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A once sleepy corner of the crypto market is seeing a surge in interest: crypto security and custody. 

Safeguarding digital assets — which are known for being swiped in hacks or lost into the ether — has always been a priority for crypto investors, but a new wave of entrepreneurs is offering solutions with more flexibility in securing and managing private keys. 

Turnkey, which revealed a $7.5 million seed fundraise on Tuesday, provides the latest example, with a team of former Coinbase Custody execs offering a platform to provide a foundation for a crypto industry in which trillions of on-chain transactions occur, rather than a world where investors simply lock up their assets. 

The firm has backing from Sequoia with Variant, Coinbase and Dragonfly also investing in the round. 

“The use-cases of 2018-2020 were buy and hold,” noted TurnKey co-founder Sam McIngvale, former CEO of Coinbase Custody. “That all changed with DeFi Summer and NFTs.”

“Many, many many more transactions, and more complex transactions are becoming the norm,” he said.

Investors have taken notice with a flurry of new deals cropping up in the market for custody, including so-called non-custodial MPC solutions. DeFi wallet Fordefi recently nabbed its SOC II. 

“For crypto institutions, which are still the bulk of the buyers, like foundations, VCs, trading firms, etc — there’s a lot of solutions trying to push non-custodial or MPC solutions as a safer way to manage risk and minimize counterparty blowup risk,” said Meltem Demirors of Coinshares. 

It shows the de-coupling of securing and safeguarding assets with the traditional business of an exchange, said Haseeb Qureshi of Dragonfly. 

Turnkey is aiming itself as a developer-first tool that allows users to “generate hundreds of wallets and sign thousands of transactions across any chain, all with flexible, programmable permissions to ensure you only sign what you want.”

Commenting on the deal, Alfred Lin, a partner at Sequoia Capital, said: “We believe Turnkey is building the right foundational infrastructure that could help onboard the next million crypto developers.” 

© 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.

OneCoin’s victims were allegedly defrauded of over $4 billion in the scheme, which began operations in 2014.

Celsius custody account holders can receive 72.5% of the cryptocurrency in their custody accounts after a federal judge approved a settlement in the defunct crypto lender’s bankruptcy case.

Judge Martin Glenn gave the green light to a settlement between the Celsius debtors, the unsecured creditors committee and an ad hoc group of custodial account holders during a hearing on Tuesday in the U.S. Bankruptcy Court for the Southern District of New York. 

Individual custody account holders must opt into the settlement. In turn, the Celsius debtors will agree to settle all causes of action against custody account holders with respect to their custody assets, according to the terms of the deal. 

“Because custody holders have the right to opt in, nobody is being forced to accept this settlement. I think that’s quite important here,” Glenn said. 

‘Rollercoaster ride’

The 72.5% return would come over time and does not include transaction fees, according to the settlement. Customer assets have often been an issue in the Celsius bankruptcy case. Glenn ruled in January that assets in Celsius Earn accounts belong to the company, not customers. The settlement approved on Tuesday does not release any rights or causes of action related to assets held in the Earn program.

Bryan Kotliar, a lawyer for the ad hoc group of custodial holders, described a lengthy process to come to Tuesday’s agreement. 

“Even beyond what’s described in the pleadings, behind the scenes has really been a rollercoaster ride … There’s been a lot of ups and downs,” Kotliar said. “It’s a settlement where I think everyone is just a little bit unhappy with it.”

“That’s usually the best settlement,” Glenn replied. 

© 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 move by the gaming giant aims to make assets more interoperable, not only between different games but also hardware like VR headsets, computers and different consoles, including non-Sony platforms like XBox.

Tomi’s aim is to “kick off a clean slate for the internet,” using its DAO governance model to promote freedom of speech and access to uncensored information.

The Commodity Futures Trading Commission and the Securities and Exchange Commission need Congress to tell them to sit down and work together to craft a regulatory framework for digital assets, a CFTC commissioner suggested on Tuesday. 

The agencies can work on that framework now without legislative authority, CFTC Republican Commissioner Summer Mersinger said on Tuesday at the DC Blockchain Summit. But she doubted they could reach an agreement without a new law compelling them to work together. 

“Do I think that’s going to happen on its own? No,” said Mersinger. “I think we would need probably some sort of legislative mandate to force us to sit down.” 

SEC, CFTC hold different crypto views

Mersinger’s comments echo CFTC Chair Rostin Behnam’s call for legislation. The CFTC and the SEC have different views over their approach to digital assets, and the two agencies are in public disagreement over how to define ether, the second-largest digital currency by market capitalization after bitcoin. 

Behnam has repeatedly said he views the digital currency as a commodity, and the agency has allowed for the self-certification of ether derivatives, creating an official agency stance that ether is a commodity. Meanwhile, SEC Chair Gary Gensler has said that he sees proof-of-stake digital assets, like ether, as securities, because staking creates an expectation of return. New York Attorney General Letitia James has also argued that ether is a security in a separate enforcement case against the trading platform KuCoin. The only certainty right now is around bitcoin, which both federal agencies see as a commodity. 

During the public appearance, Mersinger and one of her Democrat colleagues on the CFTC, Commissioner Kristin Johnson, were also asked about how cryptocurrency intermediaries are defined.  

Johnson said she wants safeguards among intermediaries, such as segregating customer assets and cyber risk safeguards, two areas in which the SEC has proposed new rule changes that would apply to the digital asset industry, as well as traditional financial firms. 

“We’ve seen too many examples of the failure of that infrastructure to be effectively established and robustly overseen by internal sources even ahead of our engagement,” Johnson said at the event.  

© 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 investor collective, also organized as a DAO, includes noted crypto firms Multicoin Capital, Delphi Digital and Dragonfly.

Invention by the father-and-son team of David and Ian Weisberger allows “clients to keep control of their own private and exchange keys to their wallets and accounts, but can execute orders across multiple exchanges simultaneously,” according to the patent document.

Iceland-based CCP Games raised $40 million to build a new blockchain-based game set in the Eve Universe.

The seed round was led by a16z, with other participants including Makers Fund, Bitkraft, Kingsway Capital, Hashed and Nexon, the company said in a press release.

“Years before the first blockchain was created, the sci-fi space MMO EVE Online proved out many of the core principles that define web3 today,” a16z said in a blog post.

While the AAA title will use smart-contract technology, its production will be separate from any of CCP’s projects, including the original Eve Online, the company said.

The popular game is a virtual world where players interact in a digital economy and build their corporations.

“Since its inception, CCP Games’ vision has been to create virtual worlds more meaningful than real life,” said CCP Games CEO Hilmar Veigar Pétursson.”Now, with advancements made within blockchain, we can forge a new universe deeply imbued with our expertise in player agency and autonomy, empowering players to engage in new ways.”

© 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.