Bessie Liu

Venture capital firm Andreessen Horowitz (a16z) has privately purchased $90 million worth of Optimism’s OP token.



According to <a href="https://unchainedcrypto.com/a16z-makes-90-million-private-purchase-of-optimisms-op-token/">Unchained Crypto</a>, the investment will be subject to a two-year vesting period and is one of the largest crypto investments that the venture capital firm has made to date.&nbsp;



The purchase was made prior to a16z’s most recent fundraise, during which the venture capital giant disclosed that it had secured $7.2 billion to invest in American Dynamism, Games, Apps, Infrastructure, and Growth.



Read More: <a href="https://blockworks.co/news/a16z-seven-billion-fundraise">A16z raises $7.2B</a>



<h2 class="wp-block-heading">Ex Revolut exec secures $6.5M for new hybrid exchange</h2>



Ruslan Fakhrutdinov, former head of crypto ops at Revolut, has secured $6.5 million to create his own new hybrid exchange, x10.



X10 has the typical features of a centralized exchange, but also offers full-custody and settlement on-chain, enabling its users to perform DeFi perpetuals trading with fast latency and throughput.



“We want to give our users and traders the best of both worlds. Imagine the features and the speed of Coinbase or Binance but with full self-custody,” Fakhrutdinov said in a press release reviewed by Blockworks. 



Fakhrutdinov added, “The FTX situation, where users only got back a third of their funds, serves as a wake-up call for the industry. It urges us to reinforce trust and efficiency in crypto trading through on-chain trade settlement, validation, and self-custody.”



Other notable fundraises this week:



<ul class="wp-block-list">
<li>STYLE Protocol secures $2.5 million to fuel interoperability among digital worlds</li>



<li>AI infrastructure company Wisdomise concludes $9.5 million funding round to accelerate product and community development</li>



<li>Wasabi lands $3 million in a seed round led by Electric Capital</li>
</ul>



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



Get the news in your inbox. Explore Blockworks newsletters:



<ul class="wp-block-list">
<li><a href="https://blockworks.co/newsletter/daily">Blockworks Daily</a>: Unpacking crypto and the markets.</li>



<li><a href="https://blockworks.co/newsletter/empire">Empire</a>: Crypto news and analysis to start your day.</li>



<li><a href="https://blockworks.co/newsletter/forwardguidance">Forward Guidance</a>: The intersection of crypto, macro and policy.</li>



<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha directly in your inbox.</li>



<li><a href="https://blockworks.co/newsletter/lightspeed">Lightspeed</a>: All things Solana.</li>



<li><a href="https://blockworks.co/newsletter/thedrop">The Drop</a>: Apps, games, memes and more.</li>



<li><a href="https://blockworks.co/newsletter/supplyshock">Supply Shock</a>: Bitcoin, bitcoin, bitcoin.</li>
</ul>

a16z

Funding Roundup: a16z made a $90M bid on Optimism

Katherine Ross

Revolut is sending out invites to select customers for a cryptocurrency exchange.



The financial technology company said it’s developing a “standalone cryptocurrency exchange.”



CoinDesk first <a href="https://www.coindesk.com/business/2024/02/16/revolut-to-introduce-crypto-exchange-targeting-advanced-traders/?utm_medium=social&amp;utm_source=twitter&amp;utm_content=editorial&amp;utm_campaign=coindesk_main&amp;utm_term=organic">reported</a> the news, noting that the exchange would be targeting “advanced traders.”



“We always develop new products and functionalities, desired by our customers or asked by the market. The standalone cryptocurrency exchange is one of the future developments, but more information will be released only when the product will be available in-app. Currently this product is accessible by invite only, we will be rolling this out and inviting more customers to take part,” a spokesperson for Revolut told Blockworks.&nbsp;



Read more: <a href="https://blockworks.co/news/making-crypto-wallets-user-friendly">Gone crypto: From Revolut to Zeal</a>



It’s not immediately clear who would be targeted as an advanced trader.



According to CoinDesk, a customer email also teased that users could find “deeper analytical tools and lower fees than the app.”



<a href="https://blockworks.co/tag/revolut">Revolut</a> said in December that it planned to “temporarily pause” UK business crypto purchases following new rules from the UK’s Financial Conduct Authority.



An <a href="https://blockworks.co/news/revolut-pauses-uk-business-purchases">email seen by Blockworks at the time</a> said that Revolut needed to “adjust our current Business crypto offering to make sure aloof the new requirements are met.”



The pause went into effect in early January.



The digital neobank, in August, <a href="https://blockworks.co/news/revolut-halt-crypto-us">announced that it would suspend crypto services</a> to US customers in October.



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



Get the news in your inbox. Explore Blockworks newsletters:



<ul class="wp-block-list">
<li><a href="https://blockworks.co/newsletter/daily">Blockworks Daily</a>: Unpacking crypto and the markets.</li>



<li><a href="https://blockworks.co/newsletter/empire">Empire</a>: Crypto news and analysis to start your day.</li>



<li><a href="https://blockworks.co/newsletter/forwardguidance">Forward Guidance</a>: The intersection of crypto, macro and policy.</li>



<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha directly in your inbox.</li>



<li><a href="https://blockworks.co/newsletter/lightspeed">Lightspeed</a>: All things Solana.</li>



<li><a href="https://blockworks.co/newsletter/thedrop">The Drop</a>: Apps, games, memes and more.</li>



<li><a href="https://blockworks.co/newsletter/supplyshock">Supply Shock</a>: Bitcoin, bitcoin, bitcoin.</li>
</ul>

Revolut

Revolut plots ‘standalone cryptocurrency exchange’

Macauley Peterson

A major impediment to Web3 mass adoption remains the friction of using a crypto wallet, one that makes the user experience convenient while also keeping assets safe.



Some of the problems are technical — private key management, multiple blockchains, fiat on-ramps — but many shortcomings stem from unintuitive design.



Zeal, a new entrant into the wallet space, aims to tackle both. Developed by an 11-person team of product and engineering pros from Revolut, Spotify and Coinbase, the wallet <a href="https://twitter.com/zealwallet/status/1737866933985595819">demonstrates</a> features that should appeal to Web3 newcomers and veterans alike.&nbsp;



Project lead Hannes Graah (pronounced like “gray”) first became curious about the crypto scene in 2015 while working at Spotify, and got more engaged with Ethereum in 2017 as the growth lead at neobank <a href="https://blockworks.co/tag/revolut">Revolut</a>. But it was only on the heels of 2020’s DeFi summer that his crypto journey began in earnest.



Read more: <a href="https://blockworks.co/news/will-defi-summer-return">DeFi summer is over. Will it ever return?</a>



“All of a sudden, all these things that used to be promises on white papers or ideas turned out to actually be tangible products,” Graah told Blockworks.



“The financial building blocks of traditional finance now existed also in decentralized shapes and forms — the zero-to-one moments of trading as an AMM, of lending as lending protocols — those are the core pillars of traditional finance, and now they existed also in a decentralized shape,” he said.



Graah and a few colleagues first launched DeFi protocol Gro, which was a decentralized risk and yield tranching protocol, organized as a <a href="https://blockworks.co/tag/dao">DAO</a>. But as interest rates fell, it became difficult to attract capital and make fully automated on-chain strategies competitive with off-chain options.&nbsp;



The Gro DAO <a href="https://blockworks.co/news/gro-dao-shutdown-total-value-locked-defi-sector">recently voted to wind down</a> and is allowing members to <a href="https://medium.com/gro-protocol/beyond-gro-dao-winding-down-f078dd85f9e4">redeem</a> capital from its treasury.&nbsp;



“We always had an idea that we wanted to build something that lets normal people access <a href="https://blockworks.co/tag/defi">DeFi</a>, and we started thinking about that in the context of yields, but now DeFi yields and [traditional finance] yields have to some degree converged,” Graah explained.



As interface builders for Revolut, the next logical step was to tackle the broader challenge of how to make DeFi apps more accessible to newcomers.



“Revolut experiences, like neobanks in <a href="https://blockworks.co/tag/web2">Web2</a>, are highly curated. They are king-made specific services, often built by the developer of the neobank,” Graah said. “Web3 is open finance where you have access to all kinds of products that are built, and right now we don&#8217;t do any curation of that.”



Zeal is a browser wallet, like <a href="https://blockworks.co/tag/metamask">MetaMask</a>, and will connect anywhere MetaMask does. A mobile version is also in the works. But there are some key differences.



The <a href="https://blockworks.co/tag/wallets">wallet</a> will route token trades via 1inch and 0x aggregators to find the best price, and it handles multichain transfers with built-in bridging using Socket.tech.



It launches with zero-fee fiat on- and off-ramps to connect to users’ bank accounts in the UK and wider Europe.



Today, most users must use a crypto exchange intermediary that sometimes raises red flags with banks, or dedicated on-ramp services that charge fees.



“What boggles my mind is that now, 15 years after the Bitcoin white paper [which] said that it was going to be peer-to-peer digital cash — and I still can&#8217;t just send you some digital dollars today,” Graah said.



Read more: <a href="https://blockworks.co/news/bitcoin-evolution-white-paper">How Bitcoin has evolved since Nakamoto’s white paper debut</a>



But he goes much further.



“Why shouldn&#8217;t you be able to pay for a coffee with tokenized treasuries? Why are there these weird walls between different asset classes, when all asset classes should be liquid and interchangeable — you should be able to use your asset classes to spend on whatever.”



<h2 class="wp-block-heading">Addressing wallet pain points</h2>



Zeal is a self-custody wallet but users don’t need to store a seed phrase. It onboards users with a passkey, such as one generated by the fingerprint sensor on a phone or computer.



In the background, the wallet deploys <a href="https://blockworks.co/tag/safe">Safe</a> smart contract wallets to every EVM chain it supports. It also abstracts away gas tokens — the smart contract deployment happens without the user having to worry about obtaining any ether.



If you want to use a new <a href="https://blockworks.co/tag/evm">EVM</a> chain, the same wallet address will be there waiting. That’s a neat trick —&nbsp;dealing with cross-chain Safe deployments <a href="https://blockworks.co/news/20m-tokens-lost-as-market-maker-wintermute-takes-blame">once tripped up major market maker</a> Wintermute, resulting in a multimillion dollar loss.



“We&#8217;re now at a point where all the technologies are finally in place to build the product experiences that can deliver things for people,” Graah said.



Safe itself is also working on bringing better UX for end users, with <a href="https://blockworks.co/news/gnosis-visa-debit-card-debut">integrations like Gnosis Pay</a> that provide users an IBAN and physical debit card.



<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">&#39;&#39;2024 will be the year that seed phrases can finally become a historical practice for most.&#39;&#39; Gnosis Co-Founder <a href="https://twitter.com/tw_tter?ref_src=twsrc%5Etfw">@tw_tter</a> shared her views in <a href="https://twitter.com/CoinDesk?ref_src=twsrc%5Etfw">@CoinDesk</a>&#39;s Blockchain Tech Predictions for 2024 article! Read the full article here 👇<a href="https://t.co/r1GkPe7gGk">https://t.co/r1GkPe7gGk</a>&mdash; GnosisDAO (@GnosisDAO) <a href="https://twitter.com/GnosisDAO/status/1737827575790243885?ref_src=twsrc%5Etfw">December 21, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Zeal plans to offer cards for point-of-sale transactions as well, but its first iteration focuses on the wallet experience, including things like “safety checks” to help users avoid scams and mistakes —&nbsp;features which currently require additional extensions such as <a href="https://www.joinfire.xyz/">Fire</a>.



By using Safe, an open-source standard securing billions of dollars, users gain peace of mind.



Read more: <a href="https://blockworks.co/news/safe-web3auth-ethereum-smart-accounts">Safe wants Ethereum users to create wallets with emails — not seed phrases</a>



“If, let&#8217;s say, the worst case scenario — Zeal disappears off the face of the Earth — then it&#8217;s still just a normal, good old Safe,” Graah said.



All of this boils down to making cryptocurrency more useful to normal, non-technical users. That’s not just good business, but good policy, and will appeal to regulators, Graah said.



“If we keep on building wallets and treating cryptocurrencies like it&#8217;s a casino, then it&#8217;ll also be considered a speculative asset in a casino,” he said.



“We have to make cryptocurrency into money and make it useful so that it&#8217;s not just something that&#8217;s exciting during a bull market, but it&#8217;s something that I can use in my daily life.”



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



Get the news in your inbox. Explore Blockworks newsletters:



<ul class="wp-block-list">
<li><a href="https://blockworks.co/newsletter/daily">Blockworks Daily</a>: Unpacking crypto and the markets.</li>



<li><a href="https://blockworks.co/newsletter/empire">Empire</a>: Crypto news and analysis to start your day.</li>



<li><a href="https://blockworks.co/newsletter/forwardguidance">Forward Guidance</a>: The intersection of crypto, macro and policy.</li>



<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha directly in your inbox.</li>



<li><a href="https://blockworks.co/newsletter/lightspeed">Lightspeed</a>: All things Solana.</li>



<li><a href="https://blockworks.co/newsletter/thedrop">The Drop</a>: Apps, games, memes and more.</li>



<li><a href="https://blockworks.co/newsletter/supplyshock">Supply Shock</a>: Bitcoin, bitcoin, bitcoin.</li>
</ul>

Bitcoin

Gone crypto: From Revolut to Zeal

Revolut is temporarily pausing the ability to buy crypto for UK Business customers.&nbsp;



According to an email seen by Blockworks, the pause goes into effect on Jan. 3 ahead of a new set of rules from the Financial Conduct Authority which go into effect on Jan. 8. Other Revolut customers will not be impacted by the pause.



The FCA is implementing crypto investment requirements, and Revolut noted that the “requirements aim to enhance the customer journey and provide additional protection for new and existing investors of crypto assets.”



“This pause won&#8217;t impact your ability to hold or sell crypto via Revolut Business, or affect any other tools and features you use with us,” the email said.



The company said it’ll keep its Business clients updated when the pause is lifted.



<a href="https://blockworks.co/tag/revolut">Revolut</a> declined to comment on the pause.



The FCA started rolling out crypto regulations earlier this year, leading other companies to hit the pause buttons on offerings and user acceptances. Binance’s partner firm, back in October, was banned from approving crypto ads by the FCA <a href="https://blockworks.co/news/binance-uk-no-new-customers">leading the exchange to issue a temporary pause</a> on accepting new UK users.



The <a href="https://blockworks.co/tag/fca">FCA</a> introduced rules in October to improve both the clarity and accuracy of marketing for crypto products. However, the <a href="https://blockworks.co/news/uk-fca-deadline-crypto-marketing-regulation">agency gave an extension</a> to some firms that would introduce “features that require greater technical development.”&nbsp;&nbsp;



The extension meant that firms could introduce features like a cooling-off period to allow consumers a set time period to consider their investment decisions without penalties.



“From this October, crypto firms must market to UK consumers clearly, fairly and honestly. And they must provide risk warnings people understand,” Lucy Castledine, director of consumer investment, said in a statement earlier this year.



The FCA <a href="https://blockworks.co/news/fca-uk-unregistered-crypto-firms-huobi-kucoin">issued multiple warnings to companies</a> not following the new rules, showing its steadfast dedication to improving the way crypto companies target users.



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



Get the news in your inbox. Explore Blockworks newsletters:



<ul class="wp-block-list">
<li><a href="https://blockworks.co/newsletter/daily">Blockworks Daily</a>: Unpacking crypto and the markets.</li>



<li><a href="https://blockworks.co/newsletter/empire">Empire</a>: Crypto news and analysis to start your day.</li>



<li><a href="https://blockworks.co/newsletter/forwardguidance">Forward Guidance</a>: The intersection of crypto, macro and policy.</li>



<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha directly in your inbox.</li>



<li><a href="https://blockworks.co/newsletter/lightspeed">Lightspeed</a>: All things Solana.</li>



<li><a href="https://blockworks.co/newsletter/thedrop">The Drop</a>: Apps, games, memes and more.</li>



<li><a href="https://blockworks.co/newsletter/supplyshock">Supply Shock</a>: Bitcoin, bitcoin, bitcoin.</li>
</ul>

Revolut will ‘temporarily pause’ UK business crypto purchases due to FCA rules

Shalini Nagarajan

Digital neobank Revolut is suspending its cryptocurrency-related services within the US in response to the prevailing ambiguities and complex regulatory environment around the industry there.



The suspension will be implemented starting Sept. 2, after which US customers won’t be able to execute purchase orders for cryptocurrencies on the platform.



From Oct. 3, things will tighten up even more as US customers won&#8217;t be able to buy, sell or hold any crypto.



“As a result of the evolving regulatory environment and the uncertainties around the crypto market in the US, we’ve taken the difficult decision, together with our US banking partner, to suspend access to cryptocurrencies through Revolut in the US,” a spokesperson told Blockworks on Friday.



“This decision has not been taken lightly, and we understand the disappointment this may cause,” they added.



The suspension is only applicable to <a href="https://blockworks.co/tag/revolut">Revolut</a> users in the US. Customers in other markets can still sign up and use its crypto services without changes.



Revolut has said that pertinent information regarding the suspension of crypto services in the US will be communicated directly to the affected customers.



Leading crypto firms are encountering regulatory challenges in the US. Both <a href="https://blockworks.co/tag/binance">Binance</a> and <a href="https://blockworks.co/tag/coinbase">Coinbase</a> have found themselves embroiled in legal disputes with the <a href="https://blockworks.co/tag/sec">Securities and Exchange Commission</a> over accusations of offering unregistered securities. 



Coinbase has <a href="https://blockworks.co/news/coinbase-sec-regulatory-clarity">argued</a> that the SEC lacks the authority to &#8220;retroactively&#8221; oversee digital asset exchanges and has accused the regulatory body of overstepping its jurisdiction in its attempt to assert control over the regulation of the industry.



In July, Revolut told its US customers that it would <a href="https://blockworks.co/news/revolut-delists-ada-matic-sol">delist</a> Cardano&#8217;s ADA, Polygon&#8217;s MATIC and Solana&#8217;s SOL tokens from its platform. This decision was also prompted by the evolving legal landscape and regulatory adjustments around cryptocurrencies in the US.



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



Get the news in your inbox. Explore Blockworks newsletters:



<ul class="wp-block-list">
<li><a href="https://blockworks.co/newsletter/daily">Blockworks Daily</a>: Unpacking crypto and the markets.</li>



<li><a href="https://blockworks.co/newsletter/empire">Empire</a>: Crypto news and analysis to start your day.</li>



<li><a href="https://blockworks.co/newsletter/forwardguidance">Forward Guidance</a>: The intersection of crypto, macro and policy.</li>



<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha directly in your inbox.</li>



<li><a href="https://blockworks.co/newsletter/lightspeed">Lightspeed</a>: All things Solana.</li>



<li><a href="https://blockworks.co/newsletter/thedrop">The Drop</a>: Apps, games, memes and more.</li>



<li><a href="https://blockworks.co/newsletter/supplyshock">Supply Shock</a>: Bitcoin, bitcoin, bitcoin.</li>
</ul>

Revolut to halt US crypto services next month

Revolut told US customers that it will be delisting Cardano’s ADA, Polygon’s MATIC and Solana’s SOL tokens on its platform.



“Our US crypto services provider has decided to delist these tokens due to the changing laws and regulations around cryptocurrency in the US. Because of this, we’ll no longer be able to process your buy and sell orders for these tokens,” Revolut told customers.&nbsp;



Revolut uses <a href="https://blockworks.co/tag/bakkt">Bakkt</a>, which announced its plans to delist ADA, MATIC and SOL in mid-June. Revolut said that effective immediately, users will no longer be able to buy these tokens via its service. It will end custodial support for them fully on Sept. 18.



However, “there are no plans to delist these tokens in other markets, where they remain available,” a Revolut spokesperson told Blockworks via email.



“We are taking proactive action to delist three coins that could be deemed securities until there is further clarity on how to compliantly offer a more extensive list of coins,” a <a href="https://blockworks.co/news/bakkt-delist-cardano-polygon-solana">Bakkt spokesperson told Blockworks</a>.&nbsp;



Robinhood also shut down support for the same three tokens following the SEC’s lawsuits against Binance and Coinbase, <a href="https://blockworks.co/news/robinhood-nixes-ada-matic-sol">citing a “cloud of uncertainty.</a>” Support officially ended on June 27.



The regulatory agency has claimed that <a href="https://blockworks.co/price/sol">SOL</a>, <a href="https://blockworks.co/price/matic">MATIC</a> and <a href="https://blockworks.co/price/ada">ADA</a> are part of a group of tokens that constitute securities.&nbsp;



In its arguments, it claimed that SOL’s&nbsp; “marketed burning” led investors to believe that they could make a profit off of their investment.



The SEC also targeted polygon’s burn marketing, saying that there are indications that the supply would decrease.



MATIC was <a href="https://blockworks.co/news/etoro-curtails-crypto-securities">also delisted on eToro</a>, as well as dash, algorand and decentraland — three other tokens the SEC has targeted in its lawsuits. Support ends on July 12.



“We are committed to working closely with regulators around the world to shape the future of the crypto industry,” the company <a href="https://twitter.com/eToroUS/status/1668323755435622405?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1668323758199955456%7Ctwgr%5Ec0cc09289d059d1f5a626e61545e7c6afd7cc278%7Ctwcon%5Es2_&amp;ref_url=https%3A%2F%2Fblockworks.co%2Fnews%2Fetoro-curtails-crypto-securities">tweeted</a>. 



Coinbase, in a lengthy response to the SEC’s claims, argued that the <a href="https://blockworks.co/news/sec-cant-seize-power">SEC can’t “seize power” </a>as it attempts to regulate digital assets and that Congress needs to make decisions in terms of regulations.



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



Get the news in your inbox. Explore Blockworks newsletters:



<ul class="wp-block-list">
<li><a href="https://blockworks.co/newsletter/daily">Blockworks Daily</a>: Unpacking crypto and the markets.</li>



<li><a href="https://blockworks.co/newsletter/empire">Empire</a>: Crypto news and analysis to start your day.</li>



<li><a href="https://blockworks.co/newsletter/forwardguidance">Forward Guidance</a>: The intersection of crypto, macro and policy.</li>



<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha directly in your inbox.</li>



<li><a href="https://blockworks.co/newsletter/lightspeed">Lightspeed</a>: All things Solana.</li>



<li><a href="https://blockworks.co/newsletter/thedrop">The Drop</a>: Apps, games, memes and more.</li>



<li><a href="https://blockworks.co/newsletter/supplyshock">Supply Shock</a>: Bitcoin, bitcoin, bitcoin.</li>
</ul>

Cardano

Revolut delists ADA, MATIC, SOL

Sebastian Sinclair

Britain&#8217;s most valuable fintech company, Revolut, faces a significant setback as the Bank of England reportedly prepares to reject its application for a banking license.&nbsp;



It follows a review of the company’s internal IT systems which were found to be insufficient in assuring revenue streams from different areas of its business including <a href="https://www.telegraph.co.uk/business/2023/03/01/revolut-posts-first-profit-wake-crypto-trading-surge/" target="_blank" rel="noreferrer noopener">crypto trading</a> revenues, its accounting firm BDO said last month.



After a two-year campaign, the Prudential Regulation Authority (PRA), responsible for licensing, informed the government of its intention to deny Revolut’s application. The decision also comes amid concerns over Revolut&#8217;s balance sheet and a qualified audit opinion on overdue accounts, local media <a href="https://www.telegraph.co.uk/business/2023/05/18/bank-england-reject-revoluts-bid-banking-licence/" target="_blank" rel="noreferrer noopener">The Telegraph</a> reported Thursday. 



PRA has instructed Revolut to produce a set of accounts with an audit opinion and simplify its share structure before the license could be granted. The regulator had previously informed the UK government of its plans to issue a notice to Revolut in March.



To date, no warning notice has yet been issued, but backroom discussions are now underway in an attempt to salvage the license application, per the report.



In any case, a denial of its banking license is only expected to affect its offerings of mortgages and loans to UK customers, while its crypto services are expected to remain unaffected.



In March, BDO, one of the UK&#8217;s top accounting firms, said it was unable to fully verify £477 million ($591 million) of Revolut&#8217;s revenues for 2021 due to internal system deficiencies. This amount represents over two-thirds of Revolut&#8217;s total revenues of £636 million ($789 million) for the year.



Revolut, which provides neobanking services, recently <a href="https://blockworks.co/news/revolut-crypto-staking-rewards">doubled down</a> on its crypto offerings, including furthering its push with staking rewards to customers across the UK and Europe.



The fintech unicorn, which has raised $1.8 billion over 19 rounds and is valued at roughly $33 billion, first began offering crypto in 2017 by allowing users to acquire bitcoin, ether and litecoin.



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



Get the news in your inbox. Explore Blockworks newsletters:



<ul class="wp-block-list">
<li><a href="https://blockworks.co/newsletter/daily">Blockworks Daily</a>: Unpacking crypto and the markets.</li>



<li><a href="https://blockworks.co/newsletter/empire">Empire</a>: Crypto news and analysis to start your day.</li>



<li><a href="https://blockworks.co/newsletter/forwardguidance">Forward Guidance</a>: The intersection of crypto, macro and policy.</li>



<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha directly in your inbox.</li>



<li><a href="https://blockworks.co/newsletter/lightspeed">Lightspeed</a>: All things Solana.</li>



<li><a href="https://blockworks.co/newsletter/thedrop">The Drop</a>: Apps, games, memes and more.</li>



<li><a href="https://blockworks.co/newsletter/supplyshock">Supply Shock</a>: Bitcoin, bitcoin, bitcoin.</li>
</ul>

Licenses

Revolut Could See License Application Denied, But Crypto Offerings Unaffected

British neobank Revolut is pushing ahead with its crypto offerings by giving its customers across the UK and Europe the ability to earn staking rewards.



Customers in supported countries can now earn up to 11.65% annual percentage yield (APY), paid in the respective tokens, on four cryptocurrencies: ether (<a href="https://blockworks.co/price/eth" target="_blank" rel="noreferrer noopener">ETH</a>), cardano (<a href="https://blockworks.co/price/ada" target="_blank" rel="noreferrer noopener">ADA</a>), polkadot (<a href="https://blockworks.co/price/dot" target="_blank" rel="noreferrer noopener">DOT</a>) and tezos (<a href="https://blockworks.co/price/xtz" target="_blank" rel="noreferrer noopener">XTZ</a>), Revolut said in a statement Tuesday.



Revolut is currently offering the most yield on DOT. Staking the token directly to the network as a Polkadot validator generates around 14.43% APY, which means staking DOT via Revolut leaves nearly 3% yield on the table.



Funds are to be held with “trusted custodians” while the platform will manage a user’s private keys. Blockworks has reached out to Revolut to learn more.&nbsp;



Revolut’s staking rewards rollout comes as the platform takes another shot at tapping potential growth from the digital asset sector. The fintech unicorn first dabbled in crypto by allowing users to acquire BTC, ETH and litecoin (<a href="https://blockworks.co/price/ltc" target="_blank" rel="noreferrer noopener">LTC</a>) back in 2017. 



Revolut has since expanded its list of supported digital assets significantly, now advertising more than 90 tokens. It also enabled bitcoin withdrawals to personal wallets in 2021.



Revolut CEO Nikolay Storonsky <a href="https://www.bloomberg.com/news/articles/2022-11-02/revolut-crypto-revenue-plunges-yet-ceo-storonsky-still-believes" target="_blank" rel="noreferrer noopener">said</a> in November that while crypto had contributed 30% to 35% of the firm’s total revenue in 2021, that figure had fallen to around 5% last year.



Still, Revolut’s push for diversifying its digital asset revenue streams echoes sentiment shared by Coinbase CEO <a href="https://blockworks.co/news/coinbase-ceo-touts-subscriptions-to-curb-reliance-on-trading-fees" target="_blank" rel="noreferrer noopener">Brian Armstrong</a> last August.



At the time, Armstrong said his company would shift the way it drums up dollars, which has mostly hinged on fees taken from trading activity when times are good.



Revolut offers a number of products and services including banking, brokerage for traditional equities and digital assets. The firm says it serves 25 million customers across 200 countries, leveraging 29 in-app fiat currencies.



Revolut has raised a total of $1.8 billion in funding over 19 rounds and is valued at roughly $33 billion, <a href="https://my.pitchbook.com/profile/104383-72/company/profile#insights" target="_blank" rel="noreferrer noopener">Pitchbook</a> data shows.



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



Get the news in your inbox. Explore Blockworks newsletters:



<ul class="wp-block-list">
<li><a href="https://blockworks.co/newsletter/daily">Blockworks Daily</a>: Unpacking crypto and the markets.</li>



<li><a href="https://blockworks.co/newsletter/empire">Empire</a>: Crypto news and analysis to start your day.</li>



<li><a href="https://blockworks.co/newsletter/forwardguidance">Forward Guidance</a>: The intersection of crypto, macro and policy.</li>



<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha directly in your inbox.</li>



<li><a href="https://blockworks.co/newsletter/lightspeed">Lightspeed</a>: All things Solana.</li>



<li><a href="https://blockworks.co/newsletter/thedrop">The Drop</a>: Apps, games, memes and more.</li>



<li><a href="https://blockworks.co/newsletter/supplyshock">Supply Shock</a>: Bitcoin, bitcoin, bitcoin.</li>
</ul>

neobanks

Revolut Doubles Down on Crypto With Staking Rewards — But Not in US

Jack Kubinec

As tech executives are forced to account for <a href="https://cms.blockworks.co/big-tech-trading-like-bitcoin-on-a-bad-day-after-disappointing-earnings/">tumbling revenues</a> to investors, a new scapegoat has emerged: crypto.



Philipp Schindler, Google’s chief business officer, <a href="https://cms.blockworks.co/google-summer-ad-business-falls-after-crypto-winter/">blamed</a> the company’s growth slowdown in part on a drawdown in ad spending by crypto companies during a third quarter earnings call.&nbsp;



Semiconductor company AMD similarly <a href="https://www.theverge.com/2022/11/1/23435504/amd-q3-2022-earnings-profits-revenue-pc-sales">pegged</a> its own revenue disappointment, among other things, on falling demand for graphics processing units (GPUs) that can be used to mine crypto. Revolut, the upstart finance app, <a href="https://www.bloomberg.com/news/articles/2022-11-02/revolut-crypto-revenue-plunges-yet-ceo-storonsky-still-believes">said</a> crypto revenue fell from 30-35% to 5% of the company’s total since 2021.



Crypto has reached a milestone in its institutional adoption journey that most in the space would be happy to detour around.



“This is the first real quarter where you&#8217;re hearing these companies actively bringing up crypto as a reason for missed revenues,” Griffin McShane, head of insights and communication at MPCH Labs, said.



But crypto companies had to become intertwined with other tech companies for this revenue shortfall to happen in the first place.



In 2018’s crypto winter, Google was <a href="https://www.cnbc.com/2019/02/04/alphabet-earnings-q4-2018.html">exceeding</a> earnings expectations, regardless of whether crypto companies were purchasing ads. But as venture capital and talented young coders created excitement around the potential of blockchain, the rest of the tech economy had no choice but to shift toward crypto. In 2022, crypto and tech prices <a href="https://cms.blockworks.co/crypto-is-more-correlated-with-tech-stocks-than-ever-how-do-we-decouple/">tend to move in tandem</a>.&nbsp;



“If you&#8217;re running a profit-focused [tech] operation, you have to be supportive of blockchain and digital assets, because that seems to be where we are going,” David Tawil, CEO of ProChain Capital, said.



Crypto’s move to the mainstream has been fragmented and beset by unimpressive trading returns in 2022. Bitcoin mining, the original crypto-tech integration, was <a href="https://bitinfocharts.com/comparison/bitcoin-mining_profitability.html#1y">80% less profitable Monday</a> compared to a year ago.&nbsp;



But tech companies do seem to be headed in crypto’s direction, despite the revenue headaches. <a href="https://cms.blockworks.co/meta-pins-web3-hopes-on-instagram-creators-minting-nfts/">Meta</a> and <a href="https://cms.blockworks.co/reddit-makes-pfp-nfts-cool-again-marketplace-trading-volume-surges/">Reddit</a> are integrating NFTs on their platforms. Google Cloud is <a href="https://cms.blockworks.co/google-signals-major-crypto-push-with-ethereum-solana-support/">launching new partnerships</a> with the Ethereum and Solana communities.



Companies further from Web3 development are likely less affected by crypto’s rising and falling. Caterpillar, for example, hasn’t shown much desire to move its manufacturing to the blockchain, and metaverse real estate doesn’t need heavy equipment to build.



But in the tech sector, a world where every company sees itself partly as a crypto company may not be so far off.



“In many ways, I think we&#8217;re already there,” McShane said.



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



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



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

Is Crypto to Blame for Tech Companies’ Woes?

<div id="highlights-block_63086f79f641d" class="highlights">
 <ul>
 <li>Elrond CEO Beniamin Mincu said many new updates are expected in the coming months</li>
 <li>EGLD price has dropped by 77% since its all-time high in November 2021</li>
 </ul>
 
</div>



British fintech and banking firm Revolut is partnering with Elrond to bring the blockchain’s native cryptocurrency, EGLD, onto its platform.



Elrond’s EGLD will be available to over 20 million Revolut users in over 30 countries, an opportunity that Elrond CEO Beniamin Mincu dubbed “tremendous.”



The move marks a bet on the underlying technology of the blockchain, considering its token plummeted some 90% from its all-time high in Nov. 2021. Its total value locked (TVL) has been decimated in that time as well and now sits at $157 million, <a href="https://defillama.com/chain/Elrond" target="_blank" rel="noreferrer noopener">according to DefiLlama</a>.


<div class="wp-block-image">
<figure class="alignright size-full"><img loading="lazy" decoding="async" width="300" height="300" src="https://blockworks-co.imgix.net/wp-content/uploads/2022/08/2022-08-25-Beniamin-Mincu.png" alt="" class="wp-image-29269" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2022/08/2022-08-25-Beniamin-Mincu.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/2022-08-25-Beniamin-Mincu.png?w=150 150w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/2022-08-25-Beniamin-Mincu.png?w=257 257w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/2022-08-25-Beniamin-Mincu.png?w=261 261w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/2022-08-25-Beniamin-Mincu.png?w=219 219w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/2022-08-25-Beniamin-Mincu.png?w=80 80w, https://blockworks-co.imgix.net/wp-content/uploads/2022/08/2022-08-25-Beniamin-Mincu.png?w=50 50w" sizes="auto, (max-width: 300px) 100vw, 300px" /><figcaption>Beniamin Mincu; Source: <a href="https://twitter.com/beniaminmincu" target="_blank" rel="noreferrer noopener">Twitter</a></figcaption></figure></div>


“It’s a huge step forward in making EGLD available to a large audience of people,” Mincu told Blockworks. “The listing is one thing, but there are other things such as staking and some other features as well.”



Elrond launched its mainnet in July 2020, using its own unique Proof-of-Stake (PoS) consensus algorithm called Secure Proof of Stake (SPoS) to support its blockchain.&nbsp;



“We believe the Elrond network enables us to scale dynamically with the demand of the network&nbsp;



in a way that no other network can do at this point,” Mincu said.



The network’s decentralized exchange and digital wallet Maiar was taken offline in June 2022 after “<a href="https://cms.blockworks.co/elrond-native-token-drops-7-as-maiar-dex-goes-dark/" target="_blank" rel="noreferrer noopener">suspicious activity</a>.” This incident caused the wallet’s token MEX to drop in value by over 90%.&nbsp;



EGLD suffered as well, slipping to as low as $38 shortly after the incident. Its price remains down from its all-time high in Nov. 23 2021 high of around $540, trading hands at roughly $56.20 at the time of writing.



Although there have yet to be any significant ecosystem updates on the network, Mincu said there will be a lot to look forward to in the coming months. Most specifically, in November — when the first Elrond conference will be held in Paris.



“We’ve been working on several things, and with this conference, people will get the sense of where this entire space is really going towards, and what we’ve been working on in silence for some time now,” Mincu said.&nbsp;



Mincu said that moving forward, he sees Elrond becoming the “next fundamental layer for the metaverse.”



“I believe that the metaverse landscape will be absolutely defining for the next decades,” he said. “But without the blockchain, the metaverse really cannot exist&nbsp; — so this is the direction that we&#8217;re pushing very heavily towards.”



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



Get the news in your inbox. Explore Blockworks newsletters:



<ul class="wp-block-list">
<li><a href="https://blockworks.co/newsletter/daily">Blockworks Daily</a>: Unpacking crypto and the markets.</li>



<li><a href="https://blockworks.co/newsletter/empire">Empire</a>: Crypto news and analysis to start your day.</li>



<li><a href="https://blockworks.co/newsletter/forwardguidance">Forward Guidance</a>: The intersection of crypto, macro and policy.</li>



<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha directly in your inbox.</li>



<li><a href="https://blockworks.co/newsletter/lightspeed">Lightspeed</a>: All things Solana.</li>



<li><a href="https://blockworks.co/newsletter/thedrop">The Drop</a>: Apps, games, memes and more.</li>



<li><a href="https://blockworks.co/newsletter/supplyshock">Supply Shock</a>: Bitcoin, bitcoin, bitcoin.</li>
</ul>

Elrond

Revolut Expands Crypto Offerings, Adding Elrond

<div id="highlights-block_62f1e689b714d" class="highlights">
 <ul>
 <li>Revolut plans to move on from its current crypto provider in early September, when the company will offer &#8220;wider and better access&#8221; to crypto</li>
 <li>The company is vying to add an additional 25 tokens to its platform in addition to its existing seven offers for US customers</li>
 </ul>
 
</div>



The US arm of digital banking platform Revolut is switching its main cryptocurrency service provider, according to two sources familiar with the matter. 



Revolut is tapping Chicago-based Apex Crypto, the sources said, moving away from Paxos. An email circulated to customers on Tuesday and confirmed by Blockworks said Revolut intends to migrate from New York State Department of Financial Services-licensed crypto firm Paxos in early September. 



Revolut later sent out an email to customers confirming the custodial change, saying assets will be transferred on-chain. Interruptions to crypto trading are expected to last a few hours on the day, per the email.



It ends a more than two-year partnership with Paxos, which paved the way for the app to offer crypto to US-based customers, initially debuting with bitcoin and ether. New York-headquartered Paxos is a financial institution and tech firm that includes crypto brokerage, asset tokenization and settlement services.



Revolut, a financial super app servicing 20 million customers across 36 countries, launched in the US in <a href="https://twitter.com/RevolutApp/status/1242413400308801536?s=20&amp;t=N433Q2SYEqyIaC3jQ25bBA" target="_blank" rel="noreferrer noopener">March 2020</a>.



&#8220;We’re excited to be partnering with Apex Crypto LLC to provide wider and better access to crypto for you and the Revolut community,&#8221; Revolut wrote in the email.



Representatives for all three companies declined to comment. 



The company is eyeing adding an additional 25 or more tokens to its platform following the migration to Apex, adding to its existing seven offerings in the US. Apex is a broker-dealer offering execution, settlement and custody as a service via its turnkey solutions platform.



Revolut also said it would eventually enable crypto withdrawals, deposits and staking &#8220;in the near future.&#8221; Users are currently able to buy, hold, sell and transfer crypto peer-to-peer through the app.



Crypto peer-to-peer transfers will be temporarily halted during and after the migration until further notice, the neobank said.



&#8220;This was a tough decision, but one we had to make as a preemptive measure to ensure that the process is completed successfully, Revolut said of peer-to-peer transfers in its email. &#8220;We&#8217;re working hard to enable this feature again in the near future.&#8221;



Purchases of Polygon (MATIC) for New York State residents will be temporarily disabled following the migration to comply with local regulations. 



Users will be allowed to opt out of the migration process by closing their positions and liquidating their assets at current prevailing market rates by authorizing Paxos to do so.



During the migration, customers will be unable to buy or sell their digital assets while the crypto section of the app will be hidden. Account balances will remain unaffected, according to the email.



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



Get the news in your inbox. Explore Blockworks newsletters:



<ul class="wp-block-list">
<li><a href="https://blockworks.co/newsletter/daily">Blockworks Daily</a>: Unpacking crypto and the markets.</li>



<li><a href="https://blockworks.co/newsletter/empire">Empire</a>: Crypto news and analysis to start your day.</li>



<li><a href="https://blockworks.co/newsletter/forwardguidance">Forward Guidance</a>: The intersection of crypto, macro and policy.</li>



<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha directly in your inbox.</li>



<li><a href="https://blockworks.co/newsletter/lightspeed">Lightspeed</a>: All things Solana.</li>



<li><a href="https://blockworks.co/newsletter/thedrop">The Drop</a>: Apps, games, memes and more.</li>



<li><a href="https://blockworks.co/newsletter/supplyshock">Supply Shock</a>: Bitcoin, bitcoin, bitcoin.</li>
</ul>