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Searching for crypto’s future stars among young prospects.

While early growth in both spaces has been eerily similar, don’t get too excited about crypto’s future.

Sens. Cynthia Lummis, R-Wyo., and Kirsten Gillibrand, D-N.Y., will introduce a revised version of their comprehensive crypto regulatory bill Wednesday.

According to information provided by Lummis’s office, the revised bill maintains much of the broad scope of the crypto legislation they introduced last Congress but is updated to reflect major developments in the industry like the collapse of FTX. House Republicans also have their own legislation that would establish a clearly defined path for a digital asset to transition from being treated as a security to a commodity, along with creating a comprehensive regulatory framework for the trading of digital assets in the U.S. and issuance of stablecoins. 

The revised version of the bill would expand the Commodity Futures Trading Commission’s power over spot markets and centralized digital asset exchanges, and would give “crypto asset companies” the power to define assets they create on their own terms.

Digital assets issued by those companies, even if the network is not decentralized, could be “presumed a commodity” if they do not involve debt, equity, or other financial interests in a company. That would place the asset under the jurisdiction of commodities law, though companies would be required to provide disclosures about the asset twice a year to the Securities and Exchange Commission.

Other details of the bill

Sweeping in scope, the bill involves policy areas across the jurisdictions of several Senate committees. That’s likely to complicate a path for the bill to become law, especially as the Biden administration and crypto skeptics in Congress may view it as too friendly for the industry.

The bill would also redefine custody rules for digital assets that qualify as securities. A “commercially reasonable” level of cybersecurity for a private key could satisfy part of the existing rule around custody.

Lummis and Gillibrand also want to require stablecoin issuers to register federally or at the state level as depository institutions, with mandatory federal supervision for state-chartered issuers. They would be required to maintain high-quality liquid assets – cash or short-term Treasury bonds – and provide proof-of-reserves. The bill would ban the use of the term “stablecoin” by algorithmic stablecoins that are unbacked by reserves without banning the assets themselves.

If passed into law, the bill would also appropriate an additional $500 million each to the CFTC and SEC, but the SEC would be prohibited from using those additional funds for enforcement, and the CFTC could only access theirs if the agency charters a crypto-specific self-regulatory organization. The Federal Trade Commission, which holds authority over false advertising, would also be appropriated $150 million over five years for consumer education and enforcement relating to digital assets.

The New York Democrat and Wyoming Republican also want to revise tax treatment of digital assets, including refining the definition of broker included in the 2021 infrastructure law that led to concerns about crypto developers and other network participants being treated as financial intermediaries for tax purposes.  

An official announcement of the revised bill introduction is expected to come later on Wednesday.

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Beyond the Edge, inspired by the famed artists’ former workspace, features digitized Pollock works that come with a physical counterpart.

Separate “data availability” layers could reduce congestion on the Ethereum network by making it easier for ancillary “rollup” networks to verify that transactional details exist and are available to download if needed — without actually downloading them. The concept might offer an alternative to Ethereum’s own proposed “danksharding” solution, seen as years away.

Tim Draper’s syndication vehicle Draper Round Table co-led a $5 million Series A funding round for the web3 social media analytics firm LunarCrush.

INCE Capital also co-led the round, with additional participation from Draper Associates, WWVentures, TRGC, Bitcoin Frontier Fund, Draper Goren Holm, Blockchain Founders Fund, MoonPay, EMURGO, LBANK Labs, FUNFAIR Ventures, Techstars, David Bleznak and Francisco OIiva-Velez Cancel.

LunarCrush’s valuation has now climbed to $30 million. The firm combines social media with cryptocurrency, NFT and stock price tracking.

“We are delighted to participate with Draper Goren Holm, and the rest of the Draper Venture Network in the LunarCrush Series A,” Tim Draper said in a statement. “LunarCrush provides the social intelligence that retail investors in crypto need to make their decisions. These guys predicted every turn in the crypto market since they have been in business, they also had an early window on the demise of Silicon Valley bank.”

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

The Fantom Foundation is taking decisive action in the wake of a string of security incidents involving the Multichain bridge that saw large amounts of crypto assets moved under suspicious circumstances in two separate incidents. The development led the foundation to endorse Axelar and LayerZero as alternative bridging solutions for the network.

Fantom Foundation recognized the challenges that the incidents posed to liquidity providers, token holders, and users within its ecosystem, saying in a statement that there is no single, officially recognized or “canonical” bridge within the network. It’s a reminder to the community of the ecosystem’s diversity and flexibility regarding its infrastructure.

It also noted that Axelar and LayerZero are gaining increased traction following the concerns surrounding Multichain.

“Both Axelar and LayerZero are current bridging solutions that are becoming popular choices amongst builders on Fantom,” the foundation tweeted. “FDN [foundation] will continue to assist with awareness and encourage further development options as new assets are issued + adopted on the network.”

The foundation acknowledged that Multichain has historically driven much of the Fantom network’s total value locked and transaction volume, largely due to its early mover advantage. However, given the recent suspicious activities, the foundation is pushing to diversify into other bridge solutions. 

“The Foundation will look to seed both Axelar and LayerZero issued asset pools directly with the bridges themselves to encourage protocol liquidity and confidence,” it added.

Multichain’s $230 million transfers

A potential exploit earlier this month saw $126 million moved and was followed by another transfer of $103 million in diverse assets. After the initial outflow, Multichain warned users to cease usage of the project and to revoke contract approvals, but a substantial amount of assets remained on the platform.

Growing suspicions of an “inside job” are being entertained by several analysts, including those from Chainalysis, a notable blockchain data analytics firm. The suspicions have been fueled by the disappearance of the Multichain’s CEO, whose whereabouts have remained unknown.

Fantom Foundation said that it’s “still waiting for an official statement and guidance from Multichain.”

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

The new messaging feature will let any two Ethereum addresses talk to each other.

Sui Foundation, the organization developing the Sui blockchain, launched a decentralized order book that it said is a “one-stop shop for trading digital assets.”

Dubbed DeepBook, Sui Foundation expects the new order book to help developers “build apps that exchange tokens seamlessly.”

Sui Foundation’s Managing Director Greg Siourounis believes DeepBook provides the basic base for building any DeFi tool built on the blockchain. Mysten Labs and MovEX helped with the technical aspects of DeepBook, the organization said in a statement.

“Combining Sui’s unique capacity for parallelized transactions with a public on-chain order book allowed the community to create a trading facility that is uniquely transparent, scalable and usable by every DeFi project on the network,” Siourounis also said in the statement.

Reducing dependency

The work could help to reduce the dependency crypto traders might have on centralized exchanges like Binance or Coinbase.

“At a basic level, DeepBook makes many of the benefits offered by traditional centralized exchanges available in Sui’s decentralized network,” it said in the statement.

“Centralized crypto exchanges act as intermediaries between buyers and sellers … [and] also retain control over users’ private crypto wallet keys ,” it continued. “As a result, in the event of a hack or a shutdown, these users could face the loss of their entire holdings.”

Meant to compete against blockchains like Ethereum and Solana, Sui was created by Mysten Labs, which is run by co-founder and CEO Evan Cheng, former head of research and development at Meta’s crypto wallet Novi Financial. Mysten’s valuation eclipsed $2 billion last year after a Series B round which raised $300 million.

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

A wallet tagged as belonging to the U.S. government has moved over $300 million worth of bitcoin (BTC) in three separate transactions.