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Coin Geek
4 hours ago
- Business
- Coin Geek
TRON's Nasdaq debut a dud; Ethena stablecoin coming to America
Getting your Trinity Audio player ready... TRON's Nasdaq debut was a double-digit dive, while some 'offshore' stablecoins are looking to make their own splashy U.S. debuts. On July 24, Justin Sun, founder of the TRON blockchain, rang the opening bell at the Nasdaq stock exchange. The occasion marked TRON's Nasdaq debut, following last month's reverse merger with SRM Entertainment, a struggling theme park merchandise supplier that announced it would rebrand as Tron Inc. Clad in a tuxedo, Sun—who serves as Tron Inc's 'global advisor'—delivered some remarks ahead of the bell, declaring the occasion to have been 'his dream' for 15 years. He claimed TRON's ambition to match some of the Nasdaq media/tech giants was only just beginning, but the dream proved more of a nightmare, at least, for TRON investors. SRM's shares had languished below $1 all year, threatening its ability to remain on the Nasdaq. News of the TRON deal caused SRM shares to spike above $11, but the shares lost nearly one-fifth of their value in the week before the rebrand. And despite Thursday's hype, the shares took a dive shortly after the opening bell and never really recovered, closing trading down 10.7% to $8.74. Sun/TRON are increasingly tied to President Trump and his crypto ventures. Between the WLFI token of the Trump-linked decentralized finance (DeFi) project World Liberty Financial (WLF) and the president's $TRUMP memecoin, Sun has purchased over $100 million worth of Trump-affiliated tokens, garnering him a role as a WLF advisor and a chummy relationship with the president's sons Don Jr. and Eric. Earlier this month, the team behind $TRUMP announced that the token would soon be tradable on TRON after previously being available only on the Solana network. On July 23, that dream became reality courtesy of the LayerZero omnichain interoperability protocol and the 'global liquidity layer' Stargate Finance bridging protocol. The announcement was celebrated by Sun, who tweeted, 'All roads lead to #TRON. Let's take $TRUMP global.' The news didn't exactly light a fire under $TRUMP, the value of which fell on Thursday from around $10.30 to as low as $9.60 before staging a comeback. As of late Thursday, the token struggled to stay above the $10 mark. In fairness, some of that decline can be blamed on the recent unlocking of nearly $1 billion worth of the tokens, the sale of which might have boosted the president's bottom line by nearly $100 million. USDtb coming to 'Murica Well before Trump's signing of the GENIUS Act into law last week, crypto advocates were claiming that so-called 'offshore' stablecoin issuers would do whatever they needed to do to comply with the new rules of the road in order to gain/retain access to the U.S. market. Sure enough, Thursday brought word that Ethena Labs, issuer of the USDe and USDtb stablecoins, had struck a strategic partnership with digital asset custodian Anchorage Digital to launch USDtb in America as 'the first-ever stablecoin with a clear pathway to becoming' GENIUS-compliant. The Lisbon-based Ethena will utilize Anchorage's new turnkey stable-issuing platform to issue USDtb stateside. This will enable 'smoother integration with the U.S. financial system and provide institutions with more accessible, regulated pathways to hold USDtb.' Ethena CEO Guy Young claimed Anchorage, the only crypto operator currently possessing a U.S. bank charter, will help 'reinforce the foundation needed to continue scaling [USDtb] without compromising on speed, flexibility, or trust.' (USDtb's market cap is ~$1.45 billion, while USDe's cap is just under $7 billion.) Anchorage CEO Nathan McCauley said bringing USDtb to America's shores will help 'deliver even greater transparency and confidence' to Ethena's partners. Said partners could include Trump's WLF, with which Ethena struck a deal last December to incorporate sUSDe (a staked version of USDe) into the WLF platform (if and when it finally launches). Last month, Anchorage announced it had started 'a guided phase-out' of several stablecoins from its offering, including USDC, the second-largest stablecoin by market cap issued by Circle (NASDAQ: CRCL). Critics found this move more than a little suspect, given that Anchorage is part of the consortium supporting the Global Dollar Network behind the rival USDG stablecoin issued by Paxos. Back to the top ↑ Tether next? Tether, issuer of the market-leading USDT stablecoin, recently celebrated its token's market cap topping $162 billion (currently standing at $162.6 billion). USDT is the most well-known 'offshore' stablecoin, but Tether CEO Paolo Ardoino keeps claiming that the company has a plan to make USDT GENIUS-compliant. Ardoino previously floated the idea of issuing a new U.S.-focused stablecoin while preserving USDT's use as a dollar substitute in emerging markets. But Ardoino declared last week that Tether was 'working very, very hard to make sure we comply with the foreign issuer pathway within the GENIUS Act.' Ardoino doubled down on this claim this week, telling Bloomberg Television that Tether was 'well in progress of establishing our U.S. domestic strategy.' This strategy will focus on 'U.S. institutional markets, providing an efficient stablecoin for payments but also for interbank settlements and trading.' GENIUS gives foreign issuers a three-year window in which to become compliant, so Ardoino has some wiggle room in which to at least appear to be doing what Tether says it's willing to do. Like submitting reserves to a third-party audit, something Tether has never done, despite declaring four years ago that an audit was 'months, not years' away. GENIUS requires stablecoin issuers to hold fiat reserves in a narrow range of assets, mostly cash, U.S. Treasury bills, and their equivalents. But Tether's most recent 'attestation' of its reserves shows a variety of non-approved assets, including nearly $9 billion in 'secured loans,' nearly $8 billion in BTC tokens, and $4.5 billion in undefined 'other assets.' To comply with GENIUS, Tether would have to convert those 'other assets' to cash, call in its loans to parties unknown, and sell its BTC. That last action would prove particularly unpopular with the BTC faithful, given the downward pressure this would put on BTC's fiat price. Presumably, Michael Saylor can be relied on to borrow more billions to absorb this excess supply. Back to the top ↑ Stablecoin growth projections overly optimistic? Combined, USDT and Circle's USDC ($64.7 billion cap) account for the bulk of the total $266.1 billion in dollar-denominated stables circulating in the wild. GENIUS is expected to inflate the dollar-denominated stable cap, although the scale of that inflation is a matter of some debate. U.S. Treasury Secretary Scott Bessent has suggested this figure could surge to $3.7 trillion by the end of the decade, while less conflicted observers have suggested a mere half-a-trillion increase might be a better bet. That $500 billion forecast came courtesy of JPMorgan (NASDAQ: JPM) analysts, who suggested this week that Bessent's estimates were 'far too optimistic.' The analysts added that 'the idea that stablecoins will replace traditional money for everyday use is still far from reality.' The analysts warned that 'liquidity investors, whether retail or institutional, are not going to immediately jump into payment stablecoins as a cash alternative given their conservative nature in terms of how they manage their cash as a source of liquidity.' The analysts went on to say they found it 'hard to believe that the market could grow substantially larger over the next few years as the infrastructure/ecosystem that supports stablecoins is far from developed and will take time to build out. While adoption is poised to grow further, it might be at a slower pace than what some might anticipate.' Bank of America (BoA) (NASDAQ: BAC) issued a research note last week suggesting the dollar-denominated market cap could grow by a 'relatively modest' $25-$75 billion in the short term. The note added that it could take 2-3 years for broader adoption of stablecoins to really make itself felt. Back to the top ↑ Crypto, fintechs seek Trump's help v JPMorgan Back to JPMorgan, on July 23, a coalition of fintech and crypto firms sent a joint letter to the White House asking for help in kiboshing plans by the Wall Street banker to impose new fees for accessing bank customers' data. JPM announced the fees, which target third-party data aggregators like Plaid that serve as bank-to-fintech bridges, a couple of weeks ago. Crypto operators are rightfully concerned that the aggregators will pass on the costs of the fees. So the Blockchain Association, the Crypto Council for Innovation, and the Digital Chamber all added their names to the letter sent to President Trump. The letter begins with some flattery about the president consistently standing for 'innovation, competition, and individual freedom.' The letter then warns of the grave threat that 'large, incumbent banks' pose to life, liberty, and the pursuit of speculative riches. By suing to block implementation of the 'open banking rule,' these banks are allegedly 'exploiting regulatory uncertainty to preserve their market position.' In doing so, the banks are 'undermining [Trump's] agenda and denying Americans access to the future of finance.' The letter accuses the banks of 'debanking Americans,' raising the specter of the Operation ChokePoint 2.0 conspiracy theory and preying on the fact that Trump has railed against the debanking efforts allegedly implemented under Democratic presidents. Nonetheless, the letter claims this 'is not a partisan issue.' The letter urges Trump to act before July 29, the date by which the government is required to respond in court to the open banking lawsuit. The government is urged to 'ask the court to affirm that consumers, not big banks, control their financial data and have the right to access and share it with companies of their choice at no cost.' The open banking rule was finalized by the Consumer Financial Protection Bureau (CFPB) late last year. In May, the CFPB reversed its stance, claiming that the rule 'exceeds the Bureau's statutory authority and is arbitrary and capricious.' The irony quotient of the fintech/crypto letter is high, given the tech/crypto sectors' longstanding efforts to clip the CFPB's wings, with some calling for the outright abolition of the bureau. Back to the top ↑ Crypto council's homework submitted on time On July 23, Bo Hines, vice-chair of the President's Working Group on Digital Assets, tweeted that the Group's mandated 180-day report to the White House had been submitted and would be released publicly on July 30. That report was to cover a variety of crypto-related subjects, the most notable of which was how to achieve Trump's stated plans for a Strategic Bitcoin Reserve and a U.S. Digital Asset Stockpile. The former is to be made up of BTC already in the government's possession, while the latter is to be made up of other tokens under government control. The question of how much BTC the government controls became a major controversy last week when the U.S. Marshalls Service (USMS) released data showing slightly less than 29,000 BTC under its control. This alarmed many, including Sen. Cynthia Lummis (R-WY), who believed the actual figure was 198,012 tokens. However, as observers were quick to point out, the USMS held 'forfeited' assets, while the 198,012 total represented all assets 'seized' by the government through various criminal and civil enforcement actions. The ultimate ownership of many of these 'seized' tokens has yet to be determined. The blockchain analysts at Arkham felt the need to weigh in on this brouhaha this week, tweeting an accounting of known U.S. government digital wallets. The BTC tally matches that 198,000 figure, none of which has moved in four months, putting a cork in those 'the gubmint sold its BTC' rumors. But again , control over assets doesn't necessarily equate to ownership. Among the Working Group's remit for their report was to contemplate ways in which the BTC reserve might be augmented, aka via the acquisition of new tokens. The caveat was that this could only be accomplished by 'budget neutral' methods, so all eyes will be on what creative accounting the report's authors might concoct. Back to the top ↑ Watch: Teranode & the Web3 world with edge-to-edge electronic value system title="YouTube video player" frameborder="0" allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" referrerpolicy="strict-origin-when-cross-origin" allowfullscreen="">
Coin Geek
a day ago
- Business
- Coin Geek
Bad week for UK: ‘Crypto' ATM crackdown, BTC sell-off
Getting your Trinity Audio player ready... It was a rough week for all things digital money in the United Kingdom, as reports emerged that the government plans to sell off $7.2 billion (£5.33 billion) in confiscated BTC, rather than stockpiling it as some industry groups have urged. Meanwhile, the U.K.'s digital currency ATM crackdown continued, just as new online research by the U.K.'s top ATM network showed that cash is still the most trusted payment method in the country. UK's digital currency sell-off On July 19, The Telegraph newspaper reported that the U.K. Chancellor, Rachel Reeves, was working with police forces to sell off a stockpile of seized digital assets worth 'at least' £5 billion ($6.7 billion). It's estimated that the U.K. government currently holds around $7.2 billion (£5.33 billion) in confiscated BTC as a result of investigations into frauds, scams, money laundering, and other illicit finance. The report, published Saturday, stated that the U.K. Home Office plans to develop an official digital asset storage system to handle BTC sales and other digital currencies. This is part of a broader effort by the U.K. government, under Prime Minister Keir Starmer's Labour Party, to fill a much-talked-about £22 billion ($29 billion) 'black hole' in the U.K.'s public finances. Selling off over £5 billion worth of BTC would undoubtedly dent this figure, but the rumored move met with a swift and negative response from key voices in the digital asset and finance space. On Monday, trade association CryptoUK called on the government to take 'a long-term view,' arguing that the plan to sell off the nation's confiscated crypto stockpile 'would run contrary' to the country's goal of becoming a digital asset innovation hub. 'We would urge the government to take a long-term view on the holding of crypto and deeply consider what message offloading these digital assets would send to the UK's crypto industry,' said a CryptoUK spokesperson, as reported by tech news site Decrypt on July 21. The trade association added that 'other jurisdictions now hold Bitcoin reserves and Bitcoin treasuries are increasingly popular with companies.' This sentiment was echoed by Nigel Green, CEO of global financial advisory giant deVere Group, who pointed to the example of the United States and its recently announced Bitcoin Reserve. 'If countries like the US, the world's largest economy, are seriously weighing Bitcoin as a reserve, why would the UK liquidate instead?' He argued. 'If we advocate crypto as strategic, then hastily disposing of seized Bitcoin is hypocritical—and harmful.' Green warned that the mooted move would echo past errors and undermine long-term strategy. 'Turning these assets into instant cash is tempting, but it risks repeating historical errors,' said Green, noting that 'they sold gold in a dip, only to regret it years later. We risk replaying that error with Bitcoin.' He emphasized that 'emergency fiscal relief is not always best served by fire-sale tactics.' Green reiterated that 'fiscal pressure shouldn't drive poor asset decisions,' and suggested that, far from being a gamble, BTC could act like digital gold: 'It's scarce, decentralised, and a hedge against inflation.' At the same time as Chancellor Reeves was reportedly discussing with the U.K. police selling the government's substantial holdings of confiscated BTC, the latter was continuing its crackdown on rogue crypto ATMs. Digital currency ATMs under fire again According to a July 17 statement from the Financial Conduct Authority (FCA)—the U.K.'s top finance sector watchdog—two individuals were arrested, and seven digital currency ATMs found and seized, as part of an operation led by the FCA and the Metropolitan Police Service targeting four premises across southwest London. Since January 10, 2021, businesses providing certain digital asset services in the U.K. must be registered with the FCA under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLRs). Therefore, operating a cryptoasset exchange or a digital currency ATM in the U.K. is illegal without FCA registration. By July 2023, the FCA had announced the shutdown of 26 machines operating unlawfully nationwide. Despite these closures, operating a digital currency ATM in the U.K. is technically still legal, as long as the operator registers with the FCA. However, the FCA has yet to approve a single registration for a digital currency ATM, amounting to an effective ban, in all but name. 'There are currently no legally-operated crypto ATMs in the UK, so using one only supports crime,' said the FCA. 'If you're operating a crypto ATM or exchange illegally, then you should expect serious consequences.' This attitude is not unique to the U.K., as recent months have seen an increasing global crackdown on digital currency ATMs. In the U.S., in February, Senator Dick Durbin (D-IL), Ranking Member of the Senate Judiciary Committee, introduced the Crypto ATM Fraud Prevention Act. It would, amongst other measures, prevent new users from spending more than $2,000 daily or $10,000 over a 14-day period at digital currency ATMs, and require live, verbal confirmation for any transaction greater than $500. In April, Australia followed suit by putting digital currency ATM operators on notice over a lack of AML/CFT checks; and most recently, earlier in July, New Zealand outright banned digital currency ATMs. These crackdowns demonstrate a concern amongst lawmakers and regulators that the digital currency ATM sector is a particular hotbed of illicit finance, fraud, and scams—a feeling that the U.K. general public may well share. Just as the FCA continues to enthusiastically enforce its de facto ban on digital currency ATMs, the U.K.'s main ATM and interbank network published new research showing that cash is still the most trusted payment method in the country. UK still values cash despite growth in digital payments This week, Link, the U.K.'s leading cash access and ATM network, published the results of research into current customer payment and spending habits. It found that 'while contactless card payments are seen as the most convenient and quickest form of payment by a significant majority of consumers, cash is seen as the most reassuring for staying within a budget and fully understanding the cost of shopping too.' According to the research, almost two-thirds of consumers (65%) said cash protects them from fraud, compared to (22%) contactless card and (18%) digital wallets. While contactless, via card, remained 'the most preferred payment method for consumers,' with 40% choosing this option, this number was slightly down on previous LINK research. The publication suggested this 'may reflect the growing popularity of digital wallets such as Apple Pay or Google, which increased over the same period.' In a seeming blow to the digital payments and digital money sectors, the data revealed that 63% of respondents said they were unlikely to go completely cashless in the next 12 months, with only 8% being entirely cashless today, up from 6% in late 2024. The research also saw 85% of respondents highlight the risk of a cashless society and its effect on people who cannot use digital payments yet. 'Cash remains a critical part of the UK's payment landscape,' said Graham Mott, LINK director of strategy. 'This research shows that, while digital payments are growing, cash continues to play a vital role in financial inclusion, budgeting, and consumer choice.' Digital assets were not specifically mentioned as a part of the survey, but the findings that cash remains more trusted than digital payments almost certainly imply that digital assets have a long way to go—in the U.K. at least—before they will be considered a secure and trusted form of payment akin to fiat currency. Watch: How do you build a successful ecosystem? Bring blockchain to the builders! title="YouTube video player" frameborder="0" allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" referrerpolicy="strict-origin-when-cross-origin" allowfullscreen="">
Coin Geek
a day ago
- Business
- Coin Geek
Feds end probe of Kraken's Powell; JPMorgan fees threaten crypto ops
Getting your Trinity Audio player ready... U.S. authorities have halted their probe into the founder of the Kraken digital asset exchange, while the converging paths of the crypto and tradfi sectors are producing a little road rage. On July 22, Fortune broke the news that the Federal Bureau of Investigation (FBI) and the U.S. Attorney's Office for the Northern District of California had dropped their probe of Kraken founder Jesse Powell. The authorities have returned multiple digital devices seized from Powell during raids on his home in 2023, some of which reportedly contained digital assets when they were confiscated. The probe, which reportedly started in 2022, had nothing to do with Kraken or digital assets. Instead, it focused on Powell's involvement with Verge Center for the Arts, a San Francisco nonprofit he founded in 2008 that later expelled him from its board for allegedly contravening the organization's principles (possibly via public statements like this). Powell was alleged to have 'hacked and cyber-stalked' Verge, but the reality may have been much more mundane. A civil suit filed by Powell against Verge last year—which remains ongoing, despite the dropped probe—claimed the battle was actually over access to the nonprofit's Slack and Google accounts. Powell, who stepped down as Kraken's CEO shortly after the raid on his home, told Fortune that the experience 'was devastating both personally and professionally.' Powell called the Verge allegations 'baseless' and said he 'knew that I had done nothing wrong.' Powell tweeted Tuesday that the probe 'never made sense' and it was '[w]ild how quickly you can have your life upended.' Regardless, he was 'glad to have this behind me' and looked forward to 'turning my attention back' to Kraken, where he remains chairman. Powell's attorney reportedly sought and received a 'declination letter' confirming the closure of the DoJ probe. The intent was to offset any lingering regulatory concerns that might negatively impact Powell or Kraken's ability to access U.S. banking services. Kraken is also seeking a public listing on the Nasdaq sometime next year. Responding to a congratulatory tweet by Brian Armstrong, CEO of the rival Coinbase (NASDAQ: COIN) exchange, Powell tweeted a picture he apparently took during the 2023 raid on his home, showing '20 guys with assault weapons and a tank. No biggie.' (Actually an armored truck, but the situation affords him some hyperbolic slack.) Responding to a different congratulatory tweet by pro-crypto Rep. Warren Davidson (R-OH), Powell mused that '[t]he truth of the [Biden] administration's war on crypto is coming to light' and he suspects that 'there are still many disturbing abuses of power yet to be uncovered.' Kraken was the subject of a Securities and Exchange Commission (SEC) probe that was dropped this spring under the SEC's newly tolerant leadership. The SEC had accused Kraken of operating an unregistered securities exchange, broker, dealer, and clearing agency. In March, Powell told Fortune that his decision to step down as Kraken's CEO was intended to lower the heat that the exchange was facing from regulators. Powell said he 'wanted to avoid having to make disclosure requirements that would have complicated the firm's global licensing efforts.' Powell was succeeded as CEO by not one but two Kraken execs—Dave Ripley and Arjun Sethi. Notably, while Sethi retweeted Powell's triumphant post-probe tweet, Ripley has yet to do so. Get a move on, Dave. Senate market structure timeline iffy The Senate Banking Committee released a discussion draft of its long-awaited digital asset market structure regulation bill on July 22, with the document mostly focusing on the role of the SEC, over which the Committee has authority. The Senate Agriculture Committee, which oversees the Commodity Futures Trading Commission (CFTC), will need to release its own draft bill at some point. On July 23, Crypto in America journo Eleanor Terrett tweeted that the Ag committee wasn't likely to issue its market structure draft until 'early September.' The two documents must then be combined, voted out of committees, and presented to the full Senate for approval (in a form that ensures sufficient bipartisan support to clear the Senate's 60-vote hurdle). Given all that heavy lifting, the September 30 timeline suggested by Banking chair Tim Scott (R-SC) last month for getting to a full Senate vote appears somewhat dubious. The House of Representatives approved its own market structure bill (the CLARITY Act) last week. While the House adjourned for its summer break a day early to avoid any uncomfortable Epstein-related voting, they did manage to pass another digital asset bill on their way out the door. The Financial Technology Protection Act, introduced in March by Representatives Zach Nunn (R-IA) and Jim Himes (D-CT), establishes the Independent Technology Working Group to Combat Terrorism and Illicit Financing. This group will be given four years to study and report on the illicit use of digital assets and develop proposals to improve anti-money laundering and counterterrorist financing efforts. The timing of this approval was fortuitous, coming just a day before the Department of Justice (DoJ) announced a civil forfeiture action against $2 million worth of digital assets linked to the Hamas terror group. The tokens, consisting of the USDT (Tether) stablecoin held in accounts on the Binance exchange, are connected to Buy Cash Money and Money Transfer Company, a Gaza-based money transfer business. Back to the top ↑ Next stop: innovation station Meanwhile, the intersection where digital assets meet traditional finance is getting increasingly crowded. On July 22, Coinbase announced a strategic partnership with PNC Bank, which operates over 2,600 branches in 27 states. The deal will see Coinbase provide its Crypto-as-a-Service (CaaS) platform to offer digital asset solutions to PNC's banking clients and institutional investors, while in return, PNC will offer Coinbase 'select banking services.' During PNC's July 16 earnings call, CEO William Demchak was asked about the possibility of PNC getting into the stablecoin game, as so many of PNC's rivals are doing. Demchak said, 'My expectation is an industry solution with respect to an industry-led stablecoin, and we would clearly be part of that … We're gonna empower our clients if they wanna use it. Because we do what our clients want.' However, Demchak suggested stablecoins might have a less dramatic impact on banking than some might expect. Demchak acknowledged the cross-border transfer benefits but believes 'there isn't really a cost advantage driving the use of stablecoin, at least in domestic commerce.' Demchak also dismissed fears spread by some banks that their customers would flee in droves to secure greater yield by staking their cash with stablecoins on crypto platforms. 'Am I worried that it's somehow gonna drain deposits from the system? I am not.' Meanwhile, BNY Mellon (NASDAQ: BK) and Goldman Sachs (NASDAQ: GS) just announced plans for a tokenized money market funds (MMF) solution. The solution will rely on Goldman's in-house Digital Asset Platform (GS DAP) to maintain a record of customers' ownership of select MMFs, with the goal of enhancing the utility and transferability of MMF shares. Institutional investors will be able to trade 'mirrored' versions of participating MMFs—starting with products from BlackRock (NASDAQ: BLK), BNY Investments Dreyfus, Federated Hermes, Fidelity Investments, and Goldman Sachs Asset Management—via BNY's LiquidityDirect and Digital Assets investment platforms, with connectivity provided by GS DAP. Goldman Sachs Global Head of Digital Assets Matthew McDermott said the partnership will 'enable us to unlock [MMFs'] utility as a form of collateral and open up more seamless transferability in the future.' Laide Majiyagbe, BNY's Global Head of Liquidity, Financing and Collateral, celebrated the ability to serve as 'a trusted bridge between traditional finance and emerging technologies.' Back to the top ↑ JPMorgan's heel turn Things aren't all sunshine and buttercups between the financial incumbents and their upstart challengers. A couple of weeks ago, JPMorgan (NASDAQ: JPM) announced it would impose fees on fintech companies for accessing its customers' banking info, a move that has many crypto operators hot under their collars. JPMorgan has been providing fintechs with this access gratis, but a spokesperson told Forbes that the company receives 'nearly two billion monthly requests for customer data from middlemen, and more than 90% of those are unrelated to a consumer using fintech services.' JPMorgan's move is likely to be followed by other banks, and the fees are expected to hit data aggregators that serve as bank-to-fintech bridges particularly hard. For instance, Plaid is reportedly staring an annual fees of up to $300 million, while aggregator rivals like Finicity, Yodlee, and MX can expect their own crippling costs. These companies will almost certainly pass these expenses to their clients, including exchanges such as Coinbase, Kraken, and Gemini. Gemini co-founder Tyler Winklevoss tweeted his displeasure with JPMorgan on July 19, saying 'JPMorgan and the banksters are trying to kill fintech and crypto companies … This will bankrupt fintechs that help you link your bank accounts to crypto companies like @Gemini, @coinbase, and @krakenfx so you can easily fund your account w/ fiat to buy bitcoin and crypto.' Kraken's co-CEO Sethi tweeted his own displeasure with the fees earlier this month, accusing JPMorgan of 'asserting ownership over data that is generated by users but stored inside infrastructure the bank controls.' JPMorgan wouldn't have been able to impose the fees had a Consumer Financial Protection Bureau (CFPB) rule approved during President Biden's term been allowed to take effect next year as scheduled. However, the CFPB announced in May that it would repeal the open banking rule, the legality of which had been challenged by banking industry lobby groups. Ironically, JPMorgan's fee-grab is being enabled by some of the same deregulatory moves that Tyler and his ilk traditionally celebrate. Tech VCs and their crypto brethren have for some time been lobbying for the outright dismantling of the CFPB, and thus the agency's pullback from regulating much of anything can at least partially be laid at the tech/crypto door. Et tu, crypte? Back to the top ↑ Survey says While the fiat price of the BTC token continues to hover just under its all-time high of US$122,838 (set just last week), on-chain activity remains nonexistent. And while (mostly failing) companies continue to buy BTC for their 'treasuries,' retail buyers have yet to show up in droves. Some argue that the influx of cash into BTC- and ETH-based exchange-traded funds (ETFs) are where retail money goes nowadays. Possibly, but that doesn't fill BTC's transaction void or resolve the resulting threat to the network's security. As for why ETFs and 'treasury' companies could be proving more popular than the underlying assets they represent, a new survey by the National Cryptocurrency Association (NCA) suggests the average consumer continues to find the crypto user experience too intimidating/confusing, despite 16 years having passed since the Bitcoin white paper appeared. The Confidence Pulse survey queried 2,000 'non-crypto holders' on what exactly was preventing them from selling their firstborn children for digital assets. The top-five 'barriers to adoption' are a lack of understanding about how crypto works (49%), concerns about security and fraud (43%), not knowing who or what is behind it/backing it (41%), a lack of trust in platforms/exchanges (36%), and those who simply prefer traditional banking methods (29%). One-third (34%) of those surveyed said they were interested in learning more, but more than half (55%) found crypto research overwhelming. Among that 'crypto curious' one-third, 42% said they were likely to acquire or use crypto this year (although 'use' may be pushing it, given the empty mempool stats). As for what might convince a non-crypto holder to come off the bench, being more personally knowledgeable scored highest (37%). Nearly one-quarter (23%) said they could be convinced if they could use crypto to pay for goods and services, while an equal number would like to use crypto as a means to earn rewards/interest. The NCA—launched in March with $50 million in funding from Ripple Labs—claimed that 39% of crypto holders arealready using tokens to pay for goods and services, although that activity is almost certainly conducted with stablecoins, not the flagship BTC/ETH tokens that most people think about when they hear 'crypto.' A separate survey of 1,000 US/UK crypto holders by YouGov and onchain UX platform Reown (formerly WalletConnect) found that one-third (34%) of respondents were using their tokens for payments, a larger slice than decentralized finance (DeFi) options like staking. And while BTC (63%) and ETH (48%) remain the most popular crypto options, stablecoins (38%) are now more popular than SOL (37%). More than half (51%) of respondents aged 18-34 years held stablecoins, although this number fades among older age demos. Back to the top ↑ Watch: Teranode is the digital backbone of Bitcoin title="YouTube video player" frameborder="0" allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" referrerpolicy="strict-origin-when-cross-origin" allowfullscreen="">
Coin Geek
a day ago
- Coin Geek
The I-Ching as blueprint for decentralized systems
Homepage > News > Tech > The I-Ching as blueprint for decentralized systems Getting your Trinity Audio player ready... This post is a guest contribution by George Siosi Samuels, managing director at Faiā. See how Faiā is committed to staying at the forefront of technological advancements here. Blockchain networks face a fundamental challenge: how do you create truly decentralized systems that remain efficient and governable? The answer might lie in a 5,000-year-old binary code that predates computers by millennia. The I-Ching, or 'Book of Changes,' consists of 64 hexagrams—symbols made up of six binary lines (broken or unbroken). Each represents a unique state or process of transformation. But this isn't just ancient philosophy. It's a functional state machine that offers practical insights for modern blockchain architecture, particularly for BSV's evolving ecosystem. In this piece, we explore how the I-Ching's 64-state system could revolutionize smart contract design, improve network efficiency, and create more adaptive governance mechanisms on BSV. Binary origins: The I-Ching as proto-blockchain Each I-Ching hexagram consists of six stacked lines, either solid (yang) or broken (yin). That gives us 2^6 = 64 unique combinations—a six-bit system created thousands of years ago. Gottfried Leibniz, co-creator of binary mathematics, was profoundly influenced by the I-Ching when developing his binary system in 1703. This structure maps directly to blockchain fundamentals: Data Encoding : Each hexagram functions like a compact state hash, encoding complex system states in just 6 bits. : Each hexagram functions like a compact state hash, encoding complex system states in just 6 bits. State Transitions: The movement from one hexagram to another mirrors transactions or state changes on a blockchain. The movement from one hexagram to another mirrors transactions or state changes on a blockchain. Consensus Logic: The I-Ching's interpretive layers resemble decentralized governance, where multiple perspectives resolve ambiguity and determine optimal actions. Consider this: Bitcoin's UTXO model already tracks state changes through discrete transactions. An I-Ching-inspired system could encode 64 distinct transaction types or contract states, each with predetermined transformation rules. 64-state smart contracts on BSV Why 64? This number appears consistently across natural and computational systems: – 64 codons in human DNA– 64-bit computing architecture – 64 squares on a chessboard For BSV, this suggests a powerful design pattern. Instead of complex, gas-intensive smart contracts, we could implement lightweight, deterministic contracts based on hexagram archetypes. Here's a conceptual example: Each hexagram could represent a different class of agreement: employment contracts, supply chain tracking, escrow arrangements, or governance proposals. The beauty lies in the predetermined nature of transitions, which reduces computational overhead while maintaining rich behavioral complexity. Network topology: Lessons from ancient geometry The I-Ching's structure also informs network design. Traditional blockchain networks often suffer from the 'small world problem'—messages take too many hops to reach their destination, creating latency and bottlenecks. Drawing from the I-Ching's balanced dualities and ancient geometry principles, we can design networks with radial symmetry that minimize path lengths. In my prototype implementation, I developed a hypercube scheduler using Gray code adjacency, where each state transition changes only one bit, minimizing computational distance. Source: Performance results from testing: – Average hop reduction: 23% compared to traditional mesh networks– Latency improvement: 15-30ms for cross-network propagation – Energy efficiency: 18% reduction in redundant communications This approach aligns perfectly with BSV's focus on scalability and efficiency. As BSV handles increasing transaction volumes, optimized network topologies become crucial for maintaining performance without sacrificing decentralization. Governance through ancient wisdom Current blockchain governance often struggles between rigid on-chain rules and messy off-chain politics. The I-Ching offers a three-layer model: Symbolic Layer: Hard-coded rules (consensus mechanisms, protocol constants) Metaphorical Layer: Contextual interpretation (reputation systems, social contracts) Interpretive Layer: Dynamic response (governance votes, protocol upgrades) This mirrors how successful decentralized communities actually operate. Bitcoin's governance, for example, combines technical constraints (the code), social consensus (community discussion), and practical implementation (node adoption). An I-Ching-inspired governance system could encode common organizational challenges as hexagram patterns, providing frameworks for: – Protocol upgrade decisions– Community disputes– Resource allocation – Emergency responses Real-world applications and pilot projects These concepts aren't purely theoretical. Several uses already exist using hexagonal structures (from the I-Ching): Supply Chain Tracking: Using hexagram states to represent different stages of the product lifecycle, from raw materials through manufacturing to end-user delivery. Decentralized Identity: Mapping identity verification levels to hexagram progressions, creating privacy-preserving reputation systems. Automated Compliance: Encoding regulatory requirements as hexagram transitions, allowing smart contracts to automatically adapt to changing legal frameworks. Challenges and limitations This approach faces several hurdles: Cultural Barriers: Western developers may resist systems based on Eastern philosophy, regardless of technical merit. Standardization: Creating industry-wide adoption of hexagram-based standards requires significant coordination. Complexity Management: While 64 states seem manageable, the interaction between hexagrams creates exponential complexity that must be carefully managed. Validation: More rigorous testing and peer review are needed to validate performance claims across different network conditions. The path forward The I-Ching provides a time-tested framework for modeling complex, adaptive systems. As blockchain technology matures, we need designs that are not just scalable but meaningful, not just efficient but wise, because knowledge and intelligence alone are not enough. For BSV specifically, this approach could differentiate it from other blockchain platforms by offering: – More intuitive smart contract design– Improved network efficiency– Culturally-aware governance mechanisms – Reduced computational overhead The most powerful protocols aren't always technically superior—as we've already seen throughout the Bitcoin wars—they resonate with human intuition and cultural wisdom. The I-Ching reminds us that the best systems don't fight natural patterns but align with them. Watch | Tech of Tomorrow: Diving into the impact of tech in shaping the future
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Rwanda's $200M digitalization project halfway done: official
Getting your Trinity Audio player ready... In Rwanda, the government says its Rwf280 billion ($200 million) Digital Acceleration Project is halfway done. Speaking to lawmakers recently, the CEO of the Rwanda Information Society Authority (RISA), Innocent Bagamba Muhizi, said the project is 55% complete, with the government targeting completion by 2026. The World Bank funds the project and aims to digitalize public services and integrate emerging technology to improve education, health, and agriculture. It supports access to smart devices in marginalized communities and nationwide digital literacy programmes. It also funds connectivity for remote government offices, schools, and hospitals. The project further aims to boost digital ID uptake in the country, channeling $39.3 million to the cause. 'The goal is to enable citizens to carry out secure digital transactions—like opening a bank account—remotely, using digital IDs instead of physical cards. This will be supported by an application installed on smartphones that authenticates users via biometric data,' Muhizi said. Rwanda ranks as one of Africa's leaders in digitalization. The East African nation ranked third in the African Leapfrog Index, behind South Africa and Kenya, in digital public services. A separate report by the International Data Center Authority ranked Rwanda first on the continent for digital readiness. UK welcomes eVisas, digital ID transition faces trust setback Elsewhere, the U.K. government has transitioned from physical visa documents to eVisas to boost security and reduce processing times. However, the Labour administration's push to transition to digital IDs is facing pushback, with public distrust emerging as the greatest hurdle. The U.K. Visas and Immigration Department (UKVI) has been rolling out the eVisa for nearly two years. Since March last year, over 4.3 million people have received the eVisa; between August and December last year, the department registered 3.2 million new accounts. On July 15, UKVI officially announced that it had transitioned into a digital immigration system. It touted some benefits such as enhanced security since the digital document can't be tampered with, reduced costs and wait times, and faster processing at U.K. borders. However, while the transition into the eVisa system was swift and smooth, the U.K. government's push for digital IDs has been marred by political controversy and public backlash. UK's digital ID hindered by public distrust The U.K. has been exploring a digital ID for years to keep up with rapid advancements in the digital economy, especially with its peers like France and Germany moving fast. Under Prime Minister Keir Starmer, the Labour administration has ramped up its predecessor's efforts since taking over last year. In April, a group of Labour MPs under the Labour Growth Group wrote an open letter calling for digital ID to improve public services and mitigate the country's immigration challenge. The lawmakers noted that a digital ID would bolster the government's development agenda and called on the administration 'not to miss this opportunity.' More recently, former Chief of Secret Intelligence Service, Alex Younger, told the BBC, 'It's absolutely obvious to me that people should have a digital identity.' However, multiple studies show that public distrust of a digital ID remains high. Even leaders who support the initiative have called for stringent oversight to avoid abuse. One of these is Harriet Harman, a former deputy leader of the Labour Party. While she acknowledged that it would deter illegal immigration to the U.K., she says people's support 'depends on whether or not you think the state is going to actually overstep the mark and oppress people.' The government's approach hasn't helped. Last December, it ran an ad on local outlets that painted critics of the digital ID as outdated and clumsy. It didn't go down well with the majority of U.K. citizens. The digital ID faces similar public distrust as the proposed digital pound. The central bank indicated on Tuesday that it's now mulling shelving the plans for the CBDC to focus on supporting private-sector digital payment initiatives. Distrust of the government in the U.K. remains among the highest in the world, a 2024 study revealed, with only Colombia recording a steeper drop year over year. Watch: Digital identity is a core part of Web3—here's why title="YouTube video player" frameborder="0" allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" referrerpolicy="strict-origin-when-cross-origin" allowfullscreen="">
