Blockchain Bites: CZ’s Exclusive Interview, California’s Souped-Up Regulator, Alt Season’s End?

Blockchain Bites: CZ’s Exclusive Interview, California’s Souped-Up Regulator, Alt Season’s End?

California beefed up its financial regulator, Bitpanda closed a notable raise and some investors say “alt-season” is over. Top shelfBrokerage raiseEuropean crypto brokerage Bitpanda has raised a $52 million Series A led by Peter Thiel’s Valar Ventures, to be put to use expanding the company’s payroll and adding a variety of products. Next year the Vienna-based firm intends to expand to “all kinds of asset classes” including stocks. In an interview, the firm’s co-founders told CoinDesk’s Leigh Cuen France, Spain and Turkey were among the fastest-growing crypto markets out of the roughly 34 countries the platform serves.Regulator reprisedCalifornia Gov. Gavin Newsom signed a bill on Friday that increases the scope of the state’s financial regulator. Renamed the Department of Financial Protection and Innovation, the agency is now equipped with “new tools to shape the regulation of virtual currency” and enhanced abilities to crack down on unlicensed or deceptive financial services and products. The new law will also create an Office of Financial Technology Innovation to engage with emerging financial products such as cryptocurrencies and a division to oversee markets. Hard forkArtificial intelligence and data service Ocean Protocol has suspended its old contract on the Ethereum blockchain and hard-forked its project, following the $150 million KuCoin hack. On Sunday at 22:00 UTC, Ocean Protocol announced it had migrated from its old token address to a new one to thwart the KuCoin hacker’s attempts to offload 21 million OCEAN tokens worth some $8.6 million. “Moving contract addresses has effectively blacklisted the hacker’s stash of OCEAN tokens. But it also raises questions of the project’s true immutability if the protocol can be effectively hard-forked in one weekend,” CoinDesk’s Will Foxley reports.Corporate statement Coinbase CEO Brian Armstrong published a blog Sunday calling the company “mission focused,” with the underlying message that it won’t engage on political or social topics outside its domain of open finance. That said, employees are expected to pursue social activism in their own time. CoinDesk’s Paddy Baker reports the blog has “split the crypto industry straight down the middle,” with many commending the public stance while others deem it regressive. For instance, Boost VC’s Adam Draper said focusing on a “unified mission” was the only way to achieve its goals. Others in the Twitterverse have called the message out-of-touch, and a way to downplay issues that…

Permission.io Has Quietly Raised $50M to Make Advertising Personal and Data Private

Permission.io Has Quietly Raised $50M to Make Advertising Personal and Data Private

Permission.io is a platform that pays users in ASK tokens for engaging with, or even looking at, ads. Built on a fork of the Ethereum blockchain, the Permission platform incentivizes users to grant advertisers and other merchant participants access to their time and data in a peer-to-peer way. Over the past 12 months, the startup has raised $5 million through a token pre-sale, and recently closed another round of funding that put the company at $47 million raised through equity financing. And since the platform came out of beta a few weeks ago, it has over 450,000 users, according to the company. “Our model is all about advertisers being able to pay individuals directly through crypto, where advertisers’ return on their investment will go up dramatically,” said Permission CEO Charlie Silver. “Everybody’s happy and everybody wins. The user is now being compensated for what typically, today, companies like Google and Facebook are being compensated for.”See also: Twetch Launches Encrypted Messaging, In-Chat Payments on BSV BlockchainData ownership: How users give PermissionThe idea of shifting the benefits of ads back toward users and advertisers rather than middle men isn’t necessarily new. The Brave browser, for example, has let its users choose whether or not to turn on their rewards token system in exchange for viewing ads since its official launch in 2019. Silver, while complimenting Brave’s leadership in the area, is quick to point out how Permission is different. He said Brave is purely a browser that collects no data, contending the ads people are served are random.Permission, on the other hand, allows people to be served ads through their “behavioral data.” Behavioral data means ads are served based on activities such as brand interactions and content consumption. “By the end of the year, users will have access to a feature called ‘MyData,’ which will allow them to input specific data points around preferences that will create even more precise ad targeting, and also restrict the ability of brands to reach users that aren’t interested in their products,” said Silver. Silver said this tool will allow users to directly revoke or manage their data, with Permission acting as an agent for this data rather than a middle man.All data generated through Permission, regardless of source, is anonymized on the advertiser end, according…

Bitcoin May Return to Center Stage After Ethereum’s White-Hot Summer

Bitcoin May Return to Center Stage After Ethereum’s White-Hot Summer

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Crypto Co-ops and Game Theory: Why the Internet Must Learn to Collaborate to Survive

Crypto Co-ops and Game Theory: Why the Internet Must Learn to Collaborate to Survive

If the internet was a person, ARPANET was its first tooth, Facebook was the pubescent rage of middle school and Bitcoin was the key to its first car. Today, we find ourselves riding shotgun, unsure of what direction the internet will take next.There are those who feel we’re about to careen off a cliff, and others who write off the internet’s dangers as inevitable growing pains of innovation. The internet allows us to work together while simultaneously incentivizing us to tear each other apart. That dynamic isn’t sustainable for long. Perhaps over the next 10 years the internet will go through one more phase of reckless adolescence (who could forget their post-college twenties?) before arriving at the plateau of middle age and all of the wisdom, maturity and better judgment that comes with it. Elena Giralt is product marketing manager at Electric Coin Co., the team that launched zcash. She runs Blockchain Latinx, a monthly meetup group that discusses blockchain, cryptocurrencies and emerging technologies. This post is part of CoinDesk’s “Internet 2030” series about the future of the crypto economy.  Positive-sum gamesAt any given time on the internet, more than four billion people have the ability to collaborate or compete with one another. Through social networks, memes and subcultures take on a life of their own, iterating off of each other like a psychedelic fractal. On the internet, we create, play and share new games that have never before existed.These games are helpful frameworks to model out the tension between selfish incentives and community benefits. Informally, a zero-sum game is a competition where one player’s gain is the other player’s loss. In contrast, a positive sum game is generally thought of as a win-win situation. What is the optimal balance between cooperation and competition?The key feature of positive-sum games is that collaboration leads to better outcomes than competition. That sounds great doesn’t it? But, in practice, collaboration often gives way to competition.A decade ago, many people considered social networks like Facebook and Twitter positive sum games (look at all of the connections! all of the value generated! how fun!). Now the pervasive narrative is that our attention, our data and democracies around the world were a dear price to pay for the explosive growth of digital advertising.Credit cards were also once…

How the Crypto Industry Seesaws Between Assets and Infrastructure

How the Crypto Industry Seesaws Between Assets and Infrastructure

In the beginning, there was bitcoin. And with bitcoin, a new asset was invented. And with that new asset, the way we interact with capital was redefined.Bitcoin achieved both of these things. It created a new form of money: one that needed neither central banks nor collateralization. One that was provably scarce and governed only by code and those who wrote and ran it. It also created a new model for ownership, trading and transacting. This new model required no third parties or middlemen. It meant that anyone could directly control their assets and could transfer them in a purely peer-to-peer manner. A new form of money. A new model of ownership. With bitcoin, there was born a new industry. The cryptocurrency space. The blockchain world. The creation of bitcoin spawned thousands of new assets and just as many new ways to interact with those assets. And while these two forms of innovation – assets and infrastructure – have often occurred side by side and have frequently happened under the same banner, they should not be confused. New assets do not necessarily create new experiences of ownership and trade. Similarly, new models of ownership and trade do not always require new assets.Jill Carlson, a CoinDesk columnist, is co-founder of the Open Money Initiative, a non-profit research organization working to guarantee the right to a free and open financial system. She is also an investor in early-stage startups with Slow Ventures.The fact that bitcoin marked the invention of both a new asset and new infrastructure has long been a source of confusion and has resulted in the conflation of the two. It’s time we started noting the difference.The industry, while rarely recognizing it, has pivoted back and forth over the years between prioritizing the creation of new assets and prioritizing the building of new infrastructure.The period from 2013 to 2015 saw the emergence of altcoins like zcash, monero, ethereum, Ripple, litecoin, dogecoin and a multitude of others. These represented new assets. Some of these new assets also offered users fundamentally new ways of interacting with their assets and with each other: privacy and programmability, for example. Others did not offer much that was new at all, besides branding. The cryptocurrency universe was left holding many bags it wasn’t…

Afraid of DeFi? Here’s how to earn 41% APY on Bitcoin without wrapping it

Afraid of DeFi? Here’s how to earn 41% APY on Bitcoin without wrapping it

The number of investors interested in yield farming has grown immensely over the past 6-months as decentralized finance (DeFi) applications became better known and easier to use. This has led to an uncountable number of liquidity pools offering annual percentage yields (APY) surpassing 1,000% and the total value locked in DeFi contracts has risen to billions of dollars.Bitcoin investors who wanted a piece of the action managed to participate in DeFi yield farming by converting their BTC into tokenized formats like Wrapped BTC (WBTC) and renBTC (RENBTC). This allows BTC holders to interact with all of the ERC-20-based tokens, but some analysts question how decentralized the Bitcoin custody is behind those offerings; therefore, it makes sense to explore more centralized solutions.Although it is impossible to directly extract yield on Bitcoin (BTC) deposits at these DeFi platforms, investors can still benefit from centralized services. While it is improbable to find APYs above 12% there are at least safer ways to earn yield on ‘uninvested’ Bitcoin.Centralized services such as Bitfinex, Poloniex, BlockFi, and Nexo will typically yield 5% to 10% per year for BTC and stablecoin deposits. To increase payout, one needs to seek higher risk, which does not necessarily mean a less known exchange or intermediary. By trading BTC options at Chicago Mercantile Exchange (CME), Deribit, or OKEx, an investor can comfortably achieve 40% or higher yields.The covered call strategy has its risksThe buyer of a call option can acquire Bitcoin for a fixed price on a set future date. For that privilege, this buyer pays an upfront for the call option seller. Although the buyer might typically use this instrument as an insurance, sellers are mostly obtaining fixed income trades.Each contract has a predetermined maturity date and strike price, so potential gains and losses can be calculated beforehand. This covered call strategy consists of simultaneously holding BTC and selling the equivalent size in call options.It would be unfair to name it a fixed income trade, as potential losses loom whenever there is a more considerable price drop at options expiry. However, one can adjust such risk while setting up the trade. It is worth noting that limiting exposure will result in lower yields.Expected returns for a November $9.5K covered call. Source: DeribitThe above chart represents a covered call…

So Now They’re Hacking DeFi Protocols Before They’ve Even Launched?

So Now They’re Hacking DeFi Protocols Before They’ve Even Launched?

When the DeFi degens caught wind of a new pre-release Andre Cronje project they piled in, only to get $16 million hacked away in a flash.DeFi is one of the breakout crypto categories of 2020. Indeed, yield farming and the grand game of “money legos” has been so profitable that many are following every new protocol with rapt attention. This is all the more true for projects graced by YFI creator Andre Cronje. So when word got out about a new, pre-release game economy engine called “Eminence,” the DeFi degens took advantage of the permissionless nature of DeFi to pump $16 million or so into EMN. What happened next was arguably the first pre-release hack in DeFi’s history. This episode breaks down what happened and what it means for the fledgling field.

Market Wrap: Bitcoin Holds at $10.7K; Uniswap Volume Drops

Market Wrap: Bitcoin Holds at $10.7K; Uniswap Volume Drops

As bitcoin struggles to hold the $10,700 price range Uniswap’s September volume set records but appears to be declining.Bitcoin (BTC) trading around $10,757 as of 20:00 UTC (4 p.m. ET). Slipping 1% over the previous 24 hours.Bitcoin’s 24-hour range: $10,621-$10,924BTC above its 10-day moving average but below the 50-day, a sideways signal for market technicians.Bitcoin trading on Coinbase since September 27.Source: TradingViewBitcoin’s price dropped a couple of hundred dollars as a spate of selling took the world’s oldest cryptocurrency to as low as $10,621 on spot exchanges such as Coinbase, recovering to $10,757 as of press time. Katie Stockton, analyst for Fairlead Strategies, says cryptocurrencies like bitcoin are affected by traditional markets, particularly equities, which are considered “risk-off” or liquid assets that can easily be sold during a market slide. “Bitcoin has been attuned to the day-to-day moves in risk assets, but the end result of the intraday volatility is a consolidation phase on the chart,” said Stockton. “Short-term momentum has improved with equities, so I expect the consolidation to give way to a move that leaves support near $10,000 intact.” Global equities markets are weak today, either flat or down:Michael Gord, chief executive officer of crypto trading firm Global Digital Assets, senses a bearish mood for the crypto markets. “Bitcoin might get over $11,000 for a short period this week, but with a big exchange like KuCoin being hacked over the weekend I expect this week to have a more bearish sentiment with retail investors,” said Gord. “Institutional investors, on the other hand, might be taking this buying opportunity to buy cheaper bitcoin.” Read More: KuCoin Maintains Wallet Freeze as Hackers Begin Laundering Stolen CryptoSeveral stakeholders in the crypto market see a lack of yields coming from traditional markets as a sign cryptocurrency has a place in uncertain times.  “We are moving into a period of stagflation – stagnant growth and inflation – which creates a steepening of yield curves in the fixed income world,” said Chris Thomas, head of digital assets for Swissquote Bank. Indeed, U.S. Treasury yields have dropped in 2020 – the two-year maturity is at its lowest yield in over 10 years.U.S. Treasury bond two-year yields the past decade.Source: TradingView“I have a customer leaving bonds for bitcoin. I look at that as very bullish,” said Henrik…