Federal prosecutors in New York announced charges against KuCoin, a leading cryptocurrency exchange, for breaching U.S. anti-money laundering laws on Tuesday (Mar. 26).

The charges accuse the Seychelles-based company of neglecting to properly vet its customers, which allegedly allowed for the transfer of billions in illicit funds since its inception in 2017. The prosecutors argue that KuCoin unlawfully courted business from American clients without the necessary registration with the Treasury Department or the implementation of required client identity verification procedures in compliance with U.S. laws.

KuCoin responded to the allegations on the social media platform X, assuring its customers that their assets are secure and that its legal team is addressing the claims. The company emphasized its commitment to complying with the laws and regulatory standards of various countries.

#KuCoin is operating well, and the assets of our users are absolutely safe. We are aware of the related reports and are currently investigating the details through our lawyers. KuCoin respect the laws and regulations of various countries and strictly adheres to compliance…

— KuCoin (@kucoincom) March 26, 2024

Further compounding KuCoin’s legal troubles, the exchange’s founders, Chun Gan and Ke Tang, both Chinese nationals aged 34 and 39 respectively, have been charged with conspiracy and are currently evading capture. According to a press release published by U.S.’s Attorney Office of the Southern District of New York:

GAN, 34, and TANG, 39, both citizens of China, are each charged with one count of conspiring to violate the Bank Secrecy Act and one count of conspiring to operate an unlicensed money transmitting business, each of which carries a maximum sentence of five years in prison.

In a separate legal development, the U.S. Commodity Futures Trading Commission (CFTC) has initiated a civil lawsuit against KuCoin. This lawsuit alleges the company failed to register its futures and swaps activities with the regulatory body.

This legal action follows a December settlement in which KuCoin agreed to prohibit New York residents from using its platform and to pay $22 million to resolve a lawsuit from the state. The exchange is accused of having operated within the United States without license.

Part of a broader crackdown

United States regulators are pushing another wave of actions against players in the cryptocurrency industry. As ReadWrite reported earlier this week, the U.S. Securities and Exchange Commission (SEC) has approached a judge in New York, seeking to impose a penalty close to $2 billion on Ripple Labs.

Early Ethereum (ETH) advisor Steven Nerayoff has also recently expressed serious concerns over the investigation of Ethereum by the U.S. Securities and Exchange Commission (SEC).

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Coinbase is advancing its storage strategy for corporate and customer USD Coin (USDC) balances by leveraging Base, an Ethereum (ETH) layer 2 solution it helped develop.

Base, built upon the Optimism (OP) Stack, aims to enhance the efficiency of managing and securing funds with its open-source technology.

Max Branzburg, the Vice President and Head of Consumer Products at Coinbase, announced via X that this shift will result in lower transaction fees and quicker settlement times, all while maintaining the current user experience standards at Coinbase. Branzburg expressed enthusiasm about the company’s ongoing shift towards blockchain technology and encouraged other firms to consider similar transitions.

1/ Going forward, Coinbase is going to be storing more corporate and customer USDC balances on Base. This enables us to manage and secure customer funds with lower fees and faster settlement times, with no impact to the Coinbase user experience.

We are excited to continue to…

— Max Branzburg (@maxbranzburg) March 26, 2024

The response from the community has been positive, with Base contributor Jesse Pollak endorsing the move and expressing eagerness to continue supporting Coinbase’s blockchain integration.

based

excited to keep supporting @coinbase moving onchain

— Jesse Pollak (jesse.xyz) (@jessepollak) March 26, 2024

Highlighting Base’s Growth

In related news, Base has experienced a notable increase in its total value locked (TVL), with user deposits surpassing $1 billion according to Defi Llama data. This marks a significant rise from the beginning of the month, when the TVL stood at $470 million.

A significant portion of this growth is attributed to Aerodrome, a decentralized exchange that has seen a substantial increase in activity since early February. Aerodrome is responsible for nearly $507 million of Base’s TVL — around half.

Additionally, Base has outperformed other optimistic rollup solutions in terms of transaction volume growth, even as platforms like Arbitrum also report significant increases. Conversely, the OP Mainnet has witnessed a steadier, more modest rise in daily transactions.

Coinbase launched Base back in late August 2023, as a new layer 2 scalability solution aimed at allowing large-scale decentralized application adoption. In late November 2023, Coinbase also launched its new open-source Onchain Payment Protocol — aimed at improving the company’s Commerce product for merchants.

This new protocol was pitched as a way to enable “instant settlement, low fees, and broad asset support” for merchants using its services.

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The U.S. Securities and Exchange Commission (SEC) has approached a judge in New York, seeking to impose a penalty close to $2 billion on Ripple Labs.

Stuart Alderoty, the Chief Legal Officer at Ripple Labs, announced via social media that the SEC has proposed such a substantial fine, with the redacted court documents expected to be publicly available by Mar. 26. According to the SEC’s request, it wants Ripple Labs to be ordered to return $876 million in gains, pay $198 million in prejudgment interest, and a $876 million in civil fines, totaling approximately $1.95 billion.

As you will see when the SEC’s brief is made public tomorrow, they ask the Judge for $2B in fines and penalties. 1/4 https://t.co/HM8dBbn7lp

— Stuart Alderoty (@s_alderoty) March 25, 2024

XRP vs the SEC

This legal battle was initiated in December 2020, when the SEC accused Ripple Labs and its two executives of breaching federal securities laws through their sales of XRP to both large-scale investors and the general public. However, in a decision made last July, Judge Analisa Torres of New York determined that while Ripple’s direct sales to institutions were in violation, the distribution of XRP through exchanges and algorithmic processes did not contravene U.S. regulations.

The SEC’s legal filings argue for a strict stance against similar violations within the cryptocurrency industry, urging the court to deliver a clear message against such infractions. Alderoty has voiced criticisms against the SEC’s actions and mentioned that Ripple Labs plans to submit a formal reply to the SEC’s motion in the coming month, with the SEC highlighting that Ripple’s response must be submitted by no later than April 22, 2024.

XRP is not the only token in the SEC’s crosshairs. Early Ethereum (ETH) advisor Steven Nerayoff has recently expressed serious concerns over the investigation of Ethereum by the SEC. He also noted that the prospects of Ethereum exchange-traded funds (ETFs) might be facing more rigorous examination.

The development follows a price prediction suggesting that XRP may soon see a 25% upward swing to regain its previous price of $0.75. The analysis highlighted the coin’s price being near the 200-day moving average support, and potentially triggering further growth towards the $0.92 mark.

Featured image: Canva

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On Monday, Nasdaq-traded spot Bitcoin (BTC) exchange-traded funds (ETFs) witnessed an inflow of $15.4 million, marking a positive shift after five consecutive days of outflows, according to preliminary figures from investment company Farside.

The inflow was predominantly led by Fidelity’s FBTC, which garnered $261.8 million, and was closely followed by BlackRock’s IBIT with a $35.5 million collection. Other ETFs such as BITB, BTCO, EZBC, and BRRR also saw inflows ranging from $11 million to $20 million. Contrarily, Grayscale’s ETF (GBTC) experienced a substantial outflow, losing over $350 million.

The previous week was challenging for these ETFs, with a total outflow of $887.6 million, primarily due to significant withdrawals from GBTC.

What are Bitcoin ETFs?

The launch of nearly a dozen spot ETFs in the U.S. on January 11 offered investors an opportunity to invest in Bitcoin without the complexities of direct ownership and storage. These funds directly invest in Bitcoin and avoid the necessity for position rollovers, distinguishing them from futures-based ETFs introduced in October 2021.

The newfound accessibility to Bitcoin can also potentially boost Bitcoin’s legitimacy and attract a broader investor base, potentially enhancing market liquidity and stability. Furthermore, it simplifies investing in Bitcoin through familiar stock exchange platforms and regulated environments, mitigating some security concerns and allowing tightly regulated institutions to partake in the market.

Since the trading of spot ETFs commenced, the value of Bitcoin has surged by more than 50% to $70,750. On Monday, the price of Bitcoin experienced a more than 4% increase, momentarily exceeding $71,000.

The development follows the recently approved U.S. spot Bitcoin ETFs experiencing a day of record-breaking inflows exceeding $1 billion on Mar. 12.

Featured image: Ideogram

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The Grayscale Bitcoin Trust (GBTC) experienced significant withdrawals, with $359 million leaving the fund on Thursday (Mar 21).

Those outflows come on the heels of a week of heavy withdrawals, culminating in a record single-day withdrawal of $642 million on Mar. 18. These recent withdrawals have escalated the total weekly outflows from GBTC to $1.8 billion, marking the fourth straight day of net withdrawals across all Bitcoin (BTC) exchange-traded funds (ETFs).

We've got a negative flow day for the Cointucky Derby #Bitcoin ETFs thanks to $GBTC's $643 million outflow day pic.twitter.com/scmVgmwtiH

— James Seyffart (@JSeyff) March 19, 2024

What’s causing the Bitcoin ETF outflow?

There’s speculation that the wave of withdrawals from Grayscale’s fund might be winding down. Eric Balchunas, a Senior ETF analyst at Bloomberg, suggests that the outflows could be largely attributed to bankruptcies within the cryptocurrency sector, indicating that the downturn might be nearing its end.

What a pounding. Thought worst was over. Guess not. Who is leaving now that wasn’t motivated to leave past two months? https://t.co/YNX1dBt2FM

— Eric Balchunas (@EricBalchunas) March 21, 2024

Balchunas pointed out that withdrawals from significant industry players like Gemini or Genesis are likely being redirected into purchasing Bitcoin, which in turn supports the market. He expressed optimism suggesting that “the worst is probably close to being over.”

The more I think about it the more likely the uptick in flows is related to the bankruptcies bc of the size and consistency. The flows in Feb showed what retail outflows look like, smaller and random pattern. Also any Gemini/Genisis outflows likely buying btc w cash hence market…

— Eric Balchunas (@EricBalchunas) March 22, 2024

As of March 21, Grayscale disclosed that its Bitcoin Trust had $23.2 billion in assets under management — now standing at under $23.24. Since converting to an ETF on January 11, GBTC has seen a reduction of $13.6 billion in assets.

Independent researcher ErgoBTC observed that roughly $1.1 billion of the recent GBTC outflows might be linked to the bankrupt cryptocurrency lender Genesis. Ergo highlighted a correlation between the timing and volume of GBTC outflows and Genesis inflows, suggesting a direct relationship.

Genesis was granted court approval in February to sell $1.3 billion worth of GBTC shares to settle its debts. Before this, the bankrupt exchange FTX had sold off its entire stake of 22 million GBTC shares, nearly $1 billion worth, effectively liquidating its position.

Amid these market movements, Bernstein has updated its forecast for Bitcoin, predicting a significant rise. The investment firm has raised its year-end Bitcoin price target to $90,000 from its earlier estimate of $80,000, buoyed by a recent uptick to around $74,000 and a positive reception to new spot BTC ETFs.

Bernstein analysts, Gautam Chhugani and Mahika Sapra, attribute their bullish outlook to several factors: the commencement of a new Bitcoin bull cycle, robust inflows into ETFs, a surge in miner capacity, and unprecedented miner revenues, presenting a compelling case for equity investors interested in the cryptocurrency sector.

Furthermore, Bernstein has adjusted its prediction for the upcoming Bitcoin halving in April, now anticipating a 7% reduction in the hash rate, a measure of mining computational power. This outlook is more optimistic than their prior estimate of a 15% decline, expecting a smoother transition and better industry consolidation than before.

The developments follow some recent reports suggesting that Bitcoin may be heading towards its biggest crash so far. Also, earlier this week the world’s first cryptocurrency saw a brief flash crash down to $8,900 on BitMEX, before quickly returning over $60,000.

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Early Ethereum (ETH) advisor Steven Nerayoff has recently expressed serious concerns over the investigation of Ethereum by the U.S. Securities and Exchange Commission (SEC).

Nerayoff claimed in an X thread on Thursday (Mar.21) that the prospects of Ethereum exchange-traded funds (ETFs) might be facing more rigorous examination. The SEC has issued subpoenas to several entities involved with Ethereum and its possible ETFs, signaling intensified regulatory attention.

UNVEILING ETHEREUM'S DECEPTIVE EVOLUTION:
The problems with @ethereum, the announcement of the @SECGov investigation, and the ETHGate movement are all due to the founders' greed and willingness to allow our revolutionary project to become nothing more than a deceptive database…

— Steven Nerayoff (@StevenNerayoff) March 21, 2024

Steven Nerayoff’s Grave accusations

Despite previous disputes with Ethereum’s leadership, including accusing co-founder Vitalik Buterin of being a fraudster, Nerayoff expresses deep disappointment with how Ethereum has evolved. He believes that had his original ideas been implemented, Ethereum would not be encountering its current challenges:

If my invention was followed, we wouldn’t have issues today; Ethereum would still be the base of crypto.

Nerayoff criticizes the Ethereum project for straying from its original vision, attributing the SEC’s investigation and the emergence of the ETHGate movement to the founding team’s greed. He argues that this deviation has turned Ethereum into a “deceptive database” manipulated by a select few at the expense of the broader community.

Ethereum is built on deceit and lies, and they think you’re all dumb enough to not be the wiser. Well, I am, and I am saying to all of you, don’t allow this to happen a day more. The Ethereum house of deceit must fall once & for all!

Nerayoff particularly highlights the rise of scam Initial Coin Offerings (ICOs) and the resulting erosion of trust as outcomes of current Ethereum leadership moving away from his initial concepts. He also highlights the non-fungible token (NFT) craze which he described as “a handful of people creating tokens and rug pulling them.”

This is not the first time that Nerayoff voiced concerns over Ethereum and its leadership. Back in September 2023, he suggested that the ecosystem received preferential treatment from regulators through an infiltration of regulatory bodies. In an audio of a nearly three-hour call with Buterin shared back in November 2023, he warned the Ethereum co-founder:

I am fairly convinced that securities laws and these other laws have been tripped.

The controversy follows Ethereum’s recent introduction of the Dencun protocol upgrade. Still, despite the upgrade having a significant impact on the protocol’s fees Solana was able to overtake Ethereum’s decentralized exchange volume soon after.

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Bitcoin (BTC) experienced a sudden drop to $8,900 on BitMEX, deviating significantly from its stable $60,000+ valuation on other exchanges.

What is a Bitcoin flash crash?

On a late Monday, Bitcoin experienced a swift downturn, dropping to a low of $8,900 on the cryptocurrency exchange BitMEX, a stark contrast to its stability above $60,000 on other platforms. This is known as a flash crash.

A sharp decline started at 22:40 UTC that within two minutes led Bitcoin’s price down to $8,900, marking its lowest point since the beginning of 2020. However, the recovery was just as rapid, with the price surging back to $67,000 by 22:50 UTC.

During this rapid rise and fall on BitMEX’s spot market, the global average price of BTC hovered around $67,400. Speculation arose on the social media platform X, with some users suggesting that massive sell-offs by large holders, or ‘whales’ triggered the price drop.

User @syq pointed out that an individual had sold more than 850 BTC (valued at approximately $55.49 million) on BitMEX, causing the XBT/USDT spot pair to dive to $8,900.

The XBT index on BitMEX monitors the price of Bitcoin, whereas the XBT/USDT pair indicates the price of Bitcoin in terms of Tether (USDT), the leading stablecoin pegged to the US dollar. Despite the turbulence in the spot market, BitMEX’s derivatives markets, worth billions, remained unaffected.

In response to the incident, BitMEX announced via social media that it had initiated an investigation into the large sell orders. Furthermore, BitMEX reassured its users, stating, “The trading platform is fully functional, and all user funds are secure.”

As mentioned earlier today already – we are investigating unusual activity on our BTC-USDT Spot Market.

This did not affect any of our derivative markets, nor the index price for our popular XBT derivatives contracts.

The trading platform is operating as normal and all funds…

— BitMEX (@BitMEX) March 19, 2024

The development follows Bitcoin reaching new all-time highs of almost $74,000 on Mar. 15, before then dropping to $66,885 on Mar. 15. The world’s first cryptocurrency’s price started skyrocketing following the approval of Bitcoin spot exchange-traded fund (ETFs) contracts back in January.

The newly-approved ETF contracts have attracted significant attention from market participants, reaching daily net inflows in excess of $1 billion for the first time on Mar. 12.

Featured image: ideogram

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Japan’s Government Pension Investment Fund (GPIF) is considering Bitcoin (BTC) as a potential investment diversification tool amidst economic and technological changes.

According to a Mar. 19 announcement, the Government Pension Investment Fund (GPIF) of Japan, recognized as the world’s biggest pension fund, is considering Bitcoin as a possible tool for diversification. The GPIF unveiled plans for new long-term investment strategies in light of significant societal and economic shifts, alongside rapid technological advancements.

To address these evolving challenges, the GPIF has initiated a five-year research initiative aimed at discovering innovative investment diversification methods. This initiative places a strong focus on sustainability and managing risks.

Part of this initiative involves the GPIF seeking information on a range of potential diversification instruments, including assets it currently views as illiquid and does not possess. Among those assets there are cryptocurrencies such as Bitcoin, precious metals such as gold, and other types of assets.

This recent announcement from the GPIF serves as a request for information and does not confirm the fund’s future expansion into any of those assets. The decision to conduct further research will be based on the data gathered through this request.

What is the world’s largest pension fund?

Founded in 2006 by the Japanese government, the GPIF’s investment strategy has traditionally focused on core infrastructure funds, which support essential social and economic activities. The fund diversifies its investments across traditional assets such as domestic and international stocks and bonds, in addition to alternative assets like infrastructure and real estate.

The report highlighted the fund’s goal to leverage its long-term investment horizon for achieving stable and efficient returns, despite short-term market price fluctuations. As of December 2023, GPIF managed assets totaling 225 trillion Japanese yen ($1.54 trillion), securing its position as the largest pension fund globally.

Although GPIF is in the preliminary stages of exploring the inclusion of Bitcoin in its portfolio, some global pension funds have already made moves into Bitcoin-related assets. For instance, in November 2023, South Korea’s National Pension Service announced the acquisition of over 280,000 shares in the U.S.-based Coinbase.

With the approval of the United States Bitcoin spot exchange-traded funds (ETF) by the Securities and Exchange Commission back in January, the world’s first cryptocurrency has gained more credibility which may get major financial institutions on  board. Following the approval, the daily Bitcoin ETF inflows surpassed $1 billion earlier this month.

Featured image: Ideogram

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The Solana (SOL) blockchain has emerged as a major platform for the emergence of new memecoins, signaling the onset of a bullish market trend. This trend was accompanied by a surge in SOL’s price as well, nearing $100.

A standout in this memecoin surge is Slerf (SLERF), which despite its creator accidentally destroying over $10 million in Solana before its debut, quickly soared to a market capitalization of $500 million within just a few hours and then fell again.

Guys I fucked up. I burned the LP and the tokens that were set aside for the airdrop.

Mint authority is already revoked so I can not mint them.

There is nothing I can do to fix this.

I am so fucking sorry.

— Slerf (@Slerfsol) March 18, 2024

As of press time CoinMarketCap data shows that Slerf is trading at $0.51. The 24-hour trading volume also reached nearly $681.6 million, up 3,450% from the $19.21 million reported 24 hours ago.

Before this crash the cryptocurrency rallied from its initial CoinMarketCap price of just under $0,68 to nearly $1.06 before crashing to its current price. The market cap reported by Coingecko also very quickly rose to over $622 million down to $184 million before settling at over $205 million as of press time. All of this activity took place on Mar. 18 as intraday volatility.

The team behind Slerf managed to gather 535,000 SOL for the coin’s launch but inadvertently destroyed $10.4 million in Solana in an attempt to clean their wallet. This surge in memecoin activity has drawn parallels to the Ethereum (ETH) initial coin offering craze of 2017, a period marked by numerous crypto ventures raising significant funds, though most ultimately fell short of their promises.

What are memecoins?

Memecoins, characterized by their origins in internet memes or possessing humorous qualities, in most cases lack practical applications beyond serving as pop culture artifacts. These digital currencies spawned after the introduction of Dogecoin (DOGE) back in 2013 are speculative by nature and are buoyed by dedicated online communities.

Dogecoin gained fame and support from Elon Musk during the 2021 bull market. In 2024, several new memecoins have quickly reached market capitalizations in the billions, creating a wave of crypto millionaires.

The memecoin boom has rekindled memories of the 2017 ICO frenzy, with influencers successfully raising millions for new memecoin ventures. A user on X remarked that the current memecoin craze represents a more transparent iteration of the 2017 ICO and 2021 NFT bubbles, with projects no longer pretending to fulfill unrealistic promises and investors acknowledging their speculative motives.

This meme coin mania is merely a more honest version of the 2017 ICO craze and the 2021 NFT/crypto-art bubble…

Projects no longer have to pretend to deliver on a fake white-paper and investors no longer have to pretend to be in it for the art

Too cynical?

— WhiteRabbit1111 (@WRabbit1111) March 16, 2024

The memecoin phenomenon, while creating overnight millionaires, often results in significant losses for many who invest without fully understanding the lack of inherent value of those assets.

While Solana’s memecoins continue to gain ground, major meme token Shiba Inu (SHIB) has seen many left wondering if it has any life left in it. In our recent market review, we share the predictions of this token’s future by three market analysts.

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President Joe Biden’s proposed 30% tax on crypto mining power faced criticism for potentially harming the industry and erasing investor wealth.

The resurgence in Bitcoin and other cryptocurrency values has brought Bitcoin (BTC) back into the spotlight, prompting an unexpected shift in stance from Donald Trump towards cryptocurrencies.

Bitcoin’s value recently soared past $71,000, surpassing its 2021 all-time high before dropping well under $70.000. This surge not only spotlighted Bitcoin but spurred growth in the prices of cryptocurrencies like Ethereum (ETH), XRP, and Solana (SOL). BlackRock — the world’s premier asset management firm — foresees a crypto market expansion to $90 trillion.

Meanwhile, U.S. President Joe Biden faces criticism for policies perceived as harmful to the crypto industry, potentially erasing billions in investor wealth. In a contentious move, the Biden administration has revisited the idea of imposing a 30% tax on crypto mining operations, which rely on high-energy computing for transaction verification and network security. According to the “General explanation of the administration’s fiscal year 2025 revenue proposals” dated Mar. 11, 2024:

Any firm using computing resources, whether owned by the firm or leased from others, to mine digital assets would be subject to an excise tax equal to 30 percent of the costs of electricity used in digital asset mining.

This proposal, as outlined by the U.S. Treasury in its 2025 revenue plan, could severely impact the mining sector, leading to significant losses in investor value, according to Taras Kulyk of SunnySide Digital:

“Implementing a blanket 30% federal tax on digital mining will certainly kill the sector and wipe out billions of dollars of investor value virtually immediately in the U.S.”

Senator Cynthia Lummis, a crypto advocate, warned that such a tax could decimate the industry’s presence in the U.S. Yet, some interpret the White House’s budget as showing strong confidence in crypto’s revenue-generating potential, suggesting an underlying bullish stance on Bitcoin and digital assets.

The White House 2025 budget is incredibly bullish on crypto assets, some might even say they believe it’s going to the moon.

But a proposed 30% punitive tax on digital asset mining would destroy any foothold the industry has in America.

— Senator Cynthia Lummis (@SenLummis) March 11, 2024

Featured image: ideogram

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Coinbase CEO Brian Armstrong has advocated for Bitcoin (BTC) as a financial discipline tool, suggesting it could counteract United States deficit spending and echo the fiscal restraint of the gold standard era.

This is (in part) why Bitcoin matters. It’s a return to the gold standard that we left fully in 1971. A return to financial discipline.

Bitcoin will be an important check and balance on excessive deficit spending which is essential to the U.S. and the dollar remaining strong. https://t.co/u4mN5SgPTX

— Brian Armstrong (@brian_armstrong) March 12, 2024

Robert Sterling, CFO of 20 Dollar Consulting, explained that the United Sates national debt is a symptom of fiscal  expansion. The trend took hold and started accelerating during the Gerge W. Bush administration and never subsided away since then.

Furthermore, the situation was further exacerbated as a consequence of military spending, tax cuts, the Great Recession and the recent COVID-19 pandemic. Armstrong commented on this trend by advocating for Bitcoin as a possible solution.

Bitcoin: the new gold standard?

The Coinbase CEO suggested the Bitcoin is a return to how the financial landscape looked up to when in 1971 the Nixon administration abolished the gold standard — one of the causes of the so-called Nixon shock. According to Armstrong, the inability of financial institutions to issue more Bitcoin according to their wishes constitutes “a return to financial discipline.”

The Coinbase CEO believes that Bitcoin could serve as a counterbalance to what he perceives as excessive deficit spending of the United States administration. He also claims that Bitcoin could keep the United States dollar strong.

Still, Armstrong did not explain how Bitcoin would strengthen the dollar or act as a counterbalance to United States’ deficit spending. Eric Voorhees — CEO of instant crypto exchange ShapeShift — voiced his confusion concerning how Bitcoin would achieve anything that was suggested by the Coinbase executive.

How does Bitcoin provide a check and balance on excessive deficit spending?

Very long term, when fiat is gone, I can see how, but while fiat is still a thing, does Bitcoin restrain gov spending at all?

— Erik Voorhees (@ErikVoorhees) March 13, 2024

Voorhees has gone as far as to suggest that in the long-term Bitcoin could end up keeping public spending in check. Still, he suggested that this could only happen after fiat currency become a thing of the past. This is in stark contrast with the Coinbase CEO’s suggestion that it could instead strengthen the United States dollar.

The debate follows recent reports that El Salvador — the world’s first country to adopt Bitcoin as legal tender — has seen $84 million in gains from its Bitcoin holdings. The country is also working to launch its “Volcano Bonds” backed by Bitcoin.

Featured Image: Ideogram

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The United States recently approved spot Bitcoin (BTC) exchange-traded funds (ETFs), which experienced another day of record-breaking inflows on March 12.

Data gathered from BitMEX Research shows that net inflows for spot bitcoin ETFs surpassed $1 billion. Blackrock’s IBIT product also saw significant activity, registering a record inflow of $849 million shortly after it reported having over 200,000 BTC assets under management earlier in the week.

In terms of Bitcoin, the inflow for the day reached a record-breaking 14,706 BTC, valued at approximately $72,895.52 per Bitcoin. Since January 11, 2024, total net inflows into Bitcoin ETFs have amounted to $11.1 billion.

In related metrics, as of the latest data, spot Bitcoin ETFs now account for over 90% of the daily trading volume among ETFs that provide exposure to Bitcoin. This marks a new peak in market share dominance. Conversely, Bitcoin futures ETFs have seen their market share decline to just 10%.

A well-received investment contract

The performance of spot ETFs focused on Bitcoin has been overwhelmingly positive, meeting and exceeding benchmarks across various indicators. During a recent interview, Brian Rudick, a Research Analyst at GSR, told The Block, “The success of U.S. spot Bitcoin ETFs has far exceeded even the most positive forecasts. Their acquisition of over $10 billion in inflows within two months nearly matches what many anticipated for their first year. Potential factors that could drive further inflows include increased sales efforts by issuers, inclusion in wealth manager portfolios, and the normalization of outflows from GBTC.”

The report follows the United States Securities and Exchange Commission (SEC) delaying decisions on the approval of Bitcoin ETF options for trading. The deferral means another 45 days (the maximum of 90 days under the law) to reach a final decision, which is now set for 24 April.

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Ethereum’s (ETH) development team is all hands on deck, preparing for the highly awaited Dencun update happening today.

This isn’t just another update, this is one of the biggest change implemented on the Ethereum blockchain in over a year. The Dancun name is a combination of the project names Deneb and Cancun, indicating a dual upgrade on Ethereum’s consensus and execution layers that were named this way.

The update is expected to go live around 13:55 UTC and the costs of transactions is expected to then take a dive. The effects should be even more noticeable on the burgeoning number of secondary networks, or layer-2 “rollups,” built on top of Ethereum.

What is Dencun?

At its core, Dencun introduces the long-awaited “proto-danksharding” with Ethereum Improvement Proposal (EIP) 4844. This change is expected to significantly improve the network’s ability to handle the data generated by layer-2 solutions.

The road to Dencun travelled along a bumpy road, with the team originally eyeing a launch in late 2023. However, the implementation was slowed by technical challenges which pushed the target date forward. Still, following test network implementations — which had issues of their own — the roadmap is moving forward once again.

How to follow the Ethereum Decun upgrade?

The Ethereum community is buzzing with excitement, and the EthStaker developer group along with Nethermind, an Ethereum infrastructure firm, are hosting live streams to celebrate Dencun’s debut which you can watch below.

Dencun’s crown jewel is the aforementioned new feature called “proto-danksharding.” It’s introducing a whole new way to store transaction data on Ethereum through so-called “blobs.” Those blobs are then deleted when their data is not necessary anymore, significantly decreasing the strain on network resources and lower costs.

Proto-danksharding is Ethereum’s first attempt at “sharding,” a technique aimed at breaking the blockchain into smaller pieces to process transactions more cheaply. Though a full-blown sharding solution is likely still a few years away, this step could mean high fees can more easily be avoided through layer-2s in the meanwhile.

Moreover, this update will make life easier for a new breed of blockchains known as data availability (DA) layers, which L2s often use to store large quantities of transaction data. Proto-Danksharding could result in cheaper DA data downloads. Polygon’s co-founder, Jordi Baylina, told Coindesk in early March:

Prices should go down… it’s a matter of supply and demand.

The next steps for Ethereum

After Dencun, the team’s eyes will be on the next big thing, currently dubbed Electra + Prague (Petra). The EIPs that will be included in this update are not yet decided, but “Verkle Trees,” a new way to help nodes store data, is being considered. Karl Floersch, the brain behind OP Labs — the company behind the Optimistic Rollups layer-2 implementation Optimism (OP)  — explained:

Scalability is the key that unlocks permissionless collaboration.”

The development follows recent reports that United States-based publicly traded cryptocurrency exchange Coinbase met with the Securities and Exchange Commission (SEC) to discuss the Ethereum exchange-traded fund (ETF) proposed by asset manager Grayscale Investments.

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El Salvador’s Bitcoin (BTC) holdings have yielded an unrealized profit of $84 million, with the treasury’s value increasing by 69% to over $206 million due to Bitcoin’s 250% appreciation over the past year.

According to data gathered from NayibTracker, since September 2021, El Salvador has seen its Bitcoin investments swell to an unrealized profit of $84 million. The value of its Bitcoin treasury has soared to more than $206 million.

This marks a 69% increase from El Salvador’s initial investment, thanks to the cryptocurrency’s 250% appreciation over the past year. El Salvador now possesses 2,681 BTC, bought across 12 transactions at an average price of $42,600 each.

El Salvador became the first country to adopt Bitcoin as legal tender alongside the U.S. dollar in 2021, following the enactment of the “Bitcoin Law.” This legislation allows for the use of Bitcoin in transactions for goods, services, and taxes within the country. The country is also working to launch its “Volcano Bonds” backed by Bitcoin.

President Nayib Bukele has shared that El Salvador is generating additional Bitcoin revenue through various services. These revenue streams include a citizenship passport program, converting Bitcoin to U.S. dollars for local businesses, proceeds from Bitcoin mining operations and government service fees.

+ #BTC revenue from our passport program
+ Revenue from converting #BTC to USD for local businesses
+ #BTC from mining
+ #BTC revenue from government services https://t.co/O1sjKoJRiq

— Nayib Bukele (@nayibbukele) March 11, 2024

El Salvador also launched the “Freedom VISA” program in December. The program offers residency to up to 1,000 individuals yearly who invest a minimum of $1 million in Bitcoin or Tether (USDT) stablecoins.

Those who qualify are granted long-term residency permits and can eventually apply for full citizenship. Application to the program also costs a non-refundable fee of $999 in either Bitcoin or USDT. Tether announced that the firm will be managing the technical aspects of the project, by providing technology and payment infrastructure.

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Nigerian authorities arrested former United States federal agent and Binance’s criminal investigations team Tigran Gambaryan along with another company official, according to a Wired report published on Tuesday (Mar. 12)

During his tenure as a federal agent in the United States, Tigran Gambaryan played a pivotal role in spearheading significant investigations that led to the apprehension of cryptocurrency criminals, dark-web narcotics vendors, and networks involved in child exploitation financed through crypto.

Following his government service, Gambaryan joined the world’s top cryptocurrency exchange Binance, only to find himself ensnared by a different kind of crypto-focused crackdown by Nigerian authorities. For the last two weeks, Gambaryan and another executive from Binance have been forcibly detained by Nigerian officials.

Why is Nigeria cracking down on Binance?

Since the 26th of February, Gambaryan and Nadeem Anjarwalla — the regional manager for Africa based in Kenya — have been held at a government facility in Abuja, Nigeria, without their passports. They have not been formally charged or informed of any criminal allegations against them, according to their relatives.

It appears their detention is part of Nigeria’s sweeping measures to prohibit cryptocurrency exchanges amidst a significant devaluation of the Nigerian currency, as initially reported by the Financial Times, which covered their detention without naming the executives.

Gambaryan, a U.S. citizen, and Anjarwalla, who holds dual citizenship in the UK and Kenya, arrived in Abuja on the invitation of the Nigerian government to discuss the ongoing ban on Binance and other crypto exchanges. This ban was implemented as the exchanges were accused of contributing to the devaluation of the Nigerian naira and facilitating illegal financial flows.

Following their initial meeting with Nigerian officials, they were taken from their hotels, instructed to pack up, and relocated to a “guesthouse” under the administration of Nigeria’s National Security Agency, where they remain detained.

Both Gambaryan and Anjarwalla have received visits from officials from the U.S. State Department and the UK foreign office, respectively, but their meetings were overseen by Nigerian guards, preventing any private conversation. Binance has refrained from commenting on the specifics of the accusations or the demands made by the Nigerian government for their release, emphasizing ongoing cooperation with Nigerian authorities to ensure the executives’ safe return to their families.

Gambaryan’s recruitment by Binance in 2021 was seen as a move to enhance the exchange’s compliance with regulations and its collaboration with law enforcement, given his achievements in cryptocurrency investigations with the IRS Criminal Investigation division. His work included leading significant cases against corrupt federal agents, tracking down stolen Bitcoin, and dismantling criminal networks funded by cryptocurrency.

The news comes on the heels of Binance recently putting a stop to its cryptocurrency services in Nigeria. This is not the first time that local authorities put pressure on the crypto industry, with a previous ban having been lifted by the Central Bank of Nigeria at the end of 2023.

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During the Asian trading session on Monday, Bitcoin (BTC) soared past $71,000 for the first time in history.

This surge comes on the heels of the U.S.’s approval of spot Bitcoin spot exchange-traded funds (ETFs) back in January, propelling the cryptocurrency to breach the $70,000 mark last week for the first time. Similarly, Ethereum (ETH) surpassed the $4,000 milestone on Monday. Now companies are looking to do the same with Ethereum.

The rally resulted in the three-month futures premium on leading exchanges, such as Binance, climbing above 25%. This premium increase could entice cash-and-carry traders, potentially enhancing market liquidity.

What’s causing the Bitcoin price to rise?

The surge in prices closely followed the London Stock Exchange’s recent openness to Bitcoin and Ethereum exchange-traded notes (ETNs) applications and the low liquidity of the Asian markets.

In the United Kingdom, the Financial Conduct Authority (FCA) announced on Monday that it would start accepting institutional investors’ applications for crypto asset-backed ETNs, with the London Stock Exchange confirming its readiness to process applications for Bitcoin and Ethereum ETNs in the coming quarter.

FCA’s approval of crypto ETNs represents a significant development in the financial and cryptocurrency markets. This approval implies that these financial instruments, which track the performance of cryptocurrencies, can be traded on regulated exchanges and offered to retail and institutional investors in the UK.

As a direct consequence, it could lead to an increase in the accessibility of cryptocurrencies to a broader range of investors who prefer or are required to invest through regulated venues. This could enhance the legitimacy and acceptance of cryptocurrencies as an investable asset class, potentially leading to increased investment flows into the crypto market as time goes on.

Additionally, the regulatory oversight associated with FCA approval may help to improve investor confidence by ensuring that crypto ETNs adhere to specific standards of transparency, reporting, and consumer protection. This step might also pave the way for further regulatory clarity and the development of additional crypto-related financial products in the UK market.

Featured image: Ideogram

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United States-based publicly traded cryptocurrency exchange Coinbase met with the Securities and Exchange Commission (SEC) to discuss the Ethereum (ETH) exchange-traded fund (ETF) proposed by asset manager Grayscale Investments.

According to recently filed documents, the crypto exchange described the proposed product to the regulator that Grayscale filed for back in October. If accepted, the proposal would convert the Grayscale Ethereum Trust close-ended fund into a spot ETF.

Coinbase’s presentation also addressed concerns of market manipulation, and claimed that a “comprehensive surveillance-sharing agreement with the Chicago Mercantile Exchange (CME) will assist in surveilling for fraud and manipulation.” The document reads:

Spot markets for ETH are highly indicative of a market resilient to fraud and manipulation. […]

As with Bitcoin, the Exchange’s comprehensive surveillance-sharing agreeement with the CME will assist in surveilling for fraud and manipulation.”

The report follows the SEC approving eleven Bitcoin spot ETFs back in January. At the time, SEC chairman Gary Gensler stated that “investors should remain cautious about the myriad risks associated with Bitcoin and products whose value is tied to crypto.”

Nate Geraci — president of investment advisor ETFStore — argued that the SEC would have a hard time finding reasons to disapprove a spot Ethereum ETF. He explained that Coinbase’s analysis found a correlation between the Ethereum future and spot market that is as strong as that found in Bitcoin markets. Furthermore, he highlighted that the SEC also already approved a futures-based ETF by the CME.

Coinbase analysis shows correlation b/w ether futures & spot markets every bit as strong as w/ bitcoin markets…

Add-in that SEC approved CME-traded ether futures ETFs and I’m not sure what grounds for disapproval of spot ether ETFs would be.

— Nate Geraci (@NateGeraci) March 8, 2024

Why is an Ethereum ETF a big deal?

The introduction of an Ethereum spot ETF to the market would represent a significant development with multifaceted implications. Primarily, it would enhance the accessibility of Ethereum for institutional investors, offering a pathway to investment that bypasses the complexities and security concerns associated with direct cryptocurrency ownership. This streamlined access is expected by many to bolster Ethereum’s market presence by attracting substantial institutional capital.

Furthermore, the market would likely see an improvement in Ethereum’s liquidity. An ETF facilitates easier buying and selling of its underlying asset, in this case, Ethereum, thereby reducing the impact of large trades on the asset’s price. Such liquidity is crucial for the health of a market as it attracts a broader investor base by decreasing slippage.

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According to Reuters, Dutch digital mapping company TomTom announced an exciting new partnership with tech giant Microsoft on Tuesday to develop an artificial intelligence (AI) powered conversational assistant for vehicles. This assistant utilizes Microsoft’s advanced Azure OpenAI service and allows drivers to “converse naturally with their vehicles,” interacting through voice with features like infotainment, navigation, and vehicle commands.

As vehicles become more advanced, automakers have been focused on integrating smart assistant technology into dashboards. Voice-powered assistants like Alexa and Siri have become ubiquitous in our homes and phones, so it’s a logical next step to bring similar functionality into our cars to handle tasks while driving. This allows drivers to access useful features while keeping their eyes on the road.

Microsoft Brings the AI Power

To create an assistant that can handle natural conversations, vast amounts of data and immense computing power is needed. This is where Microsoft lent its capabilities through Azure OpenAI Service, providing access to the advanced language models created by leading AI research company OpenAI (the maker of ChatGPT). The cutting-edge AI can understand context and hold conversations – perfect for an in-vehicle assistant.

While TomTom could have integrated an existing voice assistant like Alexa, it chose instead to custom-build one explicitly optimized for the automotive environment. As a digital mapping pioneer with over 25 years in navigation and location technology, TomTom has the specialized expertise to tailor the AI assistant to handle driving-related requests through voice interactions.

The conversational assistant can provide quick access to useful in-car features by just using your voice. Ask for directions, queue up your favorite playlist, adjust vehicle settings, and more without ever taking your eyes off the road. This promises a safer and more convenient driving experience. TomTom can integrate the assistant with vehicle infotainment systems across multiple automotive brands.

This launch builds on an ongoing multi-year partnership between TomTom and Microsoft focused on pushing AI and location technology innovations. TomTom began utilizing Azure cloud tools in 2016 to power its maps and navigation products. With this latest AI assistant, TomTom continues to discover new ways Microsoft’s leading AI capabilities can enhance its offerings.

Featured Image Credit: Erik Mclean; Pexels

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Instagram rolled out its new AI-generated background editing tool to U.S.-based users. The feature, powered by generative AI, allows users to transform the backgrounds in their Instagram stories and photos through text prompts.

The background editor is being spearheaded by Ahmad Al-Dahle, Meta’s lead for generative AI. In an announcement post on Threads, Al-Dahle said the tool will enable users to prompt changes to their story backgrounds, opening up creative new possibilities.

“With backdrop, you can reimagine your image’s background with just a few taps and a prompt like ‘chased by dinosaurs’ or ‘surrounded by puppies’ to create an entirely new image for your Story. Tap the button for a backdrop at the top of a new Story to get started,’” Al-Dahle wrote. Users can also write their own custom prompts.

Now you can try the Instagram “Try it” stickers

Once posted to stories, the AI-generated backgrounds will feature a “Try it” sticker so other users can test out the same text prompts on their own images.

The launch builds on Instagram’s growing suite of AI offerings, including creative tools already available on Snapchat and other Meta platforms like Messenger and WhatsApp. Earlier this month, Meta rolled out a similar AI image generator called Imagine, while Snapchat unveiled paid features enabling users to create fantasy-themed photos.

As AI image generation technology advances, social platforms are racing to bake the functionality into their apps. Instagram hopes features like the background editor will set it apart, though ethical concerns around deepfakes continue to swirl around AI-powered creative tools.

Generative AI refers to a type of artificial intelligence capable of creating new content on its own instead of merely analyzing existing content. The “generative” part refers to the fact that these AI systems can generate brand-new images, text, audio, video, and other data that have never existed before.

Generative AI relies on deep learning algorithms, specifically on a subset of AI approaches known as neural networks. To learn patterns and concepts, these neural nets are trained on vast datasets – sometimes containing millions or billions of examples. Once the generative AI model has been sufficiently trained, it can use its learnings to produce novel, original creations based on what it has detected within its training data.

Featured Image: Photo by Pixabay; Pexels

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OpenAI, the leading company behind the viral ChatGPT AI chatbot, announced a new partnership with Axel Springer, one of the world’s biggest news publishers.

The collaboration aims to enhance ChatGPT’s knowledge and capabilities around current events and real-time information.

Under the deal, Axel Springer will provide summaries and extracts from its reporting to OpenAI, including articles from major titles like Politico, Business Insider, BILD, and WELT. OpenAI plans to use this content to train its AI systems, as well as surface relevant Axel Springer articles to ChatGPT users when they ask questions tied to recent news.

The summaries provided to ChatGPT will contain attribution back to the full Axel Springer articles, essentially providing publicity and traffic for the publisher. Users will also be able to ask ChatGPT questions that reference the information contained across the German media conglomerate’s journalism brands.

OpenAI and Axel Springer bring news to ChatGPT

The collaboration appears aimed at addressing one of the main criticisms of ChatGPT — its lack of up-to-date knowledge on current events. Services like xAI’s new Grok chatbot boast more real-time intelligence by tapping social media data streams. By licensing recent and archival content from major newsrooms, OpenAI hopes to match and exceed these capabilities.

The Springer deal builds on past OpenAI partnerships with the Associated Press and American Journalism Project to train AI models using journalism. As OpenAI continues to face questions around copyright infringement for scraping content without consent, licensing agreements with major publishers provide legal coverage — but also draw criticism around fairness and compensation for smaller sources.

While the partnership provides clear financial value to Springer, questions remain whether it’s ethical for OpenAI to strike such deals with large publishers while scraping content from independent creators and denying compensation. Striking the right balance around sourcing training data continues to be a complex challenge for even the most well-resourced AI companies.

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