FreeCryptoCurrency.Me

Bitcoin mining company Marathon Digital Holdings has reached a $24 million settlement with its former CEO and chairman.

According to an SEC filing, the company entered into an agreement on Oct. 12 with Merrick Okamoto, relating to restricted stock unit awards. Okamoto stepped down as the company’s CEO in the spring of 2021, and left his executive chairman role at the end of that year. Current CEO and Chairman of the Board of Directors Fred Thiel succeeded him in both roles.

As part of the settlement, Okamoto agreed to a broad release of known and unknown claims against the company regarding its incentive plan.

Marathon also reached settlements relating to other restricted stock awards for five others, including Thiel, that amounted to about $1 million.

© 2022 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.

Quick Take

• The Proof-of-Stake distributed consensus mechanism has emerged as a popular alternative to Proof-of-Work, with native token staking being crucial in maintaining blockchain security.
• Staking has remained relatively stable over the past 6 quarters, with an average stake rate of 47.2% and an average stake yield of 14.3% in the Q3’22.
• While staking will remain an essential component of the crypto ecosystem, it has its fair share of concerns, with solutions being actively developed.

This research piece is available exclusively to
members of The Block Research.
You can continue reading
this Research content on The Block Research.

Texas financial regulators and attorney general want to prevent FTX’s purchase of Voyager Digital assets on the basis that the company isn’t compliant with securities and money transmitter laws.

“FTX US should not be permitted to purchase the assets of the debtor unless or until the Securities Commissioner has an opportunity to determine whether FTX US is complying with the law and related and/or affiliated companies, including companies commonly controlled by the same management, are complying with the law,” according to a new filing made Friday. 

Joseph Jason Rotunda, the Director of Enforcement Division of the Texas State Securities Board, said in the filing that he was able to sign up for an account and earn yield on FTX despite the company’s declaration that it doesn’t onboard people in the U.S.

FTX won the auction for bankrupt lender Voyager Digital and its assets with a bid of around $1.4 billion late last month. 

“The yield program appears to be an investment contract, evidence of indebtedness and note, and as such appears to be regulated as a security in Texas,” the amended filing argues, while also noting that FTX is not a licensed money transmitter or securities dealer in the state of Texas. 

© 2022 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.

NFT platform LiveArt burned 197 Seven Treasures NFTs stolen from its wallet in a hack over the weekend, The Block has learned.

The hacker gained access to the company’s Treasury Wallet 2, which it used to store NFTs earmarked for marketing and promotions, on Sunday and transferred the NFTs to their own wallet.

LiveArt opted to destroy the stolen NFTs to reduce the total number in circulation after asking for community feedback on how to proceed. It also will compensate buyers who purchased the NFTs.

“We were in two minds about this but decided to give people the benefit of the doubt,” Boris Pevzner, CEO and co-founder of LiveArt, told The Block. 

The company has filed a police report in Delaware and believes it may be able to identify the person responsible. Pevzner said they have not communicated with the hacker as they did not wish to negotiate.

The Block reached out to the hacker via a Telegram handle advertised in their OpenSea username. Writing in Chinese, they declined to share any information without payment and quoted Chinese author Lu Xun that, “Wasting other people’s time is tantamount to seeking money and killing people.”

Hackers are on a roll across the crypto sector. October is in the lead for the most crypto funds stolen in a month, according to data released by Chainalysis last week. The blockchain analytics firm reports 11 different hacks totaling $718 million this month as of Oct. 12. 

Following the hack, the NFTs were sold at progressively lower prices on OpenSea with the first going for 1.15 wETH ($1,514) and the final one for 0.45 ETH ($461). 

Hack data shared by LiveArtX via Discord.

LiveArt has identified at least 75 of the marketplace NFT transactions as wash trades by the hacker and is now trying to identify collectors that actually suffered losses from the incident.

It will compensate each buyer whose NFT was burned with the exact purchase amount and a gas fee (0.02ETH) according to the snapshot taken at 10:15 p.m. on Oct. 16, the company said on Discord.

“For panic sellers who sold below 1.2 ETH before the first announcement published at 2:19 AM on 17th October, we will offer you the difference + gas fee between 1.2 ETH and your sale price within 48 hours.”

Legitimate sales from the collection show the price of NFTs returning to their previous level after being driven down by the hacker.

© 2022 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 XRP Ledger is testing its Ethereum Virtual Machine (EVM) sidechain that aims to bring Ethereum smart contracts to the XRP Ledger,  the blockchain’s core development team RippleX announced. 

The sidechain, a parallel-running blockchain, will bring Ethereum-based smart contracts to XRP Ledger, a blockchain associated with cross-border payments firm Ripple.

The sidechain has been developed by a firm called Peersyst and is still in this first phase of development and unavailable for public testing, according to RippleX. This means for now, it is only available on XRP Ledger’s Devnet, a restricted experimental network used for testing on XRP Ledger. The second phase will begin in early 2023, and will feature a permissionless EVM sidechain that’s open to the public. 

While the XRP Ledger already supports native smart contracts, the network does not currently support the Ethereum Virtual Machine (EVM), a computing environment commonly used by Ethereum developers to write applications.

Once it’s deployed on mainnet in the second quarter of 2023, the sidechain will allow developers to write apps in Solidity, the main programming language on Ethereum and make it interoperable with the XRP Ledger via a bridge, said RippleX.

It will also let developers use the XRP Ledger’s native asset called XRP within the sidechain environment.

“The release means developers no longer have to choose between XRPL or EMV-compatible blockchains; they can have the best of both worlds,” RippleX stated.

© 2022 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.

Cofounder of CryptoKitties and Dapper Labs Mack Flavelle has signed with top Hollywood talent agency, WME, The Block learned exclusively. 

 

Flavelle, considered by some to be the “Godfather” of NFTs, helped elevate the popularity of non-fungible tokens when he created CryptoKitties, an NFT series that allows people to buy, breed and sell cartoon cat collectibles. The long-running game, built on the Ethereum blockchain, launched in 2017.

WME is one of the most powerful talent agencies in the entertainment industry, representing top Hollywood actors including Dwayne “The Rock” Johnson and Charlize Theron, and musical artists such as Meek Mill and Alicia Keys. 

Signing with the agency means Flavelle will be represented by an agency that not only possesses a diversity of interests – the agency’s parent company Endeavor owns the UFC, a professional bull-riding league, and runs fashion shows – but is also known for fostering collaboration among its extensive list of high-profile clients.




It seems like the slump in NFT prices hasn’t dissuaded interest in the area, with WME signing Bright Moments, Non-fungible Heroes and Boss Beauties all this year. WME also represents Escapeplan – the Bored Ape Yacht Club DJ duo –  and Pixel Vault, a web3 media company that secured a $100 million investment earlier this year.

Vancouver-based Dapper Labs also produced the popular NBA Top Shot collection, a darling of the NFT market after its launch in 2020. Flavelle is also the founder and CEO of Big Head Club, an “end-to-end full-service NFT studio” which has produced noteworthy collections like Stoner Cats and actor and artist Jim Carrey’s Germinations.

© 2022 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.

Tapio Protocol raised $4 million in a seed round led by Polychain, Hypersphere and Arrington, in an effort to bring a unified liquidity standard to Polkadot.

Others investors in the round included Spartan, LongHash, 0xVentures, CMS, D1 Ventures, 11-11 DG Partners, Genlock, Valhalla, PAKA, and Double Peak, according to an announcement. 

Tapio is a synthetic asset protocol that aims to promote staking and crowd-loan derivatives efficiency on the blockchain protocol Polkadot — which has a native coin called DOT.

The Tapio Protocol team has identified two core problems with DOT derivatives on Polkadot parachains, according to its announcement — namely, that liquidity is siloed on individual parachains, and each derivative format features challenges for adoption. This fragmentation of liquidity makes the ecosystem less efficient, Tapio Protocol argues, and it aims to put the proceeds of its latest raise towards solving the problem.

In order to unify DOT derivatives into a single asset, Tapio Protocol has come up with tDOT — which can already be found on Acala, a Polkadot DeFi hub. It is backed by a stable swap liquidity pool comprised of both DOT and DOT derivatives.

Polkadot was one of the hotter projects last year, but news surrounding the Ethereum competitor has slowed since then. Nevertheless, development activity on the project remains high, according to its GitHub repository, as relayed by CoinTelegraph.

© 2022 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.

Decentralized stablecoin issuer Frax Finance is set to make its liquid staking protocol on Ethereum publicly available within two weeks.

The launch will allow users to stake ether (ETH) and receive a liquid derivative token called Frax Ether (frxETH), aimed at unlocking the value of the staked tokens. The derivative will mirror the price of ether and will be freely tradable on other DeFi protocols. 

“Everything will be fully available publicly within two weeks barring anything unforeseen, but the full system is already live, and is already proposing blocks,” Frax core developer Jack Corddry told The Block.

Frax has finished a security audit of its liquid staking token ahead of a final release on the Ethereum mainnet. The project has also finished setting up a Curve pool so frxETH can be swapped with ETH with low or no slippage.  

Frax Finance is mainly known for its stablecoin that relies on collateral and algorithmic mechanisms to maintain a 1:1 peg with the U.S. Dollar. Its stablecoin is backed partially by hard collateral, primarily USD Coin (USDC), and partly by Frax Finance’s native governance token known as FXS. 

Frax’s decentralized liquid staking offering will compete with similar existing protocols, such as Lido Finance and RocketPool. “Get ready for the most interesting ETH liquid staking derivative released by a major stablecoin issuer,” the Frax team said.

Frax Finance also runs a decentralized exchange Fraxswap and a lending platform called Fraxlend. 

How will Frax’s liquid staking work?

First, users deposit their ETH to stake via Frax ETH Minter, a function that will mint the liquid derivative tied to the underlying value of deposited ETH.

Frax will use its customers’ ETH to spin Ethereum validators to generate and distribute a staking yield. This system is meant to abstract away the complexity of setting up validators by allowing people to delegate their assets to the protocol. 

To receive the yield, users will have to exchange the first derivative token (frxETH) to Staked Frax Ether (sfrxETH), a second token that will accrue staking yield from Frax’s Ethereum validators.

This second token will continue to accrue interest and increase in value in relation to ether over time. The interest can be collected by converting sfrxETH back to frxETH.

© 2022 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.

Mastercard will assist financial institutions looking to offer cryptocurrency trading, the payments giants told CNBC on Monday, by acting as a “bridge” with crypto platform Paxos. It will also provide regulatory compliance and security.

The product will reportedly be piloted in the first quarter of 2023 before expanding to other locations.

Despite a severe downtrend in coin and token prices across the wider crypto market, demand for the still-nascent asset class still exists — according to polling referenced by Mastercard’s chief digital officer.

However, according to the report, clients would rather start by going through traditional banks, which have been reluctant to enter the crypto-trading space due to compliance and security concerns — hence Mastercard’s interest in stepping in. The company will assist in maintaining compliance with crypto-related rules, verify transactions, and provide anti-money-laundering and Know Your Customer checks.

“There’s a lot of consumers out there that are really interested in this, and intrigued by crypto, but would feel a lot more confident if those services were offered by their financial institutions,” Jorn Lambert, Mastercard’s chief digital officer, told CNBC.

Financial services companies pushing deeper into crypto

Mastercard and its primary competitor, Visa, have both been making headway into the blockchain and cryptocurrency industry in recent weeks.

Earlier in October, Mastercard made known its plans to debut a crypto-related fraud-prevention solution, dubbed Crypto Secure, for banks and card issuers. The product is powered by its recently acquired blockchain-security startup, CipherTrace.

Visa, meanwhile, is launching a debit card with the crypto exchange FTX in more than 40 new countries across Latin America, Europe and Asia. The card was originally introduced in the U.S.

The news comes only days after JPMorgan CEO Jamie Dimon called cryptocurrencies “decentralized Ponzis” — a sentiment that he has reiterated throughout recent years. JPMorgan, meanwhile, refers to itself as “the first global bank to offer a blockchain-based platform for wholesome payments transactions,” and has its own crypto of sorts, dubbed JPM Coin.

© 2022 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 Australian Securities and Investment Commission (ASIC) temporarily suspended crypto asset manager Holon Investments from its retail services for three crypto funds, citing non-compliant target market determinations in an official statement.

Holon Investments is suspended from offering or distributing bitcoin, ether and filecoin for 21 days — unless revoked earlier. 

The Australian financial regulator did not agree with Holon Investments opening up “very risky and speculative” assets to an audience of lower-certainty profiles. ASIC made this order “to protect retail investors from potentially investing in funds that may not be suitable for their financial objectives, situation or needs,” the statement reads.

Specifically, ASIC targeted the three cryptocurrencies for their complexity and volatility — and expressed concern that the Sydney-based asset manager did not appropriately consider those features. All three funds are managed by crypto exchange Gemini, CoinDesk reported.

If the regulator’s concerns are not adequately addressed, ASIC will put down final stop orders. “Holon will have an opportunity to make submissions to ASIC before any final stop order is made,” the statement says.

© 2022 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.