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Google Cloud’s Blockchain Node Engine, a service for fully managed node-hosting for web3 development, will support Polygon as part of a multi-year, strategic alliance announced by Google Cloud and Polygon Labs on Thursday.

The move will simplify the deployment and management of Polygon nodes for developers and aims to increase the adoption of the Polygon ecosystem.

The Blockchain Node Engine already supports Ethereum, and it is also working to integrate Solana in a move that was was first announced last November, according to a Google Cloud spokesperson.

“Google Cloud infrastructure will help to scale the technology more quickly in order to ensure that transactions remain fast and fees remain low as demand increases,” Brendan Farmer, co-founder of Polygon Labs, told The Block. “In addition, it will make it easier and faster for developers to deploy on Polygon proof-of-stake network and Polygon Supernets, all while providing access to funding for web3 start-ups,” Farmer said.

Polygon ecosystem 

Google Cloud launched the Blockchain Node Engine last year to allow developers to easily deploy and manage blockchain nodes on Google Cloud. A blockchain node is a computer or server that participates in a blockchain network by verifying and validating transactions and blocks on the network.

The services will help developers “overcome the time-intensive processes and costly overhead associated with provisioning, maintaining, and operating their own dedicated blockchain nodes,” according to a joint statement from Google Cloud and Polygon Labs. 

Google Cloud will support all Polygon protocols, including Polygon proof-of-stake network, Polygon Supernets and Polygon zkEVM.

“Scaling blockchains with ZK technology eliminates the throughput bottlenecks present on existing chains, but it requires access to compute, so partnering with Google is an important step toward our ZK-powered future,” Farmer said.

Google Cloud’s growing crypto partnerships

Over the past few years, Google Cloud has been increasingly expanding its presence in the web3 space to help projects and developers.

Earlier this week, Google Cloud said its “Google for Startups Cloud Program” will now support web3 builders. Eligible projects raising funds for pre-seed to Series A stages will be able to apply for the program, which includes up to $200,000 in Google Cloud credits over two years and other technical support.

Polygon Ventures-backed early-stage startups are eligible to participate in the program as part of the alliance.

© 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 tech giant will be “strategic cloud provider” for Polygon protocols.

Todd Groth of CoinDesk Indices shares some thoughts on how macro analysis works in crypto.

HM Treasury, the UK’s finance ministry, said Thursday that it has opened a consultation on possible new tax regulations for decentralized finance activities.

In particular, the Treasury is focused on lending and staking — two key activities in the DeFi ecosystem. The Treasury said it wants to “create a regime that better aligns…with the underlying economic substance, whilst reducing the administrative burden on users,” the Treasury said in its announcement.”

The Treasury’s notice went on to say:

“Under the proposed changes, the use of cryptoassets in DeFi transactions would no longer be treated as giving rise to a disposal for tax purposes. Instead, a tax disposal would arise when the cryptoassets are economically disposed of in a non-DeFi transaction.”

 

UK DeFi tax consultation

Notably, the consultation will have implications for users of third-party platforms as well. “[T]he proposed tax framework outlined below is also intended to apply to the lending and staking of cryptoassets which is done through an intermediary,” the Treasury said.

The UK government has, for the past two years, moved toward the development of crypto-specific tax guidance and policies. Starting in the 2024-2025 tax year, taxpayers in the country will be required to split out crypto-derived profits on their tax returns. 

© 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.

Fortnite co-creator Geremy Mustard took part as a strategic investor in the round.

In his speech to CoinDesk’s Consensus festival yesterday, the head of the non-profit Digital Dollar Project says a U.S. central bank digital currency is too important to be left to central bankers to design. Money is a social issue requiring broad-based public engagement.

A bipartisan bill introduced simultaneously to the House and Senate would call for federal agencies to study the possible criminal uses for crypto, and provide a report with recommendations on how to address these concerns.

The proposed framework, now open for public consultation, will also apply to crypto lending and staking through intermediaries, the authority said.

The former CoinDesker has written an account of Sam Bankman-Fried’s downfall, and longevity of decentralized finance (DeFi).

Bitcoin-native startups are outperforming the overall crypto sector in terms of venture capital deals, according to a report released Thursday by Trammell Venture Partners.

While the number of crypto venture fundraising deals rose 1% in 2022 from the previous year, deals involving companies focused primarily on Bitcoin skyrocketed 52.9%.

Total capital raised by firms founded “with the first principle that bitcoin is the global monetary asset of the future” also increased, rising 13.9% in 2022 to $343 million.

Despite the growth, TVP believes there’s still a “severe misallocation” of capital, with companies focused on Bitcoin accounting for just 2% of total crypto deals last year and only 1.3% of venture dollars invested.

Bitcoin accounts for about 42% of the total crypto market capitalization, and the firm, which launched the first dedicated Bitcoin-native ecosystem-focused fund in 2021, sees advances such as the Lightning Network making the segment ripe for fresh activity. 

“Bitcoin has already won the base monetary reserve layer for the Internet, full stop. It’s just not broadly recognized as such,” TVP managing director and founding partner Christopher Calicott said in an interview, adding that excitement in the sector is often directed toward projects and protocols that move faster. 

Bitcoin stablecoins

While the Bitcoin network advances slowly by design, Calicott sees potential for growth in a number of areas, including stablecoins.

“There’s actually multiple paths to achieving that on Lightning,” he said, referring to the Layer 2 network designed to sit on top of Bitcoin and allow faster transactions and smart contracts. “We know the validated market. We’re looking for the absolute best founders that are going to build it so we can back them in a spear-fishing kind of approach.”

Speaking to other benefits of developing on Bitcoin, Calicott pointed to what he argued were growing perceptions of risk on rival blockchains including Solana and the post-Merge Ethereum.

“That kind of rapid change and risk, of all the risks that an entrepreneur considers when starting a company, the last one they’re going to take, given the option, is platform risk,” he said. “People are sleeping on Bitcoin and Lightening. It’s a really vibrant time. You go to some of these technical meetups, and people that might in any other context be competitors are brainstorming, spitballing ideas together, and there’s just like, a renewed excitement.”

Based in Austin, Texas, TVP has deployed about 65% of its dedicated Bitcoin-native ecosystem-focused fund.

“We’re being very methodical,” he said. “There’s not a moment where we can’t write a check into the right company.”

© 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.