Thomas Goldstein

Binance.US Market Share Drops Over 20% Amid SEC Lawsuit, Coinbase Gains Ground

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Binance.US has experienced a significant decline in market share of over 20% due to an ongoing lawsuit filed by federal financial regulators.

Reuters, citing data from Kaiko, reported on July 5 that Binance.US’ market share plummeted from over 22% in April to approximately 0.9% as of June 26.

The legal action was initiated by the U.S. Securities and Exchange Commission (SEC), which accused Binance.US, along with its parent company Binance and CEO Changpeng “CZ” Zhao, of operating as an unregistered securities exchange.

Prior to this lawsuit, the Commodity Futures Trading Commission had already filed a similar complaint against Binance and CZ in March.

READ MORE: How A Crypto Trader Turned $900 Into $176,000 With Pepe 2.0

In a parallel development, Coinbase, another prominent cryptocurrency exchange facing a lawsuit from the SEC, witnessed an increase in its market share in the U.S. According to Reuters, Coinbase’s market share rose from around 48% to 55% in June.

This surge in market share can be attributed, at least in part, to Coinbase being named as a surveillance partner in several SEC filings submitted by asset managers aiming to launch a spot Bitcoin exchange-traded fund in the United States.

On July 5, Cointelegraph reported that the combined trading volume of spot and derivatives on centralized cryptocurrency exchanges surged to over $2.7 trillion.

This increase in trading activity can be attributed, in part, to growing investor sentiment following BlackRock’s filing for a spot Bitcoin ETF.

However, it is important to note that the SEC has yet to approve any spot cryptocurrency ETFs in the United States, and it has rejected numerous applications from various firms.

Overall, Binance.US has witnessed a significant decline in market share due to the SEC lawsuit, while Coinbase has experienced a boost in its market share amidst its own legal challenges.

The cryptocurrency market as a whole has seen a surge in trading volume, driven in part by investor optimism surrounding the possibility of a spot Bitcoin ETF.

Nevertheless, the SEC’s stringent stance on approving such ETFs has resulted in the rejection of multiple applications from various companies.

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Crypto Exchange Launches Public Testnet for v4, Paving the Way for Full Decentralization

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Crypto exchange dYdX has achieved a significant milestone with the launch of the public testnet for its latest iteration, version four (v4), as stated in an announcement by the exchange’s development team on July 5.

This advancement brings the exchange one step closer to the eventual launch of the v4 mainnet, which is anticipated to enable full decentralization of the platform.

dYdX operates on the Ethereum and StarkEx networks and is widely recognized as a decentralized exchange (DEX) since it doesn’t hold users’ funds.

READ MORE: Hong Kong Threatening US As It Emerges As Preferred Web3 Destination

However, it does feature a centralized order book and matching engine, allowing market makers to place limit orders.

This sets it apart from automated market maker DEXs like Uniswap, which leverage on-chain pricing algorithms for buyer-seller matching.

The upcoming version four of dYdX aims to eliminate the need for a centralized order book and matching engine, resulting in a fully decentralized exchange that doesn’t rely on an automated market maker.

According to the protocol’s documentation, this will be achieved by deploying parts of the application on a separate dYdX network with its own validators, enabling the order book to be stored on-chain.

The recent announcement also revealed that users can now request testnet funds to explore the app and engage in virtual trades, track profit and loss, and perform other essential exchange functions starting from 5:00 pm UTC on July 5.

Although the ability to test bridging between networks has yet to be implemented, it is expected to be introduced during the public testnet phase.

Upon the completion of the testnet phase, the protocol’s team plans to proceed with the fifth milestone on their roadmap.

This milestone will involve integrating stablecoins into dYdX and incorporating support for Cosmos Inter-Blockchain Communication, granting Cosmos users access to the dYdX app. Following the accomplishment of this final milestone, the release of version four is anticipated.

It is worth noting that dYdX faced regulatory challenges in Canada, which led to the decision to wind down its services in the country, as announced in April.

In September 2022, the exchange faced criticism from privacy advocates after offering a $25 bonus to new users who could prove they were not bots.

However, this promotion was eventually abandoned.

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Coinbase, Binance and Gemini have least happy employees

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A recent analysis of employee reviews on Glassdoor has revealed that crypto exchanges such as Gemini, Binance, and Coinbase have some of the least happy employees in the industry.

The data, collected by tech recruitment firm TrueUp, compared employee happiness to company growth and placed 27 of the most valuable cryptocurrency firms on a quadrant chart.

According to the chart, Celsius, a defunct crypto lender, along with Gemini and Amber Group, both crypto exchanges, had the least happy employees based on the reviews of 80, 139, and 42 individuals, respectively.

Binance and Coinbase also appeared on the less happy side of the chart, with a total of 1,257 reviews on Glassdoor.

READ MORE: How A Crypto Trader Turned $900 Into $176,000 With Pepe 2.0

Although Glassdoor does not have a specific happiness metric, it assesses whether reviewers would recommend the company to a friend, approve of the CEO they worked under, and have a positive outlook for the company.

Binance, when questioned about the negative reviews, attributed them to the demanding and fast-paced work environment that the company seeks to maintain.

They stated that not all employees are cut out for such an environment and acknowledged the importance of negative feedback in addressing issues and improving the employee experience.

It is worth noting that Glassdoor reviews are user-submitted and subject to a moderation process, which raises concerns about the reliability of the data.

Some recruiters have previously questioned the legitimacy of Glassdoor reviews, suggesting that they can be easily manipulated or falsified.

However, Glassdoor maintains that each review goes through a moderation process before being published on the website.

Neil Dundon, founder of Crypto Recruit, expressed his view that employees involved in building blockchain infrastructure tend to be more satisfied than those working at exchanges.

He suggested that employees in speculative/exchange environments may feel less fulfilled compared to those working on infrastructure projects, as the latter group may have a stronger sense of purpose.

Dundon also noted that the industry-wide layoffs that occurred over the past year likely influenced the job satisfaction levels.

He mentioned that the general insecurity among employees caused by these layoffs makes it difficult for them to feel happy in their roles.

However, he believes that the worst may be behind crypto employees now.

On a positive note, the TrueUp chart indicated that the “happiest” workers in the industry were associated with Ava Labs, Blockchain.com, and Fireblocks. Glassdoor data also revealed that Alex Mashinsky, the founder and former CEO of Celsius, received low approval ratings from past and present employees.

While Brian Armstrong of Coinbase and Changpeng Zhao (CZ) of Binance had lower-than-average approval ratings among technology-based CEOs.

In summary, the analysis of employee reviews on Glassdoor suggests that certain crypto exchanges have less satisfied employees compared to others in the industry.

However, the reliability of the data and the potential impact of recent layoffs should be considered when interpreting the results.

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Larry Fink Advocates for Crypto, Fuels Hopes for Bitcoin ETF Amid Regulatory Uncertainty

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Larry Fink, the CEO of BlackRock, the world’s largest asset management firm, recently vocalized his support for cryptocurrencies during an interview on Fox Business.

This comes as BlackRock applies to list a Bitcoin exchange-traded fund (ETF) in the U.S, a move that could revolutionize finance by providing an accessible investment tool linked directly to Bitcoin.

In the interview, Fink characterized cryptocurrency’s role as essentially “digitizing gold”, implying that it could serve as an alternative investment asset that isn’t tied to any specific currency.

He suggested that Bitcoin could provide investors with a way to protect against inflation and currency devaluation, signaling an international asset appeal.

Fink’s commentary on the crypto landscape has been consistent. He has weighed in on various important occurrences within the sector, such as the FTX downfall in 2022 and the growing intrigue surrounding Bitcoin.

READ MORE: Law Firm Seeks Huge Compensation From Voyager Digital’s Creditors

Given BlackRock’s influence, with over $9 trillion in assets under management as of April, Fink’s pro-crypto statements could trigger substantial impacts both within and outside the cryptocurrency domain.

Crypto enthusiasts online have reacted favorably to Fink’s pro-Bitcoin commentary, with some predicting a potential surge in certain asset prices, referred to as the “Fink Pump”.

At the time of the interview, Bitcoin’s price stood at $30,473, a slight 1% decline from the previous 24 hours.

It’s worth noting that under Fink’s leadership, BlackRock has pursued the launch of a Bitcoin ETF, with crypto giant Coinbase as a surveillance partner.

However, the outcome remains uncertain as the U.S Securities and Exchange Commission has previously rejected all spot Bitcoin ETF applications.

Fink’s positive stance on crypto could potentially tip the scales in favor of such advancements, marking a milestone for cryptocurrency integration into traditional finance.

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Lido Team Accuses Competitor of Excessive Centralization in Liquid Staking Protocols

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In a recent social media post on July 4, Dmitry Gusakov, the community staking lead for Lido, accused their competitor, Rocket Pool, of excessive centralization.

Lido and Rocket Pool are both liquid staking protocols that enable users to delegate their cryptocurrency to validators and receive derivative tokens in return.

Gusakov’s post highlighted that the Rocket Pool contracts are under the control of the Rocket Pool team, allowing them to modify any parameters and execute any methods.

READ MORE: US Crypto Hub Still Thriving Despite Regulatory Challenges, Says Blockchain CEO

This means that Rocket Pool developers possess the ability to increase the inflation rate to an arbitrarily high percentage or raise fees up to 100%.

Gusakov emphasized that such vulnerabilities do not exist in Lido’s contracts since these actions are “fully controlled by [decentralized autonomous organization] LidoDAO.”

He claimed that the Rocket Pool contracts, on the other hand, grant significant control to the team.

In response to these allegations, Rocket Pool management committee member Waq acknowledged the existence of the vulnerability and assured that it would be addressed in the future.

Waq accused the Lido team of attempting to take credit for identifying an issue that was already known to Rocket Pool.

According to Gusakov’s post, the RocketStorage contract at Ethereum address 0x1d8f8f00cfa6758d7bE78336684788Fb0ee0Fa46 contains a parameter called “guardian.”

Various functions within the Rocket Pool contracts are labeled as “onlyGuardian,” indicating that they can only be called by the account specified in this parameter, which is currently set to the RocketPool deployer account at 0x0cCF14983364A7735d369879603930Afe10df21e.

Gusakov explained that actions that can be performed by the “guardian” include altering the “RPL InflationIntervalRate” and the “ETH DepositFee.”

This implies that the Rocket Pool team has the power to increase the inflation rate of the Rocket Pool governance token (RPL) or potentially manipulate users’ deposits by setting the fee to 100%.

The allegations made by Gusakov were shared by content creator Chris Blec, who argued that they demonstrate that “pDAO is not a DAO” and that RPL tokenholders do not genuinely control Rocket Pool’s governance.

In response, Rocket Pool community advocate Jasper.lens acknowledged the centralization issue and stated that it would be resolved in the upcoming Saturn upgrade.

Jasper explained that during the initial testing phase of Rocket Pool’s DAO voting systems, on-chain voting was not permitted.

However, after completing the testing phase, the upcoming Saturn upgrade is intended to address the centralization concerns.

Supporting Jasper.lens’ statement, Waq commented that the Rocket Pool community has been actively working on fixing the centralization issue for over a year.

Waq also predicted that the Lido team would hastily claim credit for the resolution once it is implemented.

Liquid staking protocols have gained significant popularity in recent months.

DefiLlama, a blockchain analytics platform, reported on May 1 that these protocols had surpassed decentralized exchanges as the leading decentralized finance category in terms of total value locked.

Additionally, Tenet’s partnership with LayerZero on May 30 aims to expand liquid staking implementation to more blockchains in the future.

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Law Firm Seeks Huge Compensation From Voyager Digital’s Creditors

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New York-based law firm McDermott Will & Emery has submitted a compensation claim of $5.1 million to the creditors of Voyager Digital, a bankrupt crypto brokerage firm.

The bill covers legal services provided by the law firm from March 1 to May 13, 2023.

The law firm, in a court filing on July 3, directed the billing of its legal fees to the “Official Committee of Unsecured Creditors.”

According to the court documents, McDermott Will & Emery charged an hourly rate of $1,026.76 for the services rendered during the specified period.

READ MORE: NFT Blue Chip Collections Plummet to Near Two-Year Lows

The bill presented by the law firm encompasses various legal services it offered to Voyager, including providing advice to the committee on its powers and responsibilities under the bankruptcy regulations, attending meetings, and negotiating with debtors’ representatives and other interested parties.

Additionally, the firm was responsible for preparing all the necessary legal documents on behalf of the committee.

This recent bill marks the third and final one from McDermott Will & Emery, with the total compensation amounting to $16.48 million between July 5, 2022, and May 19, 2023. Of this total, $8.97 million has already been paid by the creditors.

It is worth noting that McDermott Will & Emery is not the sole legal service provider for Voyager. On June 28, another legal advisor, Kirkland & Ellis, billed Voyager $1.1 million for legal fees incurred in April.

Despite the request for comments from Cointelegraph, McDermott Will & Emery has not yet provided a response.

Voyager Digital filed for bankruptcy in July 2022 amidst a crisis in the crypto lending sector, which resulted in market turmoil and the downfall of several well-established crypto firms such as Celsius and BlockFi.

At the time of filing for bankruptcy, Voyager disclosed liabilities ranging from $1 billion to $10 billion.

The bankruptcy proceedings have imposed substantial legal fees on various crypto firms, including Voyager.

For instance, FTX, another prominent player in the industry, was billed over $120 million in financial and legal advisory fees between February 1 and April 30, 2023.

This indicates the financial burden faced by crypto companies in navigating the complexities of bankruptcy cases and seeking professional legal guidance to handle their affairs.

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Hong Kong Government Urged To Challenge Tether and USDC

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A group of crypto and blockchain advocates has published a report urging the Hong Kong government to introduce a stablecoin linked to the Hong Kong dollar, aiming to challenge the dominance of Tether and USD Coin.

The report, co-authored by prominent individuals in the financial innovation field, proposes the issuance of an HKDG (Hong Kong Dollar Government) stablecoin to bolster the government’s efforts in the digital economy.

The authors, including Wang Yang from the Hong Kong University of Science and Technology, Cai Wensheng, the founder of Meitu, Lei Zhibin, an honorary chair of the Hong Kong Blockchain Association, and doctoral student Wen Yizhou, argue that issuing a stablecoin pegged to the Hong Kong dollar would solidify the region’s leadership in the blockchain sector.

READ MORE: Co-Founders of Collapsed Three Arrows Capital Pledge Donation to Creditors

They believe it would enhance transaction efficiency, reduce costs, improve payment systems, and strengthen Hong Kong’s fintech capabilities.

Additionally, they assert that a Hong Kong Dollar stablecoin would increase the efficiency and inclusiveness of the financial system, provide stability, security, and cross-border liquidity, supporting a broader range of financial innovations.

The authors criticize the government’s current strategy of encouraging private institutions to issue stablecoins pegged to the Hong Kong dollar as “too conservative” in comparison to its crypto and blockchain promotion goals.

The report highlights that Hong Kong’s foreign exchange reserves in March 2023 amounted to approximately $430 billion, surpassing the combined market capitalization of Tether and USD Coin, which stood at around $120 billion.

The proposed HKDG, backed by the government, is deemed to possess higher credibility and lower risk compared to existing stablecoins, particularly given concerns about the credibility of Tether and recent discounts experienced by USD Coin.

The authors outline several potential benefits of launching HKDG, including challenging the dominance of the US dollar, providing additional liquidity for government projects, and facilitating risk assessment by officials.

However, the report acknowledges potential risks, such as legal and regulatory challenges, international disputes related to illicit funding, and hacking incidents.

In June, the Hong Kong government established a task force to oversee the development of Web3.

The region has seen growing interest from over 80 digital asset and blockchain-related companies considering establishing a presence in Hong Kong, in addition to the already existing 800 fintech companies.

Overall, the report recommends the issuance of an HKDG stablecoin by the Hong Kong government to propel the region’s digital economy, enhance financial systems, and bolster its position as a leader in the blockchain sector.

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Chinese City Embraces CBDCs As Widespread Adoption Nears

Jinan, the capital city of China’s Shandong Province, has taken a significant step towards the widespread adoption of the country’s central bank digital currency (CBDC).

The city has introduced digital yuan payments on all its bus routes, encouraging residents to embrace this new payment method.

Initially, the city conducted a pilot program on two bus lines to test the feasibility of CBDC payments. Following the successful trial, Jinan has now implemented the digital yuan payment system across its entire bus network.

Local media outlet Shunwang-Jinan Daily reported that the city has upgraded its card readers and bus route software to accommodate the CBDC payments.

READ MORE: NFT Blue Chip Collections Plummet to Near Two-Year Lows

To incentivize the use of the digital yuan, Jinan is offering fare discounts to passengers who opt for this payment method.

According to the announcement, passengers can enjoy up to two discounted rides per day and a maximum of six discounted rides per month when using the digital yuan.

This initiative in Jinan is part of a broader nationwide effort to promote the adoption of the digital yuan in China.

Another city, Changshu, recently announced that it would pay civil servant salaries with the CBDC starting from May. This move extends to personnel at all levels of public service, public institutions, and state-owned units.

In addition to bus rides and civil servant salaries, China has implemented its CBDC for the Belt and Road initiative and cross-border trades.

On April 24, the city of Xuzhou issued a plan to promote the use of the CBDC in cross-border trade. Xuzhou serves as a departure point for trains transporting goods to Europe.

In a related development, BNP Paribas, a French bank, has partnered with the Bank of China (BOC) to encourage the use of the digital yuan.

Through this collaboration, BNP Paribas’ corporate clients will have the opportunity to connect with BOC’s system, facilitating real-time transactions using the digital yuan.

The introduction of digital yuan payments on Jinan’s bus routes represents a significant milestone in the promotion of China’s CBDC.

By integrating the digital currency into everyday transactions and expanding its use across various sectors, China is steadily advancing towards a digital economy.

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Ethereum Rallies, Looks To Breach Key Resistance Zone

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Ethereum is showing a strong upward momentum as its price surges past $1,940 against the US Dollar.

The cryptocurrency has the potential to continue its upward trajectory if it manages to surpass the crucial resistance zone at $2,000.

Currently, Ethereum is steadily moving closer to the $2,000 zone, trading above $1,920 and the 100-hourly Simple Moving Average.

On the hourly chart of ETH/USD, there is a bullish trend line forming, indicating support near $1,945.

If the resistance at $2,000 is successfully breached in the near future, Ethereum could experience a surge of 5% to 8%.

Ethereum’s price recently found a base above the $1,850 support level and initiated a fresh upward movement, outperforming Bitcoin.

READ MORE: EU Lawmakers Approve Controversial Law Despite Crypto Concerns

It surpassed the $1,950 resistance zone, reaching a new multi-day high at $1,975 before consolidating its gains. Although there was a slight decline below $1,965, the price managed to find support.

The immediate resistance for Ethereum is currently near $1,975, followed by a major resistance level at $2,000. A close above $2,000 could potentially trigger a renewed surge, with the next resistance level around $2,050.

Further upward gains could propel the price towards the $2,120 mark, and even higher to the $2,200 resistance level.

However, if Ethereum fails to surpass the $1,975 or $2,000 resistance levels, a downside correction might occur.

In such a scenario, initial support can be found around the $1,950 level and the trend line zone.

The next significant support level lies near $1,930, which aligns with the 50% Fibonacci retracement level of the recent upward movement.

Additionally, the 100-hourly Simple Moving Average also provides support at this level.

Further downward movement could lead to a drop towards the $1,900 mark, and if the bearish sentiment persists, Ethereum may find support around $1,880.

As Ethereum continues to display positive price action, investors are closely watching its performance and assessing the potential for further gains.

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UK Law Commission Pushing For Major Crypto Revamp

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The Law Commission of the United Kingdom is advocating for the establishment of a unique category of personal property that caters to the distinct characteristics of cryptocurrencies and digital assets.

In response to a directive from the British government, the commission conducted a comprehensive analysis of common law frameworks in England and Wales to determine how they can effectively accommodate digital assets, including non-fungible tokens (NFTs) and cryptocurrencies.

The most notable recommendation put forth by the commission is the creation of a fresh and distinct category of personal property specifically for digital assets.

The commission intentionally refrained from defining clear boundaries for this proposed category, asserting that the determination of which digital assets fall within this framework should be left to the discretion of the U.K.’s common law system.

According to a statement released by the commission and shared with Cointelegraph, the introduction of a new personal property category would enable a nuanced approach to recognizing a broad spectrum of digital assets, ranging from cryptocurrencies to digitized instruments like carbon emission credits or export quotas.

READ MORE: NFT Blue Chip Collections Plummet to Near Two-Year Lows

In addition to this, the Law Commission proposed the establishment of a panel consisting of industry-specific technical experts, legal practitioners, academics, and judges.

This panel would be responsible for providing non-binding advice to courts regarding various legal issues and considerations pertaining to the digital asset sector.

Another key recommendation put forth by the commission is the development of a tailored legal framework aimed at facilitating the operation and enforcement of collateral arrangements.

Lastly, the commission called for statutory law reforms that would provide clarity on whether specific digital assets fall under the purview of the U.K.’s Financial Collateral Arrangements Regulations of 2003.

The Law Commission’s review of the legal challenges associated with the cryptocurrency sector commenced in October 2022 at the request of the Ministry of Justice.

Subsequently, in March 2023, the U.K. Treasury and Home Office announced their intentions to implement robust regulations on the cryptocurrency sector to combat its potential misuse for criminal activities.

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