Could dlcBTC Resolve the Issues With Wrapped Bitcoin?
Weekly News Recap: 💼 Kamala Harris' advisors stir crypto backlash, 🔥 Bitcoin's hashrate hits record high, ⚖️ Celsius sues Tether for $2.4B, and more!
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Could dlcBTC Resolve the Issues With Wrapped Bitcoin?
With everyone talking about the risks of wrapped bitcoin (WBTC), can this project emerge as a new alternative?
In this episode, Aki Balogh, CEO of dlcBTC, explores how Discreet Log Contracts (DLC) can change how Bitcoin works in DeFi by creating a self-sovereign wrapped Bitcoin. He delves into the mechanics of dlcBTC, its security features, and how it aims to be more decentralized than existing wrapped Bitcoin solutions like WBTC. Aki also shares future plans for dlcBTC, including integration with Bitcoin Layer 2 solutions and expansion to various blockchain ecosystems.
Listen to the episode on Apple Podcasts, Spotify, Pods, Fountain, Podcast Addict, Pocket Casts, Amazon Music, or on your favorite podcast platform.
Weekly News Recap
Kamala Harris' Economic Advisors Stir Crypto Industry Backlash
The crypto community is reacting strongly to reports that Democratic presidential candidate Kamala Harris has enlisted two advisors with a history of anti-crypto views. According to Bloomberg, Harris has tapped Brian Deese and Bharat Ramamurti, both former aides to President Biden, to shape her economic policy. Deese, who previously led the National Economic Council, co-authored a White House blog advocating for stricter regulation of cryptocurrencies. Ramamurti, who served as the National Economic Council deputy director under Deese, has ties to Senator Elizabeth Warren, a vocal critic of the crypto industry. The news has sparked criticism from crypto advocates, who fear Harris' campaign will continue the Biden administration's tough stance on digital assets.
In this week’s episode of Bits + Bips, Asymmetric founder Joe McCann said he doesn’t see a “crypto reset” happening under Harris, observing that "if they were going to reset, wouldn’t they have pumped the brakes by now?”
Controversy Over Eigen Labs' Airdrop Practices
CoinDesk reported on Thursday that Eigen Labs, the company behind the Ethereum restaking platform EigenLayer, circulated a list of employee wallet addresses to various ecosystem projects preparing to launch tokens. While some teams requested the list in order to thank Eigen Labs employees, at least one project said Eigen Labs sent the list without them asking for it, and that they felt pressure to send tokens to Eigen’s employees.
Eigen Labs employees reportedly received nearly $5 million in tokens at peak prices, sparking criticism over potential ethical lapses. In response, Eigen Labs and its associated Eigen Foundation have since banned such payouts to employees to avoid any appearance of bias. The company stated that the restrictions were implemented to maintain trust and transparency within the ecosystem, and emphasized that the payouts were initially meant to foster collaboration among projects.
Goldman Sachs Reveals $418 Million in Bitcoin ETF Holdings
Goldman Sachs has disclosed significant investments in bitcoin-related exchange-traded funds (ETFs) for the first time. According to the bank's latest quarterly 13F filing, Goldman holds $238.6 million in BlackRock’s iShares Bitcoin Trust, comprising 6.99 million shares.
Additional holdings include $79 million in Fidelity’s Bitcoin ETF and $35 million in the Grayscale Bitcoin Trust (GBTC). Goldman’s bitcoin positions reflect a growing trend of institutional adoption in the crypto space.
Other banking giants also disclosed their crypto positions. According to its latest 13F filing, Morgan Stanley had a $187 million stake in BlackRock's spot Bitcoin ETF as of the end of Q2, while nearly selling off its position in Grayscale's GBTC.
Also this week, the State of Wisconsin Investment Board said it had increased its holdings in BlackRock’s spot bitcoin ETF to nearly 2.9 million shares, worth $98 million, while selling off its entire position in the Grayscale Bitcoin Trust. Moreover, DRW Venture Capital disclosed holdings of nearly $200 million in crypto ETFs, with a sizeable $150 million of that invested in the Grayscale Ethereum Trust.
Bitcoin Hashrate Reaches Record High
On Monday, Bitcoin's hashrate surged to an all-time high of 627 exahashes per second (EH/s), reflecting increased competition among miners. Meanwhile, onchain data from CryptoQuant revealed that miner reserves have dropped to 1.8 million BTC, the lowest level since January 2021. The decline comes as miners, who typically sell their holdings during price surges, face a volatile market.
The price of bitcoin reached a record high of $73,737 on March 14, 2024, but it has since dropped roughly 19%. The increased hashrate has also contributed to a six-month low in miner profitability, according to industry reports.
Celsius Sues Tether for $2.4 Billion
Bankrupt crypto lender Celsius has filed a lawsuit against Tether, seeking to reclaim 39,542 bitcoin valued at approximately $2.4 billion. Celsius alleges that Tether improperly liquidated the collateral during Celsius's financial turmoil in June 2022. The lender argues that Tether's actions violated their agreement and exacerbated its financial collapse by selling the bitcoin at below-market prices.
The lawsuit is part of a broader legal strategy by Celsius to recover funds for its creditors. The company has also targeted Badger DAO, Compound Labs, and Bancor DAO in separate lawsuits. The suit against Badger DAO stems from a 2021 hack that led to substantial losses for Celsius, while Compound Labs is being sued for an oracle-related incident that triggered mass liquidations in 2020. Bancor DAO, which is partially owned by Israeli Prime Minister Benjamin Netanyahu’s relatives, is accused of mismanaging its impermanent loss protection mechanism, causing significant financial damage to Celsius.
Tether has dismissed the allegations, calling the lawsuit a "baseless shakedown" and asserting that it acted within the contract's terms by liquidating Celsius's collateral. Tether also reassured its stakeholders that its $12 billion in equity ensures no impact on token holders, regardless of the lawsuit's outcome.
Three Arrows Liquidators Sue Terraform Labs for $1.3 Billion Over Luna Crash
Liquidators of the defunct cryptocurrency hedge fund Three Arrows Capital (3AC) are seeking to recover $1.3 billion from Terraform Labs, the company behind the collapsed TerraUSD and Luna tokens. The lawsuit claims Terraform induced 3AC to invest heavily in Luna and TerraUSD by manipulating the market, and inflating their prices before they plummeted in May 2022, causing massive losses.
The crash led to 3AC's bankruptcy, with the value of its Luna holdings dropping from $462 million in April 2022 to just $2,700 by mid-May. Terraform Labs, which filed for bankruptcy earlier this year, and its co-founder Do Kwon, who faces fraud charges, are central to the ongoing legal battle. Recovery prospects from Terraform remain uncertain.
Grayscale Launches Crypto Fund for MakerDAO's MKR
Grayscale has introduced a new single-asset fund dedicated to MakerDAO’s governance token, MKR. The fund, which is accessible to accredited investors, marks Grayscale's latest move to expand its product lineup. The launch follows the recent introduction of similar funds for Bittensor’s TAO and Sui (SUI) tokens, as well as a decentralized AI-focused fund.
MKR surged by over 7% following the announcement, reflecting growing investor interest. Grayscale has been on a roll, launching five different single-token trusts in the past three months.
Pump.Fun’s Fee Removal Boosts Revenue but Draws Ire of Users
Pump.Fun, a Solana-based token generator, has hit a new milestone by raking in $5.3 million in daily fees, surpassing many other platforms, including major blockchains such as Ethereum, Tron, and Solana itself. The surge in fees follows Pump.Fun’s recent decision to eliminate its $2 token creation fee, shifting the cost to the first buyer of each token. This change led to an explosion in token creation, with over 10,000 tokens minted in just three hours.
While the platform's revenue soared, user satisfaction plummeted. Many expressed frustration on social media, criticizing the rapid creation of tokens that often lose value almost immediately. One user commented, "Nobody is entertained but your team and your pockets," highlighting the growing discontent among the platform’s user base. Despite its financial success, Pump.Fun faces increasing criticism for prioritizing profits over user experience.
Fun Bits: Oops! Ethereum User Pays $88,000 for a Simple Transaction
In a jaw-dropping blunder, an Ethereum user paid $88,000 in gas fees to send a mere $2,200 worth of ETH. This apparent “fat finger” mistake has left the crypto community both laughing and cringing.
Blockchain security firm PeckShield caught the slip-up, proving that even in the world of high-tech finance, a simple keyboard slip can cost you more than just your pride—like, say, 40 times more! Moral of the story: always triple-check before you hit "send."