The good, the bad, and the crypto lawsuits ⚖️
Solana, Cardano, and Polygon in the SEC hot seat. 80% of metaverse users use crypto. Tether to El Salvador and PairedWorld is challenging the "epidemic of loneliness."
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The US Securities and Exchange Commission (SEC) has put Solana, Cardano, and Polygon in the hot seat. With the SEC tagging them as 'securities,' this trio is standing their ground and pushing back.
In the backdrop of the lawsuits against the crypto exchange giants Coinbase and Binance, our 'Big Three' - Solana, Cardano, and Polygon didn't escape the SEC's watchful gaze. Holding a combined market capitalisation of over $21 billion, the trio experienced a sharp drop in their token's market value - about 30% each - post-lawsuit.
How they denies
🎯 Cardano (IOG):The SEC’s latest lawsuits will not impact the company’s operations “in any way,”
“This latest filing from the SEC demonstrates that we still have a long way to go,” “Regulation through enforcement action does not provide either the clarity or certainty to which both the blockchain industry and consumers are entitled.”
Solana Foundation
“Disagrees with the characterisation of SOL as a security.”
Polygon Labs
“Given our focus on network security, we made sure MATIC was available to a wide group of persons, but only with actions that did not target the U.S. at any time.”
Robinhood bows out 🏹
Robinhood, the popular trading app, has decided to withdraw support for Solana, Cardano, and Polygon, citing the uncertainty brought by the lawsuits.
The deadline for this grand exit is June 27th, 2023, at 6:59 PM ET.
But what happens to all the leftover SOL, ADA, and MATIC in your Robinhood Crypto account? Robinhood will sell them off at market value and credit the proceeds to your Robinhood buying power. The rest of the crypto gang remains unaffected.
Robinhood's chief legal officer, Dan Gallagher, spilled the tea while testifying before the House Agriculture Committee. He revealed that Robinhood had tried to register with the SEC as a special-purpose broker for digital assets. They went through a whopping 16-month process, only to be told by the SEC that their efforts were in vain.
Critic's Corner
Robert Cohen, the former SEC Cyber Chief:
"There is a seeming element of real bad luck and randomness, and getting singled out to be one of the 10 or 12 tokens that are mentioned when there's hundreds that could have been,” Cohen ays. "When you think about a government taking action, that sort of randomness seems rather unfair."
Cohen points out that if the SEC were to establish clear rules, it would affect all cryptocurrencies equally, and people would have a chance to provide their input and comments.
Morgan Creek Capital founder Mark Yusko: Yusko calls it "crazy," emphasising that these are just allegations in civil lawsuits. He questions the SEC's labelling frenzy and the potential consequences of declaring everything with growth potential as a security.
“Innocent until proven guilty.”
TTD Blockquote 🔉
Gary Gensler, SEC Chair (ofc)
Crypto is filled with “Hucksters. Fraudsters. Scam artists.”
"We’ve seen this story before. It’s reminiscent of what we had in the 1920s before the federal securities laws were put in place. Hucksters. Fraudsters. Scam artists. Ponzi schemes. The public left in line at the bankruptcy court."
Gensler pointed out cases where exchanges illegally offered securities without registering with the SEC, denying investors critical protections against fraud and manipulation.
He even took a jab at Binance, claiming that their affiliate Sigma Chain engaged in manipulative trading and wash trading to inflate trading volumes. Gensler could go on and on about the wrongdoings he's uncovered, but he acknowledges that the industry is so filled with fraud, abuse, and noncompliance that the list would be never-ending.
He also highlighted how various crypto companies, including BlockFi, Celsius, FTX, and Genesis, have gone bankrupt, leaving countless investors in a state of distress.
"We’ve also seen numerous companies—before and after FTX—blow themselves up, hurting countless investors in their wake. As a result of the bankruptcies of BlockFi, Celsius, FTX, Genesis, and other crypto firms, investors often are left lining up in court."
TTD Numbers 🔢
In a survey commissioned by Paypal, we unearthed some jaw-dropping insights about the relationship between the metaverse and cryptocurrency. The study, which included 10,000 active metaverse users, sheds light on the preferences and expectations of this growing digital community.
Key Findings
56% of respondents believe their use of crypto will increase over the next five years.
The metaverse is defined as a virtual space where users can interact with each other and a computer-generated environment. Meta and Roblox are cited as examples of metaverse companies.
80% of metaverse users currently use crypto, with 97% holding coins.
The most popular cryptocurrencies among metaverse users are Bitcoin (BTC), followed by Ether (ETH) and Robux (RBX).
75% of users express interest in earning and getting paid in crypto, even during market downturns.
Interoperability and fund safety are major concerns for users. They seek seamless cross-platform functionality and secure storage of digital assets.
Paypal expects metaverse spending to reach billions of dollars. Currently, people are spending $28 billion annually in the metaverse, with a user base of nearly 38 million.
The survey estimates that total spending in the metaverse will be $72.6 billion in the next year and an average of $92.7 billion per year over the next five years.
Recent moves in the metaverse
Gucci partnered with the Bored Ape Yacht Club to explore the intersection of fashion and the metaverse.
Fidelity launched its own metaverse games on platforms like Roblox and Decentraland.
Traditional finance giants like HSBC and JPMorgan are also making their foray into the metaverse.
Apple recently announced a virtual reality headset, potentially hinting at its future involvement in the metaverse.
TTD Volcano 🌋
Tether, the heavyweight stablecoin issuer, is packing its bags and embarking on an electrifying adventure to the land of volcanoes and sunshine - El Salvador! With a cool billion-dollar renewable energy project under its belt, Tether's grand scheme is to supercharge Bitcoin's adoption in this vibrant Central American hotspot.
El Salvador, with its $1 billion renewable power generation project named Volcano Energy, is gearing up to make a big splash in the world of Bitcoin. Imagine, if you will, a powerful 241-megawatt (MW) renewable energy park harnessing the untamed power of sun and wind to fuel a bustling Bitcoin mining operation. It's a bold step forward following El Salvador's decision to adopt BTC as legal tender back in 2021.
The genius in Tether's move to invest in El Salvador's Volcano Energy is twofold. Firstly, it's a golden ticket to enter the lucrative energy-producing infrastructure market. Secondly, it allows them to power Bitcoin mining operations with the surging currents of renewable energy.
Tether's chief technology officer Paolo Ardoino compared it to the monumental transition of the European Union to the euro in the early 2000s.
TTD Token 🪙
PairedWorld, a new Ethereum-based project, is challenging the "epidemic of loneliness" through the power of Web3. The venture, backed by health experts, aims to incentivise real-world connections in existing NFT communities with its new "social token".
PairedWorld will reward active participants with tokens, unlocking access to physical world events. CEO Raluca Cherciu emphases the project's goal: to nurture genuine relationships. Future initiatives include rewarding online community activities. The project, while addressing the paradox of digital connectedness and isolation, hopes to prove that emerging technology can be harnessed for positive social impact and enhance people's lives.
PairedWorld isn't about building a brand-new digital neighbourhood from scratch. Instead, they are all about turbo-charging your current communities, giving them a kick with some ownership in this shiny new PairedWorld realm.
If you've already got your hands on some NFTs, you're invited to join the PairedWorld playground. As a welcome gift, you'll get a nifty token called SOUL, a swanky badge of honour for your rep in this cosmic ecosystem that stretches across countless blockchains and communities.
The longer you've been a loyal NFT owner and the more active you've been in your community, the more you'll be showered with PairedWorld's golden ticket tokens.
TTD Surfer 🏄
UK-based Gensyn AI announces $43 Million Series A funding, to empower developers to create AI tools on a pay-as-you-go model.
Lending protocol Sturdy Finance drained of $800,000 in security attack caused by a manipulated price oracle. Suspends all its markets.
With US regulators making aggressive moves against the crypto industry, a16z crypto, announces opening its first overseas office in London.
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Remember that time an agency of the US Government actively attacked legal US businesses and arbitrarily started undermining new technologies? #clownworld #neverforget