Shalini Nagarajan

<div id="highlights-block_62ac3ee796bd9" class="highlights">
        <ul>
                <li>The Tesla CEO reiterated his determination to get rid of farm trolls and bots on Twitter</li>
                <li>“If one can use [Twitter] to make convenient payments, that’s an increase in usefulness,” he said</li>
            </ul>
    
</div>



<p>After securing a <a href="https://cms.blockworks.co/elon-musk-secures-44b-deal-for-social-media-platform-twitter/" target="_blank" rel="noreferrer noopener">$44 billion deal</a> to acquire Twitter in April, billionaire Elon Musk spoke to employees of the social media platform in a virtual meeting on June 16, his first Twitter all-hands meeting.</p>



<p>Musk discussed his plans for the company, including the integration of digital payments and the elimination of cryptocurrency-related scams.</p>



<p>The Tesla chief executive said it would be logical to incorporate digital payments on the network to facilitate direct transfers within Twitter.</p>



<p>“I think it would make sense to integrate payments into Twitter so that it’s easy to send money back and forth, and if you have currency as well as crypto,” he said, according to a <a href="https://www.vox.com/recode/23171541/leaked-transcript-inside-elon-musks-first-meeting-with-twitter-employees" target="_blank" rel="noreferrer noopener">transcript</a> of the meeting posted by Recode.</p>



<blockquote class="wp-block-quote"><p><strong>“My goal would be to maximize the usefulness of the service — the more useful it is, the better,” he said. “And if one can use it to make convenient payments, that’s an increase in usefulness.”</strong></p></blockquote>



<p>He highlighted three areas critical to Twitter’s purpose — news, entertainment and payments. He also wants to address spam accounts on the platform.</p>



<p>“There’s quite a lot of crypto scams on Twitter,” he said. “It’s gotten better, but there’s still a fair bit of that.”&nbsp;</p>



<p>Earlier this month, Musk threatened to abandon his deal with Twitter unless the company provides him with evidence that fake accounts make up less than 5% of its users. Twitter’s <a href="https://www.reuters.com/technology/twitter-estimates-spam-fake-accounts-represent-less-than-5-users-filing-2022-05-02/" target="_blank" rel="noreferrer noopener">own estimate</a> is that fake or bot accounts count for less than 5% of its active users.&nbsp;</p>



<p>&#8220;My offer was based on Twitter&#8217;s SEC filings being accurate,&#8221; Musk <a href="https://twitter.com/elonmusk/status/1526465624326782976" target="_blank" rel="noreferrer noopener">tweeted</a>.</p>



<p>Twitter <a href="https://www.washingtonpost.com/technology/2022/06/08/elon-musk-twitter-bot-data/" target="_blank" rel="noreferrer noopener">agreed</a> to comply with Musk’s demands for internal data, according to the Washington Post.</p>



<p>Separately at the all-hands meeting, Musk said he prefers in-person work at Tesla, where cars cannot be assembled remotely. While he didn’t shoot down the possibility of remote work for Twitter employees, he suggested they periodically drop into the office.</p>



<p>“Even if somebody’s working remotely, they gotta show up at the office occasionally so that they recognize their colleagues and don’t walk down the street and pass your colleagues, and you don’t recognize them,” he said. “That would not be good.”</p>



<h3>Elon <strong>Musk the target of dogecoin pyramid scheme allegations</strong></h3>



<p>The tech mogul has previously proposed building digital payments into Twitter. After acquiring a 9.2% stake in the company, he pitched dogecoin as a payment option for users with a <a href="https://blog.twitter.com/en_us/topics/company/2021/introducing-twitter-blue" target="_blank" rel="noreferrer noopener">Twitter Blue</a> subscription in April.&nbsp;</p>



<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"><p lang="en" dir="ltr">Maybe even an option to pay in Doge?</p>&mdash; Elon Musk (@elonmusk) <a href="https://twitter.com/elonmusk/status/1512954808394731521?ref_src=twsrc%5Etfw">April 10, 2022</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



<p>Musk has often been criticized for making comments that may have influenced the price of dogecoin. On Thursday, one investor launched a $258 billion <a href="https://www.pacermonitor.com/public/case/44928222/Johnson_v_Musk_et_al" target="_blank" rel="noreferrer noopener">class action lawsuit</a> against Musk and his companies SpaceX and Tesla, alleging a scheme to illegally inflate the price of the meme coin.</p>



<p>“Defendants falsely and deceptively claim that dogecoin is a legitimate investment when it has no value at all,” the plaintiff wrote in a federal court filing.</p>



<p>Twitter already has a <a href="https://cms.blockworks.co/twitter-users-can-now-get-paid-in-bitcoin/" target="_blank" rel="noreferrer noopener">bitcoin tipping</a> feature available on its platform for users in El Salvador and the US, which uses the Lightning Network, a bitcoin scaling solution.</p>



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<hr class="wp-block-separator">


Elon Musk Teases Crypto Integration at His First Twitter All-hands

Ben Strack

<div id="highlights-block_624766c9030f0" class="highlights">
        <ul>
                <li>A scalability solution, the Lightning Network allows for faster and cheaper bitcoin transactions</li>
                <li>Kraken originally expected to allow clients to withdraw and deposit bitcoin on Lightning Network in the first half of 2021</li>
            </ul>
    
</div>



<p>Kraken has implemented Lightning Network to provide clients with instantaneous settlement of bitcoin transactions in an effort to help accelerate use of the asset as a medium of exchange.</p>



<p>The Lightning Network is a scalability solution, or layer-2, built on top of the Bitcoin blockchain that allows users to quickly send and receive BTC with virtually no fees.</p>



<p>“In addition to enabling instant and inexpensive deposits and withdrawals, Kraken is providing core network services that enable the Lightning network to route payments,” a company spokesperson told Blockworks. “Overall, we hope our integration signals our support of Lightning to the broader industry.”</p>



<p>The network can execute millions of transactions per second — compared to Visa’s processing of about 65,000 transactions per second, according to the company.</p>



<p>Its system of payment channels does not publish intermediate transactions to the blockchain while open, holding them off-chain to enable instant and efficient value transfer, an April 1 Kraken blog post states. These off-chain channels remain secured by the Bitcoin blockchain’s multi-signature and timelocking features.</p>



<p>&#8220;Bitcoin has proven to be an effective store of value over the last decade and is now seeing increased use as a borderless global currency,&#8221; Pierre Rochard, Kraken&#8217;s bitcoin product manager, told Blockworks in an email. &#8220;The Lightning Network provides real-time settlement of Bitcoin payments, larger capacity than any other system and for the first time microtransactions at scale.”</p>



<p>The integration comes after Kraken had <a href="https://blog.kraken.com/post/7225/a-need-for-speed-kraken-to-launch-bitcoin-lightning-%E2%9A%A1%EF%B8%8F-integration-in-2021/" target="_blank" rel="noreferrer noopener">announced in December 2020</a> that it expected to allow clients to withdraw and deposit bitcoin on Lightning Network in the first half of 2021.</p>



<p>The crypto exchange revealed at the time that it would be hiring a team to focus specifically on the network. The blog post stated that “easier deposits and withdrawals are just the beginning of the additional features we are aiming to provide.”</p>



<p>The spokesperson declined to comment on potential future features.&nbsp;</p>



<p>The “rapid scaling” of Kraken’s business caused the Lightning integration to take longer than anticipated, the representative added, noting that the exchange saw trading volumes across all markets hit all-time highs and its client base double in 2021.</p>



<p>Matthew Gould, founder and CEO of Unstoppable Domains, noted that layer-2 solutions are a big part of improving digital assets’ usability, making it easier for the mainstream population to adopt and transact with digital currencies.</p>



<p>“The Lightning Network is a saving grace for scaling Bitcoin, and this represents a large-scale test for the network,” Colin Pape, founder of decentralized search engine Presearch, said. “I hope that Kraken’s integration is a proof point for the validity of the Lightning Network and something that other exchanges consider, because the success of Bitcoin is the success for the digital-asset space as a whole.”</p>



<p>Spokespeople at competing exchanges did not immediately return requests for comment.</p>



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<hr class="wp-block-separator">


Kraken Supports Bitcoin’s Lightning Network After Delayed Launch

Jacquelyn Melinek

<div id="highlights-block_61ddbd6adc5e0" class="highlights">
        <ul>
                <li>Cash App is a mobile money transfer service that allows people to send and receive money as well as bitcoin</li>
                <li>Block (formerly Square) developed Cash App; Block’s CEO is Jack Dorsey</li>
            </ul>
    
</div>



<p>Mobile payment service Cash App has added a layer-2 payment protocol Lightning Network to help users transact with bitcoin, according to reports by users.&nbsp;</p>



<p>The feature was rolled out to a handful of users and the Lightning Network feature can be used as “the fastest, free way to pay anyone in bitcoin,” according to <a href="https://twitter.com/yeg0rpetrov/status/1480743605467815945?s=20" target="_blank" rel="noreferrer noopener">screenshots</a>.&nbsp;</p>



<p>At the time of publication, it was not clear how users were selected and how many users have received the new feature.</p>



<p>Cash App was not available for immediate comment requested by Blockworks. But Jack Dorsey, the co-founder and CEO of Block, which developed Cash App, has been acknowledging and <a href="https://twitter.com/ODELL/status/1480927111087104009?s=20" target="_blank" rel="noreferrer noopener">liking</a> tweets on Twitter by Cash App users posting screenshots of their Lightning Network transactions on Cash App.&nbsp;</p>



<p>Dorsey is the former co-founder and CEO of Twitter. Block, <a href="https://cms.blockworks.co/?s=dorsey#:~:text=Jack%20Dorsey%E2%80%99s%20Square%20to%20Change%20its%20Name%20to%20Block" target="_blank" rel="noreferrer noopener">formerly known as Square</a>, owns Cash App, TIDAL and <a href="https://cms.blockworks.co/jack-dorsey-tbd-will-be-open-platform-for-decentralized-bitcoin-exchanges/" target="_blank" rel="noreferrer noopener">TBD54566975</a>, a platform for decentralized bitcoin exchanges being developed by Dorsey.&nbsp;</p>



<h3><strong>The Lightning Network</strong></h3>



<p>Lightning Network is a decentralized protocol that uses smart contracts on top of blockchain-based cryptocurrencies like bitcoin. Through the network, participants can instantly send, receive or transact payments without creating an on-blockchain transaction for individual payments, according to its <a href="https://lightning.network/" target="_blank" rel="noreferrer noopener">website</a>.&nbsp;</p>



<p>In February 2019, Dorsey said during an <a href="https://stephanlivera.com/episode/52/" target="_blank" rel="noreferrer noopener">interview</a> that rolling out the Lightning Network on Cash App, is “not an if, it’s more of a when.” Nearly three years later, his plans have come to fruition.</p>



<p>Dorsey has recently been an outspoken advocate for crypto and said that bitcoin will <a href="https://cms.blockworks.co/jack-dorsey-says-bitcoin-will-replace-us-dollar-and-you-dont-own-web3/">replac</a><a href="https://cms.blockworks.co/jack-dorsey-says-bitcoin-will-replace-us-dollar-and-you-dont-own-web3/" target="_blank" rel="noreferrer noopener">e</a><a href="https://cms.blockworks.co/jack-dorsey-says-bitcoin-will-replace-us-dollar-and-you-dont-own-web3/"> the US dollar</a>. He has also <a href="https://twitter.com/jack/status/1424854924194729984?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1424854924194729984%7Ctwgr%5E%7Ctwcon%5Es1_c10&amp;ref_url=https%3A%2F%2Fcms.blockworks.co%2Fwp-admin%2Fpost.php%3Fpost%3D12995action%3Dedit" target="_blank" rel="noreferrer noopener">tweeted</a> that bitcoin will “unite a deeply divided country (and eventually world).”</p>



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Cash App Integrates Lightning Network for Bitcoin Payments

<div id="highlights-block_61b8b92aa0f7f" class="highlights">
        <ul>
                <li>NYDIG will use the capital to develop its Bitcoin-focused platform by integrating Bitcoin protocol upgrades like Lightning payments, asset tokenization and smart contracts</li>
                <li>NYDIG’s CMO previously told Blockworks the company will continue to integrate into the market in a “major way” by next year</li>
            </ul>
    
</div>



<p>NYDIG completed a $1 billion growth equity funding round led by WestCap, according to a company announcement Tuesday.&nbsp;</p>



<p>The equity raise increased the company’s valuation to “more than” $7 billion, the company revealed. Prior investors, including Morgan Stanley, Affirm, New York Life, Mass Mutual, Bessemer Venture Partners, FinTech Collective, FIS and Fiserv also contributed to the round.&nbsp;</p>



<p>“Bitcoin as an asset class has become more of an institutional topic, certainly from macro investors,” Morgan Stanley’s Head of Digital Asset Markets Andrew Peel <a href="https://cms.blockworks.co/morgan-stanleys-peel-bitcoin-is-becoming-an-institutional-topic/" target="_blank" rel="noreferrer noopener">told Blockworks</a> in September. “The growth [in DeFi] can’t be ignored,” Peel said.&nbsp;</p>



<p>The capital will be used to develop its Bitcoin-focused platform by integrating Bitcoin protocol upgrades like Lightning payments, asset tokenization and smart contracts.</p>



<p>“&#8230;this new equity capital will further accelerate progress towards making this exciting network accessible – and useful – to all,” Robert Gutmann, co-founder and CEO of NYDIG, said in a statement.&nbsp;</p>



<p>NYDIG <a href="https://nydig.com/" target="_blank" rel="noreferrer noopener">began</a> in 2016 and spun off into a separate entity in 2017 with a mission to “make Bitcoin accessible to all” by providing technology and financial services solutions to banks, FinTech companies, investment managers, and institutions, among others. It is also a subsidiary of holding company Stone Ridge, a $12 billion alternative asset manager.&nbsp;</p>



<p>The firm is known for partnering with a range of institutions, from traditional financial companies and <a href="https://cms.blockworks.co/nydig-and-q2-launch-bitcoin-platform-to-help-banks-credit-unions-transact-bitcoin/" target="_blank" rel="noreferrer noopener">banks</a> to national <a href="https://cms.blockworks.co/houston-rockets-partner-with-nydig-through-bitcoin-paid-deal/" target="_blank" rel="noreferrer noopener">sports teams</a>.&nbsp;</p>



<p>NYDIG’s Chief Marketing Officer Kelly Brewster declined to comment further on the capital raise when requested by Blockworks on Tuesday.&nbsp;</p>



<p>But last month, Brewster <a href="https://cms.blockworks.co/nydig-plans-to-bring-bitcoin-to-thousands-of-us-banks-in-2022/" target="_blank" rel="noreferrer noopener">said to Blockworks</a>, “Over the course of the next year, we plan to bring bitcoin to hundreds, if not thousands, of banks around the country and the first banks are coming online right now.” The current demand from companies looking to integrate Bitcoin is unlike anything Brewster has ever seen before in this space, he mentioned at the time.&nbsp;</p>



<p>Although there are banks that have already partnered with NYDIG, the company will continue to integrate into the market in a “major way” by next year, Brewster said.</p>



<hr class="wp-block-separator"/>



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NYDIG Closes $1B Funding Round, Raising Valuation Above $7B

Sam Martin

<div id="highlights-block_617725d07bf3f" class="highlights">
        <ul>
                <li>The Bitcoin Network has successfully implemented the highly anticipated Taproot upgrade</li>
                <li>Paraswap announced a new airdrop strategy in an attempt to out-smart &#8216;airdrop hunters&#8217;</li>
            </ul>
    
</div>



<p>Taproot is officially live as Bitcoin successfully underwent its largest upgrade in roughly four years. </p>



<p>The Bitcoin Lightning Network continues to expand its channel count, node count and liquidity. </p>



<p>Senators Lummis and Wyden propose a bill to clarify tax reporting requirements for industry players.  </p>



<p>Paraswap rolled out a retroactive airdrop of its token PSP, allocating 7.5% of the 2 billion token supply to early, active users.</p>



<p>NFTs are seeing a resurgence in volume to kick off the week. </p>



<h3><strong>Latest in Macro:</strong></h3>



<ul><li>S&amp;P 500: 4,682, +.00%</li><li>NASDAQ: 15,853, -.04%</li><li>Gold: $1,862, -.14%</li><li>WTI Crude Oil: $80.95, +.20%</li><li>10-Year Treasury: 1.625%, +.041%</li></ul>



<h3><strong>Latest in Crypto:</strong></h3>



<ul><li>BTC: $64,011, -.19%</li><li>ETH: $4,569, +.44%</li><li>ETH/BTC: .0716, +1.56%</li><li>BTC.D: 43.45%, -.57%</li></ul>



<h3>Taproot</h3>



<p>Yesterday, Bitcoin block 709,632 was processed and the <a href="https://cms.blockworks.co/anticipating-bitcoins-taproot-upgrade-heres-what-you-need-to-know/" target="_blank" rel="noreferrer noopener">Taproot upgrade</a> was activated. This is widely considered to be the largest update to Bitcoin in the past four years.</p>



<p>The Taproot upgrade enables Schnorr signatures, taproot and tapscript, according to a <a href="https://kraken.docsend.com/view/9e9y7may8526z934" target="_blank" rel="noreferrer noopener">Kraken Intelligence paper</a>. While users should not expect Ethereum-like smart contract capabilities, it is a big step that lays the ground work for innovation atop of the Bitcoin network.  </p>



<p>Noelle Acheson, Head of Market Insights at Genesis, noted the important enhancements in an email to Blockworks: </p>



<ul><li>It will boost Bitcoin’s smart contract functionality, potentially broadening its use cases.</li><li>It increases privacy by obscuring what type of transaction is being executed.</li><li>Bitcoin transactions will become more data-efficient, which could optimize block capacity and lead to lower transaction fees.</li><li>Taproot&nbsp;makes transactions on the Lightning Network more flexible and more private, which should further boost Bitcoin adoption.</li></ul>



<p>A rough timeline of the Taproot upgrade from birth to implementation:</p>



<div class="wp-block-image"><figure class="aligncenter size-full"><img decoding="async" loading="lazy" width="750" height="609" src="https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-3.01.24-PM.png" alt="" class="wp-image-11195" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-3.01.24-PM.png?w=750 750w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-3.01.24-PM.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-3.01.24-PM.png?w=317 317w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-3.01.24-PM.png?w=321 321w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-3.01.24-PM.png?w=270 270w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-3.01.24-PM.png?w=80 80w" sizes="(max-width: 750px) 100vw, 750px" /><figcaption>Source: Kraken Intelligence</figcaption></figure></div>



<h3>The Lightning Network</h3>



<p>The Lightning Network (LN) is a protocol that enables high­-volume, low­-latency digital micropayments without the need for trusted intermediaries, according to the project&#8217;s <a href="https://lightning.network/lightning-network-technical-summary.pdf" target="_blank" rel="noreferrer noopener">website</a>. Using novel Bitcoin multi-signature transactions and scripts, Lightning participants do not give unilateral custody of funds to a third party, reducing transaction costs and counterparty risk.</p>



<p>Bitcoin node operators are able to download the Lightning Network daemon, fund their Lightning account, and begin opening channels in exchange for <a href="https://www.nasdaq.com/articles/how-to-operate-a-profitable-lightning-node-2021-03-01" target="_blank" rel="noreferrer noopener">some passive income</a>. </p>



<p><a href="https://defipulse.com/lightning-network" target="_blank" rel="noreferrer noopener">Defi Pulse</a> explains that because LN nodes (i.e., users in LN channels) are interconnected, nodes do not always need to open a direct channel with everyone they want to transact with. Payments can be routed through other channels, provided that a path with adequate liquidity exists between the two transacting nodes.</p>



<p>The Lightning Network has seen massive growth over the past year, with the total number of channels open <a href="https://1ml.com/statistics" target="_blank" rel="noreferrer noopener">crossing 80,000</a> and the amount of liquidity continuously reaching all-time highs. The more channels and liquidity in the LN, the more useful it becomes. Some of this growth is likely attributed to the <a href="https://cloudtweaks.com/2021/07/how-bitcoin-brought-lightning-network-el-salvador/" target="_blank" rel="noreferrer noopener">adoption of BTC as legal tender</a> in El Salvador. </p>



<div class="wp-block-image"><figure class="aligncenter size-full"><img decoding="async" loading="lazy" width="700" height="450" src="https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Unknown-2.jpg" alt="" class="wp-image-11200" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Unknown-2.jpg?w=700 700w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Unknown-2.jpg?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Unknown-2.jpg?w=400 400w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Unknown-2.jpg?w=406 406w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Unknown-2.jpg?w=341 341w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Unknown-2.jpg?w=80 80w" sizes="(max-width: 700px) 100vw, 700px" /><figcaption>Source: lookintobitcoin.com</figcaption></figure></div>



<h3>Senators propose fix to crypto reporting laws</h3>



<p>Senators Wyden and Lummis introduced a bill to narrow some of the cryptocurrency tax reporting rules in the Infrastructure Bill being signed into law today, according to a <a href="https://www.bloomberg.com/news/articles/2021-11-15/senators-seek-crypto-reporting-fix-as-biden-signs-infrastructure?sref=uaUCx1z2" target="_blank" rel="noreferrer noopener">Bloomberg article</a>. The primary goal of the proposal is to ensure innovation is not stifled due to a lack of clarity around reporting requirements in the bill.</p>



<p>“Our bill makes clear that the new reporting requirements do not apply to individuals developing blockchain technology and wallets,” Wyden said in a statement. “This will protect American innovation while at the same time ensuring those who buy and sell cryptocurrency pay the taxes they already owe.”</p>



<p>Senator Lummis, a long-time supporter of Bitcoin, has been very vocal about her concerns related to government spending and its resulting inflation. She took to <a href="https://twitter.com/CynthiaMLummis/status/1458475839641763844?s=20" target="_blank" rel="noreferrer noopener">Twitter</a> to say &#8220;Bottom line: Inflation is a reflection of the debasement of US dollars by the federal government. New spending is at the root of the price increases at your grocery store.&#8221;</p>



<figure class="wp-block-image size-large"><img decoding="async" loading="lazy" width="1024" height="731" src="https://blockworks-co.imgix.net/wp-content/uploads/2021/11/goldvinflationvbtc-1024x731.jpg" alt="" class="wp-image-11203" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2021/11/goldvinflationvbtc-1024x731.jpg?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/goldvinflationvbtc-1024x731.jpg?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/goldvinflationvbtc-1024x731.jpg?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/goldvinflationvbtc-1024x731.jpg?w=1536 1536w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/goldvinflationvbtc-1024x731.jpg?w=360 360w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/goldvinflationvbtc-1024x731.jpg?w=366 366w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/goldvinflationvbtc-1024x731.jpg?w=307 307w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/goldvinflationvbtc-1024x731.jpg?w=80 80w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/goldvinflationvbtc-1024x731.jpg?w=2000 2000w" sizes="(max-width: 1024px) 100vw, 1024px" /><figcaption>Source: Ycharts</figcaption></figure>



<p>Despite the successful implementation of Taproot, red-hot inflation numbers and a positive regulatory proposal, the BTC price has traded flat to negative over the last 24 hours. BTC was last hovering near $64,000, down roughly .5% on the day. </p>



<h3>Paraswap airdrop</h3>



<p>Paraswap, a decentralized exchange (DEX) aggregator that provides rates over multiple DEXs on the Ethereum blockchain, airdropped its token (PSP) to certain users this morning. Roughly 20,000 addresses were allocated 7.5% of the 2 billion PSP token supply. </p>



<p>The Paraswap team noticed a large amount of &#8216;airdrop hunters&#8217; and chose to select eligible recipients based on various usage metrics from a snapshot taken on Oct. 8, rather than airdropping tokens to every wallet that used Paraswap. Paraswap detailed its plan in a company released medium <a href="https://medium.com/paraswap/whats-an-active-user-clarifying-psp-token-distribution-filtering-logic-81df6096d410" target="_blank" rel="noreferrer noopener">article</a>, however, the airdrop led to confusion and discontent among users.</p>



<p>An overview of the PSP airdrop can be seen in the following photo:</p>



<div class="wp-block-image"><figure class="aligncenter size-large"><img decoding="async" loading="lazy" width="1024" height="492" src="https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-2.41.33-PM-1024x492.png" alt="" class="wp-image-11188" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-2.41.33-PM-1024x492.png?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-2.41.33-PM-1024x492.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-2.41.33-PM-1024x492.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-2.41.33-PM-1024x492.png?w=428 428w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-2.41.33-PM-1024x492.png?w=470 470w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-2.41.33-PM-1024x492.png?w=389 389w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-2.41.33-PM-1024x492.png?w=80 80w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-2.41.33-PM-1024x492.png?w=1404 1404w" sizes="(max-width: 1024px) 100vw, 1024px" /><figcaption>Source: Dune Analytics</figcaption></figure></div>



<h3>Non-Fungible Tokens (NFTs)</h3>



<p>NFTs are starting to see signs of life after a rough week last week. Bored Ape Yacht Club and its&#8217; Mutant derivative have seen a lot of attention today. Trading data from <a href="https://opensea.io/rankings" target="_blank" rel="noreferrer noopener">OpenSea</a> and <a href="https://solanalysis.com" target="_blank" rel="noreferrer noopener">Solanalysis</a> of some of the top Solana and Ethereum projects can be found below:</p>



<div class="wp-block-image"><figure class="aligncenter size-large"><img decoding="async" loading="lazy" width="1024" height="332" src="https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-2.42.37-PM-1024x332.png" alt="" class="wp-image-11189" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-2.42.37-PM-1024x332.png?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-2.42.37-PM-1024x332.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-2.42.37-PM-1024x332.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-2.42.37-PM-1024x332.png?w=428 428w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-2.42.37-PM-1024x332.png?w=470 470w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-2.42.37-PM-1024x332.png?w=389 389w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-2.42.37-PM-1024x332.png?w=80 80w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-2.42.37-PM-1024x332.png?w=1238 1238w" sizes="(max-width: 1024px) 100vw, 1024px" /><figcaption>Top Ethereum Projects</figcaption></figure></div>



<div class="wp-block-image"><figure class="aligncenter size-large"><img decoding="async" loading="lazy" width="1024" height="283" src="https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-2.42.45-PM-1024x283.png" alt="" class="wp-image-11191" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-2.42.45-PM-1024x283.png?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-2.42.45-PM-1024x283.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-2.42.45-PM-1024x283.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-2.42.45-PM-1024x283.png?w=428 428w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-2.42.45-PM-1024x283.png?w=470 470w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-2.42.45-PM-1024x283.png?w=389 389w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-2.42.45-PM-1024x283.png?w=80 80w, https://blockworks-co.imgix.net/wp-content/uploads/2021/11/Screen-Shot-2021-11-15-at-2.42.45-PM-1024x283.png?w=1214 1214w" sizes="(max-width: 1024px) 100vw, 1024px" /><figcaption>Top Solana Projects </figcaption></figure></div>



<p>If you made it this far, thanks for reading! I am looking forward to catching up tomorrow.</p>



<hr class="wp-block-separator"/>



<p><strong>Get the day’s top crypto news and insights delivered to your inbox every evening.&nbsp;<a href="https://cms.blockworks.co/newsletter/" target="_blank" rel="noreferrer noopener">Subscribe to Blockworks’ free newsletter</a>&nbsp;now.</strong></p>



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BTC Price Flat After Taproot, Lightning Network Continues to Grow: Markets Wrap


<p>On this episode of Blockworks&#8217; podcast &#8220;<a href="https://youtu.be/1j5mDQnA4i4" target="_blank" rel="noreferrer noopener">On the Margin</a>,&#8221; Michael Ippolito, co-founder, is joined by returning guests Jeff Booth &amp; Greg Foss. Jeff &amp; Greg discuss breaking news as the first ever U.S Bitcoin ETF was approved and what this could mean for institutional exposure to Bitcoin.</p>



<p>Mike, Jeff &amp; Greg also discuss the recent developments in El Salvador as Bitcoin was made legal tender, The Lightning Network, the deflationary forces &amp; network effects of technology, and the outlook for 2021 &amp; the future of Bitcoin.</p>



<p>They also covered:  </p>



<ul><li>Bitcoin mining</li><li>Altcoins vs Bitcoin</li><li>and more!</li></ul>



<p>Watch the full episode down below! 👇</p>



<figure class="wp-block-embed is-type-video is-provider-youtube wp-block-embed-youtube wp-embed-aspect-16-9 wp-has-aspect-ratio"><div class="wp-block-embed__wrapper">
<iframe loading="lazy" title="Everything You Need to Know: Bitcoin ETF, Lightning Network, &amp; Altcoins | Jeff Booth &amp; Greg Foss" width="1024" height="576" src="https://www.youtube.com/embed/1j5mDQnA4i4?feature=oembed" frameborder="0" allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture" allowfullscreen></iframe>
</div></figure>



<p>&#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 a co-host where they break down the top crypto and macro stories. Episodes go live every Wednesday and Saturday morning.</p>



<p>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>.</p>



<p><strong>Are you a UK or EU reader that can&#8217;t get enough investor-focused content on digital assets? <a target="_blank" href="https://cms.blockworks.co/events/das-london/" rel="noreferrer noopener">Join us</a> in London on November 15th and 16th for the Digital Asset Summit (DAS) London. Use code ARTICLE for £75 off your ticket. <a target="_blank" href="https://cms.blockworks.co/events/das-london/" rel="noreferrer noopener">Buy it now</a>.</strong></p>


Podcast: Bitcoin ETF, Lightning Network, & Altcoins | Jeff Booth & Greg Foss

Sam Reynolds

<div id="highlights-block_6141f6db39d9f" class="highlights">
        <ul>
                <li>Transaction fees paid to miners have dropped to a low not seen since March 2020</li>
                <li>Investors in the industry remain confident in North American infrastructure shift trend</li>
            </ul>
    
</div>



<p>Transaction fees paid to bitcoin miners are at a low not seen since the <a href="https://www.cnbc.com/2020/03/13/bitcoin-loses-half-of-its-value-in-two-day-plunge.html" target="_blank" rel="noreferrer noopener">Covid crash of March 2020</a>, but experts think the decline is unlikely to affect the industry’s mining push into North America due to block subsidies which will remain in place <a href="https://www.bitcoinblockhalf.com/" target="_blank" rel="noreferrer noopener">until sometime in the spring of 2024</a>.</p>



<p>As of writing, bitcoin can be sent for 5 &#8220;satoshis&#8221; per byte (currently about $0.35), even at a high priority, meaning the transaction will be processed in the next block, or 1 satoshi per byte (about $0.07) if you&#8217;re willing to wait for 20-30 minutes. The fee is not linked to the value of the transaction, so a person could even send $1 billion for 7 cents and have settlement essentially guaranteed within a couple of hours.</p>



<h3>How it works</h3>



<p>The Bitcoin blockchain is made up of “blocks” of transaction data, cryptographically linked together. Blocks can vary in size (think of them as a page of a ledger or record book), based on a variety of factors. Currently, each block is <a href="https://www.blockchain.com/charts/avg-block-size" target="_blank" rel="noreferrer noopener">approximately 1MB</a> in size.</p>



<p>Block subsidies are rewards given to miners for their effort in securing the network and are determined by an algorithm in <a href="https://bitcoincore.org/" target="_blank" rel="noreferrer noopener">the protocol’s source code</a>. Subsidies are distributed upon the completion of a new block after the preceding one is finished, which occurs — on average — every 10 minutes.</p>



<div class="wp-block-image"><figure class="aligncenter size-full is-resized"><img decoding="async" loading="lazy" src="https://blockworks-co.imgix.net/wp-content/uploads/2021/09/2021-09-15-BTC-blocks-copy.jpg" alt="BTC blocks" class="wp-image-7938" width="630" height="200" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2021/09/2021-09-15-BTC-blocks-copy.jpg?w=630 630w, https://blockworks-co.imgix.net/wp-content/uploads/2021/09/2021-09-15-BTC-blocks-copy.jpg?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2021/09/2021-09-15-BTC-blocks-copy.jpg?w=428 428w, https://blockworks-co.imgix.net/wp-content/uploads/2021/09/2021-09-15-BTC-blocks-copy.jpg?w=470 470w, https://blockworks-co.imgix.net/wp-content/uploads/2021/09/2021-09-15-BTC-blocks-copy.jpg?w=389 389w, https://blockworks-co.imgix.net/wp-content/uploads/2021/09/2021-09-15-BTC-blocks-copy.jpg?w=80 80w" sizes="(max-width: 630px) 100vw, 630px" /><figcaption>Recently mined Bitcoin blocks; Source: mempool.space</figcaption></figure></div>



<p>Currently, the block subsidy is 6.25 bitcoins per block completed. Block subsidies comprise one part of the revenue miners generate from their activities. The remainder is transaction fees — the fees users of the blockchain pay to send bitcoin over the network.</p>



<h3>Transaction fees matter</h3>



<p>Transaction fees have fallen sharply since mid-April, due to a combination of lower network activity and <a href="https://bitcoinvisuals.com/ln-capacity" target="_blank" rel="noreferrer noopener">growing capacity</a> on the Bitcoin layer-2 Lightning Network. </p>



<figure class="wp-block-image size-full"><img decoding="async" loading="lazy" width="933" height="470" src="https://blockworks-co.imgix.net/wp-content/uploads/2021/09/2021-09-15-BTC-fees.jpg" alt="BTC fees" class="wp-image-7945" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2021/09/2021-09-15-BTC-fees.jpg?w=933 933w, https://blockworks-co.imgix.net/wp-content/uploads/2021/09/2021-09-15-BTC-fees.jpg?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2021/09/2021-09-15-BTC-fees.jpg?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2021/09/2021-09-15-BTC-fees.jpg?w=428 428w, https://blockworks-co.imgix.net/wp-content/uploads/2021/09/2021-09-15-BTC-fees.jpg?w=470 470w, https://blockworks-co.imgix.net/wp-content/uploads/2021/09/2021-09-15-BTC-fees.jpg?w=389 389w, https://blockworks-co.imgix.net/wp-content/uploads/2021/09/2021-09-15-BTC-fees.jpg?w=80 80w" sizes="(max-width: 933px) 100vw, 933px" /><figcaption>Fee revenue since April 2021; Source: blockchain.com</figcaption></figure>



<p>“Although fees declining isn&#8217;t great for miners, I don&#8217;t see this as a long-term issue. We are still so early in the digital asset adoption curve that I think this will iron itself out over time,” Brian Dixon, Chief Operating Officer of Digital Currency and Blockchain asset management firm Off the Chain Capital, told Blockworks. “Most well-known mining operations are very profitable and can sustain themselves during this period of volatility.”</p>



<p>Indeed, in an August 3 note, Compass Point Research analyst Michael Del Grosso gave publicly listed miner Marathon Digital a buy rating, and called Riot Blockchain, another miner, a buy in an August 24 note.&nbsp;</p>



<p>Kevin Zhang, vice president of business development at Foundry, a Digital Currency Group subsidiary that provides financing for bitcoin and other mining equipment, also agrees that fee compression isn’t a huge deal for miners and won’t be making a “direct impact into the investment thesis or expansion plans in North America.”</p>



<p>“That being said, longer term, if the price of bitcoin in USD doesn’t continue to appreciate along the same pace as hashrate and network difficulty then the fee’s will need to increase to offset the lost revenue over time,” he added.</p>



<h3>The hashrate factor</h3>



<p>Bitcoin is programmed such that subsidies become easier or harder to achieve depending on the amount of hashrate available, and is updated roughly every two weeks to keep the average block time consistent. Increased hashrate improves the security of the network and is correlated with the $BTC price.</p>



<p>Despite some market volatility, generally speaking the mining industry has been on a bit of a bull run as it <a href="https://cms.blockworks.co/china-mining-exodus-seen-as-positive-for-bitcoin/" target="_blank" rel="noreferrer noopener">moves</a> to North America from China given the recent crackdowns in-country on the industry.&nbsp;</p>



<p>“It’s been a huge net positive for the market,” said Dixon, noting that as an investor he’s seen significant interest from energy companies looking at how bitcoin mining can use off-peak <a href="https://cms.blockworks.co/microstrategy-and-galaxy-bitcoin-mining-council-claims-mining-is-one-of-most-sustainable-industries/" target="_blank" rel="noreferrer noopener">power</a> making the grid more efficient overall.&nbsp;</p>



<p>Several of the largest US-listed bitcoin mining firms with operations predominantly in North America have collectively mined over 10,500 BTC year-to-date with nearly 40% of the output coming from the past two months, according to Off the Chain Capital. Five of the largest bitcoin mining firms have added almost all of their mined bitcoin to their balance sheets — adding up to 17,960 BTC as of August, valued at around $820 million, the firm also noted.&nbsp;</p>



<p>Dixon said that it&#8217;s going to take some time before companies are able to ramp up to full capacity. Generally, bitcoin miners don’t use data centers, but prefer to build out their own hosting facilities, which will take some time given the tight labor market in the US. And then there’s the monumental task of getting all the dedicated mining <a href="https://cms.blockworks.co/bitmain-set-to-add-56k-bitcoin-mining-rigs-in-georgia-state/" target="_blank" rel="noreferrer noopener">machines</a> to North America, in spite of the challenging freight market.&nbsp;</p>



<p>“This isn’t going to happen tomorrow,” Dixon said. “Covid continues to be a challenge when you are moving this much freight between countries.”</p>



<hr class="wp-block-separator"/>



<p><strong>Are you a UK or EU reader that can’t get enough investor-focused content on digital assets?<a target="_blank" href="https://cms.blockworks.co/events/das-london/" rel="noreferrer noopener">Join us</a>&nbsp;in London on November 15th and 16th for the Digital Asset Summit (DAS) London. Use code ARTICLE for £75 off your ticket.&nbsp;<a target="_blank" href="https://cms.blockworks.co/events/das-london/" rel="noreferrer noopener">Buy it now</a>.</strong></p>



<hr class="wp-block-separator"/>
