Category Archives: Cryptocurrency

Will 2021 be remembered as the year cryptocurrency went mainstream?

The blockchain-powered financial services industry drew about $30 billion in venture capital this year, more than in all previous years combined. Meanwhile, hype over a more decentralised Internet - from NFTs and crypto to Web 3.0 and beyond - reached a fever pitch.

Co-hosts Mustafa Alrawi and Kelsey Warner unpack and explain the trends, and Kelsey interviews Abu Dhabi Global Market's Wai Lum Kwok, senior executive director, about the role regulators play in this new frontier.

The future of digital assets and ADGM's stance (0m 54s)

FinTech products and services approaching ADGM (4m 11s)

Finding a balance between regulation and innovation (7m 15s)

Where are we in the evolution of FinTech? (8m 54s)

Cryptocurrencies drew about $30bn from VCs in 2021, more than in all previous years

Next generation ultra-rich to increase wealth through cryptocurrency investments

Global cryptocurrency regulation should be comprehensive and co-ordinated, IMF says

What to consider before investing in cryptocurrencies

Updated: December 22nd 2021, 2:00 AM

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The mainstreaming of cryptocurrency and what it means: Business Extra - The National

Cryptocurrency-based scammers and cyber criminals netted a whopping $7.7 billion worth of cryptocurrency from victims in 2021, marking an 81% rise in losses compared to 2020, according to blockchain analysis firm, Chainalysis.

Some $1.1 billion of the $7.7 billion in losses were attributed to a single scheme which allegedly targeted Russia and Ukraine, it said.

"As the largest form of cryptocurrency-based crime and one uniquely targeted toward new users, scamming poses one of the biggest threats to cryptocurrency's continued adoption," said Chainalysis.

SEE: Hackers are turning to this simple technique to install their malware on PCs

At the same time though, the number of deposits to scam addresses fell from just under 10.7 million to 4.1 million, which it said could mean there were fewer individual scam victims but they are losing more.

A major source of rising cryptocurrency losses in 2021 were so-called "rug pulls", where the developers of a new cryptocurrency vanish and take supporters' funds with them. Rug pulls accounted for 37% of all cryptocurrency scam revenue in 2021, totaling $2.8 billion up from just 1% in 2020.

"Rug pulls are prevalent in DeFi because with the right technical know-how, it's cheap and easy to create new tokens on the Ethereum blockchain or others and get them listed on decentralized exchanges (DEXes) without a code audit," it warned.

The characteristics of the investment scam networks are changing. Chainaylsis found that the number of active financial scams rose from 2,052 in 2020 to 3,300, while their individual lifespan has decreased from over 500 days in 2016 to 291 days in 2020 and just 70 days in 2021.

"Previously, these scams may have been able to continue operating for longer. As scammers become aware of these actions, they may feel more pressure to close up shop before drawing the attention of regulators and law enforcement," it said.

SEE: Dark web crooks are now teaching courses on how to build botnets

Unsurprisingly, scams also increase in line with the rise in value of popular cryptocurrencies such as Ethereum and Bitcoin, although that link may have been broken in the last year.

Chainalysis notes: "The most important takeaway is to avoid new tokens that haven't undergone a code audit. Code audits are a process through which a third-party firm analyzes the code of the smart contract behind a new token or other DeFi project, and publicly confirms that the contract's governance rules are iron clad and contain no mechanisms that would allow for the developers to make off with investors' funds."

It added: "Investors may also want to be wary of tokens that lack the public-facing materials one would expect from a legitimate project, such as a website or white paper, as well as tokens created by individuals not using their real names."

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Scammers grabbed $7.7 billion worth of cryptocurrency in 2021, say researchers - ZDNet

In a recent Twitter exchange, with Grammy award-winning rapper Cardi B, former Twitter CEO Jack Dorsey said on Tuesday that Bitcoin will replace the US dollar. Cardi B asked on Twitter if crypto would replace the US currency to which Dorsey replied, Yes, Bitcoin will.

The Twitter interaction between Cardi B and the tech billionaire about cryptocurrency replacing the dollar prompted massive reactions on the social media platform. Dogecoin co-founder Billy Markus posted a meme about how Dogecoin is more stable than the US dollar. While Bitcoin investor Dennis Porter pointed out that such a conversation was actually inevitable.

Dorsey left Twitter last month to focus on fintech firm Block, formerly known as Squaremaking Parag Agrawal, the new CEO of Twitter, who is now heavily involved in decentralised projects in the company.

Earlier, in October, Dorsey said that Block is looking to build a bitcoin mining system based on custom silicon and open source for individuals as well as businesses. This would add to Squares existing bitcoin-focused projects including a business to build an open developer platform, as well as a hardware wallet for the cryptocurrency.

If we do this, wed follow our hardware wallet model: build in the open in collaboration with the community, Dorsey said in a tweet. A team led by Squares hardware lead, Jesse Dorogusker, will investigate requisites for Square to take on the project to build a bitcoin mining system.

Dorsey is a Bitcoin investor. His love for cryptocurrency dates back to 2017 when he started advocating Bitcoin as the king coin. When the crypto market crashed in 2018, Dorsey was unfazed, calling Bitcoin the future world currency, despite the digital currency being at its lowest point in several years. In March 2019, Dorsey had said that he spends several thousand dollars each week to buy Bitcoin.

Endorsing blockchain technology for transparency in payment, Dorsey has recently released the whitepaper of its decentralised Bitcoin exchange proposal tbDEX. Dorsey has confirmed to investors that Bitcoin will be a big part of the companys future.

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Bitcoin will replace the US dollar, says former Twitter CEO Jack Dorsey - The Indian Express

Since its debut in 2015, Ethereum has played a crucial role in advancing blockchain utility. Specifically, it introduced the concept of programmability, allowing developers to write self-executing code (smart contracts) to the blockchain. In turn, that technology has evolved into decentralized applications (dApps) and decentralized finance (DeFi) products.

Powered by that innovation, Ethereum's price has skyrocketed 881,500%since hitting a low in October 2015, and it's currently the largest DeFi ecosystem by a wide margin. For both reasons, Ethereum still looks like a worthwhile investment, but the odds of a repeat performance are virtually nonexistent. So if you're looking for a cryptocurrency with moonshot potential, you're better off looking elsewhere.

For instance, Polkadot (CRYPTO:DOT) has an ambitious vision, and an experienced founder backs it. Here's what you should know.

Image source: Getty Images.

Polkadot was designed by Gavin Wood, co-founder and former chief technology officer of the Ethereum Foundation. He actually invented Solidity, the programming language used to build smart contracts on Ethereum. Wood also co-founded the Web3 Foundation, a nonprofit group working to build a decentralized version of the internet, known as Web 3.0.

If successful, that technology would allow users to access secure web applications that exist beyond the control of any third party. Just like the internet of today, those dApps could be anything from financial services and productivity tools to video games and social media platforms. But unlike the internet of today, no corporation would be collecting user data in the background. Polkadot is at the heart of that vision.

To that end, the Polkadot blockchain is architected uniquely. At its core is the relay chain, a blockchain that relies on the energy-efficient proof-of-stake consensus. The relay chain is tasked with orchestrating and securing various programmable side chains (called parachains). Polkadot also supports bridges, a special type of parachain designed to communicate with external networks.

That means Polkadot is interoperable with other blockchains, making it possible to exchange data with platforms like Ethereum. That feature is critical because the future of blockchain technology is likely composed of many tailor-made chains, each with a specific use case, all capable of interacting.

In November, Polkadot started auctioning parachain slots to blockchain project developers. Only five auctions have taken place so far, with DeFi platform Acala winning the first and Ethereum-bridge Moonbeam winning the second. On Dec. 17, both parachains are set to connect to the relay chain, marking a pivotal moment in Polkadot's history, as both Acala and Moonbeam could dramatically accelerate the growth of its dApp ecosystem.

Auctions will continue at regular intervals for some time, with a long-term goal of reaching 100parachains. At that point, Polkadot's throughput could reach 1 milliontransactions per second (TPS), making it far more scalable than virtually every other blockchain platform, thoughthere is at least one exception.

Image source: Getty Images.

Polkadot is energy-efficient, highly scalable, and interoperable with other networks, solving several problems that currently impede other blockchains. From that perspective, Polkadot could certainly power Web 3.0, or at least a thriving ecosystem of dApps and DeFi products, and that's the heart of the investment thesis.

DeFi products and dApps aren't free. In exchange for securing transactions, validators collect transaction fees from users, and those fees are paid in the native cryptocurrency. In the case of Polkadot, that means DOT tokens. In other words, as more developers, consumers, and investors adopt products on Polkadot, demand for DOT should rise, driving its price higher.

Similarly, owning DOT makes you a stakeholder in the Polkadot ecosystem. That means you can propose and vote on changes and earn rewards by staking DOT tokens. Currently, those rewards would total 13.8%(before commission fees) on an annualized basis. If Polkadot does indeed become the foundation of Web 3.0, owning a piece of that infrastructure makes for a very compelling investment.

This article represents the opinion of the writer, who may disagree with the official recommendation position of a Motley Fool premium advisory service. Were motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

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Missed Out on Ethereum? My Top Cryptocurrency to Buy Right Now - Motley Fool

GIBRALTAR--(BUSINESS WIRE)--Bullish, a technology company developing products for the digital assets sector, announced today that its flagship product, the Bullish exchange, is now available to eligible individual users and institutions in select jurisdictions within Asia-Pacific, Europe, Africa and Latin America. The trading platform leverages innovations in decentralized finance (DeFi) with regulatory compliance frameworks, giving institutional and retail traders access to deep liquidity and low-cost transactions.

Following the launch of the exchange in late November to select institutions, Bullish has hydrated its proprietary liquidity pools with more than US$2 billion of cash and digital assets, and has already achieved 24-hour total trading volume exceeding US$150 million.

An evolution from the traditional exchange, Bullishs proprietary Hybrid Order Book pairs the high-performance of a traditional Central Limit Order Book (CLOB) with Automated Market Making (AMM) a protocol that uses a mathematical algorithm to facilitate prices in a transparent, market-neutral, and deterministic manner. Bullish Liquidity Pools offer clients the ability to manage balanced portfolios while earning passive yields at scale across highly variable market conditions.

Within traditional finance, innovation has unfortunately become synonymous with complexity, creating a vacuum for closed-door decisions to thrive, said Thomas Farley, Chairman and CEO of Far Peak Acquisition Corporation (NYSE: FPAC), a special purpose acquisition company, who will serve as the incoming CEO of Bullish upon the completion of the proposed business combination between Bullish and FPAC. The Bullish exchange aims to drive value back to underlying asset providers and fundamentally enhance the market architecture of DeFi with the high performance of a CLOB. Its the best of both worlds that opens up new opportunities for a new era of finance.

The Bullish exchange leverages a private EOSIO-based blockchain in order to integrate the strategic advantages of blockchains inherent capabilities into the platform design, and achieve a new degree of security, transparency, and resiliency. Combined with WebAuthn standards, which eliminate many security vulnerabilities inherent with passwords by using public key cryptography, users will experience a password-free authentication environment, creating a more secure onboarding process and ongoing account access.

Bullish was born from working backwards from our own desire to more effectively manage digital assets, and today were ready and excited to share these revolutionary tools with the public,'' said Brendan Blumer, Chairman of Bullish.

Bullish previously announced its intention to go public on the NYSE through a business combination with FPAC. Subject to various approvals and conditions, the merger is anticipated to close in the first quarter of 2022. The Bullish exchange is operated by Bullish (GI) Limited and regulated by the Gibraltar Financial Services Commission.

About Bullish

Focused on developing products and services for the digital assets sector, Bullish has rewired the traditional exchange to benefit asset holders, enable traders and increase market integrity. Supported by the groups treasury, Bullishs new breed of exchange combines deep liquidity, automated market making and industry-leading security to increase the accessibility of digital assets for traders. Bullish exchange is operated by Bullish (GI) Limited and is regulated by the Gibraltar Financial Services Commission (GFSC) (DLT license: FSC1038FSA). For more information, please visit bullish.com and follow Twitter and LinkedIn.

Forward-Looking Statements

This communication includes, and oral statements made from time to time by representatives of FPAC and Bullish Global may be considered, forward-looking statements within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements generally relate to future events or FPACs or Bullishs future financial or operating performance. In some cases, you can identify forward-looking statements by terminology such as may, should, expect, intend, will, estimate, anticipate, believe, predict, potential or continue, or the negatives of these terms or variations of them or similar terminology. In addition, these forward-looking statements include, but are not limited to, statements regarding Bullish Globals business strategy, cash resources, current and prospective product or services, as well as the potential market opportunity. Such forward-looking statements are subject to risks, uncertainties, and other factors which could cause actual results to differ materially from those expressed or implied by such forward looking statements. These forward-looking statements are based upon estimates and assumptions that, while considered reasonable by FPAC and its management, and Bullish Global and its management, as the case may be, are inherently uncertain. Factors that may cause actual results to differ materially from current expectations include, but are not limited to: (1) the occurrence of any event, change or other circumstances that could give rise to the termination of the definitive agreements respecting the Business Combination; (2) the outcome of any legal proceedings that may be instituted against FPAC, Bullish or Bullish Global or others following the announcement of the Business Combination; (3) the inability to complete the Business Combination due to the failure to obtain approval of the shareholders of FPAC or to satisfy other conditions to closing; (4) changes to the proposed structure of the Business Combination that may be required or appropriate as a result of applicable laws or regulations; (5) the ability of Bullish to meet applicable listing standards following the consummation of the Business Combination; (6) the risk that the Business Combination disrupts current plans and operations of Bullish Global as a result of the announcement and consummation of the Business Combination; (7) the ability to recognize the anticipated benefits of the Business Combination, which may be affected by, among other things, competition, the ability of the combined company to grow and manage growth profitably, maintain relationships with customers and suppliers and retain its management and key employees; (8) costs related to the Business Combination; (9) changes in applicable laws or regulations; (10) the possibility that Bullish may be adversely affected by other economic, business and/or competitive factors; (11) the impact of COVID-19 on Bullish Globals business and/or the ability of the parties to complete the Business Combination; and (12) other risks and uncertainties set forth in the section entitled Risk Factors in the Bullish Investor Presentation dated July 2021, in the sections entitled Risk Factors and Cautionary Note Regarding Forward-Looking Statements in the preliminary proxy statement/prospectus included in the registration statement on Form F-4 (the Registration Statement) filed by Bullish with the U.S. Securities and Exchange Commission (the SEC), in the sections entitled Risk Factors and Cautionary Note Regarding Forward-Looking Statements in FPACs IPO Prospectus dated December 2, 2020 filed with the Securities and Exchange Commission on December 3, 2020, in the section entitled Risk Factors in FPACs most-recent Quarterly Report on Form 10-Q, as well as any further risks and uncertainties to be contained in any other material filed with the SEC by Bullish or FPAC. In addition, there may be additional risks that neither Far Peak or Bullish Global presently know, or that Far Peak or Bullish Global currently believe are immaterial, that could also cause actual results to differ from those contained in the forward-looking statements. Nothing in this communication should be regarded as a representation by any person that the forward-looking statements set forth herein will be achieved or that any of the contemplated results of such forward-looking statements will be achieved. You should not place undue reliance on forward-looking statements, which speak only as of the date they are made. Neither FPAC, Bullish nor Bullish Global undertakes any duty to update these forward-looking statements.

Important Information and Where to Find It

This document does not contain all the information that should be considered concerning the proposed Business Combination. It does not constitute an offer to sell or exchange, or the solicitation of an offer to buy or exchange, any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, sale or exchange would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. It is not intended to form the basis of any investment decision or any other decision in respect of the proposed Business Combination. In connection with the proposed Business Combination, Bullish has filed the Registration Statement with the SEC which includes a preliminary proxy statement / prospectus with respect to the Business Combination. The definitive proxy statement / prospectus and other relevant documentation will be mailed to FPAC shareholders as of a record date to be established for purposes of voting on the Business Combination. FPAC shareholders and other interested persons are advised to read the preliminary proxy statement / prospectus and any amendments thereto, when available, and the definitive proxy statement / prospectus because these materials contain and will contain important information about Bullish, FPAC and the proposed transactions. Shareholders may obtain a copy of the preliminary proxy statement / prospectus and, when available, the definitive proxy statement / prospectus without charge, at the SECs website at http://sec.gov or by directing a request to: Far Peak Acquisition Corp., 511 6th Ave #7342, New York, NY 10011. INVESTMENT IN ANY SECURITIES DESCRIBED HEREIN HAS NOT BEEN APPROVED OR DISAPPROVED BY THE SEC OR ANY OTHER REGULATORY AUTHORITY NOR HAS ANY AUTHORITY PASSED UPON OR ENDORSED THE MERITS OF THE OFFERING OR THE ACCURACY OR ADEQUACY OF THE INFORMATION CONTAINED HEREIN. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

Participants in the Solicitation

FPAC, Bullish, Bullish Global and their respective directors and executive officers, other members of management and employees may be considered participants in the solicitation of proxies with respect to the potential transaction described in this communication under the rules of the SEC. Information regarding persons who may, under the rules of the SEC, be deemed participants in the solicitation of the shareholders in connection with the potential transaction and a description of their interests is set forth in the preliminary proxy statement/prospectus included in the Registration Statement. These documents can be obtained free of charge from the sources indicated above.

No Offer or Solicitation

This communication is for informational purpose only and not a proxy statement or solicitation of a proxy, consent or authorization with respect to any securities or in respect of the potential transaction and shall not constitute an offer to sell or a solicitation of an offer to buy the securities of Bullish or FPAC, nor shall there be any sale of any such securities in any state or jurisdiction in which such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of such state or jurisdiction. No offer of securities shall be made except by means of a prospectus meeting the requirements of section 10 of the Securities Act.

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Bullish Exchange Opens Regulated Cryptocurrency Trading Platform to the Public - Business Wire

Ryan Cooper

Something has changed since Bitcoin became the first crypto currency in 2009.The total value of all crypto currencies now approaches $3 trillion. Sothebys and Christies, the global auction houses, have auctioned over $165 million of crypto assets so far in 2021, and they accept bids in Ethereum.The Lakers will play in Crypto.com arena, formerly Staples Center. Coinbase is a publicly traded company.The U.S. Securities and Exchange Commission has approved a Bitcoin futures Exchange Traded Fund that started trading in October. Wyoming allows the legal registration of a new type of business entity called a Decentralized Autonomous Organization LLC, which permits management not only by humans but also by software algorithms.Simply put, we are not only looking at entirely new asset classes, but also new ways of doing business. This is much bigger than just cryptocurrencies; in fact some are describing this as the early stages of Web 3.0.You should absolutely be cautious and skeptical. Much of this space is a modern equivalent of the Wild West, with little to no regulation, where buyer beware reigns supreme.But the winds of change are blowing. We are seeing demands from the IRS for improved data reporting, as well as SEC crackdowns on crypto currencies that could be considered securities under U.S. law.Institutional investors and venture capital have started entering the space and are demanding better security and compliance. You may find this whole thing ridiculous, extremely volatile and incredibly risky, and you would be right. Ive been following these developments for about five years, and I can only say one thing with certainty: Crypto assets are not going away.Over the last few years, more people have started asking about the tax implications of buying and selling crypto currencies. Did you know that for the past two years, you have testified whether you made any crypto sales when signing your tax returns?If you did and those sales do not appear on Schedule D, you may have filed an incorrect return. The IRS position on this has been established since 2014, so this is not new territory.The terminology of crypto assets is very different, but in most situations, the income tax implications are similar to buying and selling stock, and similar tax planning strategies apply. There are trusted resources available if you want to donate appreciated crypto assets to charity or want to protect gains from taxation by rolling proceeds into an Opportunity Zone investment. As with most things tax-related, there are finer points and complexities, and I recommend talking to a professional who understands crypto assets.Someone recently shared a video clip from 1995 of David Letterman interviewing Bill Gates. Letterman was joking about the first baseball game broadcast on this new thing called the internet. Have you heard of radio? is the punchline.My point is that we can all make jokes, but being obstinate in the face of progress is a reaction, not a strategy. Be cautious, be skeptical, do your research but dont dismiss or ignore it.(Ryan Cooper, CPA/PFS, is the manager of special projects at Nagel CPAs, LLC Accountants and Advisors, serving the middle Rio Grande Valley, Central Utah and beyond. Learn more at nagelcpa.us.)

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Ryan Cooper on Finances: Cryptocurrency's here to stay; be wise - Rio Rancho Observer

Federal prosecutors in San Diego have filed a lawsuit to seize $154 million that was allegedly embezzled from Sony Life Insurance Co. in Japan, funneled through a La Jolla bank and converted into cryptocurrency.

The civil forfeiture action comes after the FBI confiscated 3,879 Bitcoins related to the alleged scheme. The Bitcoins are being held in the San Diego FBIs Bitcoin wallet for safekeeping with the intention of returning the money to Sony.

According to the lawsuit filed by the U.S. Attorneys Office, Rei Ishii, a former employee of Tokyo-based Sony Life Insurance, engaged in a scheme to transfer funds from the Sony Lifes Citibank account to a Coinbase credit account held at San Diegos Silvergate Bank, where the funds were converted to Bitcoin.

Coinbase is a well-known cryptocurrency exchange where people invest in, buy and sell Bitcoin. Each transaction is recorded in a digital public ledger known as a blockchain. Coinbase is considered a financial institution that must comply with anti-money laundering and other laws.

Bitcoin is one of several virtual currencies available on the Internet. Beyond trading, virtual money can be exchanged for goods and services or real money, such as U.S. dollars, on exchanges.

Silvergate Bank has been an early provider of services targeting the crypto market. It supplies financial infrastructure such as fund transfers, customer account controls and security, as well as a payments system to help the digital currency market grow.

Phone calls and emails to Silvergate were not returned.

The lawsuit alleges Ishii illegally transferred the funds in May 2021 to the Silvergate-Coinbase account in an apparent ransom scheme.

Sony Life supervisors received anonymous emails from Ishii a few days after then transfer stating If you accept the settlement, we will return the funds back, and if you are going to file criminal charges, it will be impossible to recover the funds, according to the lawsuit.

Law enforcement was able to trace the Bitcoin transfers and identify the funds allegedly stolen from Sony Life, which had been transferred to an offline cryptocurrency cold wallet.

Investigators then obtained a private key the equivalent to a password needed to access the Bitcoin address. All the Bitcoins traceable to the alleged theft have been recovered and protected, according to court records. Ishii has been criminally charged in Japan.

This case is an example of amazing work by FBI agents and Japanese law enforcement, who team up to track this virtual cash, said Randy Grossman, acting U.S. Attorney for the Southern District of California. Criminals should take note. You cant rely on cryptocurrency to hide your ill-gotten gains from law enforcement.

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San Diego lawsuit aims to safeguard $154M in embezzled funds that were converted to cryptocurrency - The San Diego Union-Tribune

Werewolves are mythical creatures that have also captured the attention of people over the centuries. Being afraid of them being fascinated by the man-wolf hybrid, there are mixed opinions about the powerful creature, which only adds to its magnetic pull. Incidentally, the hate-love relationship is also one of the ideologies associated with the cryptocurrency world.

Werewolf Protocol decided to amalgamate the mysterious creatures, werewolves with the stand-alone and growing blockchain technology to create a powerful and exciting ecosystem meant to evolve cryptocurrencies.

Werewolf Ecosystem Be an Alpha of Crypto World

Werewolf utilizes the power of blockchain technology to evolve cryptocurrencies, and the projects ecosystem consists of decentralized finance-based applications, such as decentralized exchange, staking, an asset marketplace, and metaverse gaming, with more to come.

Werewolf Ecosystem is a rapidly developing project that started as a DeFi platform to become a unified DeFi Ecosystem with scalable opportunities. The ecosystem is powered by the Werewolf Coin, a utility token that powers the governance model installed to keep the project decentralized and fair. The project aims to use the native WWC token for distributing staking rewards, trading NFTs (purchasing and selling on Werewolf exchange).

Apart from the WWC coin, Werewolf Ecosystem offers WOLF Coin, which is native coin used for staking and to be bought in the IBCO. Using the WOLF Coin and WWC token, the Werewolf ecosystem is offering an exciting approach to the blockchain world and making it more interesting for the community.

The robust set of products offered by Werewolf Protocol includes:

This robust and exciting connection between werewolf mythology and blockchain technology empowers Werewolf Protocol to present a distinct project to the entire crypto community. To learn more about the Werewolf Ecosystem, visit https://werewolf.exchange/index.html.

Disclaimer: This is a paid post and should not be treated as news/advice.

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Werewolf: Harnesses the power of blockchain to evolve cryptocurrency - AMBCrypto News

Crypto lending allows investors who hold cryptocurrency to lend their digital assets to different borrowers and to receive interest payments in exchange.Mark Blinch/Reuters

Over just the past two years, Ledn, a Toronto-based cryptocurrency lending company, has seen its digital assets under management grow from a couple of million dollars to almost $2-billion, fuelled by a surge in the number of users opening new accounts on its platform, according to Ledn co-founder Mauricio Di Bartolomeo.

Ledn offers various yield-generating crypto products, including bitcoin-backed loans and a bitcoin savings account. For simply parking your bitcoin with Ledn, you can earn up to 9.5-per-cent annual interest.

But despite already managing billions in digital assets, Ledn has not yet received full regulatory approval by the Ontario Securities Commission. Just six Canadian crypto platforms have so far been approved by regulators. All of them are crypto trading platforms, and are categorized as securities dealers. None are in the crypto lending business, like Ledn.

We filed our registration and disclosed our business model to the OSC in March, but we are still waiting to complete the regulatory process, Mr. Di Bartolomeo told The Globe and Mail. Were not sure yet how the OSC plans to designate us.

Ledns registration status perhaps best illustrates a conundrum regulators face when it comes to the crypto industry. As soon as they decipher and deliver guidance on one kind of crypto business, various other new and often more complicated business models emerge, leaving authorities grappling with exactly how to regulate the new entities.

Crypto lending, to put it simply, allows investors who hold cryptocurrency to lend their digital assets to different borrowers and to receive interest payments in exchange. Borrowers are typically traders who use digital coins to trade various cryptocurrencies on crypto exchanges.

For years, traders have bought and sold cryptocurrencies, including bitcoin (BTC) and ether (ETH), on those platforms. Scores of crypto exchanges emerged, both domestically and abroad, and retail investor interest in the sector skyrocketed.

This past March, the Canadian Securities Administrators, the umbrella group of provincial and territorial securities commissions, issued guidelines on how to regulate crypto exchanges. The CSA determined these businesses are essentially securities dealers because they facilitate trades.

Wealthsimple sells U.K. operations after exiting U.S. market

Toronto fintech company Ledn Inc. raises $70-million, launches bitcoin-backed mortgages

Over the next eight months, Canadian crypto companies such as Coinberry, Bitbuy, Netcoins and Wealthsimple Crypto, all of which operate trading platforms, obtained restricted dealer status from regulators. That signalled to investors the platforms were safe to use.

In the meantime, however, crypto lending was gaining massive popularity, fuelling the growth of companies offering digital asset lending services that could allow Canadian investors to, in some cases, earn annual yields as high as 20 per cent by simply holding crypto.

Quebecs giant pension plan, Caisse de dpt et placement du Qubec, even invested in a crypto lender, pouring hundreds of millions into U.K.-based Celsius Network, which operates a complex decentralized finance (or DeFi)-based lending platform.

But exactly how regulators intend to police crypto lenders is still unclear.

In a statement to The Globe, OSC spokesperson Crystal Jongeward said that based on the models of crypto lending companies the commission has seen, regulators generally believe this type of activity falls within securities laws. But the agency would not disclose how many Canadian crypto companies offer lending services and whether those companies have begun the process of obtaining regulatory approval.

With the crypto exchanges, they effectively trade securities. So how they are regulated is pretty clear-cut, said Jonathan Ip, a lawyer specializing in cryptocurrency at Toronto-based boutique firm Iterative Law. But with companies that facilitate the lending of crypto, it is still not clear-cut, in that the regulators have not provided guidance saying that these products are definitely securities.

Part of the issue for regulators is that crypto lending is highly complex and can take on various forms.

There is centralized crypto lending, such as the bitcoin savings account offered by Ledn, in which investors earn income, or yield, by just leaving crypto assets in an account. Like traditional financial institutions, the platforms offering these yields, which sometimes promote themselves as savings wallets, lend out crypto at higher rates than they offer to depositors, pocketing the difference.

Then theres DeFi lending, which connects a users personal crypto wallet to a smart contract on the blockchain (think of it as connecting your money to an anonymous pool). The peer-to-peer arrangement of DeFi lending means that a users crypto is channelled into a liquidity pool that anyone can access.

If another user wants to borrow crypto from that pool, they have to provide collateral, in the form of crypto, into the pool. The borrowers are typically crypto traders who are similar to short-sellers of stock they borrow crypto, sell it on exchanges and hope to earn a profit by buying coins later at a lower price to repay the loan.

But because everything is decentralized and run by software, there are no intermediaries, so you dont know who is borrowing your crypto. The incentive for lenders, however, is to earn yield.

If you have crypto in your wallet and youre not planning to use it, why not lend it to somebody for a lucrative yield? Thats the thinking here, Mr. Ip explained.

By many accounts, DeFi lending, in particular, is a booming industry.

DeFiPulse, a website that tracks crypto lending activity, estimates that over the past year, the total value of bitcoin and ether locked in lending protocols has risen from US$20-billion to more than US$105-billion. Aave, a Swiss company that is one of the biggest DeFi lending platforms, started the year with US$1.4-billion in crypto assets, and now holds US$14.8-billion, according to data from FRNT Financial Inc., a Toronto-based crypto derivatives trading platform.

According to Genesis, a New York-based crypto trader, lender and prime brokerage, crypto loan originations reached US$35.7-billion in the third quarter, up 586 per cent year over year.

In some ways, Mr. Di Bartolomeo of Ledn said, Canadian regulators are far ahead of U.S. authorities in terms of how they approach the crypto industry as a whole.

The debate in the U.S. still revolves around whether crypto assets are commodities or securities. Washingtons Securities and Exchange Commission has recommended that crypto trading platforms register with it, but has not mandated registration.

When it comes to crypto lenders, regulatory oversight has often been arbitrary. The San Francisco-based crypto giant Coinbase, for example, tried launching a crypto lending feature earlier this year. It received a warning letter from the SEC that did not explain why the lending platform was problematic, except to say that it would be considered a security.

At the same time, scores of American crypto lenders are operating and thriving, despite being unregulated. BlockFi, a New Jersey-based DeFi trading platform, was recently valued at US$3-billion after raising US$350-million in a funding round co-led by Bain Capital Ventures and the hedge fund Tiger Global.

Canadian regulators took the co-ordinated approach to regulating crypto trading platforms as securities dealers. So now they can start going down their list, understanding different kinds of crypto businesses and determining how they can be regulated, Mr. Di Bartolomeo said.

The concern for regulators with any crypto business always comes back to retail investors, and how to ensure assets do not get hacked. I think regulators are still trying to get a sense of what protections are in place who is on the other end of a crypto loan. But the whole point of DeFi is you dont know who is borrowing your assets, Mr. Ip said.

One of the biggest DeFi lending breaches in history occurred recently, when BadgerDAO, a lending protocol, was hacked, leading to the loss of US$120-million worth of bitcoin. Celsius Network, the company that the Caisse had invested in, was allegedly, according to various media reports, affected by the hack to the tune of US$54-million because it used Badgers lending protocol as a way to expose its clients funds to a bigger lending pool.

But Celsius claims its users funds were not affected. Our security team initiated a full scan of all Celsius DeFi wallets. We identified a compromised withdrawal and immediately shut down the attackers access to funds on the Badger platform, the company tweeted in the aftermath of the hack.

Because Celsius is essentially unregulated (though its website states it is engaged in conversations about its business with various regulators around the world), it is complicated to figure out who exactly would be in charge of overseeing the firm, and responding to any kind of hack or company communication.

This is exactly the danger. Youre relying on software. If these smart contracts are poorly written and vulnerable to hacks, you can lose your funds, Mr. Ip said.

The Canadian company Bitbuy, which is now fully approved as a crypto trading platform by the OSC, attempted to tap into crypto lending back in 2019, by announcing a centralized lending platform alongside now-defunct Cred, a San Francisco-based crypto lender. (Cred, as it turns out, filed for bankruptcy late last year amid allegations of fraud and after falling victim to a hack of millions of dollars worth of bitcoin.)

Bitbuys chief executive officer Michael Arbus told The Globe the reason why the crypto lending product never commercially launched was because the company did not have enough of a view on the regulatory posture of such a product. He added that Bitbuy is only approved for spot trading, although it is possible that the company will explore crypto lending when regulators have clarified their position.

I think theyll get to regulating DeFi lending eventually, Mr. Di Bartolomeo said. Its not an easy world to understand and its moving so quickly. Ultimately, its important that crypto businesses that operate in Canada, whether youre a crypto lender or not, are very clear to the consumer as to what risks they are taking.

Editors note: Attribution of a quote by Bitbuys chief executive officer Michael Arbus has been corrected in the online version of this story.

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Regulators grapple with growing world of cryptocurrency lending - The Globe and Mail

MIAMI (AP) Miamis mayor says he plans to distribute the proceeds from the citys cryptocurrency to residents.

Mayor Francis Suarez said Thursday during an interview with a cryptocurrency news site that he was planning to convert the millions of dollars in proceeds MiamiCoin has created into a Bitcoin dividend.

Were going to be the first city in America to give a Bitcoin yield as a dividend directly to its residents, Suarez said in the inteview with Coindesk.com. Were going to create digital wallets for our residents, and were going to give them Bitcoin directly from the yield of MiamiCoin.

Among the questions that still need to be answered, according to Suarez, are whether the dividends will go to taxpayers, residents, people who vote in the city or those who have Miami addresses.

Promotion of tech and cryptocurrency in Miami has boosted Suarezs national profile for nearly a year, according to the Miami Herald.

MiamiCoin debuted in August courtesy of CityCoins, a nonprofit and opensource protocol that allows people to hold and trade cryptocurrency representing a stake in a municipality. CityCoins users mint new tokens and earn a percentage of the cryptocurrency they create, and a percentage of that goes to Miami.

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Miami mayor says residents will get cryptocurrency ...