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- Bitcoin, Ethereum, Cosmos and more Week 17 2024
Bitcoin, Ethereum, Cosmos and more Week 17 2024
Keeping you updated on crypto, web3 and blockchain
TLDR: Stacks Sets the Nakamoto Makeover in Motion, Bitcoin Options Valued at $6.3B Reach Expiration, SEC Proposes Regulation of Ethereum as a Security, SEC Anticipated to Reject Spot Ethereum ETFs in May, Cosmos Fixes Critical Bug in IBC Protocol, FBI Issues Warning on Unregistered Crypto Money Transmitting Services & Pantera Capital Set to Launch $1B Crypto Fund.
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Bitcoin Highlights of the Week
Following extensive research and development, the Stacks blockchain is undergoing a significant transformation. The implementation of the largest upgrade to date for this prominent Bitcoin scaling layer commenced at Bitcoin block height 840,360, marking the beginning of a two-phase process expected to conclude in late May. Dubbed Nakamoto in homage to Bitcoin's pseudonymous creator, the upgrade aims to separate the Stacks block production schedule from that of Bitcoin.
Nakamoto will implement a fresh approach to generating Stacks blocks, enhancing its unique proof-of-transfer consensus algorithm. Beginning today, new block "signers" will gradually begin validating transaction "tenures." Initially, until the upgrade is fully operational in May, this process will serve as a form of "practice."
Since its launch following the Bitcoin network's halving event on April 20th, Runes, a new token standard on the Bitcoin blockchain, has dominated transaction activity. Over 2.38 million Runes transactions have been processed, constituting 68% of all Bitcoin transactions. This data comes from a Dune Analytics dashboard shared by blockchain research firm Crypto Koryo, which includes ordinary peer-to-peer Bitcoin transactions, BRC-20s, Ordinals, and Runes in the total transaction count.
Around $9.4 billion worth of cryptocurrency options expired Friday on the Deribit derivatives exchange.
The bulk of these expiring options are bitcoin contracts, totaling a notional value of $6.35 billion. The put-call ratio before Friday's end-of-month expiration stands at 0.68, indicating an increase in put volume compared to calls compared to the previous week.
Ether options, valued at $3.08 billion, are also approaching expiry. However, the ratio of puts to calls for ether contracts is notably lower than that of bitcoin. Prior to Friday's expiration, the put-call ratio for ether contracts is 0.49. A ratio below one suggests that call volume surpasses put volume, indicating bullish sentiment in the market.
Keonne Rodriguez and William Lonergan Hill face charges for running Samourai Wallet, an unlicensed money transmitting business. Samourai allegedly facilitated over $2 billion in illicit transactions and laundered more than $100 million in criminal proceeds.
Block, the payments startup founded by Twitter's Jack Dorsey, has revealed the successful development of its 3-nanometer Bitcoin mining chip and outlined its intentions to build a comprehensive Bitcoin mining infrastructure.
Ethereum Highlights of the Week
Consensys, the firm behind MetaMask, lodged a lawsuit against the Securities and Exchange Commission (SEC) in a Texas court this week. The lawsuit claims that the SEC is exceeding its regulatory authority.
Consensys contends that the SEC is attempting to classify Ethereum (ETH) as a security, despite the fact that ETH does not exhibit the characteristics of a security. The company highlights that the SEC had previously stated that ETH is not a security and falls outside its regulatory jurisdiction. According to Consensys, the SEC, led by Chair Gary Gensler, is making an attempt to assert undue authority.
According to a recent report by Reuters, it's highly probable that the United States Securities and Exchange Commission (SEC) will reject applications for spot Ether exchange-traded funds (ETFs) in May.
The report, published on April 24th, cites discussions between U.S. issuers and regulatory authorities, suggesting a looming denial. Sources familiar with the matter, who chose to remain anonymous, highlighted one-sided discussions and a lack of substantive dialogue regarding the proposed products in recent meetings.
These interactions contrast with detailed conversations held in January, preceding the approval of spot Bitcoin ETFs. Historically, the SEC rejected spot BTC ETF filings for over a decade until Grayscale Investments secured a court victory against the regulatory body in August 2023.
This week, asset manager Franklin Templeton announced that it has implemented peer-to-peer token transfers for its $380 million tokenized money market fund. This development is a significant stride toward integrating the offering more deeply into the broader digital asset economy, akin to its competitors.
This advancement enables investors in the Franklin OnChain U.S. Government Money Fund (FOBXX) to directly transfer the fund's BENJI token among themselves without the need for any intermediaries. The BENJI token, which is accessible on the Stellar (XLM) and Polygon (MATIC) blockchains, represents shares in the fund. The fund comprises government securities, cash, and repurchase agreements, offering a consistent yield to token holders.
BlackRock and Grayscale have submitted revisions to their applications for spot Ethereum exchange-traded funds (ETFs) following the SEC's recent decision to postpone its verdict on various Ethereum ETF proposals.
BlackRock, in an updated 19-b 4 filing, proposed a rule change for its iShares Ethereum Trust, suggesting a shift to cash-based creation and redemptions. This means authorized participants would only exchange cash instead of Ethereum when creating or redeeming shares.
Similarly, Grayscale filed an S-3 registration statement to convert its existing Grayscale Ethereum Trust into a spot Ethereum ETF. As the Grayscale Ethereum Trust is already registered with the SEC, Grayscale utilized Form S-3 for this purpose instead of Form S-1.
Movement Labs, with its ambition to construct a network of blockchains utilizing Facebook's Move programming language, has secured a substantial $38 million in Series A funding.
The San Francisco-headquartered blockchain development firm raised the capital in a funding round led by Polychain Capital, with participation from Aptos Labs, Bankless Ventures, OKX Ventures, and eight other venture capital firms.
By employing Move-based Ethereum virtual machines (EVMs), Movement Labs seeks to bolster smart contract security and transaction throughput within the Ethereum ecosystem.
Movement Labs asserts that Move-EVM can fortify protocols against prevalent reentrancy attacks, which have previously impacted prominent protocols such as Curve and KyberSwap. The team estimates that smart contract vulnerabilities alone resulted in losses exceeding $5.4 billion between 2022 and 2023.
Cosmos Highlights of the Week
Injective has rolled out the INJ 3.0 update on its mainnet, transforming $INJ into one of the most deflationary assets in the crypto sphere. With plans for an expedited reduction in the INJ supply over the next two years, this marks the inception of a new era for the platform.
Developers working on Cosmos have addressed a crucial security flaw in the Cosmos Inter Blockchain Communication (IBC) protocol, which posed a risk of at least $126 million. Asymmetric Research privately shared information about the vulnerability affecting the Cosmos ecosystem, ensuring it was fixed before any exploitation occurred.
With the recent v22 chain upgrade, Stride gains the capability to significantly expand the number of host-chain validators it can delegate to, often enabling delegation to the entire active set of validators. This enhancement unlocks numerous new opportunities for Stride's delegation program.
Copy-staking is straightforward: Stride mirrors the delegation choices of the host-chain's community by delegating to all validators in the active set based on their current stake weight. For instance, if the top-ranked validator holds 5% of a chain's total delegations, Stride will delegate 5% of all tokens staked with it to that validator. As the stake distribution among validators shifts over time, Stride's delegations adapt accordingly.
Delegation weights in copy-staking are updated monthly, with plans for continuous rebalancing in a future upgrade.
Ankr, a web3 infrastructure provider, has introduced its AI-focused Layer 1 blockchain, Neura, on the public testnet.
Neura, first announced in March, allows developers to create decentralized applications that integrate AI, cloud computing, and blockchain technology. The platform aims to assist AI startups in addressing funding, GPU resource allocation, and efficient data storage challenges.
Calculated Finance has launched on the Neutron network, with all swaps being routed through Astroport.
Other Highlights of the Week
The U.S. Federal Bureau of Investigation (FBI) cautions Americans about the risks associated with unregistered cryptocurrency money transmitting services.
In a statement issued by the FBI's Internet Crime Complaint Center (IC3) this week, they advised individuals to steer clear of crypto services offered by companies not registered as Money Services Businesses (MSBs) under federal law and failing to comply with anti-money laundering regulations.
The FBI highlights the importance of taking precautionary measures to avoid inadvertently using non-compliant services. They recommend refraining from utilizing cryptocurrency money transmitting services that do not collect required know your customer (KYC) information from customers.
According to the U.S. Department of Justice, Changpeng "CZ" Zhao, the founder and former CEO of Binance, faces a proposed three-year prison sentence for his involvement in allowing the crypto exchange to breach federal sanctions and money laundering regulations. Zhao's legal team countered, advocating for no jail time, pointing to the fine he already paid and his "exceptional acknowledgment of culpability."
Pantera Capital, a digital asset investment manager, is reportedly seeking to raise over $1 billion for its upcoming fund, Pantera Fund V. Set to debut in April 2025, this fund will provide investors with exposure to a wide range of blockchain-based assets, marking a departure from the firm's existing funds with more specific investment targets, such as the Liquid Token Fund, Early Stage Token Fund, Bitcoin Fund, and Venture Funds.
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