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Actor Seth Green paid 165 ETH (around $297,000 at the time) to recover his Bored Ape NFT, which had previously been stolen in a phishing attack.  

Green had negotiated with the alleged entity who stole the entity, who goes by Mr. Cheese, to get his NFT, according to BuzzFeed News. The Bored Ape is now back in his possession. 

Green’s Bored Ape NFT was set to be the star of an animated television series called White Horse Tavern. Its theft put into question whether Green even had the copyrights to make his Ape a star in the first place — showcasing how murky NFT copyright and ownership still remains. 

As The Block previously reported, Green wrote on Twitter that he lost several NFTs, including Bored Ape #8398, to a phishing attack, and had been working with authorities to get them back.

© 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 since-deleted online post began circulating yesterday calling for the removal of three Coinbase executives, citing failures of the exchange’s non-fungible token (NFT) platform, an aggressive approach to hiring and communication failures.

On Friday, CEO Brian Armstrong addressed the claims in a tweet thread.

The author positions themselves as a Coinbase employee or coalition of Coinbase employees, though The Block was not able to verify the identity of the poster. 

“We the employees at Coinbase believe that the executive team has recently been making decisions that are not in the best interests of the Company, its employees, and its shareholders,” reads the post, according to an archived version since circulated on social media.

The post names COO Emilie Choi, CPO Surojit Chatterjee, and Chief People Officer LJ Brock as “the most prominent executives who have been executing plans and ideas that have led to questionable results and negative value,” and calls for their removal.

The claims

These “questionable results” include a toxic workplace culture due to feedback and performance review systems, aggressive hiring and recent rescinding of offers and “over-prioritization of certain products” leading to a lack of focus on what the poster perceives as important issues, “like infrastructure.”

The post also cites “a general apathetic and sometimes condescending attitude” from the named executives. It proposes a vote of no confidence to remove them.

The post claims the actions of Choi, Chatterjee and Brock have hurt employees, “who have to deal with the unrealistic demands from said executives and the damage they have caused on a day-to-day basis,” as well as damage to shareholders. Coinbase’s stock has plummeted in recent weeks. 

The Block spoke with multiple Coinbase employees who could not verify if the post came from a fellow employee, but said the claims are consistent with grievances they’ve seen expressed in the workplace.

One employee said that some teams have grown to a size that doesn’t make sense for their mandate and that over-expansion can dilute cultures. Another said that Choi, Chatterjee and Brock are unpopular internally among certain groups in the company. 

The response

Armstrong pushed back against the letter in a Twitter thread, posting a Hacker News forum discussion of the post and calling the claims “really dumb on multiple levels.”

He urged the poster to quit and find a company to work at that they believe in if they have no confidence in Coinbase leadership. While he said he welcomed suggestions to improve the company, Armstrong said “our culture is to praise in public, and criticize in private.”

“Posting this publicly is also deeply unethical because it harms your fellow co-workers, along with shareholders and customers,” he tweeted. “It’s also dumb because if you get caught you will be fired, and it’s just not an effective way to get what you claim to want.”

The supposed-employee post made mention of specific human resources tools Coinbase has tested, naming the Dot Collector, a Ray Dalio-developed tool that enables real-time feedback and polling of micro-feedback to improve performance. Armstrong specifically responded to this claim, saying he was “shocked to see how much play this got, for such a small thing in the org.”

Two teams tried out the tool for about a quarter, according to Armstrong, and didn’t use it much. The feedback received was positive, he said, but there weren’t plans to use it further at Coinbase.

“A non-event from my POV,” Armstrong wrote.

He attributed some of the ire to the general frustration of a down market, and encouraged teams to pull together in a difficult period. Given Coinbase’s size, Armstrong said he expects a small number of individuals to periodically leak information.

“There is probably lots we can be doing better, but if you’re at a place where you want to leak stuff externally then it’s time for you to go,” he said. “You’re hurting yourself and those around you.”

Contributed reporting by Frank Chaparro

© 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.

The introduction of the landmark “Responsible Financial Innovation Act” on June 7 was a big moment for the crypto world. The actual bill, however, has left many in crypto as well as Congress underwhelmed.

Senator Cynthia Lummis (R-WY) had been teasing her work on the bill since late 2021, amid a massive bull market and in the aftermath of the Infrastructure Act, which saw an unprecedented collision of the crypto industry and Washington, DC. 

A laundry list of media appearances focused on the bill, drawing new levels of attention from mainstream outlets. Senator Kirsten Gillibrand (D-NY) joined Lummis at a Grayscale-sponsored Politico Live event in March to announce her engagement on the bill — granting it the descriptor “bipartisan.” 

Lummis also appeared at Bitcoin Miami in April. She spoke on a bill with Ted Cruz at an event at the Heritage Foundation, a conservative think tank, at the end of May. It was there that she formally announced the June 7 date of introduction. The next day, both Gillibrand and Lummis appeared at an event by crypto trade association Chamber of Digital Commerce. 

The day after the bill’s introduction, Lummis and Gillibrand appeared at a Washington Post Live event also sponsored by crypto asset manager Grayscale. Joining them was CFTC Chairman Rostin Behnam.

Prior to the bill’s introduction, the long list of media appearances did not entail the release of any language of the bill. Indeed, the teams behind the bill were extremely protective of the actual text, despite presenting isolated provisions like a de minimus tax exemption or a larger role for the Commodity Futures Trading Commission in those public appearances. 

In response to The Block’s May 27 publication of a full draft of the bill, Senator Lummis tweeted that “Any language circulating online is an incredibly outdated version from March 1.”

Given the extensive public relations work on the bill during its development, its final introduction on June 7 was inevitably going to be a significant event for the cryptocurrency industry as well as the broader public. 

But the scene had changed. The collective crypto market cap has slipped from $3 trillion to $1.3 trillion, and the collapse of TerraUSD last month has many in power looking askance at the industry’s ability to self-police.

Moreover, while almost every crypto firm with a DC presence has put out some sort of statement of support for the effort of the bill, the reaction among the industry to its actual language is decidedly mixed. Many are clearly looking at the bill as a work in progress.

“A great jumping-off point,” wrote the Stellar Foundation’s chief legal officer, Candace Kelly. 

The crypto trade associations expressed similar thoughts. In a statement, Perianne Boring, executive director of the Chamber of Digital Commerce, described the bill as “a foundational, comprehensive start.”

Jake Chervinsky, head of policy at the Blockchain Association, tweeted that “I & @BlockchainAssn are excited to continue working with both offices to make this bill the best it can be, & then to make it the law of the land.”

Partially, that is due to the scale of the bill, which encompasses broad spectrum of issues. No one individual party is pleased with the whole thing. But many parties within the industry are happy to have the mass attention on the bevy of issues facing them. 

There is also the reality that such expansive issue-specific bills generally only pass into law in response to massively eye-catching and controversial events or with small sections rolled into larger omnibus bills. 

Also factoring into the bill’s reception is that congressional midterm elections are coming up in November, with an anticipated flip away from the current narrow Democratic majority in the House of Representatives and potentially the Senate as well. Campaign season is therefore in high gear, taking many lawmakers away from lawmaking. 

Consequently, the likelihood of even pieces of the current legislation passing into law this Congress is minimal. 

© 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.

All except one of the crypto investment vehicles tracked by The Block closed the week down on Friday following a tumultuous day of trading in Europe. 

The European Central Bank announced its first interest rate hike —  a 0.25% raise —  since 2011 on Thursday and on Friday stocks and investment vehicles traded down across the board as the market reacted.

Trading in Europe and the US was further impacted by the latest inflation numbers from across the Atlantic — US inflation hit a 41-year high of 8.6%.

As a result of this rough macroeconomic background, several crypto ETNs and ETPs closed down significantly, including 21Shares Tezos and Cardano ETPs which lost 7.8%  and 6.12%, respectively.

Here’s how some of the major European crypto investment vehicles performed on Friday, June 10:

© 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.

TBD, the Bitcoin-focused venture first announced last spring, unveiled an ambitious effort Friday to build a decentralized Web platform dubbed “Web 5.”

The web democratized the exchange of information, but it’s missing a key layer: identity. We struggle to secure personal data with hundreds of accounts and passwords we can’t remember. On the web today, identity and personal data have become the property of third parties,” the project’s website states. “Web5 brings decentralized identity and data storage to your applications. It lets devs focus on creating delightful user experiences, while returning ownership of data and identity to individuals.”

A presentation made public along with the announcement explores the different components of the proposed platform. Web 5 notably utilizes Ion, a second-layer network built on top of the Bitcoin blockchain, as a protocol for “verifiable credentials.” 

“[T]his will likely be our most important contribution to the internet,” Dorsey said in a tweet. “Proud of the team.” 

“RIP web3 VCs,” Dorsey added in his post. 

© 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.

Lido’s staked ETH (stETH) token price has dropped to a 5% discount against ether (ETH) for the second time in a month, amid fears of shrinking liquidity for the staking derivative. 

stETH is a derivative token backed 1:1 by ETH. Users who stake their ETH on the Lido Finance platform receive the staked derivative in return. The upside is that they can access the value of their staked tokens while they are being staked, but the downside is that they can’t unstake the actual ETH until after Ethereum goes through The Merge, when it will transition to a proof-of-stake network. 

Token holders are able to sell their stETH for ETH on the open market, but there has always been a slight discount, reflecting the level of risk that comes with holding a derivative rather than the actual asset itself. Yet over the last month, this discount has deepened considerably. 

On May 13, the value of stETH was worth around 95% of the ETH price. It then rose to around 98% and remained there for the next few weeks. In the past day, the value has dropped again, back down to the 95% mark.

The value of stETH has dropped 5% below the value of ETH. Image: CoinMarketCap.

The main cause appears to be significant stETH owners selling large quantities of the token. One wallet sold close to 50,000 stETH on Thursday.

This has had a big impact on Curve, the main DeFi liquidity pool. Curve works by having quantities of both assets in a pool, which traders can sell into. But due to the large selling volume, the pool has become unbalanced. It now has a ratio of 22% ETH to 78% stETH as of the time of publishing. This is the most unbalanced that the pool has ever been. 

An unbalanced pool means one of the assets, stETH in this case, is becoming more illiquid. As such, it will become harder to sell as there isn’t enough ETH liquidity to honor sell orders of stETH at current prices.

This situation has prompted Lido to make a statement saying that there is no cause for alarm.

“The market is naturally finding a fair price for stETH as some participants need to find liquidity. This creates an opportunity for others to buy stETH at a significant discount,” the platform stated on Twitter.

Lido blamed recent crypto market events for having caused the value of stETH to drop, including the collapse of Terra, as well as crypto participants deleveraging positions in the wake of falling prices.

What happens if stETH decreases more?

If the value of stETH drops further, it is not necessarily an issue for current holders. Each token is backed by 1 ETH and when redemptions are available, the underlying collateral will become available. 

Crypto researcher Mika Honkasolo pointed out that stETH is not pegged to ETH in the same way that a stablecoin might be pegged to the value of its underlying collateral. In a blog post on this topic, he said, “There’s no “need” for stETH to maintain a tight correlation to the ETH price. It doesn’t matter if it fluctuates 90% below the ETH price or 50% above it. Confidence can’t be lost because of price action.”

Honkasolo noted, however, that the drop in value of stETH could affect those who have used the token to create leveraged positions, in particular to go long on the price of ETH. He said that if the value of stETH goes to 85% of ETH, liquidations would start to happen.

“The current market sentiment is bad and it seems there’s a non-trivial chance of cascading liquidations. That then pushes the stETH price really low (theoretically, to the 0.65 range),” he said.

On the flipside, as Lido noted, if the price falls lower it could incentivize more traders to buy stETH and to wait until they can redeem it for the underlying 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.

MoneyGram, the money transfer company known for peer-to-peer payments, is launching an on- and off-ramp service for digital wallets.

This will make it easy for digital wallet customers to move between fiat to cryptocurrency to fiat again, without needing a bank account or credit card, the company said in a press release. 

The company is working in partnership with Stellar Development Foundation, a non-profit that develops the Stellar blockchain. 

The service is initially being rolled out in a few select markets including Canada, Kenya, the Philippines and the US, at any MoneyGram location in these countries. The company said it was focusing on these markets because they are “remittance markets,” or places where there are a high volume of cross-border transactions. 

The company said that global cash-out functionality is expected to be available by the end of June 2022.

The partnership will also focus on changing-up the settlement process, which will work using Circle’s USDC stablecoin. 

“Today, almost 2 billion people rely on cash for their livelihood, with no options to access the digital economy. At the same time, a persistent pain point for crypto-native users is off-ramping cryptocurrency quickly and reliably,” said Denelle Dixon, CEO and Executive Director of the Stellar Development Foundation, in a statement. “The groundbreaking nature of this service is how it solves problems for a range of users with varying needs around the world.”

More wallets will be added to the service soon, but for now, users of Stellar-connected digital wallets Vibrat and Lobstr can access the service.

© 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.

Fractal, a gaming focused NFT platform, is launching a digital crypto wallet for web3 gamers to make the sign-up process seamless for those unfamiliar with crypto. 

Fractal acts as a marketplace for gaming companies to drop new products to fans, and also serves as a secondary market where gamers can sell NFTs to each other.

A digital wallet, which is used to store and retrieve crypto, is where NFTs purchased on Fractal are currently stored. 

“There’s actually not a lot of people who’ve ever touched a blockchain game. There’s around 1.4 million wallets and 3 billion game players out there in the world,” said Justin Kan, co-founder of Fractal, in an interview with The Block. Kan previously co-founded Twitch, a popular streaming platform for gamers.

“In order to get [blockchain games] to be much more mainstream, we are going to have to improve the usability side,” said Kan. “So we’ve created a non-custodial wallet… you can log into a game using just Google, and it creates a crypto wallet for you.” 

For gamers who’re unfamiliar with how crypto wallets work, downloading a chrome extension or plugin and figuring out how it works can be a barrier to entry into the blockchain gaming space. Fractal’s new product allows users to start playing a blockchain game in seconds, by creating a Fractal wallet using their existing Google accounts. 

Fractal launched in December 2021, when gaming NFT trade volume was $49 million based on data complied by The Block.

As of June 5, that number sits at around $3.3 million after the decline of popular play-to-earn game Axie Infinity. 

© 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.

The exploiter who stole 20 million Optimism (OP) tokens from crypto market maker Wintermute has returned 17 million of those coins to the Optimism contract address.

Data from Etherscan show 17 transfers of 1 million OP tokens each beginning at 12:09 PM UTC with the final transaction happening at 12: 31 PM UTC Friday.

The exploiter still has 1 million OP tokens left in the wallet as of the time of publishing. The attacker previously sent 1 million coins to Ethereum co-creator Vitalik Buterin and also sold another 1 million immediately following the hack.

By returning the funds, the attacker has made good on an earlier promise to do so, albeit, 3 million tokens short. Wintermute had initially given the hacker one week to return the funds while promising not to pursue any legal actions.

The hacker was able to access the funds because Wintermute provided an undeployed multi-signature wallet to Optimism to receive a 20 million OP token grant from the latter.

© 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 exchange and wallet provider Blockchain.com will begin offering “.blockchain” domain names to users powered by Unstoppable Domains, the company said on Friday.

According to the announcement, all 82 million registered Blockchain.com users will be able to obtain a free .blockchain domain from the company’s wallet service. These domain names will give users the ability to transact in crypto using human-readable addresses rather than the default long-string alphanumeric wallet addresses.

Human-readable addresses are similar to social media logins and make crypto transactions more accessible to people who might struggle with alphanumeric wallet addresses.

Blockchain.com users will also be able to customize their domain names or purchase more via the Unstoppable Domains service. Each domain name from the platform is a non-fungible token minted on Polygon, an Ethereum Layer 2 network.

“With a .blockchain domain, our users can not only send and receive crypto as easily as they send email, but own their identity in Web3. Our partnership with Unstoppable Domains marks the first custom top level domain (TLD) and gives us a unique way to share the .blockchain name with the millions of users of the Blockchain.com Wallet.”

Unstoppable Domains previously partnered with exchange giant Coinbase to offer “.crypto” domain names to the latter’s wallet users.

© 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.