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Bifrost Finance, a liquid staking protocol on Kusama (KSM), has requested a 50,000 KSM ($2.5 million) loan from the Kusama treasury.

The request is currently up for a vote by both the Council — the Polkadot and Kusama governing body — and the general community.

Bifrost users receive “vtokens,” a staking derivative token, in exchange for coins staked on the platform. These vtokens can be deployed on decentralized finance protocols in the DotSama ecosystem, enabling users to enjoy staking rewards and DeFi yield at the same time. “Dotsama is a portmanteau of Polkadot and Kusama.

The project won the fifth Kusama parachain auction in July 2021. These auctions were to determine the projects that will earn slots on the Kusama parachain which is a canary network for Polkadot.

According to the proposal from Bifrost, the loan will be used to bootstrap liquidity for the platform’s staked KSM derivative called vKSM (similar to staked ETH on Ethereum). This liquidity is to enable Bifrost to incentivize vKSM utilization across DotSama DeFi protocols.

The requested loan has a one-year tenure at an interest rate of 19%. Bifrost will split the loan equally between Solarbeam and Taiga Protocol. Solarbeam is a decentralized exchange in the Moonriver parachain network. Moonriver was also one of the earliest winners of last year’s Kusama parachain auction. Taiga is a derivatives liquidity protocol similar to Synthetix on Ethereum.

The 25,000 KSM split between both platforms will be used to provide liquidity for the KSM/vKSM trading pair. Bifrost says it is not expecting any impermanent loss when repaying the loan since vKSM can always be redeemed 1:1 for KSM.

© 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.

At the Federal Reserve’s first conference on the international role of the dollar, the prospect of a US central bank digital currency did not particularly impress panelists. 

According to a July 5 write-up on the June conference, a panel focused on digital assets found that institutional investment in crypto is “constrained by the lack of a regulatory framework.” Meanwhile, a Fed-issued CBDC — a particularly hot topic in Congress at the moment — or alternatives underwhelmed.

“Panelists generally agreed that technology by itself would not lead to drastic changes in the global currency ecosystem, as other factors such as the rule of law, stability, network effects, and the depth of markets are crucial for the advantages held by dominant currencies,” the Fed’s summary said.

The write-up also downplayed the risks that foreign currencies, especially the Chinese renminbi, or digital assets pose to the dollar in the international sphere, calling “the scope of cross-border CBDCs still quite limited.” Indeed, the report of the conference points to research that suggests a major market for Bitcoin comes from efforts to evade capital controls, particularly China’s stringent regime.

China’s ambitions for an international role for the renminbi have caused a great deal of concern among certain commentators and policymakers in the US, which draws a great deal of international leverage from the dollar’s role as the global reserve asset. The digital RMB is the largest-scale CBDC operation in the world right now, but seems to have been more an effort to compete local payments platforms like AliPay and WeChat Pay than foreign currencies up to this point. 

© 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.

Mining hardware manufacturer Bitmain will start selling its new application-specific integrated circuit (ASIC) miner AntMiner E9 on Wednesday.

The new Ethereum miner features a hash rate of 2,400M, 1920 watts of power consumption and power efficiency of 0.8 joules per minute, the company said on Twitter.

According to Bitmain, the E9 is equivalent to 25 RTX 3080 graphics cards. Sales will start at 9 am ET on Wednesday.

The new model was announced over a year ago, when Ethereum mining revenues were on the rise. The launch is happening despite of Ethereum’s move from proof-of-work to proof-of-stake, which is expected to happen later this year. Post-merge, the hardware can be used to mine other cryptocurrencies that rely on the Ethash algorithm.

In April 2021, Ethereum Miners were bringing in $1.68 billion in revenue, reaching an all-time high the following month ($2.4 billion). But revenues have since gone down significantly, totaling $549.58 million last month.

© 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.

Bullish.com, a crypto exchange serving institutional clients, has joined rivals in making layoffs as the market struggles with an ongoing period of weakness.

Fewer than 30 staff members have lost their jobs at Bullish — which, according to its LinkedIn profile, employs around 270 people — a source familiar with the situation told The Block. A company spokesperson confirmed the layoffs on Tuesday, while adding that “Bullish continues to actively hire for product, engineering and other strategic roles as we continue to evolve our business strategy.”

Bullish was launched last year to much fanfare as a subsidiary of Block.one, the software company behind the EOSIO blockchain protocol. Block.one and other investors — including Peter Thiel’s Thiel Capital, British hedge fund billionaire Alan Howard, Galaxy Digital and Nomura — provided an initial $10 billion in funding.

By cutting jobs, Bullish joins other crypto firms that have been struggling due to a significant market downturn. In recent weeks, Coinbase, Gemini, BitMEX, OSL and Abra have all trimmed their workforces, as The Block previously reported.

Bullish is based in the Cayman Islands and regulated by the Gibraltar Financial Services Commission. The company has employees across the globe, with a large presence in Hong Kong.

Last year, Bullish said it plans to go public via a deal with Far Peak Acquisition Corporation, a special purpose acquisition company (SPAC). That deal is yet to close and Bullish last week agreed to extend the outside termination date from July 8 to December 31 to give it more time to complete.

As part of the extension, Bullish said it also paid Far Peak a $2.5 million fee, which Far Peak will use for working capital.

If the SPAC deal goes through, Bullish will become a publicly traded company on the New York Stock Exchange. The company expects the deal to close in the third quarter of this year.

© 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

• The stablecoin sector in the cryptocurrency market is one of the most debated and controversial topics
• Specifically, LUNA’s collapse in May added to the scrutiny from retail investors and government agencies alike, as more stablecoin regulation is anticipated
• The Block noticed and mapped out 84 stablecoins across six categories

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Lamborghini Squadra Corse GT racing team Vincenzo Sospiri Racing announced that it will begin using non-fungible tokens (NFTs) to certify and authenticate factory car parts, the team announced on Tuesday.

The move is part of a pilot scheme by the company Go2NFT, which specializes in creating corporate NFTs for businesses.

In a statement, the company said the rollout could also be extended to authenticate merchandise and other official products. In March, it received a $5 million investment from blockchain ecosystem Skey Network. 

“We know that provenance, accountability and quality control are key challenges for superbrands wanting to protect their IP and we believe that NFT utility can help create more trust and transparency for brands and their fans,” said Boris Ejsymont, chief business officer for Go2NFT.

Lamborghini itself launched its first NFT collection in January this year in collaboration with Swiss artist Fabian Oefner. 

However, the most famous lambo-related NFT collection is probably that of artist Shl0ms, who blew one up to protest the get-rich-quick culture of crypto earlier this year.

© 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.

Core Scientific sold 7,202 bitcoin throughout the month of June, bringing in $167 million at an average price of $23,000 per bitcoin.

That money was mostly used for equipment payments, capital investments in additional data center capacity and scheduled repayment of debt, according to a statement on Tuesday.

The bitcoin sold represented a majority of the company’s holdings, which totaled 8,058 bitcoin at the end of May.

“We are working to strengthen our balance sheet and enhance liquidity to meet this challenging environment,” said CEO Mike Levitt. “Our industry is enduring tremendous stress as capital markets have weakened, interest rates are rising and the economy deals with historic inflation. Our company has successfully endured downturns in the past, and we are confident in our ability to navigate the current market turmoil.”

Other bitcoin miners have similarly sold a significant portion of their bitcoin holdings recently. Bitfarms, for one, gave up 3,000 BTC to pay down part of a $100 million loan from Galaxy Digital.

By the end of June, Core Scientific had 1,959 bitcoin and roughly $132 million in cash on its balance sheet. Going forward, the company intends to continue selling some of its self-mined bitcoin to “pay operating expenses, fund growth, retire debt and maintain liquidity,” the statement said.

Meanwhile, in June, it generated 1,106 self-mined bitcoin — down 2.8% from the previous month. While the company deployed new miners last month, bitcoin production was impacted by a “substantial increase in curtailment activity,” meaning that they had to power down for a total of 2,472 megawatt-hours.

Daily bitcoin production actually went up by 14% in June, from 34.8 BTC per day at the beginning of the month to 39.8 BTC.

By the end of the month, Core Scientific had a self-mining hash rate of 10.3 exahash per second (EH/s) and an additional 7.6 EH/s in colocation services. The company aims to reach 30 EH/s by the end of the year.

“We remain focused on executing our plan, while taking advantage of distressed opportunities that may arise,” Levitt said.

© 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.

Crypto trading firm Cumberland said that the speed of the crypto market’s recovery will depend on how quickly distressed assets can be transferred from troubled companies to more secure ones.

The firm noted that the assets belonging to these companies will have to be liquidated in order to offset outstanding liabilities — and this is having a big impact on crypto prices.

“Uncertainty around the size and timing of these asset sales is hanging over the market like a cloud,” the firm said on Twitter. 

As a result of the constrained market outcomes, a host of crypto companies have come under severe pressure. On June 12, a month to the day after Terra’s collapse began, crypto lending platform Celsius halted withdrawals for its customers. Other lenders have since followed suit in limiting services. 

Market conditions then deteriorated further when crypto hedge fund Three Arrows Capital (3AC) was liquidated by several lenders, including BlockFi and Voyager Digital — the latter lent $650 million to 3AC, which it plans to pursue.

Last week it was revealed that BlockFi may be acquired by FTX US. Sam Bankman-Fried’s firm had previously stepped in to stabilize the company with a $250 million revolving credit line, but a path to acquisition was eventually revealed on Friday. The exchange said it would provide the firm with a $400 million revolving credit line, which, subject to shareholder approvals, would give it an option to acquire the firm at a price up to $240 million.

Any market recovery hinges on how these insolvent firms’ assets are handled, according to Cumberland. “As large and opaque off-chain liquidation flows are looming in the backdrop, participants will be hesitant to commit capital. This reduces liquidity and increases volatility,” it said.

Cumberland, which is within the DRW family of companies, is an established principal trading firm with over 25 years of experience working in traditional financial markets, and offices around the globe. 

Market maker QCP echoes a similar sentiment

QCP Capital, a crypto trading firm in Singapore, shared similar concerns in a market update on Sunday. The firm said the crypto credit crisis is not over yet, with more potential liquidations on the horizon.

It went on to say that details of Babel’s insolvency have yet to come to the fore. Miners make up a large portion of Babel’s clientele and they would face significant strain if details showed that their loans to Babel and other borrowers are in default. According to QCP, miners would be forced to reduce inventory for working capital in this scenario. 

Meanwhile, large blocks of GBTC continue to be sold in the market as the trust’s discount widens below -30% again. These sales could be the last of 3AC’s collateral with Blockfi and Genesis being liquidated, according to QCP.

© 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 vote for Tornado Cash (TORN) — a coin mixing protocol for obscuring blockchain transaction history — to diversify its treasury holdings into ether (ETH) has failed. This comes as a lot of governance platforms continue to wrestle with the fact that their treasuries are declining rapidly.

The governance vote, which concluded on July 4, was a proposal to sell 50,000 of its vested native tokens (TORN-v-1) for ETH via a two-week limit order crowdsale on the decentralized exchange aggregator 1inch. This crowdsale would have been at a minimum of 0.008 ETH per token. As such, the platform would have raised at least $480,000 from the process if the vote had passed.

Since the tokens were vested, they can’t be sold but they can be used to vote on governance decisions. As such, their sale would have seen buyers participate in the governance process. These tokens would have been locked up in governance for one year before they could be withdrawn at a 1:1 rate for TORN coins. Buyers would also have earned yield from staking during the vesting period.

Details from the voting page show that 68% of the participants were against the vote. Voter participation in the process was almost seven times the number required to achieve a quorum on Tornado Cash DAO, showing that there was a considerable number of participants weighing in (or ones with deep pockets). The coin mixing platform also stated that voter participation in the proposal was over 200% more than the previous governance vote.

Tornado Cash is the latest DeFi protocol to have looked at treasury management in this current bear market. The decline in crypto prices has seen the value of their treasuries plummet significantly. This situation has led to governance proposals on several projects, aiming to diversify their treasuries.

Liquid staking giant Lido Finance is considering a proposal to sell $17 million worth of ETH to help the project navigate the current market conditions. In its treasury, the project only holds its native token, which is down more than 90%.

Stablecoin issuer Fei Protocol has also voted to sell some of its treasury tokens including Curve, Convex, and Aave for the Dai stablecoin. The move was to increase the stablecoin share of the project’s treasury.

Plus, MakerDAO is moving forward with plans to invest $500 million of its treasury into stocks, although this wasn’t due to declining prices (since its treasury largely comprises stablecoins).

© 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.