Michael Bodley

<div id="highlights-block_62055f2e51569" class="highlights">
 <ul>
 <li>The hedge fund specialist had $43.8 billion of gross assets under management in November 2021, the most recent figure available </li>
 <li>Crypto strategies present a fresh set of due-diligence challenges for investors</li>
 </ul>
 
</div>



The asset management arm of UBS, one of the world’s largest hedge fund investors, is conducting due diligence on crypto portfolio managers as the division delves into digital assets, according to two sources familiar with the matter. 



The vetting process for UBS Asset Management, via hedge fund-of-funds unit Hedge Fund Solutions, has been ongoing and has ramped up in recent months as institutional interest in the sector has grown, the people said.&nbsp;



Sources were granted anonymity to discuss sensitive business dealings. A UBS spokesperson declined to comment.



UBS’ efforts have accelerated as the number of crypto-focused hedge fund launches — not to mention traditional asset managers<a href="https://cms.blockworks.co/sources-brevan-howard-launches-first-digital-assets-fund-in-massive-crypto-push/" target="_blank" rel="noreferrer noopener"> starting crypto trading programs</a> — has boomed recently. 



Though Hedge Fund Solutions has yet to back a digital assets portfolio manager or spin up a fund-of-funds focused on crypto specifically, sources flagged the effort as the latest sign that big-time investors can no longer afford to wait on the sidelines. The asset management unit had $43.8 billion of gross assets under management as of November 2021, the most recent data available.&nbsp;



Other large hedge fund investors are expected to follow suit, sources said.



<blockquote class="wp-block-quote">“The people that park their money in the asset management arms of these big banks want crypto exposure just as much as everyone else,” one source said. “And they don’t necessarily have the know-how to source and vet these managers themselves. It makes sense for [UBS] to step in and make it happen.”</blockquote>



The bank has been busy getting familiar with crypto players and learning the ins and outs of conducting due diligence on strategies in the sector. For professionals used to vetting traditional fund managers, taking stock of crypto managers presents a new set of challenges around counterparty risk and custody, asset evaluation and evolving regulations.&nbsp;



“Even if they haven’t backed anyone yet, that’s not necessarily a bearish indicator,” one source said. “These things take time. They’ve got to get comfortable with vetting crypto managers. And they have to make sure their [limited-partners] are comfortable with it, too.”&nbsp;



Hedge Fund Solutions is led by Bruce Amlicke, the division’s chief investment officer.



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Sources: UBS Asset Management Vetting Crypto Hedge Fund Managers

Casey Wagner

<div id="highlights-block_61fb1529c0f6e" class="highlights">
 <ul>
 <li>In a win for cryptocurrency stakers and miners, the IRS proposes not to tax unsold tokens of Tennessee couple</li>
 <li>Tokens attained through proof-of-stake protocols are taxpayer-created property and should not be taxed until sold or exchanged, the Nashville couple argued in May</li>
 </ul>
 
</div>



A decision to refund a Nashville couple taxes related to unsold Tezos tokens is set to clarify the IRS tax treatment of staked cryptocurrency.&nbsp;



In a win for cryptocurrency stakers and miners, the IRS has offered to refund the couple taxes paid on rewards gained — but not redeemed — from staking on the Tezos blockchain, according to people familiar with the matter.



Official court filings <a href="https://storage.courtlistener.com/recap/gov.uscourts.tnmd.86378/gov.uscourts.tnmd.86378.35.0.pdf" target="_blank" rel="noreferrer noopener">were made public</a> on Thursday, indicating that a bench trial is set for March 2023, unless the case is settled following the conclusion of the discovery process in mid-March of this year.&nbsp;



In May 2021, Joshua and Jessica Jarrett requested a refund of $3,293 of income tax paid in 2019 for the receipt of 8,876 Tezos tokens, according to a legal <a href="https://www.scribd.com/document/509435727/Jarrett-Compl?secret_password=LFIAqtDNw9i5loKXdjB4" target="_blank" rel="noreferrer noopener">complaint</a> filed on May 26, 2021, with the US District Court for the Middle District of Tennessee. The couple also sought a $500 increase in tax credits for lost income.&nbsp;



Tokens attained through proof-of-stake protocols are taxpayer-created property and should not be taxed until sold or exchanged, the Jarretts argued. The complaint claims that nothing under United States law or IRS code and regulations allows for taxpayer-created property to be taxed as income.&nbsp;



The decision to offer a refund — which was rejected by the plaintiffs — has potentially large implications for how proof-of-stake miners and <a href="https://cms.blockworks.co/coinshare-launches-new-etps/" target="_blank" rel="noreferrer noopener">stakers</a> are taxed in the future.&nbsp;



A representative from the IRS declined to comment, and the agency has not yet published any formal policy statement — which is what the Jarrets are seeking in this case.



An offer of a settlement is not the same as a binding precedent, <a href="https://twitter.com/TokenTax/status/1489106538639675394" target="_blank" rel="noreferrer noopener">according to tax</a> and public <a href="https://twitter.com/jchervinsky/status/1489094575100735489" target="_blank" rel="noreferrer noopener">policy experts</a>.



This story was updated on Feb. 3, 2022, at 7:10 AM, with details on the released court filings.



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In Win For Crypto Stakers, IRS Offers Refund on Untraded Token Rewards

<div id="highlights-block_61f99ef2ea65f" class="highlights">
 <ul>
 <li>The company’s cloud services department is looking at how to integrate blockchain technology</li>
 <li>YouTube and Google Maps could employ Web3 elements, Alphabet’s CEO said</li>
 </ul>
 
</div>



Alphabet, the parent company of Google and YouTube, is looking at how to build blockchain technologies into its blockbuster services, executives said on a Tuesday earnings call.



Responding to an analyst question on how the company views Web3, CEO Sundar Pichai said there are several “areas of interest” for Alphabet: augmented reality, for one, as well as looking at how blockchain technology can be used to power computing and services layers for the likes of YouTube and Google Maps.



The company is “definitely looking at blockchain,” Pichai said, calling it “an interesting and powerful technology with broad applications.”



Alphabet’s cloud team — an <a href="https://cms.blockworks.co/google-creates-blockchain-unit-hires-new-founding-leader/" target="_blank" rel="noreferrer noopener">emerging</a> part of its business that competes with Amazon Web Services and Microsoft — is looking at how to “support customer needs” via blockchain-based <a href="https://cms.blockworks.co/google-cloud-hiring-blockchain-specialists-in-bid-to-drive-decentralization-efforts/" target="_blank" rel="noreferrer noopener">platforms</a>, according to Pichai. That seemingly could be applied in employing blockchain tech to organize customer service requests. 



He did not provide further specifics.&nbsp;



“Anytime there’s innovation, I find it exciting, and I think it is something we want to support the best we can,” Pichai said. “The web has always evolved, and it’s going to continue to evolve, and as Google, we have benefited tremendously from open-source technologies, so we do plan to contribute there.



The company’s <a href="https://abc.xyz/investor/static/pdf/2021Q4_alphabet_earnings_release.pdf?cache=d72fc76" target="_blank" rel="noreferrer noopener">earnings</a> exceeded analyst expectations, with fourth-quarter revenue of $75.33 billion, an increase of 32% from the same period a year prior. Profits rose by one-third. 



“Technology will continue to evolve and innovate, and we want to be pro-innovation and approach it that way,” Pichai said.





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Alphabet CEO Says Company ‘Definitely’ Looking at Blockchain

Jacquelyn Melinek

<div id="highlights-block_61f991c634137" class="highlights">
 <ul>
 <li>“We have high conviction that we made the right move,” Cheng said</li>
 <li>Since leaving, the co-founders had “technical breakthroughs” that Cheng says they wouldn’t have had if they stayed at Meta</li>
 </ul>
 
</div>



Fed up by the red tape of Big Tech, four former Facebook employees banded together and created a startup focused on Web3 and blockchain infrastructure. Now, they’re planning to launch a blockchain in the near future.&nbsp;



The co-founder and CEO of Mysten Labs, Even Cheng, spent the last 16 years at tech companies, namely Apple and Facebook, now known as Meta.&nbsp;



He and three other ex-Facebook employees — Sam Blackshear, Adeniyi Abiodun and George Danezis — worked together on Meta’s Novi Financial team to help develop the Diem blockchain and Move programming language, a cross-platform smart contract language that helps developers secure against exploits.&nbsp;&nbsp;



But they felt there were too many restrictions at their previous employer, so they turned to their own devices.



<blockquote class="wp-block-quote"><cite><meta charset="utf-8">“Some of our dreams couldn’t be realized at Facebook due to regulatory pressure and the company being unable to adopt cutting edge technology aggressively,” Cheng said. “So, we thought about doing a startup because we’ve done work in the space and want to share it.”&nbsp;</cite></blockquote>



Mysten Labs partnered with 0L Network on Tuesday, an open, permissionless version of Diem’s blockchain, to expand the Move smart contract programming language.&nbsp;



“We have high conviction that we made the right move,” Cheng said. “We are able to accelerate our development pace by an order of magnitude and make decisions faster as we’re free of the handcuffs that slowed us down.&#8221;



The startup was founded in November 2021, and a few months later <a href="https://cms.blockworks.co/facebook-led-crypto-project-diem-to-be-sold-off-for-200m-report/">Diem was sold for $200 million</a> to Silvergate Capital Corp in late January. The firm focuses on building new blockchain infrastructure to scale the Web3 space.&nbsp;



“We are building our own blockchain that will be comparable to Ethereum, Solana and so on, but we want the capability to go beyond that,” Cheng said.&nbsp;



The blockchain will be launched in late March and will have a test net, beta net then go to mainnet later this year, he added. The company anticipates developer activity on-chain and building by April or May.&nbsp;



Since leaving, the co-founders have had “technical breakthroughs” that Cheng says wouldn’t have happened at Meta. “We’re driving toward something concrete and able to come across fundamental solutions, even in a short amount of time,” he said.



Meta was not available for comment Tuesday.&nbsp;



“A lot of it is continuing the research we started [at Meta] and bringing it to the marketplace,” Cheng said. “We need to overhaul the infrastructure because there’s interesting projects out there that aren&#8217;t having their needs met by current blockchain technology.”



Going forward, the company’s focus is on continuing to create solutions for “pain points” in blockchain technology through smart contract developments, utility-focused infrastructure for crypto assets and practical self custody, Cheng said.



“Changes by Web3 will happen sooner than people expect,” Cheng said. “Developers&#8217; eyes light up as they discuss the possibilities with us and that’s tremendous.”&nbsp;



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Four Ex-Facebook Developers Join Forces to Build Future of Web3

<div id="highlights-block_61f7fb4afebe8" class="highlights">
 <ul>
 <li>The company also released its anticipated iOS app to the general public</li>
 <li>Phantom is planning to onboard even more users, a “loftey goal of about 50 million” by the end of 2022, CEO Brandon Millman said</li>
 </ul>
 
</div>



Phantom has raised an additional $109 million as the Solana-focused crypto wallet becomes the latest digital asset unicorn.&nbsp;



The Series B capital raise — bringing the company’s valuation to $1.2 billion — was led by Paradigm. The funding will be used to expand to additional blockchains, add more users and make more hires. In total, Phantom has raised <a href="https://cms.blockworks.co/andreessen-horowitz-leads-9m-series-a-round-for-crypto-wallet-phantom/">$118 million</a>.



“We decided to raise the money to put more fuel on the fire and keep it going,” Brandom Millman, co-founder and CEO of Phantom said in an interview with Blockworks.&nbsp;



Even though the wallet caters to Solana users, it plans to expand into other multi-chain ecosystems this year.  Phantom is looking to first add the Ethereum Virtual Machine, or EVM ecosystem. EVM is a platform that developers can use to create decentralized applications, or dApps, on Ethereum.



<blockquote class="wp-block-quote"><cite><meta charset="utf-8">“Our original impetus was to be a <a href="https://cms.blockworks.co/custodial-solution-for-metamask-institutions/">MetaMask</a> competitor, so we want to make moves to realize that and expand to other ecosystems sometime this year,” Millman said. “Phantom was always meant to be the wallet we wanted to use coming from the Ethereum side, so we want to fulfill that.”</cite></blockquote>



The non-custodial crypto wallet now has over 2 million active monthly users, up from virtually zero when it was in beta testing in April 2021. For comparison, the six-year-old Ethereum-focused MetaMask had <a href="https://www.businesswire.com/news/home/20211117006028/en/MetaMask-Surpasses-21-Million-MAUs-as-ConsenSys-Raises-200-Million-to-Make-Web3-Universally-Easy-to-Use-Access-and-Build-On">over 21 million</a> monthly active crypto wallet users as of November 2021.



Last month, Millman told Blockworks he was anticipating anywhere from <a href="https://cms.blockworks.co/solana-focused-wallet-phantom-hits-1-8m-users-but-aims-much-higher-for-2022/">10 million to 50 million users</a> in 2022, but now he is holding his stance at the higher end of that range with a “lofty goal of about 50 million.” 



As demand continues to grow, Phantom is also releasing its <a href="https://cms.blockworks.co/phantom-wallet-launches-mobile-version-to-bring-solana-to-smartphones/">iOS app</a> to the public, so users can store, send and receive Solana’s SPL tokens and NFTs, as well as stake Solana’s native token, SOL, to earn rewards on their iPhones. The Android app for Phantom will be released during the first half of 2022, he said.&nbsp;



Users can also preview non-fungible tokens and use the app’s browser to access all decentralized applications, or dApps, in the Solana ecosystem. To date, Phantom users have staked 112.4 million SOL, roughly $10.4 billion, swapped $1.37 billion in tokens and made $55.2 million in NFTs, DeFi and app transactions.



“We have come from a graveyard of wallets before us that came and went during the last crypto cycle,” Millman said. “It’s tremendous validation for wallets and Web3 in general as an area to create awesome, investable long lasting businesses.”



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Crypto Wallet Phantom Hits Unicorn Status After Raising $109M

Sebastian Sinclair

<div id="highlights-block_61f7623b07be0" class="highlights">
 <ul>
 <li>Binance has restricted 281 Nigerian-based personal accounts</li>
 <li>Of those, around a third have been restricted at the request of international law enforcement.</li>
 </ul>
 
</div>



Binance, the world&#8217;s largest crypto exchange by trade volume, has restricted 281 personal Nigerian accounts with more than a third being at the behest of law enforcement.



In a <a href="https://www.binance.com/en-NG/blog/all/a-letter-from-our-ceo-to-nigerians--our-commitment-to-user-protection-421499824684903365" target="_blank" rel="noreferrer noopener">letter</a> on Saturday, Binance CEO Changpeng “CZ” Zhao said user security remained Binance&#8217;s &#8220;top priority&#8221; before citing that anti-money laundering measures and account restrictions were in place.



Around 79 other cases that were facing restrictions have been resolved while all non-law enforcement-related cases are expected to be resolved within two weeks. More Binance personnel are being deployed to expedite the matter CZ said. 



Of the 281 accounts, 38% have been restricted at the request of international law enforcement, the letter said.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true"><a href="https://twitter.com/hashtag/boycottbinance?src=hash&amp;ref_src=twsrc%5Etfw">#boycottbinance</a> Binance is locking NIGERIAN accounts using P2P and related services. They locked plenty accounts already in Nigeria. My 5btc locked in binance. Use binance at ur own risk.<a href="https://twitter.com/hashtag/boycottbinance?src=hash&amp;ref_src=twsrc%5Etfw">#boycottbinance</a> <a href="https://twitter.com/hashtag/BinanceStopScamming?src=hash&amp;ref_src=twsrc%5Etfw">#BinanceStopScamming</a> <a href="https://twitter.com/hashtag/BINANCESTOPSCAMMINGNIGERIANS?src=hash&amp;ref_src=twsrc%5Etfw">#BINANCESTOPSCAMMINGNIGERIANS</a>&mdash; hoseaolu (@honetnetworks) <a href="https://twitter.com/honetnetworks/status/1487381321097830400?ref_src=twsrc%5Etfw">January 29, 2022</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Last week, users began complaining of issues on <a href="https://twitter.com/Sir_Dubem/status/1486281036812140552?s=20&amp;t=O2nCMRLRqxjEZfy9JszY0w" target="_blank" rel="noreferrer noopener">Twitter</a> revolving around Nigerian-based Binance accounts. #Binancestopscammingnigerians was seen trending before CZ responded with the letter.



In February of last year, Binance briefly suspended deposits in Nigerian naira following orders from the country central bank for local banks to close accounts linked to various cryptocurrency platforms.



Crypto is seen by many in the 190 million-strong population of Nigeria as a means to circumvent monetary controls and to serve the underbanked or unbanked. Crypto exchanges have, for quite a while, offered up a means to transact peer-to-peer at a time when more than half in the country are <a href="https://globalfindex.worldbank.org/sites/globalfindex/files/chapters/2017%20Findex%20full%20report_chapter2.pdf" target="_blank" rel="noreferrer noopener">unbanked</a>.







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Binance Restricts 281 Nigerian Accounts Citing Safety Measure

<div id="highlights-block_61f7226e3cbeb" class="highlights">
 <ul>
 <li>The SEC has given the nod for BSTX to begin providing customers a market and price feed based on blockchain technology</li>
 <li>The move marks the first time the SEC has granted approval for a national blockchain-enabled securities exchange</li>
 </ul>
 
</div>



A joint venture between the Boston Options Exchange (BOX) and crypto tokenization firm tZero has been granted regulatory approval to operate a bourse utilizing blockchain tech for its settlements and market data.



The US Securities and Exchange Commission (SEC) gave the nod to the Boston Security Token Exchange (BSTX) for its Market Data Blockchain product following a lengthy rule review process, according to an <a href="https://www.sec.gov/rules/sro/box/2022/34-94092.pdf" target="_blank" rel="noreferrer noopener">SEC notice</a> on Wednesday.



BSTX has been cleared to offer &#8220;several proprietary market data products,&#8221; similar to those provided by other national securities exchanges in addition to a historical market data product powered by the blockchain.



The move marks the first time the SEC has granted approval for a national blockchain-enabled securities exchange. BSTX will serve as the listing market for eligible companies and issuers of exchange-traded products.



Specifically, BSTX&#8217;s blockchain product will seek to settle transactions within the same day (T+0) or a day after (T+2) while providing &#8220;proprietary and transparent blockchain data feeds,&#8221; according to a <a href="https://www.businesswire.com/news/home/20220128005108/en/tZERO%E2%80%99s-BSTX-Joint-Venture-Receives-Approval-as-National-Securities-Exchange-Facility" target="_blank" rel="noreferrer noopener">statement</a> on Thursday. 



BSTX will also offer &#8220;improved market quality&#8221; for early-stage companies. Companies looking to unlock further liquidity will be able to tap into solutions designed to improve trading while democratizing access to other companies and assets, the statement reads.



Conditionally, BOX is required to join all relevant national market system plans related to BSTX equities trading. These include the Consolidated Tape Association Plan, the Consolidated Quotation Plan, and the Nasdaq UTP Plan. BOX must also join the National Market System Plan and the National Market System Plan, per the notice.



“This is a watershed event in the digital evolution of the securities markets and the trading experience,&#8221; said BSTX Board Member and tZERO Interim CEO, Alan Konevsky. 



Indeed, the march towards its approval from the regulator stretches back more than two years following BOX&#8217;s <a href="https://www.sec.gov/comments/sr-box-2019-19/srbox201919-6613675-202939.pdf" target="_blank" rel="noreferrer noopener">amended filing</a> in Jan. 2020 to use an omnibus entry based on the Ethereum blockchain. Shortly after, the SEC declined the application.



&#8220;With BOX Digital’s experience in building and operating a sophisticated securities exchange and tZERO’s industry-leading blockchain technology innovation, we have brought together our organizations’ combined expertise to drive innovation,&#8221; said Konevsky.



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SEC Approves First National Blockchain-powered Boston Security Token Exchange

Morgan Chittum

<div id="highlights-block_61f41353732cf" class="highlights">
 <ul>
 <li>Verizon previously partnered with smart glasses company Vuzix to deliver a “first-of-its-kind” augmented reality experience for gaming</li>
 <li>After Facebook rebranded to Meta, mentions of the metaverse in third-quarter earnings calls spiked 349%, according to Bloomberg</li>
 </ul>
 
</div>



Count Verizon among the growing number of multi-billion dollar companies testing the metaverse waters.



Verizon posted on LinkedIn three <a href="https://www.linkedin.com/jobs/view/2886416372" target="_blank" rel="noreferrer noopener">content partnerships manager roles </a>Jan. 21, in search of a&nbsp; candidate who can lead “partnerships and initiatives that relate to 5G, gaming, VR, AR, NFTs, Web 3, metaverse content and other new immersive content formats and applications.”



The telecommunications giant joins the likes of Nike and Disney’s Hulu in looking to fill suddenly urgent positions in the nascent space as hiring competition for Web3 professionals heats up. Seemingly everyone is paying attention. After Facebook rebranded to Meta, mentions of the metaverse in third-quarter earnings calls spiked 349% and over 1,100% year-on-year, according to a <a href="https://www.coinbase.com/prime/2021-year-in-review?utm_source=twitter&amp;utm_medium=organic&amp;utm_campaign=in_i_m_w_m_awa_twi_soc_0_institutional-2021-year-review" target="_blank" rel="noreferrer noopener">Bloomberg analysis</a>



Verizon previously partnered with smart glasses company Vuzix to deliver a&nbsp; “first-of-its-kind” augmented reality experience for gaming.&nbsp;



“AR allows us to meet our consumers in a new metaverse, reimagining our worlds and how we engage on a deeper level,” Andrew McKechnie, chief creative officer at Verizon, told <a href="https://www.marketingdive.com/news/verizon-showcases-5g-with-metaverse-treasure-hunt/607746/">MarketingDive.</a>&nbsp;



Verizon did not immediately respond to Blockworks’ request for comment.&nbsp;



The hunt for scarce talent in the virtual world is prompting some to make hires without clearly defined roles or an understanding of where the metaverse fits into old-school companies with long-established business models, according to industry participants.&nbsp;



“I think like anything there are some elements of companies that like to be associated with the metaverse or the idea of the metaverse because it makes them look cutting edge and very advanced,” David Doung, Head of Institutional Research at Coinbase, told Blockworks. “But there is still a misunderstanding of what it represents. To be fair, with any new technology like this, I think that it&#8217;s hard to come to a consensus of what the definition of it actually is.”&nbsp;



In some cases, retailers have turned to acquiring crypto-native firms to get a leg-up.&nbsp;&nbsp;



Nike, for instance, in December <a href="https://news.nike.com/news/nike-acquires-rtfkt" target="_blank" rel="noreferrer noopener">acquired</a> NFT startup RTFKT. Meanwhile, the sports apparel giant is looking for a director of metaverse engineering, according to a Jan. 27<a href="https://www.linkedin.com/jobs/view/2883860198" target="_blank" rel="noreferrer noopener"> job posting</a>, who will lead expansion of the retailer’s “rapid end-to-end proof of concepts, prototypes, and production of metaverse software and device solutions.”



The role requires knowledge of blockchain ecosystems, cryptocurrencies, non-fungible tokens (NFTs), smart contracts, decentralized apps,&nbsp;decentralized autonomous organizations (DAOs), digital wallets and more.



Nike has posted four other metaverse-related job openings over the past week, including a senior 3D game designer, a principle innovation engineer for the metaverse, expert innovation program manager for blockchain and a virtual material designer.



Streaming service Hulu also signaled an interest in expanding into the metaverse with a Jan. 14 job posting.&nbsp;



The company may hire a brand culture marketing manager, whose role would include focusing on how the platform could “break through into other spaces outside of streaming [such as] NFTs, crypto [and the] metaverse,” to “target the streamers of tomorrow,” according to <a href="https://www.linkedin.com/jobs/view/2788396622" target="_blank" rel="noreferrer noopener">LinkedIn</a>.



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



Morgan Stanley in November <a href="https://cms.blockworks.co/how-megabanks-goldman-sachs-morgan-stanley-are-talking-about-the-metaverse/" target="_blank" rel="noreferrer noopener">told investors</a> that the metaverse would be “the next big investment theme” and would become an $8 trillion market.



Other large brands have created metaverse-related job postings over the past month, including <a href="https://www.linkedin.com/jobs/view/2867373145" target="_blank" rel="noreferrer noopener">American Eagle</a> and <a href="https://careers.ulta.com/careers/jobs/171847?lang=en-us" target="_blank" rel="noreferrer noopener">UltaBeauty</a>.&nbsp;



“We&#8217;re still trying to come to grips with what [the metaverse] actually represents and what it needs,” Coinbase’s Duong said. “There is some element of that at play where some companies are mentioning it but I&#8217;m not fully confident what they&#8217;re doing could actually be considered metaverse-related or that they have actual plans associated with that. But I do have good faith that a lot of companies out there are working on it and that they&#8217;re focused on it to build it out.”



Jacquelyn Melinek contributed reporting. 



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Verizon Joins Hulu, Nike in Metaverse Hiring Spree

<div id="highlights-block_61f34342f4b25" class="highlights">
 <ul>
 <li>Google&#8217;s cloud division has formed a new business unit that will seek to support its new and existing customers developing on the blockchain</li>
 <li>The Digital Asset Team will provide dedicated node hosting for developers through to on-chain governance </li>
 </ul>
 
</div>





Google&#8217;s cloud computing division is hunting down blockchain experts as part of a new business unit aimed at supporting the tech giant&#8217;s existing customers.



The unit, known as the Digital Assets Team, will focus on the retail and healthcare sectors as Google attempts to expand its offerings beyond advertising.



<blockquote class="wp-block-quote">“We’re seeing [interest in the blockchain space] across every industry vertical we interact with — from financial services and capital markets to retail, sports and gaming,” Richard Widmann, Google Cloud&#8217;s head of strategy for digital assets, told Blockworks.</blockquote>



”Digital asset and blockchains technology is already having a profound impact on our customers and their users across nearly every major vertical, and perhaps most prominently in the financial services space,&#8221; he said. 



Decentralization is a major component of the crypto-industry. Decentralized finance, or DeFi, has sprung up in recent years based on the philosophy of cutting out the middleman, including banks and lenders, to transact peer-to-peer via the use of smart contracts. Google is hoping to capitalize on the movement as finance continues to evolve.



”We see the evolution of blockchain technology and decentralized networks today as analogous to the rise of open source and the internet 10-15 years ago,” Widmann said.



The new unit will support customers seeking to build, transact, store value and deploy new products via blockchain-based platforms, said Yolande Piazza, vice president of financial services at Google Cloud in a <a href="https://cloud.google.com/blog/topics/financial-services/google-cloud-launches-dedicated-digital-asset-team" target="_blank" rel="noreferrer noopener">blog post</a> on Thursday.



<blockquote class="wp-block-quote">&#8220;This new team will enable our customers to accelerate their efforts in this emerging space and help underpin the blockchain ecosystems of tomorrow,&#8221; said Piazza.</blockquote>



Specifically, Google Cloud’s Digital Assets Team will provide dedicated node hosting for developers, take part in node validation and on-chain governance and support on-chain governance via participation from Google Cloud executives and senior engineers, per the post.



The team will also help drive co-development and integrations into Google&#8217;s partner ecosystem as well as advancing go-to-market initiatives with its ecosystem partners in the hope that Google Cloud becomes &#8220;the connective tissue between traditional enterprise and blockchain technologies.&#8221;



Several large blockchain and crypto companies utilize Google&#8217;s Cloud Platform including <a href="https://cloud.google.com/blog/topics/public-datasets/working-with-hedera-hashgraph-to-support-the-next-generation-of-distributed-ledger-technology" target="_blank" rel="noreferrer noopener">Hedera</a>, <a href="https://cloud.google.com/blog/products/data-analytics/how-theta-labs-reached-the-outer-limits-of-video-streaming" target="_blank" rel="noreferrer noopener">Theta Labs</a>, and <a href="https://cloud.google.com/blog/topics/startups/scaling-blockchain-and-nfts-with-google-cloud">Dapper Labs</a> which recently signed on in a bid to leverage the tech giant&#8217;s &#8220;performance, reliability and security.&#8221;



This story was updated on Jan. 28, 2022, at 2:25 pm ET to include commentary from Google.



Additional reporting by Casey Wagner



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



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Google Cloud Hiring Blockchain Specialists in Bid to ‘Drive Decentralization’ Efforts

Sam Reynolds

<div id="highlights-block_612aa21a4208c" class="highlights">
 <ul>
 <li>Unlike traditional finance exchanges which used large, complex data centers, digital asset exchanges use cloud computing offerings from Amazon and Microsoft </li>
 <li>Institutional investors no longer have a latency race, needing to build their servers as close as possible to markets’ data centers. All they need to do is run code on the same cloud provider as the exchange.</li>
 </ul>
 
</div>



Market accessibility is a big theme for digital assets and it goes beyond allowing retail traders better access to yield. As explained on a <a href="https://events.bizzabo.com/TheAsia-Europe/agenda/session/615883" target="_blank" rel="noreferrer noopener">recent webinar,</a> crypto’s embrace of cloud computing instead of proprietary data centers makes it more accessible to investing firms of any size, not just the world&#8217;s biggest financial institutions.&nbsp;



In the era of the ‘<a href="https://en.wikipedia.org/wiki/Flash_Boys" target="_blank" rel="noreferrer noopener">Flash Boys</a>’, Wall Street’s high frequency traders, trading firms looked for every advantage they could to get their data to the trading center’s servers faster than their competitors.



But in the world of cryptocurrency trading things have changed. Exchanges like Binance, Coinbase, or FTX which <a href="https://www.coingecko.com/en/exchanges" target="_blank" rel="noreferrer noopener">collectively push through tens of billions of dollars</a> in volume every day aren’t hidden away on expensive servers running proprietary software in exclusive data centers. They, like many of the world&#8217;s other web-based applications such as Netflix or Facebook, run on cloud servers such as Amazon’s AWS or Microsoft’s Azure.&nbsp;



“If you look at how traditional trading infrastructure has been made, a bank or institution will co-locate in a data center of a physical exchange and they will buy expensive physical hardware,” explained Gabriel Bassas, vice president of Avelacom, a telecom company that primarily serves the finance industry. “Whereas with crypto exchanges, they are based in cloud environments. From a customer’s [virtual machine] to the cloud, there’s an undetermined variable. That’s something that institutions are unfamiliar with.”



And that unfamiliarity brings an advantage to crypto native funds that didn’t exist years ago when traditional finance (tradfi) funds were building out their expensive physical infrastructure.



Bassas explained on the webinar that all crypto funds need to do is deploy their trading code on the same cloud provider as the exchange — no need to build expensive physical infrastructure at the same data center the exchange is hosted at.&nbsp;



“Before you know it, you’ve built out a smart auto order routing network at very low cost and very. So essentially you&#8217;ve got a cloud network and a proprietary network,” Bassas said.&nbsp;



As both the trading firm’s code and the exchange are based within the same cloud service provider’s infrastructure, the data doesn’t even hit the internet as it stays within the internal network of the cloud provider.&nbsp;



<h3 class="wp-block-heading">Reducing the barrier of entry</h3>



“There used to be a massive barrier of entry for traders in the form of trading infrastructure. You have to spend a lot of money, and invest a lot of time, and have a lot of specialties and in terms of building infrastructure,” Bassas said. “You can access and build trading infrastructure in a matter of three days at the max. The barrier to trading has been removed.”



Cloud providers like AWS or Microsoft’s Azure have different cloud servers around the world to serve customers that span geographic regions. In order to execute a geographic arbitrage strategy, all a trader needs to do is deploy the code on different geographic instances: one on a cloud server in Hong Kong, then in London, and again on the US East Coast. The cost to do so is marginal; all it takes is a few clicks on the cloud provider’s web portal.&nbsp;&nbsp;



As the webinar was sponsored by Avelacom, Bassas’ company, he was quick to point out the significant advantage trading firms can get when using cloud providers — of which Avelacom is optimized for — and his network. He claimed when paired the two can offer a latency advantage of up to 77 milliseconds.



In comparison, tradfi trading firms of yore would spend millions to get an advantage of even a millisecond.



Given the low barriers to entry of crypto and its embrace of cloud computing, the entire financial trading infrastructure industry is getting shaken up. Much like how cloud computing a decade ago disrupted the need for technology companies to have their own servers, something similar is happening in finance thanks to crypto.



Want more investor-focused content on digital assets?&nbsp;<a target="_blank" href="https://cms.blockworks.co/events/digital-asset-summit-2021-2/" rel="noreferrer noopener">Join us</a>&nbsp;September 13th and 14th for the Digital Asset Summit (DAS) in NYC. Use code ARTICLE for $75 off your ticket.&nbsp;<a target="_blank" href="https://cms.blockworks.co/events/digital-asset-summit-2021-2/" rel="noreferrer noopener">Buy it now</a>.&nbsp;&nbsp;&nbsp;

Institutional Investors Building Crypto Derivatives Trading Infrastructure Just Need the Cloud

<div id="highlights-block_60c9fc7f1690b" class="highlights">
 <ul>
 <li>Fireblocks has a $2 billion valuation after raising $313 million in Series D funding.</li>
 <li>Andreessen Horowitz led a $20 million Series A funding round for digital wallet Valora.</li>
 </ul>
 
</div>



Wall Street indices tumbled on Tuesday, hours before second-quarter earnings from tech giants like Microsoft Corp. and Google Inc. Shares from both companies shed 7% and 2% intraday.&nbsp;



The Centers for Disease Control and Prevention (CDC) also reversed its indoor mask-mandate, which could have contributed to the losses across the board.&nbsp;The agency recommended that fully-vaccinated people should wear masks inside in areas with higher Covid-19 rates.&nbsp;



The Nasdaq Composite was pulled lower, dropping 1.4% intraday. Tuesday’s trading for the index was close to benchmarking it’s biggest one-day plunge since May. The Dow Jones Industrial Average dropped 0.4% and S&amp;P declined 0.7%.&nbsp;Big losers include United Parcel Service (UPS) and Moderna, whose shares fell 8% and 4%, respectively.&nbsp;Tesla Inc. declined 3% too.



<h3 class="wp-block-heading">Equities</h3>



<ul><li>The Dow plunged -0.24% to 35,058.</li><li>S&amp;P 500 declined -0.47% to 4,401.</li><li>Nasdaq fell -1.21% to 14,660.</li></ul>



<div class="wp-block-image is-style-default"><figure class="aligncenter size-large"><img loading="lazy" decoding="async" width="570" height="374" src="https://blockworks-co.imgix.net/wp-content/uploads/2021/07/0306811F-373C-4ECA-B496-3F9FFAD919E3-1.jpeg" alt="" class="wp-image-5908" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2021/07/0306811F-373C-4ECA-B496-3F9FFAD919E3-1.jpeg?w=570 570w, https://blockworks-co.imgix.net/wp-content/uploads/2021/07/0306811F-373C-4ECA-B496-3F9FFAD919E3-1.jpeg?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2021/07/0306811F-373C-4ECA-B496-3F9FFAD919E3-1.jpeg?w=392 392w, https://blockworks-co.imgix.net/wp-content/uploads/2021/07/0306811F-373C-4ECA-B496-3F9FFAD919E3-1.jpeg?w=398 398w, https://blockworks-co.imgix.net/wp-content/uploads/2021/07/0306811F-373C-4ECA-B496-3F9FFAD919E3-1.jpeg?w=334 334w, https://blockworks-co.imgix.net/wp-content/uploads/2021/07/0306811F-373C-4ECA-B496-3F9FFAD919E3-1.jpeg?w=80 80w" sizes="(max-width: 570px) 100vw, 570px" /></figure></div>



Following a wild day for price action when bitcoin hiked 14%, the cryptocurrency has since simmered down.



Tuesday’s trading had a shallow dip after surpassing $40,000 less than 24 hours before. The almost three-month benchmark high was short lived as the crypto fell around 4% throughout the day. Rumors that Amazon may accept bitcoin as payment may have led to the rush, but the unconfirmed whispers about the tech giant were quickly dispelled.&nbsp;



On Tuesday, there was a slew of crypto-related funding round news. Andreessen Horowitz (A16z), led a $20 million Series A funding round for a mobile-first digital wallet Valora, Blockworks <a href="https://cms.blockworks.co/a16z-leads-20m-series-a-for-digital-wallet-valora/" target="_blank" rel="noreferrer noopener">reported.</a> Other <a href="https://cms.blockworks.co/funding-news-fireblocks-eco-and-saber-labs-all-raise-millions/" target="_blank" rel="noreferrer noopener">funding announcements </a>include blockchain unicorn and infrastructure firm Fireblocks, which raised $310 million.



Also, Coinbase released data Tuesday after looking at 20 major crypto exchanges. The <a href="https://www.bloomberg.com/news/articles/2021-07-27/ether-trading-volume-beat-bitcoin-s-in-first-half-for-first-time" target="_blank" rel="noreferrer noopener">report</a> revealed that ether’s trading volume grew faster than bitcoin’s in H1 of this year. Despite its volume growing faster, there’s still a significant gap in the two cryptocurrencies. According to their <a href="https://www.coinbase.com/prime/prime-coinbase-H12021" target="_blank" rel="noreferrer noopener">findings,</a> bitcoin&#8217;s total trading volume was around $2.1 trillion while ether&#8217;s was at $1.4 trillion.



Bitcoin has maintained support around $38,000. Ethereum has continued to stay afloat above $2,000. The second-biggest cryptocurrency fell 8% on Tuesday. Both were trading lower at press time.



<h3 class="wp-block-heading">DeFi</h3>



<ul><li>Uniswap is trading at $18.41 with a total value locked of $4,098,197,805 down -1.8% in 24 hours at 4:00 pm ET.&nbsp;</li><li>Chainlink is trading at $18.93, advancing 1.8% with trading volume at $1,143,122,658 in 24 hours at 4:00 pm ET.</li><li>DeFi:ETH is 31% at 4:00 pm ET.</li></ul>



<h3 class="wp-block-heading">Crypto</h3>



<ul id="block-1209f037-00c3-4876-ad37-a29ab610c717"><li>Bitcoin is trading around $37,879.88, down -3.80% in 24 hours at 4:00 pm ET.</li><li>Ether is trading around $2,36.81, shedding -5.86% in 24 hours at 4:00 pm ET.</li><li>ETH:BTC is at 0.059, declining -1.26% at 4:00 pm ET.</li><li>VIX is up 9.33% to 19.22 at 4:00 pm ET.</li></ul>



<h3 class="wp-block-heading">Insight</h3>



&#8220;Markets function to empty the wallets of the investor who doesn&#8217;t have conviction. If an investor is just chasing price and headlines, they will always buy at the top and sell at the bottom,&#8221; Charlie Silver, CEO of <a href="http://permission.io/">Permission.io</a>, said in a note. &#8220;Conviction and long term commitment are the antidote to markets that are extremely volatile like the one we are presently seeing in crypto. If you don&#8217;t have conviction and understanding you shouldn&#8217;t participate.&#8221;



<div class="wp-block-image is-style-default"><figure class="aligncenter size-large is-resized"><img loading="lazy" decoding="async" src="https://blockworks-co.imgix.net/wp-content/uploads/2021/07/79A4E3F7-6C70-4CCB-BDAC-7A42939FF0C1-1024x566.jpeg" alt="" class="wp-image-5906" width="635" height="350" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2021/07/79A4E3F7-6C70-4CCB-BDAC-7A42939FF0C1-1024x566.jpeg?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2021/07/79A4E3F7-6C70-4CCB-BDAC-7A42939FF0C1-1024x566.jpeg?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2021/07/79A4E3F7-6C70-4CCB-BDAC-7A42939FF0C1-1024x566.jpeg?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2021/07/79A4E3F7-6C70-4CCB-BDAC-7A42939FF0C1-1024x566.jpeg?w=428 428w, https://blockworks-co.imgix.net/wp-content/uploads/2021/07/79A4E3F7-6C70-4CCB-BDAC-7A42939FF0C1-1024x566.jpeg?w=389 389w, https://blockworks-co.imgix.net/wp-content/uploads/2021/07/79A4E3F7-6C70-4CCB-BDAC-7A42939FF0C1-1024x566.jpeg?w=80 80w, https://blockworks-co.imgix.net/wp-content/uploads/2021/07/79A4E3F7-6C70-4CCB-BDAC-7A42939FF0C1-1024x566.jpeg?w=1073 1073w" sizes="(max-width: 635px) 100vw, 635px" /><figcaption> </figcaption></figure></div>



<h3 class="wp-block-heading">Commodities</h3>



<ul id="block-d64d70c9-7052-4f1a-8167-3d370fe08354"><li>Brent crude is little changed at $74.37 per barrel, falling -0.17%.</li><li>Gold is up 0.02% to $1,799.30.</li></ul>



<h3 class="wp-block-heading">Fixed Income</h3>



<ul><li>US 10-year treasury yields 1.236% as of 4:00 pm ET.</li></ul>



<h3 class="wp-block-heading">Currencies</h3>



<ul><li>The US dollar fell -0.23%, according to the Bloomberg Dollar Spot Index.</li></ul>



<h3 class="wp-block-heading">In other news&#8230;</h3>



Saber Labs, Fireblocks, and Eco all announced new funding rounds on Tuesday, Blockworks <a href="https://cms.blockworks.co/funding-news-fireblocks-eco-and-saber-labs-all-raise-millions/" target="_blank" rel="noreferrer noopener">reported.</a>&nbsp; Eco, a digital wallet, raised $60 million in new funding, along with Saber Labs who scored $7.7 million in a seed round led by Grace Capital. Fireblocks, a digital asset platform, now has a valuation of $2 billion, after raising $313 million in Series D funding.



<h3 class="wp-block-heading">We&#8217;re watching out for&#8230;</h3>



<ul><li>Federal Reserve policy meeting (FOMC) ends on Wednesday.</li><li>US Gross Domestic Product (GDP) data is due on Thursday.</li></ul>



That&#8217;s it for today&#8217;s markets wrap. I&#8217;ll see you back here tomorrow.

Bitcoin Dips; Tech Stocks Tumble Before Earnings: Markets Wrap

<div id="highlights-block_60ef3b4f4438f" class="highlights">
 <ul>
 <li>The company is also backed by IDG Capital, Binance, Lightspeed Venture Partners, Yale University, and others </li>
 <li>CertiK is one of the fastest growing organizations in the blockchain security space and has raised $48 million since its inception in 2018, including an $11 million funding round within the past year</li>
 </ul>
 
</div>



CertiK, a blockchain security firm, announced a $37 million Series B funding round co-led by Coatue Management and Shunwei Capital, with participation from Coinbase Ventures, marking the largest single round of fundraising in the blockchain security space, the company said.&nbsp;



The company is also backed by IDG Capital, Binance, Lightspeed Venture Partners, Yale University, and others.&nbsp;



The funding will be used to expand its<a href="https://www.cybavo.com/blog/defi-hacks-2021/"> security technology</a> in the cryptocurrency and decentralized finance markets. 



The company does code auditing and has a platform called Skynet, which uses on-chain and off-chain data to provide real-time insights into the <a href="https://cms.blockworks.co/algorithmic-stablecoin-developer-sam-kazemian-calls-for-caution-on-regulation/" target="_blank" rel="noreferrer noopener">security of DeFi applications</a> and to date has monitored over 2 million smart contract addresses and more than 2 billion on-chain transactions, it said. 



“Decentralized finance has grown enormously over the last 18 months, giving millions of people access to innovative financial tools and savings products,” said Kai Jiang, a partner at Coatue Management. “With such rapid innovation, security is of the utmost importance.”



The NYC-based startup is one of the fastest-growing organizations in the blockchain security space and has raised $48 million since its inception in 2018, including an $11 million funding round within the past year. 



The company was founded by professors at Yale University and Columbia University to use AI technology to audit and monitor blockchain protocols and smart contracts and has over $70 billion worth of digital asset value, including leading projects such as Aave, Polygon, Binance Smart Chain, Terra, Yearn, and Chiliz.



“The power of blockchain boils down to the power of the people,” said Ronghui Gu, CertiK co-founder and professor at Columbia University. “We’re proud to advance transparency in the space by providing the tools and resources – including our official audit reports – so the community can make sense of vital security information.”