I will be more selective of the smaller headlines going forward, so I can reduce the time it takes to write these updates.
Kraken reaches settlement with SEC for ETH staking product
On Thursday, the SEC and Kraken announced a $30m settlement surrounding providing proper disclosures about their ETH staking product. Here is the official statement by Gary Gensler. Kraken will no longer provide staking services in the US. Gensler warned that “other platforms should take note of this and seek to come into compliance”. Coinbase released a blog post explaining why they believe that their staking services are not a security. On a related note, Nic Carter released a blog post exposing the efforts of the authorities in the US to cut off crypto from the banking system. I would suspect some more moves from the SEC this week.
NFTs on Bitcoin
Let me try and explain this in a way that I understand. Ever since Bitcoin was invented, the community understood the potential to store non-financial data on-chain. Originally this was done via hashing the file/image/audio etc. that you wanted to “store”, and sending a negligible amount of Bitcoin to an address that equalled that hash. This made the UTXO set grow with many unspent transactions that would never be spent. So instead, the community leveraged the OP_RETURN opcode, that allows you to store up to 80 bytes of data on-chain, without it impacting the UTXO set. Now, with two recent upgrades to the network (Segwit and Taproot), one is able to store up to 4MB of data in a transaction and bypass this 80 byte limit. People have been using this to store NFTs. See an example here. There is a heavy debate in the Bitcoin community whether this is a reasonable use of the network. Advocates claim that it is providing miners with much needed transaction fees, whilst others say that it adds unnecessary load on each node. There’s a pretty good blog post here by Dennis Porto, part of the team behind one of these NFT projects.
Other news
StarkWare announced plans to open-source the StarkNet Prover
Optimism plans major network upgrade called Bedrock in March
ENS DAO has voted to sell 10,000 ether to fund ~2 years of runway. They executed the trade via Cowswap, which claims to protect you from MEV by executing your trade over multiple platforms
Uniswap DAO completes vote for proposed BNB deployment. See votes here
Pyth is launching on Arbitrum
Genesis, Digital Currency Group, Gemini and a few others have reached an agreement to start recovery of assets.
The English Premier League announced a four-year licensing partnership with Sorare (powered by StarkEx). The deal is rumored to be worth $150m
A damning bankruptcy report revealed that Celsius failed to report $800 million in losses. At the same time, Alex Mashinsky cashed out $68.7m in CEL tokens. The bankruptcy report also disclosed a $2bn loan that Celsius gave to Tether, which Tether denies
PayPal has paused their stablecoin project. They were planning to partner with Paxos, who is now under probe by the New York regulator
The Coinbase employee who would front-run token listings pleaded guilty to wire fraud
Su Zhu unveiled the OPNX exchange that will allow for the trading of bankruptcy claims from crypto platforms that went bankrupt