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Twitter’s board of directors addressed Elon Musk’s offer to buy Twitter by putting in place a plan that aims to hinder his ability to do so.

The company announced on Friday a shareholder rights plan, more commonly known in the finance world as a “poison pill,” which is a defense strategy companies can use to protect themselves from hostile takeovers. The plan will be in effect until April 14, 2023, per the statement.

Essentially, this approach allows shareholders to purchase additional corporate stock at a discount, effectively diluting the value of the stock and making it more expensive for the prospective buyer, according to the Cornell Law School Legal Information Institute.

Twitter’s rights plan can be exercised wherever any entity buys 15% or more of Twitter’s stock in a transaction not approved by the board, according to a statement released by the company. If triggered, the rights holders would then be entitled to buy additional shares of the company.

Musk acquired a 9.2% stake of Twitter last month, and a few days later declined to join the company’s board. On Thursday, the tech billionaire announced a $41.4 billion cash offer to buy Twitter. Musk said that his intention was to ensure that the social media platform remains an inclusive arena for free speech.

The newly announced plan doesn’t prevent the board from accepting an acquisition proposal if board members decide that is the best course of action, per the statement.

© 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

• This weekly series explores the most interesting insights in NFTs, blockchain gaming, and virtual worlds
• The first wave of blockchain games has struggled to maintain last year’s record-high valuations
• Amidst an onslaught of malicious actors, creators have innovated on behalf of NFT collectors to establish certain safeguards

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US president Joe Biden has said he plans to nominate Michael Barr to be the Federal Reserve’s next vice chair of supervision.

Barr, who was previously said to be under consideration to lead the Office of the Comptroller of the Currency, served in the Treasury Department under President Barack Obama, where he helped develop the 2010 Dodd-Frank regulatory framework for financial institutions.

Barr later served as an advisor to the distributed ledger tech company Ripple. He is currently a faculty member at the University of Michigan.

“I will work with Senate Banking Committee Chair Sherrod Brown to move Barr’s nomination forward quickly, and urge the Senate to swiftly confirm the four eminently qualified nominees for the Board of Governors—Jerome Powell, Lael Brainard, Philip Jefferson, and Lisa Cook— currently awaiting a vote,” Biden said in a Friday statement. 

Barr’s nomination follows the withdrawal of Sarah Bloom Raskin’s nomination following opposition from Republican lawmakers and Democratic Senator Joe Manchin. 

© 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.

Amun Holdings Limited – owner of both 21Shares and Amun, Inc. – introduced the first crypto exchange traded product (ETP) to market back in 2018.

Although the collaborative ARK Investments and 21Shares bitcoin spot ETF was recently rejected in the US, 21Shares remains the world’s largest provider of crypto ETPs with 30 unique products currently trading across exchanges. 

In this episode of The Scoop, recorded at the Bitcoin 2022 conference in Miami, 21Shares and Amun co-founders Hany Rashwan and Ophelia Snyder sat down with host Frank Chaparro to discuss the current landscape of crypto ETPs, and explain why they believe the rise of crypto index tokens and crypto basket ETPs are signs of a maturing industry.

As Snyder commented during the interview:

“‘Is bitcoin going to zero this year?’ is no longer a continuing ongoing narrative. That changes things. It means that people are starting to look at crypto as an asset class, as an industry, as a theme… It’s not, ‘ok, will bitcoin now exist?’ It’s now: ‘Ok, well crypto is definitely going to exist, so what is the S&P 500 of crypto?’

While 21Shares has the most ETP offerings on the market, other firms are also developing crypto basket products such as Bitwise’s recently announced NFT index fund (though this fund is only available to accredited investors).

Given their positions in the market, both Rashwan and Snyder are very aware of the institutional funds flowing into the crypto: something the two have continued to witness despite the market’s drawdown over the last few months. 

As Snyder explained:

“The thing I find most interesting about flow data is that it is not highly correlated with price. And I had a very interesting conversation with one of our lead market makers about a week ago talking about what’s going on in this market actually, and what are they seeing on the trading side, and one of the key takeaways is this: the institutions are actually forming thesis based investment philosophies. So they look at fundamentals…they develop a thesis and they invest.” 

During this episode of The Scoop, Chaparro, Rashwan, and Snyder also discuss:

• Progress on a Bitcoin Spot ETF
• Crypto Basket Index Tokens vs. Crypto ETPs
• How Amun and 21Shares work with global regulation of digital assets

This episode is brought to you by our sponsors Fireblocks, Coinbase Prime & Cross River
Fireblocks is an enterprise-grade platform delivering a secure infrastructure for moving, storing, and issuing digital assets. Fireblocks enables exchanges, lending desks, custodians, banks, trading desks, and hedge funds to securely scale digital asset operations through the Fireblocks Network and MPC-based Wallet Infrastructure. Fireblocks serves over 725 financial institutions, has secured the transfer of over $1.5 trillion in digital assets, and has a unique insurance policy that covers assets in storage & transit. For more information, please visit www.fireblocks.com.

About Coinbase Prime
Coinbase Prime is an integrated solution that provides institutional investors with an advanced trading platform, secure custody, and prime services to manage all their crypto assets in one place. Coinbase Prime fully integrates crypto trading and custody on a single platform, and gives clients the best all-in pricing in their network using their proprietary Smart Order Router and algorithmic execution. For more information, visit www.coinbase.com/prime.

About Cross River
Cross River is powering today’s most innovative crypto companies, with banking and payments solutions you can rely on, including fiat on/off ramp solutions. Whether you are a crypto exchange, NFT marketplace, or wallet, Cross River’s API-based, all-in-one platform enables banking as a service, ACH & wire transfers, push-to-card disbursements, real-time payments, and virtual accounts and subledgers. Request your fiat on/off ramp solution now at crossriver.com/crypto.

© 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

• Bitfinex is seeking a license to list companies in El Salvador, CTO Paolo Ardoino told The Block.
• As the next step in its fundraising, El Salvador should pass a new securities law “between one and two weeks.”

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Tornado Cash, a popular Ethereum mixer that helps obfuscate crypto transactions, has said that it will block crypto addresses sanctioned by the Office of Foreign Assets Control (OFAC) — an enforcement agency of the US Treasury Department.

The news means OFAC-sanctioned crypto wallet addresses will now not be able to use Tornado Cash. “Maintaining financial privacy is essential to preserving our freedom, however, it should not come at the cost of non-compliance,” tweeted Tornado Cash on Friday.

Tornado Cash said it uses the Chainalysis oracle — a smart contract that validates if a crypto wallet address has been included in a sanctions designation — to block OFAC-sanctioned crypto addresses.

The news comes a day after the Treasury Department alleged that North Korean hacking group Lazarus is linked to the $625 million theft from the Axie Infinity’s Ronin bridge. The Department added an Ethereum address to its sanctions list, allegedly tied to the Ronin exploit, and Tornado Cash has now blocked this address.

Tornado Cash created a contract to block sanctioned addresses over a month ago. Thus far, the contract has created three transactions to block a total of 24 addresses. The Ronin exploit-tied address was added on Thursday.

Tornado Cash co-founder Roman Semenov said that the changes are made only at the frontend, i.e., at its decentralized application (dapp) level. “The smart contracts are immutable,” Semenov said in a tweet on Friday. “The protocol (onchain smart contracts) and the frontend (dapp) are different things.”

In other words, he meant Tornado Cash itself cannot be shut by sanctions.

Last year, decentralized protocols Uniswap and 1inch also blocked some services from their frontend. Uniswap delisted a host of tokens that resembled securities or derivatives offerings, while 1inch began begun geofencing US IP addresses.

As for Tornado Cash, some people on Twitter have criticized its move, suggesting that sanctioning addresses does not mean bad actors cannot use its services. All they have to do is send their crypto to other non-sanctioned addresses and still use Tornado Cash, according to them. 

Tornado Cash declined to comment on The Block’s queries for this story.

© 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.

Executive Summary 

This report provides key insights into the state of the crypto derivatives market. Section 1 starts by highlighting the increasing  inflow  of  institutional  capital  into  the  crypto  space.  It then outlines the main crypto derivative  products and their  differences to those in the traditional finance space.

Section 2 takes stock of the state and recent developments in the crypto derivatives market by looking at the four key metrics i) volume, ii) open interest, iii) funding rates, and iv) implied volatility. It provides several insights:

• Both volume and open interest metrics indicate that the crypto derivatives market has grown considerably; 
  
• Activity in crypto options relative to futures is set to grow strongly if ratios of options to  futures  for  (i)  open  interest  and  (ii)  volume  converge  to  those  found  in  the traditional finance space;
  
• Activity  on  the  crypto  derivatives  market  continues  to  exceed  that  on  spot  markets, indicating some degree of market maturation; 
  
• Implied volatility is still relatively high in comparison to equity markets, but continues to trend downwards, and funding rates have been compressed.  

Section  3  sheds  light  on  the  major  derivative  trading  venues,  which  are  providing  the infrastructure  that  makes  possible  the  strong  growth  in  the  crypto derivatives  space.  It is shown  that  most  crypto  derivative  venues  are  of  a  centralized  crypto-native  nature.  In addition,  it  is  discussed  how  liquidity  network  service  providers  give  investors  access  to aggregated liquidity from crypto exchanges and OTC venues to address liquidity fragmentation. This aggregation may result in better liquidity, transparency, and pricing. 

Section 4 concludes and provides an outlook on future growth and developments in case there is further regulatory scrutiny.

© 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.

Fasset, a digital asset gateway, closed a $22 million Series A funding round led by Liberty City Ventures and Fatima Gobi Ventures, with participation from Soma Capital, MyAsiaVC and others, it said in a statement from Dubai on Friday.

The funding will be channeled toward new product development and market expansion. The company has been in advanced discussions with several regulatory authorities and will soon be launching services in Indonesia and Pakistan, it said.

“We have been working with some of the most prolific and well known Islamic finance jurists and thought-leaders to educate the masses on how Muslims can interact with this emerging asset class in a Sharia compliant manner,” Mohammad Raafi Hossain, the company’s co-founder and chief executive officer, who’s also a former adviser to the UAE Prime Minister’s Office, told Bloomberg earlier, which cited an emailed interview.

Some parts of the Islamic world have been skeptical toward cryptocurrencies, while others, including Dubai, have been actively attracting digital asset companies.

Changpeng Zhao, co-founder and CEO of Binance, the world’s biggest cryptocurrency exchange by trading volume, said last month that Dubai would be his base for the foreseeable future and by “any common interpretation,” the company’s headquarters, Bloomberg reported at the time.

© 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.

Emirates plans to expand the airline’s use of the metaverse and launch NFTs to increase revenue and improve customer service, it said in a statement on Thursday.

The NFTs are designed to be both collectible and utility-based, and the first projects are already underway, with launch anticipated in the coming months, it said.

Emirates added that its Emirates Pavilion at the Dubai Expo 2020 site will be repurposed as a center for innovation and future-focused projects involving the metaverse, NFTs and web3.

CEO and chair Saeed Al Maktoum said: “Dubai and the UAE are blazing the way in the digital economy, having a clear vision supported by practical policies and regulatory frameworks in areas such as virtual assets, artificial intelligence, and data protection.”

He added that the company is “committing a significant investment in financial and resourcing terms, to develop products and services using advanced technologies that will deliver on revenue, brand experience, and business efficiencies.”

The Block reported last month that Binance had become the latest firm to be granted a virtual asset license in Dubai, following FTX.

© 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 volume of papers from the Bank for International Settlements (BIS) points out that payment system efficiency is the top motivation for central banks in emerging market economies experimenting with central bank digital currencies (CBDCs) or considering such an approach.

The document, published on Thursday, is made up of a series of papers that were prepared for a meeting of deputy governors of central banks from emerging economies, which happened on February 9 and 10.

“Providing a cash-like digital means of payment, in light of reduced cash usage and an increase in private digital payment services, is the most common consideration [for CBDB issuance],” it says.

The report includes countries such as Brazil, Hong Kong, Mexico, South Africa and the United Arab Emirates.

It also points out that central banks in emerging market economies prioritize financial inclusion and focus on cyber security risks, potential bank disintermediation and cross-border spillovers.

© 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.