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Acala, a parachain project on Polkadot, says it has recovered about 2.97 billion from 16 addresses that minted 3 billion Acala USD (aUSD) in a security incident last Sunday.

The incident occurred due to a code error in one of Acala’s smart contracts that managed the iBTC/aUSD liquidity pool. The error allowed some Acala liquidity providers to mint its native stablecoin and illegitimately move them into their control.

Per the team, 99% of these “error mints” remained within addresses on the Acala network. This team halted the Acala chain and was able to freeze addresses that held the minted stablecoin.

After placing the network in maintenance mode on Monday, the team was able to recover 1.292 billion aUSD. This sum was burned following a swift passing of a governance vote.

In its latest update, the team has recovered another 1.682 billion aUSD, which increased the overall recovered sum to 2.974 billion aUSD. This additional sum of 1.682 billion aUSD is expected to be burned as well before the team restores back its network. Meanwhile, 48 million aUSD hasn’t been recovered yet, which includes the minted aUSD that was swapped and transferred to other blockchains.

The incident caused tremendous volatility in the price of aUSD. It momentarily plummeted to less than 0.01, losing more than 99% of its value on Sunday. The stablecoin has since recovered and is changing hands at $0.90 at the time of writing.

© 2022 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.

Canadian pension fund Caisse de dépôt et placement du Québec (CDPQ) revealed on Wednesday that it has written off its investment in Celsius.  

CDPQ, which manages about CAD$392 billion ($303 billion) in assets, shared its six-month returns for the first half of the year on Wednesday, registering an average return of –7.9% and revealing it wrote off CAD$200 million investment in Celsius.  

CEO Charles Emond said the cryptocurrency sector was in transition, and the fund had “arrived too soon.” Despite this admission, Emond, who previously spent almost two decades at Scotiabank, said the fund’s due diligence was “quite extensive with many experts and consultants involved.” He went on to say that they have written off the investment out of prudence.

CDPQ made an investment of around CAD$200 million in the crypto lending firm last October, during a $400 million investment round it led with WestCap group. 

Celsius entered Chapter 11 proceedings in July, having halted withdrawals due to cascading market conditions and ensuing liquidity troubles in June. Law firm Kirkland & Ellis filed projections on Sunday that shows the lender could run out of funds by October. The firm also owes depositors $2.8 billion more in crypto than it’s currently holding. 

© 2022 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.

eToro, an online brokering service, is acquiring options trading platform Gatsby as part of the firm’s expansion plan to draw in younger, US-based investors. 

The deal is valued at $50 million, in cash and common stock, an eToro spokesperson confirmed. The acquisition is part of the firm’s ongoing diversification efforts in the US.

Gatsby was founded in 2018 by co-founders Jeff Myers and Ryan Belanger-Saleh. The app offers commission-free options and stock trading for younger demographics. 

“We’ve always been huge fans of the social aspects of eToro,” Belanger-Saleh said in the statement. “We’ve always thought of them as the cool older sibling we’d love to hang with. In terms of product and culture, it’s a great fit and we’re really excited about the next chapter in our shared future.” 

The Gatsby team will join eToro following the acquisition, including president Davis Gaynes, chief operating officer Peter Quinn, chief technology officer Jeffrey Kleiss and head of product Matt Morris. 

“We are incredibly excited to welcome the Gatsby team to the eToro family,” said eToro CEO and co-founder Yoni Assia. “We have a shared mission of empowering investors through simple, transparent investing tools.” 

Gatsby previously raised $10 million during a Series A funding round in March 2021. The firm’s backers included Barclays Bank, Techstar Ventures and Beta Bridge Capital. 

© 2022 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.

Kaszek Ventures, one of Latin America’s most active venture capital firms, recently invested in an unnamed DeFi and crypto banking solutions company and is eyeing more digital asset investments.

Managing director Hernan Kazah, also a co-founder, didn’t disclose the amount invested but said the company, which isn’t ready to go public with the funding that closed about a year ago, is a DeFi bet that focuses on international transaction solutions through crypto for remittances or savings in different currencies.

It’s part of Kaszek’s deeper move into the digital asset space. The venture capital firm’s fourth early-stage fund invested in Bitso, a Mexican crypto exchange founded in 2014 that has since expanded to Brazil, where it has 1 million customers. Its fifth early-stage fund has already made investments in Colombian digital asset-focused Minka and Argentina’s Exactly Finance.

“That portfolio is still in the making, I’m sure we’re going to add at least one or two more” digital asset-focused investments,” Kaszek said in an interview. “When we go to fund six, the digital asset ecosystem will be more developed and we’ll be doing more things.”

Latin America is ripe for disruption with gaps around financial inclusion being targeted by tech companies of all kinds. VC investment in blockchain and crypto companies reached $653 million in 2021, up from $68 million in 2020, according to The Association for Private Capital Investment in Latin America, a non-profit organization. Other venture capitalists targeting the region include General Atlantic and SoftBank.

In total, some $16 billion in capital venture funding was invested in the region’s startups last year, compared to $4 billion in 2020, according to CB Insights. That record won’t be reached again this year, but funding has already surpassed $4 billion for 2022, Kazah said.

Kaszek, which has raised $2 billion, has been a leading investor in tech-related companies since its founding in 2011.

Kaszek invested $3 million last year in Exactly, a startup building an open-source, non-custodial credit protocol on the Ethereum platform. Exactly is betting on the Ethereum Merge coming up next month to lower costs, and plans to offer fixed income and variable income solutions.

© 2022 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.

Collective NFT ownership platform Fractional announced on Wednesday that it is rebranding to Tessera and has closed a $20 million Series A fundraising round led by Paradigm. 

The round closed earlier this summer, according to a press release. Other investors include Uniswap Labs, E Girl Capital and Focus Labs, as well as more than 50 angel investors including DC Investor and Keyboard Monkey. 

Co-founded by Andy Chorlian in 2021, Tessera, which originally launched under the name Fractional, is a platform that enables individuals from all over the world to come together and collectively own some of the most sought-after non-fungible tokens (NFTs) and projects. 

NFT collections on Fractional include CryptoPunks, Bored Ape Yacht Club, Pudgy Penguins and Cool Cats. 

Over time, decentralized autonomous organizations (DAOs) have also emerged on the platform, such as Doge NFT and Free Ross DAO, according to the release. 

“As we grow into this next phase, the name Tessera feels more representative of our platform, which is all about giving people the ability to collect things they love and identify with,” said a Tessera spokesperson over email. 

“Fractional was starting to feel a bit too financial and limited in scope, whereas Tessera speaks to the countless different ways people can use NFTs,” they added. 

Over the next few days, Fractional’s social channels will switch over to the new Tessera branding and content, per the release. 

Tessera’s Series A comes almost a year after the startup raised $6.3 million in a seed round, which was also led by Paradigm.  

The Block Research’s July funding recap shows that NFT and gaming startups have remained popular amongst investors for funding in the wider blockchain sector over the past 12 months. 

Monthly blockchain/crypto venture funding from The Block Research

© 2022 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.

Episode 77 of Season 4 of The Scoop was recorded remotely with The Block’s Frank Chaparro and Tessera co-founder and CEO Andy Chorlian.

Listen below, and subscribe to The Scoop on Apple, Spotify, Google Podcasts, Stitcher or wherever you listen to podcasts. Email feedback and revision requests to podcast@theblockcrypto.com.

Fractional — a crypto startup whose tech allows individual non-fungible tokens (NFTs) to be locked in a smart contract, and then ‘fractionalized’ into fungible digital pieces — is changing its name to ‘Tessera.’ 

In addition to the name change, Tessera announced they closed a $20 million Series A earlier this summer in a funding round led by Paradigm.

In this episode of The Scoop, Tessera co-founder and CEO Andy Chorlian explains how fractionalized NFTs foster new digital communities, and why ‘Tessera’ is a more suitable name for the direction of the platform.

According to Chorlian, Tessera is helping new communities form by taking ‘blue-chip’ NFTs that could cost tens or hundreds of thousands of dollars, and making them more accessible to the average collector:

“It’s really just reshaping what it is that’s exciting about a particular NFT or owning that NFT — generally more so in like the collecting things that you love and meeting other like minded people and being in interesting communities.”

The team decided to move away from ‘Fractional’ — a name that “sounds like a DeFi protocol,” according to Chorlian — in favor of ‘Tessera’ because of the word’s dual meaning and resonance with the vision for the platform:

“It is the name of a tile used to create mosaic artwork, and the other use… is the idea of a membership pass or an identity card, and that really hit two of the main things that we think our product and NFTs in general are cool and exciting for.”

During this episode, Chaparro and Chorlian also discuss:

• How NFT market cycles relate to the broader crypto market
• The difference between NFT collecting and speculating
• Why NFTs will continue to gain utility over time

This episode is brought to you by our sponsors Tron, Chainalysis &IWC Schaffhausen
About Tron
On August 1st, 2022, Poloniex launched a faster and more stable trading system along with a brand new user interface. Poloniex was founded in January 2014 as a global cryptocurrency trading platform. With its world-class service and security, it received funding in 2019 from renowned investors, including H.E. Justin Sun, Founder of TRON. Poloniex supports spot and margin trading as well as leveraged tokens. Its services are available to users in nearly 100 countries and regions with various languages available. For more information visit Poloniex.com

About Chainalysis
Chainalysis is the leading blockchain data platform. We provide data, software, services, and research to government agencies, exchanges, financial institutions, and insurance and cybersecurity companies in over 60 countries. Backed by Accel, Addition, Benchmark, Coatue, Paradigm, Ribbit, and other leading firms in venture capital, Chainalysis builds trust in blockchains to promote more financial freedom with less risk. For more information, visit www.chainalysis.com.

About IWC Schaffhausen
IWC Schaffhausen is a Swiss luxury watch manufacturer based in Schaffhausen, Switzerland. Known for its unique engineering approach to watchmaking, IWC combines the best of human craftsmanship and creativity with cutting-edge technology and processes. With collections like the Portugieser and the Pilot’s Watches, the brand covers the whole spectrum from elegant timepieces to sports watches. For more information, visit IWC.com

© 2022 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.

On-chain game developer community MatchboxDAO announced a $7.5 million seed funding round on Wednesday.

StarkWare, Geometry Research, ReadyPlayerDAO, Neon DAO, Delphi Ventures, Lemniscap, Fabric Ventures, Road Capital, Formless Gamma and Bonfire Union were among the investors.

The round also saw participation from individual investors including Stateless Ventures founder Matt Slater and The Block’s VP of Research Larry Cermak.

Alongside announcing a valuation of $50 million, MatchboxDAO said in a statement it would use the funding to accelerate gaming initiatives. The DAO, which builds on StarkNet, is focused on developing two projects. Matchbox Spark will serve as an incubator for projects providing mentorship and funding for game developer teams, while Matchbox Studios includes a set of core games and a suite of tools for accelerating game development.

The DAO launched earlier this year, and currently supports 25 projects with its seven-strong team, although MatchboxDAO Foundation founder and CEO Yonatan Ben-Shimon said they are currently looking to expand their team.

“Our long-term goal is to become the on-chain version of Unreal Engine. We want to enable game developers to build and launch a game within a very short period of time,” Ben-Shimon told The Block.

Disclosure: Members of The Block Research may, from time to time, participate in equity or token sales announced by industry startups. The Block News has no knowledge of this participation ahead of announcements and no special consideration is given to funding news involving members of The Block Research.

© 2022 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.

Senator Pat Toomey, R. PA, is calling the Federal Deposit Insurance Corporation to account for its work in crypto. 

In an August 17 letter to FDIC acting chairman Martin Gruenberg, Toomey says the agency “may be
improperly taking action to deter banks from doing business with lawful cryptocurrency-related
(crypto-related) companies.”

Citing whistleblower communications to Toomey’s office, the letter says the FDIC has asked member banks to “refrain from expanding relationships with crypto-related companies” and avoid extending credit to crypto clients. 

The letter asks Gruenberg to account for these actions and to turn over documentation as to the FDIC’s work on crypto. 

Earlier this week, the Federal Reserve finalized guidelines that would seemingly make it easier for FDIC-insured banks with novel charters, including fintech companies, to access master accounts with the Fed. 

Toomey is the leading Republican on the Senate Banking Committee. Since announcing that he will not seek another term, he has emerged as a major crypto advocate. This is not his first action interrogating an agency for its work on cryptocurrency. 

This is, however, Toomey’s final few months in office. 

© 2022 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.

A Bored Ape Yacht Club (BAYC) superfan dropped a staggering 777 ETH ($1.5 million) on a Bored Ape non-fungible token (NFT) on Tuesday night.

Vis.eth, who describes himself as an investor in his Twitter bio, added Bored Ape #5383 to his already vast collection of Yuga Labs wares spread across two wallets.

The seller made off with a tidy profit of around 682 ETH ($1.2 million), having purchased the Ape on August 1 last year for $242,000.

The sale comes in spite of market conditions, as trading volume for NFTs has fallen significantly across all major marketplaces in recent months.

Vis.eth told the Bored Ape Gazette — which has also covered some of his previous large purchases — that he bought the NFT because he wanted to “collect a golden monkey,” referring to the color of the Ape’s fur. Solid gold fur is considered a rare trait among NFTs in the collection, and according to data provider CryptoSlam, #5383 is the 285th rarest NFT in the 10,000-strong collection.

“777 ETH is a suitable price. Yuga will be the first successful social verse,” Vis.eth said.

Over the last few months Vis.eth has spent millions on Otherdeeds, too. His two wallets currently hold more than 60 of the land NFTs that form part of Yuga Labs’ upcoming metaverse project, Otherside, including more than a dozen that are home to Kodas, the mysterious Otherside avatars about which little is known.

Despite being an outlier in the current market, spending $1.5 million on a Bored Ape NFT isn’t record breaking. Among the most costly sales, Sotheby’s auctioned off Ape #8817 for $3.4 million on its metaverse marketplace in October last year. The same month, another rare Ape, #8585, sold for $2.7 million, at the time equivalent to 696.969 ETH.

Generally, NFTs in the BAYC collection sell for significantly less. CryptoSlam gives a current average sale price of $115k for BAYC NFTs over the last seven days, with a floor price of 78.5 ETH.

© 2022 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.

Quick Take

• Market conditions have stabilized, but the total value locked in DeFi is still significantly lower than its peak in late 2021.
• The main theme across governance communities remains to establish protocol stability and drive sustainable growth.
• Covered protocols include Aave, BitDAO, Frax Finance, Sushiswap, Uniswap and 1inch.

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