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Sam Altman’s latest eyeball-scanning initiative is attracting attention from data protection regulators.

France’s privacy watchdog, Commission nationale de l’informatique et des libertés, stated that it is aware of Worldcoin and said that its biometric data collection “seems questionable.”

“Worldcoin collected data in France, and the CNIL initiated investigations,” the CNIL told Reuters in an email.

Worldcoin is a crypto project from ChatGPT founder Sam Altman that scans users’ eyeballs for what it calls privacy-preserving digital identities.

Earlier this week, UK data protection regulator The Information Commissioner’s Office said it would inquire into Worldcoin — which claims it complies with all laws and regulations.

© 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 latest price moves in bitcoin (BTC) and crypto markets in context for July 28, 2023. First Mover is CoinDesk’s daily newsletter that contextualizes the latest actions in the crypto markets.

Crypto’s spot market is becoming increasingly concentrated, according to data from Kaiko. 

The top two largest exchanges accounted for more than 50% of the total market this year, which is a slight increase from 2020. In 2020, Binance — the largest exchange by trading volumes — accounted for just 24% of the spot market. That figure currently stands above 50%. 

“This trend could continue amid a wider downturn in market activity, which puts pressure on smaller exchanges,” Kaiko said. 

Still, Binance’s spot trading volumes have been declining over the last year, according to The Block’s data dashboard. The exchange’s spot market share is on track to hit its lowest level since last July, with its share of the total market standing at 47.15%. 

© 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.

In the domain of Ethereum’s Layer 2 scaling solutions, recent figures signal a significant shift.

As of July 27, Optimism — a Layer 2 network emphasizing scaling applications using Optimistic Rollups — logged 944,000 daily transactions. This surpasses its competitor, Arbitrum, which registered 660,000 transactions, as per data from Blockscan. Notably, this is the first instance since January 2023 where Optimism has taken the lead in daily transaction volume.

This shift, deviating from a six-month trend, is attributed mainly to the introduction of Worldcoin on the Optimism network. Worldcoin — a crypto identity project linked to Sam Altman, co-founder of ChatGPT creator OpenAI — was recently launched on Optimism, fueling the network’s activity.

From the onset of June 2023, when the Worldcoin team began deploying user accounts on Optimism, the network has witnessed a remarkable boost in activity. The daily transaction tally has risen by 240%, escalating from just below 277,000 to 944,000 transactions since June 1. Conversely, Arbitrum’s daily transaction count has seen a marginal dip, declining from 745,000 transactions to 660,000 during the same period.

Dune Analytics data highlights Optimism’s growing traction, particularly the evident interest in Worldcoin on the network. The count of Worldcoin wallets on the Optimism chain, indicative of engagement with the protocol, is nearing the 1 million mark, currently at 961,000. It’s important to note that this number excludes pre-release wallets that users have yet to migrate to the Optimism chain.

Arbitrum still leading in other metrics

Nevertheless, Arbitrum still has the lead in other metrics. The total value locked on Arbitrum remains the highest among all Layer 2 solutions, standing at $2.1 billion, followed by Optimism with $917 million, according to DeFiLlama. Furthermore, Arbitrum leads daily active users, with 123,000 compared to Optimism’s 89,000, further on-chain data shows.

Optimism and Arbitrum are the top two Layer 2 solutions by adoption. Utilizing Optimistic rollup technologies, they afford users the ability to process transactions off the main Ethereum blockchain, presenting a more cost-effective method than mainnet transaction processing.

© 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 Netherlands, which has taken a tough line on rivals such as Binance and Coinbase, follows France, Dubai and the U.K. in recognizing the crypto exchange.

Users will be able to convert Blumer tokens for other cryptocurrencies and withdraw to wallets.

A new crypto casino inspired by the Milady NFT project has rolled out on the Ethereum blockchain, with transaction volume hitting $36 million in the first 12 hours after its release.

Crypto.com has secured registration with the central bank of the Netherlands to provide crypto services — just a month after rival Binance failed to get registration in the country and had to exit.

Crypto.com said it received registration following a comprehensive review of its business and compliance that aligned with the Netherlands’ Money Laundering and Terrorist Financing (Prevention) Act. 

“Collaborating with regulators to responsibly advance the crypto and blockchain industry is of paramount importance to Crypto.com,” Kris Marszalek, CEO of Crypto.com, said in a statement. “This registration approval from De Nederlandsche Bank is a significant milestone for our business and the latest testament to our commitment to compliance.”

Crypto.com has recently received regulatory approvals in several jurisdictions, including Singapore — where it’s headquartered — France, Italy, the U.K., Dubai and Australia. As for the Netherlands, Crypto.com’s parent company, Foris DAX Global Limited, will be listed in DNB’s public register as a crypto service provider by Monday, a Crypto.com spokesperson told The Block. 

Crypto.com is just one of several crypto firms to secure registration in the Netherlands. Other firms include Coinbase Europe, Bitstamp Europe and Hidden Road Partners, per the public register.

Binance left the Netherlands last month

Binance left the Dutch market last month after it couldn’t secure registration but said it would continue dialogue with Dutch regulators. 

The central bank of the Netherlands, DNB, refuses a crypto applicant if they fail to submit all required information or if DNB finds the information submitted incorrectly. The central bank also refuses registration if it finds policymakers or co-policymakers to be unfit or improper, according to its website.

© 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.

Maelstrom CIO and former BitMEX CEO Arthur Hayes said AI-powered DAOs would revolutionize how economic entities are organized and funded — breaking free from traditional company structures. 

These traditional structures are not well-suited for AI-driven economic entities, given their reliance on human work ethic and state-enforced contracts to generate productivity and wealth, Hayes argued in his latest blog post.

State-enforced contracts become futile when applied to AIs with no physical bodies and cannot be punished or coerced without destroying the internet and all computer infrastructure — meaning an AI DAO had no reason to follow state-based legal norms, Hayes said. Instead of choosing a jurisdiction, AI DAOs will use smart contracts deployed on public blockchains, like Ethereum, to allow the DAO to provide services for a fee — enabling such DAOs to be self-governing and enforce their own rules.

Unlike traditional companies, AI DAOs wouldn’t need to rely on human intermediaries and be subject to state control, with the blockchain serving as the ultimate enforcer — ensuring compliance with contracts and transparency of operations, Hayes said.

Hayes predicted that DAO capital markets would become the first truly global markets, allowing anyone with an internet connection to trade AI DAO-issued tokens. Decentralized exchanges would become the venue of choice to raise capital and trade the tokens rather than traditional centralized exchanges, he added. “A DEX is naturally suited to support the trading of any type of equity, debt, utility, participation, etc. token issued by an AI-powered DAO,” Hayes said, and will “likely become natural monopolies,” dominating the trading of various DAO-issued tokens.

He added that investors would also have access to the financial performance of DAOs in real-time, eliminating the need for auditors and third-party intermediaries.

A trillion-dollar AI-powered economy

Hayes believes the future AI-powered economy will grow into a market of trillions of dollars within the next decade. As AI DAOs emerge, the demand for blockchains, like Ethereum, will skyrocket, leading to a surge in the price of their native tokens. “Ethereum transactions will grow exponentially as DAOs proliferate. As a result, the price of ETH should skyrocket in anticipation if this AI DAO hypothesis is widely believed,” Hayes said.

“I’m a bit of an ETH maxi when it comes to needing actual utility on a Layer-1,” he added. “While investors might make money trading the latest hyped Ethereum clone, none of them will ever eclipse Ethereum in terms of adoption and usefulness.”

Summing up how he intends to profit from his hypothesis, “Ethereum jig jig boom,” Hayes said.

On Wednesday, The Block reported Hayes’ family office, Maelstrom, had participated in a Pre-A funding round for Aethir, a decentralized cloud network for gaming and AI, at a $150 million valuation.

Earlier this month, Hayes said bitcoin would be the currency of artificial intelligence, with its digital, uncensorable and scarce properties being ideal for an AI-driven future.

© 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.