FreeCryptoCurrency.Me

Formally enacted today, the EU’s Markets in Crypto-Assets Regulation is the most comprehensive framework of its kind. How will it influence how non-EU states regulate digital assets?

Crypto futures traders going long suffered heavy losses on Wednesday as prices fell, with $253 million in long liquidations. 

Bitcoin experienced a sharp sell-off yesterday, dropping below $30,000 as it fell 3.8% in about 5 hours, according to Binance data via TradingView. The broader crypto market fell in tandem with the leading cryptocurrency by market cap, with ether sinking below $2,000. Crypto stocks, such as Coinbase and MicroStrategy, were also in the red.

Long positions across derivatives exchanges saw the largest liquidations so far this year. About $253 million in longs were liquidated, according to data from The Block. Most of the volume was on Binance and OKX, which saw $95.4 million and $85.2 million in liquidations, respectively. 

Bitcoin was trading below $29,000 by 10:40 a.m. EDT, down a further 2.2% over the past 24 hours. Long liquidations continued as another $30 million has been wiped out in the past 12 hours. 

Prices plunge in shallow markets

The market dip was initially unexplained but has since been linked to a lack of liquidity and a large sell order on Binance. 

“In retrospect, fingers are now pointing to a large sell order emanating from Binance that pushed prices lower,” said Noelle Acheson, the former head of research at Coinbase who now writes the Crypto is Macro Now newsletter on Substack. This then triggered liquidations which pushed prices even lower, she added. Acheson did note that volatility, which would typically spike in this instance, was unchanged — if not falling. 

Volumes on exchanges remain low, as does market liquidity, which Kaiko recently noted is at record lows. In low liquidity environments, price moves higher or lower can be exaggerated. Prices have less support to both the downside and the upside at the moment. 

© 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.

Perkins, who is president of crypto VC CoinFund, published a set of 10 regulatory principles that form the basis of his advocacy role with the CFTC.

Last November, Armani Ferrante, who had just raised $20 million from FTX and others, was on a flight from Lisbon texting back and forth with his co-founder, trying to figure out what was going on at the exchange. No one responded as they tried desperately, like so many others, to get their money off of FTX as it imploded.

“It was just full blown panic mode,” said the former Alamada Research engineer and founder of Coral, a crypto infrastructure company. “It was like we were punched in the gut … We were just trying to stay as positive as possible and keep the team motivated and not freaking out, especially because a lot of us lost personal capital as well.”

Coral lost the entirety of FTX’s investment on the exchange, about $14.5 million. The firm had to “go into cockroach mode,” Ferrante told Frank Chaparro on The Scoop podcast.

They analyzed their runway and made cuts where they had to in order to stay afloat.

We had to “really prioritize like, how do we make money? How do we make it to the next round? How do we stay alive?” Ferrante said. “It was a traumatic experience on every dimension and it feels like it was forever ago. But we’re here. We’re here and we’re still going.”

Even without the funds, Coral has succeeded in getting the xNFT protocol live and on Solana and its wallet, Backpack, on Solana and Ethereum and available for download in beta form.

Wallets galore

Backpack will join a market already brimming with wallets. But this one is more of a social wallet, said Eden Au, research director at The Block Research.

“Most of them aren’t focusing on the social aspect of it — which could be crucial for NFT communities,” Au said.

John Dantoni, also a research director at The Block Research, agreed. 

“The xNFT part goes in line with ‘being an App Store’ where you’ll be able to buy, sell, transfer and interact with applications directly inside your wallet, as opposed to current set up where you use your browser wallet and sign,” Dantoni said. 

Ferrante compares Backpack as a wallet to the way the iPhone is a phone.

With “the iPhone, you can call people, you can text people, but it’s so much more than that, right? It’s got this really rich application ecosystem. It’s got unique developer tooling that’s got this awesome, secure, heavily curated app store with incredible user experiences,” he said. “We’re really trying to be like the gateway into web3.”

For more on Ferrante’s interview with Chaparro, please look for it in the next episode of  The Scoop.

© 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.

Terraform Labs co-founder Do Kwon has been charged with using a fake passport by authorities in Montenegro, DL News reported, citing a court filing. 

Kwon, a South Korean national, was arrested while trying to leave Montenegro on a private jet last month. He is accused of trying to travel with a fake Costa Rican passport.

TerraUSD, the stablecoin created by Terraform Labs and often known by its ticker UST, collapsed in May last year, wiping out tens of billions of dollars for investors. The incident was the first of a series of crises to hit crypto markets over the course of 2022, including the bankruptcies of crypto lender Celsius and exchange giant FTX. 

If convicted of the document-related charges, Kwon faces a sentence of three months to five years in jail, DL News 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.

The fundraise comes ahead of the network’s mainnet launch early next year.

The decentralized-exchange (DEX) aggregator, which nabbed $175 million in a 2021 series B funding round, is one of the biggest protocols yet to launch on a zero-knowledge EVM (zkEVM).

Blockchain research and infrastructure provider Flashbots introduced the beta version of its MEV-Share protocol, aiming to distribute a portion of Maximal Extractable Value profits to Ethereum users.

Incorporated within Flashbots Protect, a remote procedure call (RPC) tool that can be integrated with users’ wallets, the MEV-Share protocol seeks to defend against bots trying to extract profits by front-running user transactions, according to a statement. It does so by giving users control over the execution of their transactions on the Ethereum network. The concept was first introduced by the Flashbots team in February.

MEV is a technique that involves manipulating transaction sequencing to capitalize on profitable on-chain trades, such as arbitrage and front-running of transactions.

Traditionally, profits from MEV are obtained by searchers and block builders on the Ethereum network, who determine transaction order and relay it to Ethereum validators. Users typically lack control over the execution of their transactions, with wallets and decentralized applications (dApps) missing the necessary tools to use MEV for their benefit.

Flashbots MEV profit sharing

The new protocol seeks to change the traditional MEV order flow by placing users, the originators of MEV, in control. With MEV-Share, the team claims to give users the ability to adjust privacy settings and manage order flow sharing, which safeguards against front-running while selectively sharing transaction information with searchers operating MEV bots. As a result, users qualify for “MEV redistribution rewards” while maintaining a fundamental level of privacy.

“Users can now gain access to MEV redistribution while still maintaining a base level of privacy. They can add these protections to their wallet with a few clicks,” a Flashbots spokesperson said in the statement.

By enabling Ethereum users to benefit from MEV profits and become an active part of the transaction supply chain, the Flashbots team further noted it believed this system can offer benefits to searchers, builders and users alike. 

The MEV Share protocol is available to all participants in the MEV niche, including users, searchers, builders, wallets and other applications. Following a technical evaluation during the beta phase, Flashbots plans to release the MEV-Share code as open-source in the future.

As a leading software developer and researcher in blockchain arbitrage and infrastructure provision, Flashbots is one of the biggest names in the MEV niche. The project was seeking to raise $50 million at a billion-dollar valuation, The Block reported in January.

© 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.

Berachain, a bear-themed crypto project run by a group of pseudonymous co-founders known as Homme Bera, Dev Bear, Papa Bear and Smokey the Bera, has raised $42 million to launch a new Layer 1 blockchain.

Polychain Capital led the funding, with Hack VC, Shima Capital, Robot Ventures, Goldentree Asset Management and others participating, Berachain said Thursday. Angel investors, including Tendermint co-founder Zaki Manian and Celestia co-founder Mustafa Al-Bassam, also backed the round.

Startups building new Layer 1 blockchains and scaling networks have continued to gain traction from investors in recent months. Projects including Sei Labs, Dymension, VRRB Labs and Sovereign Labs have announced rounds since the start of the year. 

Berachain has been under development since late 2021 and began raising for the round shortly after the FTX exchange collapsed in November, with the deal closing it “not too long after,” Smokey the Bera told The Block. The funding was realized via a simple agreement for future tokens (SAFT) sale, they said.

The project aims to allow users to stake tokens while providing liquidity to DeFi protocols in parallel.

“Say, for example, if you had ether and all of that ETH was being used to secure the Ethereum network and was also being able to be used within DeFi protocols such as Uniswap and MakerDAO,” Smokey the Bera said in an interview. “That’s really a powerful unlock.”

Berachain tokens

Berachain has a tri-token system of bera (the native gas token), honey (a native stablecoin) and BGT (the “non-transferrable” Bera Governance Token). Users who stake bera or “other permissioned tokens” will earn BGT over time, allowing them to “capture honey generated by the underlying chain architecture as a reward for their participation in governance,” Berachain said.

The Berachain network is being built on the Cosmos SDK, using a “proof of liquidity” consensus mechanism, and will be compatible with the Ethereum Virtual Machine (EVM). Currently available as a development network (devnet), Berachain is expected to release a public incentivized testnet in the coming weeks and potentially a mainnet later this year, according to Smokey the Bera.

Berachain’s tokens will also launch alongside its mainnet and investors backing the funding round will get native bera tokens, Smokey the Bera said. The Berachain ecosystem claims to have already had $250 million in committed total value locked.

Berachain co-founders also behind Bong Bears

Berachain is the pseudonymous co-founders’ second project, after the NFT project Bong Bears, a collection of “100 absolutely zooted NFT bears getting baked.” Investors who purchased a JPEG of a bear for 0.069 ETH in August 2021 received the right to claim follow-on collections — called Bond Bears, Boo Bears, Baby Bears, Band Bears and Bit Bears — free of charge. These collections have exceeded $20 million in secondary volume across marketplaces, said Berachain.

Smokey the Bera said they and the other co-founders have known each other for several years and have previously worked in industries including health care, venture capital and tech. They all are based in Toronto, Smokey the Bera said. Building pseudonymously in crypto isn’t new, and Smokey said it helps from a safety, privacy and legal point of view.

© 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.

Iron Fish, a Layer 1 blockchain initiative emphasizing transactional privacy through zero-knowledge proofs, has released its mainnet after being in development for more than two years. 

The Iron Fish team secured $28 million in a funding round led by Andreessen Horowitz in 2021. It’s conducted three testnet phases spanning from 2022 to the first quarter of 2023 prior to the release. There seems to be significant interest in the Layer 1, which had over 60,000 nodes by the conclusion of its most recent testnet phase.

Iron Fish is wading into a crowded field of privacy-focused payment networks and blockchain protocols that includes zCash, Secret Network, Oasis, Aztec and Aleo.

The blockchain leverages, Zero-knowledge proofs (ZKPs), a cryptographic technique that allows one party  to prove to another party that they possess certain information or that a specific statement is true without revealing any details about the information itself. This technique can be used either to help blockchains scale or to achieve transactional privacy. In Iron Fish’s case, it’s the latter.

Iron Fish is a proof-of-work chain

Iron Fish is also based on a proof-of-work consensus mechanism, so users can operate specialized machines to mine the native cryptocurrency of the network. Despite the energy consumption associated with proof of work, this consensus has proven to provide security against network takeovers and data manipulation, as well as maintain decentralization.

“Iron Fish is a proof-of-work (PoW) based layer 1 blockchain network, intended to serve as a fully-compliant privacy layer for digital assets and web3,” Elena Nadolinski, founder and CEO of Iron Fish, told The Block. “Using zero-knowledge proofs and robust encryption standards, Iron Fish enables users to transact in a fully private way, without compromising on accessibility.”

The team said it is aiming to carve out a niche in the privacy sphere by providing native mechanisms that potentially hold an edge over blockchains where user tracing is more straightforward. They do this by allowing users to execute anonymous and private transactions using zero-knowledge proofs.

Emphasis on interoperability 

Interoperability is another key aspect of Iron Fish, the team said, enabling users to bridge assets from other blockchains, including Bitcoin and Ethereum, to facilitate increased privacy in transactions for users.

One of the features we’ve worked hard on is this multi-asset feature—meaning that Iron Fish can now comprehend different assets, allowing a bridge operator to bridge assets across from other chains onto Iron Fish—making Iron Fish a privacy platform for such assets.

“We want to support transparent bridges that have programmability. So, for instance, you might want to move an asset from Ethereum over to Iron Fish. You have the programmability of Ethereum and then if you want the privacy, you move the assets over to Iron Fish to transact, store, and swap privately,” Nadolinsky added. 

© 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.