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The misguided Digital Asset Money Laundering Act sponsored by Senators Elizabeth Warren and Roger Marshall may be dead on arrival, but the crypto community should not ignore the conflict it represents between crypto and law enforcement, writes Chris Grieco.

The 13th anniversary of the first bitcoin transaction has taken a nefarious turn with meme coin issuers profiting over $200,000 from pizza-related rug pulls.

Sort allows developers to incorporate smart contracts into apps

MicroStrategy, the publicly traded software company best known for its bet on bitcoin, said Monday that it supported a proposal from the Financial Accounting Services Board that would let firms use fair-value accounting for crypto held on their balance sheets.

“We appreciate the rigorous process the FASB is undertaking,” the company said in a letter, noting that it is the largest public company holder of bitcoin, with 140,000 BTC worth just under $4 billion at current market prices.

Under existing accounting rules dubbed the “indefinite-lived intangible asset accounting model,” the company has to use the original purchase price and then record cumulative impairment charges. That means its bitcoin holdings are only valued at $2 billion on its balance sheet, half its fair market value. 

“Reporting crypto asset holdings under a fair value model, as proposed by the FASB, would enable us to provide investors with a more relevant view of our financial position and the economic value of our bitcoin holdings, which in turn would facilitate the ability of investors to make informed investment and capital allocation decisions,” the company said. 

The FASB voted on the proposal last year, and the changes are currently in a public comment period.

Long-sought changes 

MicroStrategy faced pushback from the U.S. Securities and Exchange Commission in 2022 when it used non-GAAP measures to try and adjust bitcoin impairment charges. The company has long pushed for U.S. accounting standards to be updated to better account for crypto assets.

The company encourages interested parties to provide feedback on the accounting rules proposal, which the FASB is accepting through June 6. In its letter, MicroStrategy submitted answers to eighteen separate questions.

“Fair value is a more useful and balanced accounting model for investors than the current model, whereby only decreases in fair value are recognized, and subsequent increases are not,” the company wrote. “While the current model offers a distorted picture of an entity’s crypto asset holdings that may confuse investors unfamiliar with the accounting standard it reflects, fair value accounting provides investors with the ability to make clear “return on investment” calculations, thereby providing the basis for economic reality-driven investment decisions.”

© 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.

Strike, a payments platform built on Bitcoin’s Lightning Network, has added support for Tether’s USDT, the world’s largest stablecoin.

The development means USDT on-ramps, off-ramps and settlements are now possible within the Strike app, Tether CTO Paolo Ardoino told The Block. While it hasn’t been finalized which blockchains will be used to support USDT on the platform, he said “it will be a mix of most used chains.”

The announcement comes two days after Strike launched its app in 65 new countries from a previous base of the U.S., Argentina and El Salvador. The app allows users to instantly send and receive bitcoin, utilizing the Lightning Network. Users can also send payments within the platform and buy bitcoin.

“With Tether’s stablecoin as an intermediary, users gain the ability to convert their digital assets into fiat currency swiftly, overcoming liquidity challenges that have previously hindered adoption,” Tether said in a statement Monday. “This user-friendly approach aligns with Tether and Strike’s commitment to democratizing finance and promoting inclusivity on a global scale.”

As part of the arrangement, Strike will hold “cash” balances belonging to non-U.S. customers in USDT, not in any fiat currency, according to company documentation about the app. “When we refer to ‘cash’ in the app, we do so only for convenience, and references to ‘cash’ should be interpreted to mean USDT,” the company said.

Launched in 2014, USDT is the largest stablecoin in the world, with a total supply of over 83 billion coins, according to The Block’s Data Dashboard.

Strike was founded in 2020 by Jack Mallers, and the company plans to launch its app in more markets in the future.

“Everyone on planet Earth should have easy access to money that can’t be inflated by governments and a payments network that can’t be influenced by intermediaries,” Mallers said last week. “Strike is a global money app that gives everyone easy access to better payments and bitcoin. It’s an experience billions of people need. That’s our mission, Better Money. It’s what we do.”

© 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 curated NFT marketplace is running a two-month pop-up of 0x.17 gallery, beginning with a solo exhibition from artist Claire Silver about our future with AI.

The Evmos team alleged that co-founder Ashish Khosla has been unloading substantial quantities of the project’s native token since his departure.

Khosla is reportedly attempting to divest himself of half a million tokens, worth $70,000, through Osmosis, a decentralized exchange within the Cosmos ecosystem, according to a thread by Evmos on Twitter.

“We are aware of the departed co-founder who owns the 34M wallet and has been attempting to sell 500k EVMOS on Osmosis,” the team said.

It’s worth noting that Khosla was originally allotted 34 million Evmos tokens ($4.7 million) on a four-year vesting schedule. This allocation means that Khosla continues to receive newly vested tokens into his assigned address over this period.

Evmos is a Cosmos-backed blockchain that supports the Ethereum Virtual Machine (EVM). While Evmos is based on the Cosmos software stack, it is also compatible with Ethereum apps. Last year, the team raised $27 million in a token fundraising round led by Polychain Capital. Its development is currently led by the other co-founder Federico Kunze Küllmer.

Khosla has sold 144,000 tokens so far, valued at $40,000 at the time of sale, according to on-chain findings from Jessica Huhnke, a web3 data analyst and engineer at Flipside Crypto. This accounts for a mere 1.5% of the total Evmos sold since April 30. In contrast, other users have sold a combined total of around 9 million tokens, Huhnke found.

Disagreements over accountability

Nevertheless, Khosla’s sell-offs coincided with a sharp decrease in Evmos’ token price. Its value has nosedived by more than 50% this May, falling from $0.30 at the beginning of the month to now $0.14. 

Khosla left the project due to “operational misalignment and disagreements over accountability,” the Evmos team stated. They claim to be actively working with Khosla to transfer the tokens back to the Evmos Foundation rather than seeing them sold on decentralized exchanges. Evmos also shared Khosla’s GitHub contributions to the project.

Khosla’s wallet remains the largest delegator on the Evmos’ network and has staked 11.5 million ($1.6 million) tokens, the Evmos team said.

 

© 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.

Per Observers, U.S. Treasury’s efforts to build back cash balances post-debt deal will suck out the dollar liquidity from system, pushing bitcoin lower.

The bankrupt estate was ordered to issue a corrective letter clarifying its May 13 disclosure statement was not approved by court.

EOS Network Foundation’s founder said the other option is a hard fork to exclude EOS tokens held by B1.