed during Thursday’s session as traders leaned more risk-off and speculated what strong GDP numbers might mean for interest rates going forward. 



Preliminary data shows economic growth remained stable during the last quarter of 2022, beating expectations and posting only a moderate decline from the previous period.



The US Commerce Department just reported initial gross domestic product (GDP) numbers, which showed a 2.9% annual rate of economic growth, adjusted for inflation. Several revisions to the data are expected in the coming months. 



The Federal Reserve is expected to continue raising interest rates, although at a slower pace, delaying the shift in policy traders have been eyeing. As of Thursday afternoon in New York, markets were pricing in a 99% chance of a 25 basis point increase next month. 



“The market's obsession with rates and inflation, and their implications for the dollar, leads me to believe that this ultimately ends up bearish for asset prices,” Darius Tabatabai, CEO of decentralized exchange Vertex Protocol, told Blockworks. “A strong GDP print will serve as a warning around potential inflation risks, and most likely embolden hawks on the FOMC.”



Tom Siomades, chief investment officer of AE Wealth Management, agreed, noting that continued lagging unemployment is not helping the case for the Fed to pause interest rate increases anytime soon. The trend means investors will be more likely to allocate to safer investments, he added. 



“Expect fixed income, quality and dividend paying stocks to do well as this tug of war between when the Fed stops and how high it may raise rates continues for the next few months,” Siomades said. 



Downward trend for crypto still on the cards



Markets traded mixed on the GDP news, with the S&P 500 and Nasdaq Composite indexes initially falling before rallying around 0.5% and 1%, respectively, later in the session. 



Bitcoin remained mostly flat,

Strong GDP Numbers May Be Bearish for Crypto – Here’s Why

Though the prevalence of bitcoin miners using nuclear energy at scale could take years to materialize, several players in the space are bullish on the prospect. 



Volatility around bitcoin and the general slow pace of movement in an often risk-averse power industry could serve as barriers though, industry participants said. 



Bitcoin miner TeraWulf recently revealed it is setting up operations at a nuclear energy-powered data center in Susquehanna, Pennsylvania, as part of a partnership with Talen Energy forged in 2021.



The company is targeting 50 megawatts (MW) of mining capacity at the site, with a hashrate capacity of about 1.6 exahashes per second (EH/s). 



TeraWulf began operations at its other site in upstate New York last March, using hydro and solar power at the facility. It is now set to commence mining at the nuclear plant by the end of the quarter. 



Nuclear, natural gas and coal provide base load — a minimum level of power on a grid over a period of time. Renewable energy, such wind and solar sources, have intermittent load, meaning they are not continuous. 



“Given the significant penetration of renewables, what’s been happening with a lot of these base-load facilities is they’re not running at base load anymore,” Nazar Khan, TeraWulf’s co-founder and chief operating officer, told Blockworks. “They were looking and saying the optimal way to run a nuclear facility is for it to just run.”



Khan added that the set-up allows for a bitcoin miner to be an asset to a system that rarely uses peak demand. While TeraWulf gets a reliable and carbon-free energy source to mine bitcoin, the nuclear plant can guarantee a number of megawatts coming off their generators each day. 



“If we could do five more deals like Talen, we would,” he said. “We’ve had discussions with the largest nuclear operators in the country down to folks who have a couple of sites.”



Khan said the conversations are ongoing, declining to share the

Going Nuclear: Bitcoin Mining’s Potential Energy Future

Founders of Nifty Gateway, the Gemini-owned NFT art marketplace, have publicly announced their departure from Gemini on Wednesday as they prepare for their next venture.



Established by brothers Duncan and Griffin Cock Foster in 2018, Nifty Gateway is designed specifically for NFT art collectors. It was acquired by Gemini in 2019 and later facilitated a $3.5 million sale of the “Everydays” collection by artist Mike Winkelmann — otherwise known as Beeple.



Winkelmann later made headlines again after securing a whopping $69 million in an auction at Christie's, almost single-handedly starting the NFT buzz, which lasted throughout 2021.



Nifty’s initial dominance in the NFT space was quickly overtaken by the launch of NFT projects that focused more on avatar-like jpegs. The market began shifting towards NFT marketplaces such as OpenSea.



Read More: The Top 8 NFT Marketplaces – Where To Buy NFTs



In a conversation with Blockworks, Duncan Cock Foster said that starting a business inevitably involves making mistakes.



“There are certainly many things I would do differently if I had a chance to do it all over again,” Cock Foster said. “However, I am overall extremely proud of the work we have done.”



NFT trading volumes have dipped significantly over the past year, although January has seen a slight rebound. Nifty Gateway is a custodial marketplace, meaning on-chain sales data showing a peak of 20 trades a day over the past week is not an accurate reflection of activity, a spokesperson for Nifty told Blockworks.



"There were at least 850 sales in the last 24 hours. The majority of our trades on Ethereum happen off chain and aren't recorded as on-chain transactions."



Parent company Gemini is also going through a tumultuous time as it battles lawsuits from customers of its lending platform, Gemini Earn, following the collapse of crypto lender Genesis, which filed for bankruptcy last week. 



Despite apparent challenges, Cock Foster

Why Are Nifty Gateway’s Founders Leaving Gemini?

Bitcoin Cash proponent Roger Ver is once again feuding with an embattled crypto company over bad trades worth millions of dollars — this time, it’s a subsidiary of bankrupt lender Genesis.



Genesis subsidiary GGC International filed a court summons in New York earlier this week, demanding Ver pay no less than $20 million to cover a set of crypto options, which expired at the end of December.



Ver, once referred to as “Bitcoin Jesus” for his BTC evangelism before staunchly supporting the Bitcoin Cash hard fork in 2017, says he won’t be paying up. 



In a Reddit post Wednesday, Ver claimed he has enough funds to pay Genesis, and even said he’d be “happy to pay,” but it’s Genesis that failed to hold up its end of the bargain.



“... Genesis was required by our agreement to remain solvent — as Genesis can’t ask its clients to play a ‘heads clients lose, tails Genesis wins’ game,” Ver wrote. He further claimed that he’d asked Genesis in June for assurances of its solvency, but didn’t receive what he wanted to know.



GGC International is a British Virgin Island company that facilitates crypto derivatives and spot trading, according to Genesis’ website. 



Genesis, itself a subsidiary of Barry Silbert’s crypto-conglomerate Digital Currency Group, filed for bankruptcy last week, about two months after halting customer withdrawals and loan originations. But GGC International hasn’t filed for bankruptcy just yet.




On the topic of #Genesis: https://t.co/2a0fYu5P3E pic.twitter.com/a6tA0HISMo— Roger Ver (@rogerkver) January 25, 2023




Blockworks has reached out to both Ver and Genesis for comment. 



While it’s unclear whether courts will compel Ver to cover the expired options, this isn’t the first time he's been challenged on trading debt.



Last July, he was entangled with a smaller platform, CoinFLEX, after CEO Mark Lamb accused him of owing the company $47 million in USDC after he failed to meet a margin call.